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I guess I'm a lot less absolute in my approach to this problem than some. For me, the rule is simply that I'm willing to pay what I feel the book is worth, and not more than that. I know this is a fuzzy, mushy rule, but that's what best matches my reading needs.
There are a handful of authors for whom I would previously have been willing to shell out the bucks for a hardback, and I'd probably pay a like amount for their books in digital format. For most other authors, I'm willing to spend around what their books cost in paperback, plus or minus a bit. ($10.00 or so isn't all that out of bounds for an e-book, in my view.) On the other hand, one of the books I depend on for my work (freelance paralegal) is an annual $125.00 purchase in paperback, and I'd happily shell out that much for a searchable Kindle edition that obviates the need for me to cart around 5 pounds of dead trees. (In fact, I suggested that to the publisher (LexisNexis) in a detailed e-mail about why e-books would be a win/win for them. They didn't respond to my e-mail, but that's no surprise.) But there are definitely legal e-books I've bought that were worth more than $9.99 to me, and I had no qualms about spending the money on them.
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