Quote:
Originally Posted by DuckieTigger
So if nothing changed concerning how and how much pbooks are discounted, then the decline in ebook sales is due to the move back to agency alone?
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Not exactly.
It is due to high prices--which Amazon (and other retailers) no longer can temper with promotional discounting.
BPH ebook pricing has been steadily rising--even without agency--for two years now, roughly the time that the Tradpub apologists have been saying "ebook sales have plateaued". Average BPH prices had crept up over a dollar since 2013 even before Agency kicked in.
(We had that discussion earlier this year in one of the author earnings threads.)
What Agency has done is jack them up even more--often substantially--well above the buy-no buy threshold of many readers. There will always be true fans that will pay anything to get a specific author's book but for every one of those there are many who won't. Book buying is discretionary spending.
The BPHs problem is they see everything through the dual prism of high overhead (loads of high salaried VPs doing very little value add and glass tower rents are just two areas beyond cuts) and, much worse, the metric of reader-spend.
Their obsession is to squeeze every last buck possible from the readers even if, in the end, they don't get any of the added money. (Which is what happened with the conspiracy--they jacked up prices by two bucks or but they themselves got less per book.) In their blind gross-obssessed world view, discoubting $10.99 ebook to $9.99 is a whole dollar they can't report in their quarterly report and not at all the reason they got to report the other ten dollars.
They are now starting to reap the fruits of that thinking.
Even their pet pundits like Shatzkin are starting to belatedly realize there really is a line where even a small increase loses you the whole sale. That squeezing readers for money that never gets to the bottom line (because you lose it in warehousing, transportation, pulping, or inventory taxes or because you forced the retailer to keep it) is simply a self-defeating policy.
For years the BPHs have been fighting Amazon even though Amazon is trying to help them sell more books (more readers for their authors? Boo!) and make them more money because they already get too much of their via Amazon.
What they failed to notice is that Amazon doesn't need them as much as they needed them in 2010. Amazon prosperity, especially in ebooks, is no longer tied to BPH prosperity. They can use new tactics to prosper despite--or from--BPH losses.
Which is what they are doing.
The BPHs want people buy their titles as low-margin pbooks instead of high margin ebooks? Fine, Amazon will make sure they sell those pbooks and not B&N or BAM or Walmart or the airport shops. It certainly won't be Apple or Google or Kobo. Less BPH ebook sales means less money for Apple, Google, and Kobo. More money for Amazon, though. And more money for Indies and other, non-agency tradpubs.
Oh, and it also means a bigger share of the total market for Amazon.
And a bigger BPH dependency on Amazon.
As I said: self-defeating.