"Why e-books cost money to publish"

[TadW]

Remember how a German publisher claimed that lowering e-book prices would kill the industry? Today I found a similar reasoning on a blog by harperstudio, a company who "is committed to partnering with authors to publish books in a way that is effective, creative, and sustainable." From the blog entry:

Whether a book is printed on paper and bound or formatted for download as an e-book, publishers still have all the costs leading up to that stage. We still pay for the author advance, the editing, the copyediting, the proofreading, the cover and interior design, the illustrations, the sales kit, the marketing efforts, the publicity, and the staff that needs to coordinate all of the details that make books possible in these stages. The costs are primarily in these previous stages; the difference between physical and electronic production is minimal. In fact, the paper/printing/binding of most books costs about $2.00…so if we were to follow the actual costs in establishing pricing, a $26.00 “physical” book would translate to a $24.00 e-book…and while I agree that e-books should be priced at a greater discount to hardcovers than $2.00, we need to move the conversation beyond the idea that e-books “don’t cost publishers anything to make.”

[TheRealBillc]

As was mentioned in the thread about the other publisher with smiliar assertions about cost, YES, I think most of us can agree that author advances and all the rest up to printing would be the same or similar for p-books and e-books, but since you should likely be doing both at or near the same time, then the costs to do most of those activities need not be doubled. Surely if you proof read for p-book printing you don't have to proof read again for e-book publishing. As a result, the ADDITION of an e-book copy (to the effort of putting a book out for purchase) should result in a greater savings to the customer and a greater income opportunity (lower cost = more sales) than these publishers care to admit. I think the real issue here is that they have convinced themselves that an e-book sale is a lost p-book sale and they are unwilling to give up the revenue gererated by the p-book, so e-book pricing must be the same or nearly the same. Maybe they need a math/finance/economics course refresher? 'cause we're not buying their "logic".

[basschick]

for that matter, you don't actually NEED a cover - i've bought a few commercial ebooks that didn't have any.

[pilotbob]

Interesting that the price comparison is used with a Hard Cover book. Sure, $24 vs $26 isn't much. But, compare an $8 MMP to $6.

I WILL TAKE THAT $2 OFF PER BOOK.

If that is how all ebooks were priced that is fine. If that is the cost, why should the publishers get an extra $2 per book. If they give 100% of that $2 to the author I will gladly pay it.

Also, consider discounts. B&N and other places don't always charge you cover price for a book. But, with eBooks many times it is the publishers selling directly to the consumer, they don't discount the cover price.

BOb

[worxland]

Yep, and what about transport/delivery/postage costs? It is a sizable part of whole (for some products - which are heavy while relatively cheap, hmm what example I could think of... - it can be as high as 30%) which also can be saved (OK, seriously diminished) with electronic distribution.
"the editing, the copyediting, the proofreading, the cover and interior design, the illustrations" - these are one-time costs, while paper/printing/transport is multiplying with every copy of the book. So no one is (or should be) fooled by such whinings.

[Jellby]

Actually, since all those cost are the same, and you have to share them between paper books and e-books, the price of paper books should go down with the introduction of e-books

[GlennD]

In fact, the paper/printing/binding of most books costs about $2.00…so if we were to follow the actual costs in establishing pricing, a $26.00 “physical” book would translate to a $24.00 e-book

If this is to be believed, the major reason for the price difference of a hardback vs a paperback is the marketing. If that's true, I can think of some books that would sell like hotcakes if they were under 10 bucks in hardback, without a dime spent on marketing. The next Wheel of Time book comes to mind.....

The other cost savings in ebooks of course is the lack of remainders - retailers will never ever have to return unsold copies of ebooks. At the most they'll have to stop selling them when their sales agreement expires.

[slayda]

Based on that analysis, paperback books must be losing the publisher $16 - $18 each if the paperback cost the buyer $6 - $8. I'd pay $4 - $6 for an ebook and think I had a bargain.

No wait, that's about what I do pay at Baen (sans DRM).

[bill_mchale]

If it really is costing 80% of the cost of a book to bring it to market, no wonder the Publishing industry is going out of business.

But lets look at what we know to be true about publishing.

1. Only about half of the suggested retail price of the book goes to the Publisher and Author, the rest is for the book store (which often discount new hard backs by 10-30%).

2. Built into the cost of the book is the knowledge that a significant number of even best selling novels (with the possible exception of Harry Potter ) are going to be returned to the book seller. I think I read that the publishers assume about half the books they print will be returned. So that $2.00 above is more like $4.00 per book sold.

3. As others have rightly pointed out, if the claims were true of hardbacks, then book companies should surely go out of business by printing paper back copies of the book. This is especially true of midlist authors whose works often start with paperbacks.

4. Lets be honest, a lot of the copy editing can be done by automated computer programs these days.. and considering the number of mistakes I see in many modern novels, many publishing companies seem to end copy editing with the computer program.

Ultimately, I think the basic problem is that Book Publishers are still bound to an old model of doing business; a model that is grossly inefficient, is built around the blockbuster book and terribly run brick and mortar book stores. I can see numerous places where the costs could and should be trimmed dramatically.

It would help if I knew how much profit that companies like fictionwise and booksonboard makes on each book, but lets assume for the moment that we keep the custom of them selling the books for 200% the wholesale price. If we only work with the $2.00 claim, then e-books should be $4.00 cheaper than the hard back version of the book. If we look at the $4.00 per book sold (since extra books aren't printed), we are looking at ebooks being $8.00 cheaper per book.

I think ultimately it comes down to this, the vast majority of the publishing industry doesn't know how to sell books. Sure they can sell a book... given a million dollar marketing budget. Whats worse, most of the books that get all the attention these days, well frankly suck.

--
Bill

[rhadin]

Originally Posted by TheRealBillc

Surely if you proof read for p-book printing you don't have to proof read again for e-book publishing.

Sadly, you do have to reproofread the ebook file once it is created. One would think the process would be flawless, but it isn't. Even so, proofreading is not a large expense.

[lilac_jive]

Originally Posted by rhadin

Sadly, you do have to reproofread the ebook file once it is created. One would think the process would be flawless, but it isn't. Even so, proofreading is not a large expense.

Hell, I'll do it for them cheaper than what they are paying people now, I'm sure.

Read all day and get paid? Plus utilizing my grammar nazi skills? Where do I sign up?

[rhadin]

Originally Posted by bill_mchale

4. Lets be honest, a lot of the copy editing can be done by automated computer programs these days.. and considering the number of mistakes I see in many modern novels, many publishing companies seem to end copy editing with the computer program.

A computer program cannot copyedit a book. How would it know whether a comma should be inserted or removed, for example? A computer program can help with copyediting, especially find and replace for consistency and spell checking, but as Bill noted, too many publishers do seem to end the copyediting with the computer program and the poor results are obvious.

A skilled, competent copyeditor (live person) is not inexpensive. Sadly, publishers often hire poorly skilled people who charge very little for their service to copyedit books in an effort to save money. And many people believe that because they read books and can spot an error or two that they are great editors.

[Ralph Sir Edward]

Originally Posted by rhadin

A computer program cannot copyedit a book. How would it know whether a comma should be inserted or removed, for example? A computer program can help with copyediting, especially find and replace for consistency and spell checking, but as Bill noted, too many publishers do seem to end the copyediting with the computer program and the poor results are obvious.

A skilled, competent copyeditor (live person) is not inexpensive. Sadly, publishers often hire poorly skilled people who charge very little for their service to copyedit books in an effort to save money. And many people believe that because they read books and can spot an error or two that they are great editors.

Question. When you take a hardback and reprint it to a MMPB, exactly what copyediting (and separately copyproofing are done)? This is not a trivial question. The plates are not the same, different font sizes, sometimes different fonts, and diferent pages lengths.

[phenomshel]

Originally Posted by lilac_jive

Hell, I'll do it for them cheaper than what they are paying people now, I'm sure.

Read all day and get paid? Plus utilizing my grammar nazi skills? Where do I sign up?

I'm with you!

[FizzyWater]

Originally Posted by slayda

Based on that analysis, paperback books must be losing the publisher $16 - $18 each if the paperback cost the buyer $6 - $8

Yup. Exactly what I was thinking.

Plus, I think part of the "ebooks should be significantly cheaper" theory is also based on the fact that many of those fixed costs are already being covered by the print books. So creating an ebook in addition to the print book is cheaper for the publisher than, say, printing another 100,000 copies.