Quote:
Originally Posted by Smashwords
pdurrant, one of the advantages of the ebook model compared to the p-model is that authors and publishers can price their books dramatically cheaper yet still make greater per unit profits on ebooks than print books.
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Or so the conventional wisdom goes, anyway.
It kind of depends on how much of the total price of the print book comes from the overhead of printing, shipping, and storage (remember, e-books still have to be edited just like any other book, and the employees and fixed overhead costs of the publisher still have to be paid—not to mention the author himself)—and how much of that savings is eaten up by the costs of getting the book formatted electronically and sold, and paying for on-line storage and bandwidth.
The idea that publishers automagically Save Great Gobs Of Money by selling e-books over selling p-books has always seemed a little suspiciously simplistic to me, because most of the people saying it do not tend to have publishing industry experience, and publishers tend to be reluctant to provide exact cost figures for their books. (And honestly, why should they?)
Baen is making money selling e-books at slightly below paperback cost (or at least they say they are), but they don't really think of themselves as an "e-book vendor." They see the e-books as mainly promotional materials, and seem to think that even the people who buy the e-books will just turn around and buy the printed books after reading the first couple of chapters—so they might not be trying quite as hard to make a profit as those who view e-books as desirable in and of themselves.
My gut feeling (which is at least as scientific as most of the Save Great Gobs Of Money peoples' outlook) is that e-books cost a
bit less to produce than a paperback (and they become more so the longer the book has been in print, as the per-copy cost of smaller additional printing runs will be higher), but not as much less as everybody seems to think. I think Baen's pricing is probably just about right.
But for publishers who price e-books commensurate with hardcovers—feh. They should be, but I expect the publishers are afraid that the e-book sales might cannibalize the p-book sales, and at least this way they still get that same hardcover price out of an e-buyer—or else they turn him off of the e-book and he buys the paper one instead. They need to figure out that the paper and e-book market segments are not going to have that much overlap, and lower their e-book price to reach an optimal equilibrium point to bring in as much additional money as they can from the e-book segment, while still selling to the p-book segment at p-book prices.
Maybe someday that will actually happen.