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Originally Posted by rmeister0
Furthermore, has anyone done any market studies to see if reducing the price of ebooks would actually increase sales? Sounds counter-intuitive, but I'm willing to bet that if the current $25 hardcover best seller were sold for $1 as an ebook, there would be a big discussion about what under-valuing a product does to its market perception.
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Regardless of the actual cost and profit, a significantly cheaper ebook version will make the pbook look expensive by comparison, which is not the kind of impression a publisher wants to make. And as you rightly point out, reducing the price might not yield more sales, let alone more profit.