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Originally Posted by taustin
Amazon is known to have spent $56 million on servers with Rackable Systems in 2007, and $86 million in 2008, when they bought more servers than Microsoft.
You have a funny definition of "virtually nil"
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Like I've said in the posts above; amazon provides the largest virtualization service in the world in addition to running some of the world's most accessed services. Kindle is even a drop in the bucket compared to the total amount of resources required for the amazon network. If you're trying to say that $142 million is anything but an investment in said architecture then you'd be wrong.
You can't count investments as losses or the world would simply stop. If they hadn't expanded their network then they would have to close down profitable services, which wouldn't make any fiscal sense. What is relevant to this discussion is how much it costs to use said architecture in order to deliver a book, that's the per-copy charge, since their network would exist whether or not amazon was doing kindle.
And like I said, if I (a one man shop in sweden) can deliver a book for $0.00004 with various middle-men taking their cut then you can be certain it's many, many magnitudes cheaper for amazon. Any other numbers you toss out is just disinformation ignoring these basic facts.
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And, once again, the cost of putting ink on paper and getting the book in to your local store accounts for only about 10% of the retail price. Really.
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Not arguing that, never said it cost outrageous amounts to sell pbooks. What I said is that the per-copy cost per ebook can't be honestly compared to the cost of a pbook. Let's say the pbook is a hardcover at $15 msrp. So that'd be $1.5 cost for that particular book according to your percentage. The cost of an ebook (delivered by my network) would be 0.000026% of that. Would you call that even remotely comparable?