http://www.nytimes.com/2009/05/17/we...ew/17rich.html
May 17, 2009
Steal This Book (for $9.99)
By MOTOKO RICH
Just how much is a good read worth?
David Baldacci, the best-selling thriller author, learned what some of his fans think when “First Family,” his latest novel, went on sale last month. Amazon initially charged a little over $15 for a version for its Kindle reading device, and readers revolted.
Several posted reviews objecting that the electronic edition of the book wasn’t selling for $9.99, the price Amazon has promoted as its target for the majority of e-books in the Kindle store. Hundreds more have joined an informal boycott of digital books priced at more than $9.99.
“I love Baldacci’s writing,” wrote one reader, who decided not to buy. “Sorry Mr. B — price comes down or you lose a lot or readers. I’ll skip your books and move on!”
It was a chilling sentiment for authors and publishers, who have grown used to an average cover price of $26 for a new hardcover. Now, in the evolving Kindle world, $9.99 is becoming the familiar price. But is that justified just because paper has been removed from the equation?
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For the moment, say some publishers, Amazon is effectively subsidizing the $9.99 price tag for new book titles in digital form by paying publishers the same $13 it pays them for a new hardcover title with a list price of $26. It’s a classic “loss leader” situation. Although Amazon won’t comment on the arrangement, the online bookseller is using low-price e-books as a lure to persuade consumers to pay $359 to buy a Kindle, or $489 for the new, larger Kindle DX.
But Amazon presumably won’t be willing to take those losses forever. And publishing executives say they fear that Amazon eventually will pressure them to accept lower payments for e-books.
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Publishers and writers may hope that more readers are like Lina Albarella, a former book editor who said that in the 18 months since her husband bought her a Kindle, she has purchased close to 40 titles. While the $9.99 price is an attraction, she says she is more swayed by the instant gratification made possible by electronic books.
After buying the first in Stephenie Meyer’s “Twilight” series, Ms. Albarella finished it at 1 in the morning. She bought the next installment on her Kindle from her bedroom and began reading right away.