Breakdown of costs of book production

[catsittingstill]

We've been doing a lot of speculating here in past months over what an e-book costs to produce, trying to get a handle on what it ought to cost the consumer.

There is an article in Kindle 2 Review about the costs of producing paper books that might be worth looking at.

To be sure you see it (it's not showing up as a link in my preview) the article is here: http://ireaderreview.com/2009/05/03/...ok-publishing/

[dauwhe]

[1] Actual production costs--typesetting, eBook creation, etc.--are dropping rapidly, every year. One result is that the U.S. typesetting industry has practically been destroyed. Everything is moving offshore. This is starting to happen for some editorial functions, too (especially for higher education books). Your college textbook may have been copyedited in India.

[2] Most everyone in publishing that I know makes a pitiful amount of money. I honestly don't know how many of them manage to live in the NYC area. Certainly none of the people I know who work in Manhattan live in Manhattan!

[3] If this forum is like any of the others I frequent, someone will soon chime in to explain that prices are set by the market, and that it's not a matter of adding some fixed markup to the cost of production

Dave

[sirbruce]

It's clear that the retailer cut is simply too high. Ebooks have less overhead and that means more money for the publisher, but retailers also need to take a smaller cut and the author needs a greater royalty.

[AnemicOak]

If publishers were willing to cut distributors like LightningSource (Ingram) and Content Reserve (OverDrive) and do the distribution themselves by setting up their own DRM servers they could cut out a big part of their costs. It's not like they need to handle returns, remainders, etc like with pbooks. Or they could skip having their own DRM servers (I know, dream on) and save even more money.

I'm kind of surprised a couple of the bigger pubs haven't tried self distribution. They don't need warehousing, shipping, etc. Just a few good people could handle it.

And yes, lowering the cut retailers get should be doable too I'd think. No B&M retail space, no returns to speak of, no physical stock sitting waiting to be sold and staffs the size of a small bookstore (last I heard Fictionswise was only about six people) should all combine to allow a retailer to run a profitable business even if their share was cut. Of course it's easy to say that, but I don't have all the knowledge to know if it's feasible.

[Lemurion]

I've seen book production cost breakdowns for years, and they all tell me the same thing: an ebook should be no more expensive than a paperback original. Any additional cost for creating an e-version should be easily absorbed by the removal of the cost of printing, warehousing, shipping and returns.

As to the best price for ebooks - I don't know: but the price of a mass-market paperback is a good upper bound.

[khalleron]

Originally Posted by Lemurion

I've seen book production cost breakdowns for years, and they all tell me the same thing: an ebook should be no more expensive than a paperback original. Any additional cost for creating an e-version should be easily absorbed by the removal of the cost of printing, warehousing, shipping and returns.

As to the best price for ebooks - I don't know: but the price of a mass-market paperback is a good upper bound.

Well, that is the upper bound of all *my* ebooks. If the price is too high, I don't buy it. I have lots to read, I don't *have* to have that new one the moment it comes out - or if I do, I'll check it out of the library and wait for the ebook price to drop. I'm *not* paying hardcover prices for ebooks.

[Andybaby]

Originally Posted by sirbruce

It's clear that the retailer cut is simply too high. Ebooks have less overhead and that means more money for the publisher, but retailers also need to take a smaller cut and the author needs a greater royalty.

40% of sale price for the retailor is average, it costs alot to keep things out on the floor.

[sirbruce]

Originally Posted by Andybaby

40% of sale price for the retailor is average, it costs alot to keep things out on the floor.

Right, that's too high. Booksellers need to find a way to cut costs. Perhaps that means only putting sample copies on shelves, and then printing a customer copy on demand when they go to checkout. This would allow them to carry more titles with less storage space.

In any case, ebooks eliminate this problem. And can even eliminate the retailer completely if they don't get with the program.

[Andybaby]

Originally Posted by sirbruce

Right, that's too high. Booksellers need to find a way to cut costs. Perhaps that means only putting sample copies on shelves, and then printing a customer copy on demand when they go to checkout. This would allow them to carry more titles with less storage space.

In any case, ebooks eliminate this problem. And can even eliminate the retailer completely if they don't get with the program.

maybe for ruaral stores, but the Barnes and nobles I go to in NYC are always packed, and the rent is high, and even though they are ALWAYS packed, ive seen a few fail and close up shop. I don't think there is any other way. you cant make them smaller

40% is not high for a retailer. especially in books. and I dobut they sell them all the time for full sticker, so most of the time less than that, by 10-30%

for Ebooks, the retailer cut shouldn't be so High, but I still think it should be atleast 20%-30% due to the fact they have to advertise too, the more they can advertise, the more people will come, the more people will buy ereaders, and the more people will buy books.