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Originally Posted by HamsterRage
Interesting, but we've never seen the price of books drop....
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We also haven't seen publisher's profits soar into the stratosphere, and as Thompson points out, other costs -- notably author advances (though afaik, not royalty rates) -- have been steadily increasing.
Net profit is apparently around 10% for the industry. I'd say that's pretty good, and I'd be a bit hard pressed to call it "extortionate." Unlike, oh, drug manufacturers -- 22% profit margins in that sector.
I don't know how the sector's profit margins have changed since the 70s, I'll see what I can dig up. However the business has also radically changed since then, so I'm not sure how far back you can really make a fair comparison.
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Originally Posted by HamsterRage
There was another thread recently that had the data to show that the price of books has continued basically doubled or tripled the rate of inflation since the 70s....
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The price of books is higher, when adjusted for inflation, than it was in the early 70s.
However, it is exceedingly rare for one specific product to track the CPIX perfectly at a given time. Would you expect the percentage changes in the cost of cars, oil, rice and paper to be identical at all times?
As a comparison: Ford Mustang Fastback, 1970, sticker price $2,771 (or $15,000 in 2009 dollars). Ford Mustang V6 2011, $23,000. Assuming the two are roughly equivalent vehicles, we could assert that "Mustangs outpaced the CPIX by 50%."
Now, I don't have many doubts that the cost of the manufacturing has dropped significantly since the 70s; there's far more automation, lots of production is offshore, and so forth. Should we expect the 2011 Mustang to cost $10k instead of $23k? Are we getting jacked if it isn't? Should consumers rail against Ford for their extortionate pricing?
