Quote:
Originally Posted by Ivo
Aside from Canadian story, your argument about profitability (or lack of it) is weak. Kindle edition of this particular book in the US is $9.41, so I'm not sure what makes it unprofitable if the paperback edition costs $7.99. They surely didn't use dead trees, nor transport the books, and yet you claim that more expensive ebook is less profitable than cheaper paperback. Unless the paperback is also not profitable, even more so then ebooks.
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It's not an "argument," it's an explanation, and keep in mind that I've worked in publishing for many years, so I bring a good deal of knowledge to the table.
Paper vs. electronic is a different kettle of fish entirely.
When publishers sell to retailers, the retailer's purchase price is a percentage of the list price for the book. The discount Kindle gets for ebooks is far, far steeper than the discount a retailer receives for a physical book. Also keep in mind that the cost of printing and binding isn't as high as people think: it's usually 1/8 or 1/7 of the list price. Even associated costs (warehousing, distribution, etc.) combined with printing & binding only come to about 1/5 or, at most, 1/4 of the list price. So the publisher's "savings" are, in fact, not that great with ebooks, and they're more than wiped out by Kindle's steep discount.
Also, at the $7.99 price you're quoting for the physical book, that's mass market, and the cost of printing and binding would be even less than the ratios I've posted above. The Kindle discount leaves very little for the publisher, and that amount may not even cover overhead costs for the title.
Other things to keep in mind: Kindle, not the publisher, sets the price for ebooks. Kobo does as well, in a roundabout way, by requiring publishers to match a selling price to a discount level. The ebook retailer actually determines the price with their contract terms. The publisher has SOME choice: if they price a book at one price, the eretailer discount is a certain percentage. If they price the book at a lower level, the retailer's discount is less. (That's an incentive to keep the price down.) When the publisher has a choice, they'll choose the option that provides them some level of profitability. They do want to sell ebooks, so they try to go for the lower price if they can, but they don't want to lose money.
As it stands now, ebooks are not terribly profitable for publishers. There ARE costs involved with producing ebooks. I've spoken to an executive at a company that is seen as on the leading edge of ebook publishing in Canada, and he tells me that their ebook progam is actually losing money at this point -- and this company has few books that are more than $9.99 (roughly half the price of their physical books), so they're not doing themselves in by overpricing.
That said, the Kobo price shouldn't be higher than the physical book price, since Kobo has more respectable terms.