Astak's 5" Pocket Pro $199

[AnemicOak]

Originally Posted by bsg75

It is well known by everyone in the industry that Amazon et al. LOSE MONEY on eBook sales.

They lose money on most of the $9.99 hard cover equivalent best sellers. They do not lose money on most titles.

[Wolfgan]

Originally Posted by bsg75

It is well known by everyone in the industry that Amazon et al. LOSE MONEY on eBook sales. Barnes & Noble types are looking to make profits in the future and battling for market share, but there's no profit in eBooks as of right now. They pay publishers about $12 for NYT bestsellers, half the price of the hardcover, and they take a loss with each sale at the $9.99 promotional price.

The fact is that profit margins on eBook readers are LARGE--at least relative to, say, computers. I can believe Astak has a thinnish margin, but the actual manufacturing costs are pretty low. A display module runs $30-$40. Wireless modules and touchscreen assemblies are the only other expensive parts. Isuppli has done a teardown of the Kindle 2 and it costs $185 to build, vs. $299 retail. That's a VERY healthy margin. (Of course, the Kindle's selling price includes free lifetime wireless data service.) With no wireless module and a smaller screen with less grayscale, the Pocket Pro should cost well under $150 to manufacture. Maybe around $100, I'd hazard to guess. Don't get me wrong, I still want one. I just like to think I'm learned enough to know I'm paying something of a premium.

I agree that a lose money strategy is not sustainable in the long run, but consider that Isuppli calculations only take into account the bill of materials, and you need to add the cost for assembly, shipping from the other side of the world, distribution, marketing, channel margins, etc etc
I don't think they lose money, but I don't believe the profit is big either that's why they need high volumes to make it worthy (if profit is sizable, capitalism kicks in and suddenly everyone is selling ebook readers :-)
Regards, Wolf.

[slayda]

I personally question whether Amazon loses money on those best sellers. I suspect that it is the authors that lose the money. Just my opinion.

[AnemicOak]

Originally Posted by slayda

I personally question whether Amazon loses money on those best sellers. I suspect that it is the authors that lose the money. Just my opinion.

Unless the publishers are cutting them a deal, which they've said they're not, then the discounting is coming out of Amazon's cut.

[bsg75]

Originally Posted by Wolfgan

I agree that a lose money strategy is not sustainable in the long run, but consider that Isuppli calculations only take into account the bill of materials, and you need to add the cost for assembly, shipping from the other side of the world, distribution, marketing, channel margins, etc etc

The Isuppli numbers DO include assembly cost, and are not just the sumtotal of parts costs. Remember this is Chinese slave labor. The teardown excludes everything else because those costs are impossible to estimate.

Originally Posted by AnemicOak

They lose money on most of the $9.99 hard cover equivalent best sellers. They do not lose money on most titles.

Since bestsellers are, um, the best sellers, Amazon loses money on eBook sales overall. And I'm sure bestselling authors would not stand for being gipped. Amazon is definitely the one losing money. This loss is subsidized by sales of the Kindle device, the exact opposite arrangement that Robertb proposes. Of course, this upside-down condition is temporary. eBooks will eventually be sold at a profit and readers will be sold at low margins. Next, the readers could be subsidized by the eBook sales or even given away free like cell phones along with commitment to a service plan. That's what Robertb is thinking of, but it's not the current situation.

[griffonwing]

Don't forget the crapload of money they are taking from book uploaders. 65% is a HUGE amount of money for their cut.

[pilotbob]

Originally Posted by griffonwing

Don't forget the crapload of money they are taking from book uploaders. 65% is a HUGE amount of money for their cut.

Ok, first you've got it backwards... The AUTHOR gets 65% of the list price not Amazon.

Also, keep in mind that they are doing all the fulfillment and hosting and e-commerce work too. In addition, your book is going into a marketing system that pulls millions of searches an hour... possible a minute. You don't have to pay for any of that marketing up front.

Compare that to a deal that an author gets from a traditional publisher. You get 10% if you were VERY lucky. That is, if they will even publish your book in the first place. Also, they usually get exclusive rights and right of first refusal on additional printings. Then what marketing do they do, none... so you pretty much have to do the same type of marketing.

So, if you write a book, and publish it through Acme Publishing at a list price of 9.99 you are getting $1 per sale. If you publish that book via Amazon you get $6.50 per book. Yes, a real rip off eh?

BOb

[griffonwing]

I heard your cut was 35%, not the other way around.

http://www.selfpublishingreview.com/...-so-it-begins/

I’ve said for awhile now, that though I appreciate the opportunities Amazon gives to indie authors, that we shouldn’t be “too” grateful because they are ripping us off on Kindle sales. On Kindle we only get 35% cut, that’s less than industry standard for a publisher, and not only that, but it’s an ebook, exactly what is Amazon doing with Kindle books that rates that big of a cut?

With physical books you can understand since they have to ship them out, but when we’re talking about a non-physical product, the most they can say they need is storage space and bandwidth, which in the grand scheme isnt’ THAT expensive.

It goes on from there.

[pilotbob]

Originally Posted by griffonwing

I heard your cut was 35%, not the other way around.

You are correct, I checked on amazon. Still, this is more than the 10% you would get with a traditional publisher assuming you can get a contract with one.

BOb

[griffonwing]

But that is comparing pBook vs eBook. The two are VERY diffeerent. Apples and Oranges. Regardless of the marketing and search, their cut should be no more than 15-20%. Luckily, I'm not the only one who feels this.

Amazon is trying to screw people over to make the buck. That's all they care about.

I, for one, cannot wait for a fair ebook marketer/publisher that will rival and topple Amazon's dominating shadow.

[developerzero]

Hey Robertb, I had a quick question that I haven't seen answered (and I've finally finished reading all 36 pages). How quickly can we expect the PocketPROs to be showing up at our local Fry's? (Specifically, the one in Wilsonville, OR)

[Musicman]

Originally Posted by developerzero

Hey Robertb, I had a quick question that I haven't seen answered (and I've finally finished reading all 36 pages). How quickly can we expect the PocketPROs to be showing up at our local Fry's? (Specifically, the one in Wilsonville, OR)

This one was answered up front. The Pocket Pro will only be available from Astak's Web Site. The reason given was was to keep the cost down.

[AnemicOak]

Originally Posted by griffonwing

But that is comparing pBook vs eBook. The two are VERY diffeerent. Apples and Oranges. Regardless of the marketing and search, their cut should be no more than 15-20%. Luckily, I'm not the only one who feels this.

Amazon is trying to screw people over to make the buck. That's all they care about.

I, for one, cannot wait for a fair ebook marketer/publisher that will rival and topple Amazon's dominating shadow.

Businesses don't survive with a 15-20% margin. AFAIK Amazon's cut from publishers is no more than any other ebook distributors & DRM providers take.

[griffonwing]

But that is 15-20%, almost pure profit. And it's just from the ebooks. Remember, Amazon deals in MORE than just books. They have great margins, I am certain, of actual tangible goods.

What kind of costs are Amazon accruing for a self-published books.

Marketing- It's put into a database, tagged, possible images. Are these all supplied by the author who uploads them? I upload a book, do I supply the genre info, tag words, author, book name, short desc, etc..?

Storage- It's a 500kb file. A 1TB HD holds 1,073,741,824 kilobytes.. that is 2,147,483 books at 500kb each. Storage is not a problem.

Distribution- Sure, they have to have some way to manage the distribution, keep records, tally up rankings, etc.. But this system was already in place with Amazon's website.

Everything here was already in place long before the Kindle, except for the uploading/tagging pages. But this should not cost 65% of gross cover price.

[tolutaua]

Has anyone here received the pocket pro yet?