Kindle Books Outsell Hardcovers

[DMcCunney]

Originally Posted by GA Russell

I understand the argument that the accountants should assign the eBook edition its fair share of the burden of the publisher's creating the book. And I don't disagree.

Good.

Yet as I understand it, there is a huge number of books available for free on the darknet.

There are indeed.

So if the pirate can create the eBook for next to nothing,

The pirate is donating his or her labor. The people who work for publishers expect to be paid for what they do.

And the pirate is working from an existing copy, either scanning, OCRing, and proofreading a paper book to make an electronic copy, or breaking DRM on an existing ebook and sharing the copy.

What the pirate is doing is a small fraction of the total work involved.

I think that the publishers are out of line to suggest that the creation of the eBook is a large expense.

No one is claiming the creation of an ebook is a huge expense, in the sense of what is needed to get a final electronic manuscript into an ebook format. The claim is simply that most of the costs of producing a book occur before it ever reaches the stage of being published in any form.

I think this goes back to the debate about the Labor Theory of Value. The Austrians showed that just as beauty is in the eye of the beholder, value is in the eye of the purchaser.

Correct. Something is worth what someone else is willing to pay for it. If what the market is willing to pay for it is not enough to cover the cost of production and a reasonable return for the producer, it may not get made.

So I think that the publishers are justified to charge a high price for an eBook best seller just off the press that is in the news. But I see little justification for the setting of the price of a backlist fiction eBook near that of the paperback version. That's just price gouging.

<shrug>

Pricing is what the market will bear. Publishers set those prices because they think they can get it. If they can sell the desired number of copies at that price, they can get it, and have no incentive to lower the price. Publishers are all still finding out what they can successfully charge for an ebook, and there's a lot of wishful thinking on both sides about what the price can be.

My personal feeling is that when the dust settles, the price will be around that of the mass market PB edition, but won't fall to that level until the mass market PB would be issued. They will want to get the revenue from people who will pay a premium to read the book sooner, the same way people who want to read the book now spring for the hardcover instead of waiting a year for the MMPB.

Your "price gouging" may be my fair price. It depends on our desires and the relative value we assign to the product.

What happens if the ebook is the only edition? A lot of this discussion seems to assume the paper editions are somehow subsidizing the ebook. What happens when there is no paper edition to share the burden of the costs? A fair number of folks on MR dream of a day when the paper books go away, and only electronic editions are published.
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Dennis

[kjk]

Originally Posted by DMcCunney

What happens if the ebook is the only edition? A lot of this discussion seems to assume the paper editions are somehow subsidizing the ebook. What happens when there is no paper edition to share the burden of the costs? A fair number of folks on MR dream of a day when the paper books go away, and only electronic editions are published.
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Dennis

I think we are going to see a short, squat, pyramid-printed hardcovers at the top, paperbacks from those hardcovers, paperbacks only, and, spread far and wide, eBooks that begin and end as eBooks.

[queentess]

Originally Posted by DMcCunney

No one is claiming the creation of an ebook is a huge expense, in the sense of what is needed to get a final electronic manuscript into an ebook format. The claim is simply that most of the costs of producing a book occur before it ever reaches the stage of being published in any form.

What happens if the ebook is the only edition? A lot of this discussion seems to assume the paper editions are somehow subsidizing the ebook. What happens when there is no paper edition to share the burden of the costs?

And I think this is the key point. Yes, to create an ebook from an electronic copy of the final manuscript is not such a big deal. But what happens when the pbook market falls and ebooks are the dominant force? Should they then shift all the overhead to the ebook creation and sell the pbook at a fraction of current prices? If the publishers drop prices drastically for ebooks now, they won't be able to raise them later without huge consumer backlash.

That said, as a consumer, if I'm going to pay the same amount for an ebook that I would for the pbook, it must have ALL the functionality of a pbook, including be able to lend it to my friends or sell it used. There's going to have to be some pricing trade-off for the reduced functionality and the DRM. (Which is funny, because I'm sure it costs the publishers a bunch of money to add DRM…)

[DMcCunney]

Originally Posted by queentess

And I think this is the key point. Yes, to create an ebook from an electronic copy of the final manuscript is not such a big deal. But what happens when the pbook market falls and ebooks are the dominant force? Should they then shift all the overhead to the ebook creation and sell the pbook at a fraction of current prices? If the publishers drop prices drastically for ebooks now, they won't be able to raise them later without huge consumer backlash.

If the pbook market falls that badly, there may not be pbooks. Pbooks won't be sold at a fraction of current prices. Trying to do so would be like the old joke about "losing money on every sale, but making it up on volume!" All you do there is increase your losses.

If anything, p-book prices will increase. Economies of scale are in play. With a physical printed book, the more copies you print, the less the cost of producing each is, and the more you can spread the total manufacturing cost. It's why niche market and specialty books tend to have higher prices: the number of copies that will be sold is far lower, and the production cost for each book is much higher.

But it's one reason why we aren't likely to see the sort of ebook pricing a lot of folks hope for. Smart publishers will be looking ahead to the days when ebooks dominate, and any vendor will want to charge as much as can be gotten for what she makes and sells. The underlying costs of making a book don't magically decrease that much just because it's electronic instead of paper - 80% of them are there regardless.

That said, as a consumer, if I'm going to pay the same amount for an ebook that I would for the pbook, it must have ALL the functionality of a pbook, including be able to lend it to my friends or sell it used. There's going to have to be some pricing trade-off for the reduced functionality and the DRM. (Which is funny, because I'm sure it costs the publishers a bunch of money to add DRM…)

It costs the publishers something to add DRM, as they probably license the technology, but I doubt it's a significant cost per book.

Lending and reselling ebooks are thorny issues, and I've no idea how they might be addressed.

When you lend a pbook, while it's out on loan, you don't have it. Only one person can read it at a time. With an ebook, that's a lot harder to implement. Barnes and Noble has a lending function on their nook reader - you can lend an ebook to another nook owner for a two week period. But while it's on loan, you can't access it, just like a pbook. It can be done because both devices are nooks and on B&N's network. It can't work otherwise.

Resale is likewise. If you sell your pbook, you no longer have it. How do you implement that for resale on an ebook? You need a method whereby selling your used copy erases if from your device (and prevents you from restoring it from a backup, as you no longer have the right to display it.) I don't know a way to do that, and I can only imagine the howls of protest from people who read ebooks about any proposal that might accomplish it. What would be required would be far too intrusive for anyone's comfort.

Speaking personally, I occasionally lend pbooks, but don't resell them. Books I actually buy, I plan to keep. I do occasionally give away things I've accumulated duplicate copies of ("Free to good home!" ), so inability to do either with an ebook is not a factor in my decision.

The more interesting question for me is how much price is a factor. Books compete for the reader's discretionary time as well as money. Reading is by nature a foreground activity, and what you must concentrate on while you do it. Books must battle for attention with all the other things you might be doing, like watching TV. Ebooks make it convenient for people to read anywhere, any time, in odd moments like during a commute, and increase the total number they can read by some measurable amount, but there will still be limits on how many the average reader will have time to read. The scarce resource here isn't money to buy the books, it's time to read them once I have.
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Dennis

[GA Russell]

My concern is with the here and now, and primarily about backlist fiction.

As I have stated elsewhere, there are no Perry Mason books legitimately available as eBooks. A pirate can and will make eBooks of them easily and then give them away free.

Assuming that a publisher has the rights to them, and just hasn't gotten around to them, I think that publisher should do his job and e-publish the books, and price them at something very nominal like 99 cents.

These large cost sums bandied about may be appropriate for new books, but I do not think they are relevant for backlist fiction.

[DMcCunney]

Originally Posted by GA Russell

My concern is with the here and now, and primarily about backlist fiction.

As I have stated elsewhere, there are no Perry Mason books legitimately available as eBooks. A pirate can and will make eBooks of them easily and then give them away free.

Can and have. I've seen them.

Assuming that a publisher has the rights to them, and just hasn't gotten around to them, I think that publisher should do his job and e-publish the books, and price them at something very nominal like 99 cents.

That's a huge and probably unfounded assumption.

For books that are that popular, publishers have an incentive to keep them in print. Backlist sales of established sellers go a long way toward smoothing out the peaks and valleys of new release successes and failures. (Mind you, I don't underestimate publisher stupidity. I've heard of cases where publishers lost rights to a title because they forgot they had the rights, and let them lapse unintentionally. They forgot they had the rights, but the author/author's agent didn't, and promptly formally requested that the rights revert.)

If I had to make a guess, whoever has the rights is either doing a poor job of marketing them, or has a higher idea of what they're worth than a publisher is willing to pay.

And republishing at that nominal 99 cent price has issues, even if the publisher has the rights. Author, author's heirs, author's estate, or author's agent might just think the books can command a higher price, and do everything they can to toss blocks into that road.

These large cost sums bandied about may be appropriate for new books, but I do not think they are relevant for backlist fiction.

See above about one of the functions of backlist books. Imagine you're an author with backlist titles out there, and are trying to make your living as a writer. Do you think you'll be happy at your publisher choosing to reissue your titles as ebooks at that nominal 99 cent price? When you may see 20 cents or less on a copy? (Your royalty percentage will be set in your contract.) See my previous comments about books competing for reader's time. I don't see the fact that they are really cheap increasing sales enough to come anywhere near "making it up on volume."

I understand why getting them at that price is a good deal for you. I don't understand what makes it good for the author or the publisher.
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Dennis

[GA Russell]

Originally Posted by DMcCunney

I understand why getting them at that price is a good deal for you. I don't understand what makes it good for the author or the publisher.

I assume that the author and the publisher will consider something better than nothing.

As a record company exec once said, How do you compete with free?

If a backlist fiction title is currently unavailable as a legitimate eBook, the publisher and the author are getting nothing from eBook sales.

Elfwreck today in another thread described how easy it is to make an eBook copy. So the pirate copy of this backlist item either exists or could easily exist tomorrow.

A sales pitch could be made that the "official" eBook is a better product than the pirate version, and well worth the 99 cents.

But the public isn't going to want to hear a story about how expensive it is to create an eBook. Not when they know that the pirates are doing it for nothing.

By the way, when I brought up the concept of backlist items, I had in mind items like Perry Mason whose authors are long dead. I can understand a living author wanting more than 20 cents for his work, but I assume that if the market were there for real money, the "official" eBook would already exist, and he'd already be making the real money. Presumably, the time for making the big bucks on that work of art has passed, and we are now looking at the "found money" stage of the process.

[DMcCunney]

Originally Posted by GA Russell

I assume that the author and the publisher will consider something better than nothing.

Sure, but what "something" is will vary depending upon who you talk to.

As a record company exec once said, How do you compete with free?

By offering something people are willing to pay for.

If a backlist fiction title is currently unavailable as a legitimate eBook, the publisher and the author are getting nothing from eBook sales.

If a non-backlist title is not available as an ebook, publisher and author get nothing from ebook sales. Consider J. K. Rowling, who would not license ebook editions, so the only ebook copies of Harry Potter you could get were pirated. Legitimate copies didn't exist. (I recall hearing she is finally reconsidering her stance on ebooks.)

Elfwreck today in another thread described how easy it is to make an eBook copy. So the pirate copy of this backlist item either exists or could easily exist tomorrow.

Probably does exist now, if the work is at all popular. But most folks may not be aware of it, and may not be interested in looking for it if they are.

A sales pitch could be made that the "official" eBook is a better product than the pirate version, and well worth the 99 cents.

But the public isn't going to want to hear a story about how expensive it is to create an eBook. Not when they know that the pirates are doing it for nothing.

I don't believe anyone is telling the public an ebook is expensive to produce. They are telling the public books in general can be expensive to produce.

And while an increasing number of people are now reading ebooks, you can't assume they are aware of the darknet, or go in search of pirate editions. They may have something like a Kindle, and get what Amazon offers. They may not be aware pirate copies exist.

(There's a prolific MR poster who has no computer, and participates here posting from his Kindle.)

And if I'm a publisher, I'm sure as hell not going to use "better than a pirated edition" as a sales pitch. Do record companies who permit Apple to offer their content through iTunes talk about it being preferable to MP3s obtained through bit torrent?

I've got a Kindle. Amazon sells the book I want. I can pay for it on line and download it now and start reading. I don't have to go searching the darknet for a decently produced copy and take the time and trouble involved in doing so. Instant gratification, and value I'll pay for.

(No, I don't have a Kindle, or want one. I'm just illustrating the notion that convenience rules.)

By the way, when I brought up the concept of backlist items, I had in mind items like Perry Mason whose authors are long dead. I can understand a living author wanting more than 20 cents for his work, but I assume that if the market were there for real money, the "official" eBook would already exist, and he'd already be making the real money. Presumably, the time for making the big bucks on that work of art has passed, and we are now looking at the "found money" stage of the process.

You would like to think so. Unfortunately, not everyone involved agrees with you. I'm more familiar with the SF/fantasy field, and hear horror stories about works by authors long dead whose stuff is not available because the author's estates have unrealistic views of what the works are worth, and ask far more for reprint rights than prospective publishers are willing to pay. I'm quite certain the same problem exists in other genres.

And lots of publishers are still stupid about ebooks, period.
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Dennis