Quote:
Originally Posted by JSWolf
It seems this agency pricing is not working out all that well.
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And even where it almost does, it doesn't. E.g.
The Lord of the Rings:
Kindle price: $14.99, set by the publisher, 25% off the print RRP ($20)
Amazon Paperback price: $13.60, 32% off the print price.
Assuming a 50% discount to Amazon on the print price, Amazon are making $3.60 from the print sale, and $4.50 from the Kindle sale. And the publishers are making $10 less printing/storage costs (so, say $8) from the print sale, and $10.49 from the Kindle sale.
So both retailer and publisher and making /more/ per sale from the Kindle ebook than from the print book sale, and the consumer is paying more.
Way to go to kill the ebook market!
Now a $9.99 RRP on a 30:70 split would have given the publisher $7 (just a little less than the paper book!) and Amazon $3 (just little less than for the paper book).
So the agency model isn't entirely insane - in that it is sensible to cut the percentage of RRP that the retailer gets, since there aren't the same costs involved in selling ebooks as paperbooks (no inventory management, storage, transport, packing). But requiring retailers to keep a fixed price is foolish. And setting the RRP too high while doing so is even more foolish!
Checking my records, I see I paid $10.47* for my ebook of The Lord of the Rings back in April 2009.
Sigh.
*Well, I paid $20.94, but on 100% micropay rebate, which means it was effectively half price. I don't think I would have paid $20.