[Kali Yuga]

Ahh, so much to respond to...

Originally Posted by JSWolf

It's not a matter of hacking and slashing. I get email from Borders that gives me 25-40% off. I cannot apply this to eBooks. Why? Because the Agency 5 say I cannot.

Yes, I agreed with your assertion that retailers can't discount, and can't use pricing as an advantage. However, the publishers can and do discount.

Originally Posted by JSWolf

No, This is way wrong. A lot of people who read eBooks are doing so because they don't buy hardcovers....

Like I said, they do not want to pay hardcover prices. However, they still want to pay a low price for a high-demand good. And it's pretty clear they no longer want to wait to pay a lower price.

Originally Posted by JSWolf

I was OK paying $9.99 for an eBook that was out in hardcover that I wanted there and then. I am not OK paying $12.99-$19.99 for an eBook.

Then you can wait 6 months until the price drops.

There is absolutely nothing immoral about charging more when demand is high, especially for a non-essential good.

I'm not saying you have to like it, but the reality is that "I want this book the instant it comes out at $10 instead of $15!" basically has zero moral force.

Originally Posted by JSWolf

But with an eBook, you are not allowed (supposedly) to remove the DRM....

You're missing my point.

A paper book has, as a part of its physical characteristics, a set of built-in restrictions. E.g. you can't duplicate it an unlimited number of times for personal use, you can't sell your copy and simultaneously keep it for yourself, and so forth. Paper winds up like a "built-in DRM" that restricts your actions -- it's just a different set of restrictions..

In addition, the idea that "ebooks have a lower value" willfully ignores the fact that ebooks give you other cost-saving or added-value aspects. Yes, you lose X Y and Z, but you gain A B and C. I.e. if you're going to demand that ebooks cost less, you ought to figure in the "zero cost for delivery" to your calculations. (And yes, believe it or not, shipping and handling are usually very profitable for retailers.)

And don't forget, to the publisher asking $15 for a new ebook, when the cover price on the hardcover is $25, is a huge price cut. When you buy the hardcover at a steep discount, the retailer is subsidizing your purchase.

Originally Posted by JSWolf

But the $3 profit they would be making from the eBook priced at $10 is $3 more then they would be making when the eBook is priced at $12.99-$19.99 and I'm not buying it.

Again, you are missing the point.

Any price higher than "$0.00" involves a loss of sales. If they're going to drop the price by $3, that needs to be made up by significantly higher sales. I will definitely agree there will be instances where lowering the price will increase sales volume enough to increase a title's profits.

However, there are also numerous instances when the purchase is merely delayed instead of lost. In other instances, the price the buyer is willing to pay is so low that discounting is totally counter-productive. If you believe all brand-new ebooks should only ever cost $5, perhaps you are not a customer worth having.

Originally Posted by JSWolf

Look at BAEN. They sell eBooks reasonably and give away a lot for free and yet they MAKE A PROFIT WITH EBOOKS. How is that done?

• Free books are done as a promo, and Baen probably believes (with good reason) that it's cheaper than spending ad dollars.
• Many of their books are in series, so give away one free, and if the customer likes it they may buy 3+ other books.
• They largely cut out the middle-man, which most publishers can't do.
• I assume they pay authors lower royalties per copy (lower cover price = lower royalties).
• I assume they pay authors much smaller advances.

By the way, numerous other publishers also issue ebooks for free as promos, check out Amazon's "Top 100 Free" -- http://www.amazon.com/gp/bestsellers/digital-text

Originally Posted by JSWolf

Give your answers, it looks like you work for the Agency 5 and agree with their tactics.

"No, I am not in any way shape or form working in the book industry" and "not necessarily."

I'm actually on the fence about agency pricing. However, the reality is that the ONLY reason, IMO, that anyone objects to it is because some people are insanely sensitive to certain forms of pricing. If agency pricing resulted in a flat $10-per-title price, and retailer pricing resulted in $15 for a new ebook, I wonder how these conversations would go. Hmmm....

But in general I support the ability of a company to survive and actually turn a reasonable profit. I also recognize that book publishers are saints compared to the music and movie industries, which are notorious for abusing their financial obligations to many artists. As such I do not resent book publishers (of ANY size) for having the "temerity" to try and run a business.