Interesting article on book pricing and why it might rise

[EricDP]

Originally Posted by DMcCunney

Ultimately, you get what you pay for, and if you don't pay, you won't get.

Another piece of common sense I don't agree with. Every piece of software on my computer costs me $0. It's extremely high quality and does everything I want. I used to pay through the nose for expensive Microsoft stuff that barely worked, was loaded with restrictions, and required me to pay even more money for regular upgrades I didn't want to stay supported and get security patches I shouldn't need. Go figure.

[Barcey]

Originally Posted by DMcCunney

If it works for you, splendid. The key is that the reviews average out to matching your expectations, and you are overall satisfied with the books you buy based on those reviews.


And how does a book get that critical mass of reviews? I prefer reviews by people I already know and trust. I know where they are coming from, and don't have to wonder what their agenda might be, as I already know what it is. A larger quantity of reviews reduces the possibility of rigged results, but you must have that larger quantity.


Because I've had the temerity to suggest it might not be possible for them to produce ebooks at the sort of prices lots of folks would like to see?

Well, sorry about that. But what will you do if I'm right?

Whether the big publishers remain in business is beyond my control. I have no idea whether they will or not, and for the most part, I don't care. I do know an assortment of people trying to make a living, as writers, or as employees of publishers, and I do care about what happens to them.

My agenda, to the extent that I have one, is fairly simple. I know a bit about the process by which books are acquired and published. Based on what I know, I don't think major publishers can make and sell ebooks as cheaply as many people seem to think, and remain in business as going concerns. There's an awful lot of wishful thinking on the part of publishers about how much they can charge, and even more wishful thinking on the part of readers on how little can be charged for them. The truth is somewhere in the middle, and we're all finding out where that middle is.

If the major publishers do go out of business, the dual questions are where you will get books you want to read, and whether the authors can make enough money writing them to make it worth while to continue.

The stuff I like is the end result of a collaborative process. A writer wrote a manuscript. An editor liked it well enough to buy it, and work with the author to improve it. Other people worked on other parts of the process, and the end result was a book I found worth buying, reading, and having on my shelves (or my reading device.) The value for me is an aggregate of all of those parts, and it's value I'm willing to pay for.

Ultimately, you get what you pay for, and if you don't pay, you won't get.

My basic take on "let the big publishers go out of business" is "Be careful what you wish for. You might get it." I strongly suspect you will not be happy if you do.
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Dennis

Speaking as someone who has stopped purchasing from the major publishers I can tell you it's not a problem. You find an author you like and then you read the rest of their books. Meanwhile you keep your eyes open for other books you might like. Publishers are just one filter for finding good books to read, they aren't irreplaceable for anything they're doing. Someone else can fill the role.

It's about getting paid for the value and services that you add and not about maintaining what you were previously paid. If you are adding value (like the author) you have nothing to fear. If you are taking a larger percentage then the value you're adding then you have something to fear. That's all this is about. It's about the publishers no longer being in the driver seat cutting up the pie and telling everyone else how little they deserve.

Amazon and Apple didn't get in a price war with music and drive it down to the point that nobody could make music or that I can't find music to listen to. They wouldn't do this with ebooks either. It's just fear mongering.

For the record I don't believe that Amazon deserves 30% for the value they're adding either. Removing the requirement form them to compete in the marketplace for that percentage is one of the worst things about the publisher price fixing.

[BearMountainBooks]

For the record I don't believe that Amazon deserves 30% for the value they're adding either. Removing the requirement form them to compete in the marketplace for that percentage is one of the worst things about the publisher price fixing.

For the record, other vendors allowing direct upload of books are offering authors LESS percentage and they rarely have the same number of eyeballs looking. Not complaining, but I did find it interesting. Only Apple offers 70 percent and Smashwords offers a bit more for direct sales (it can be 70 percent depending on credit card fees, affiliate payments and whatnot.) I think the battle will continue and the retailers aren't always going to even want to offer 70 percent for their service.

It is as it ever was--a mad competitive dash!

[Lemurion]

Originally Posted by Barcey

It's about getting paid for the value and services that you add and not about maintaining what you were previously paid. If you are adding value (like the author) you have nothing to fear. If you are taking a larger percentage then the value you're adding then you have something to fear. That's all this is about. It's about the publishers no longer being in the driver seat cutting up the pie and telling everyone else how little they deserve.

I agree that it's about getting paid for services and value. The problem is that there is a fundamental disagreement about both the value (and necessity) of the services publisher's provide, and the costs incurred by the publishers to provide those services.

The lower a value one places on certain services, the less legitimate one is likely to consider costs arising from those services. We've already seen a significant disagreement on the value of editing, and I'm sure that's not the only such area of disagreement.

Personally, I think the value of the services added by a publisher are enough to put the cost of an ebook easily into the mass-market paperback range of $6-8 at retail - and that $5-7 is a reasonable premium to pay for access to the story before it's out in mass-market paperback.

[vaughnmr]

Interesting comment on the publishers from Teleread:

http://www.teleread.com/paul-biba/my...-stories-2010/

[DMcCunney]

Originally Posted by EricDP

Another piece of common sense I don't agree with. Every piece of software on my computer costs me $0. It's extremely high quality and does everything I want. I used to pay through the nose for expensive Microsoft stuff that barely worked, was loaded with restrictions, and required me to pay even more money for regular upgrades I didn't want to stay supported and get security patches I shouldn't need. Go figure.

You're running open source software? So do I, though not entirely. Most things have quite acceptable open source equivalents, but not everything.

But consider where the open source apps come from. Most of them are created by people working on them in their spare time, and doing other things for a living. Their motivation is some combination of geek cred and scratching an itch because it's a tool they'll use too.

But how do you apply that model to books? A lot of folks write on the side and have a day job, including most published authors. Some folks just like to write and have what they wrote available for others to read, and don't especially care about getting paid for it. Others folks do, and some people are actually trying to make a living writing.

How do you advise people trying to make actual money writing to proceed?
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Dennis

[BearMountainBooks]

Originally Posted by DMcCunney

You're running open source software? So do I, though not entirely. Most things have quite acceptable open source equivalents, but not everything.

But consider where the open source apps come from. Most of them are created by people working on them in their spare time, and doing other things for a living. Their motivation is some combination of geek cred and scratching an itch because it's a tool they'll use too.

But how do you apply that model to books? A lot of folks write on the side and have a day job, including most published authors. Some folks just like to write and have what they wrote available for others to read, and don't especially care about getting paid for it. Others folks do, and some people are actually trying to make a living writing.

How do you advise people trying to make actual money writing to proceed?
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Dennis

And some of those software writers take donations and would like to make a little money on the side too...Just sayin' The models, in some cases, aren't all that different.

[DMcCunney]

Originally Posted by Barcey

Speaking as someone who has stopped purchasing from the major publishers I can tell you it's not a problem. You find an author you like and then you read the rest of their books. Meanwhile you keep your eyes open for other books you might like. Publishers are just one filter for finding good books to read, they aren't irreplaceable for anything they're doing. Someone else can fill the role.

And if the writer I like is still producing books issued by a major publisher? I read their stuff up to the point at which I switch and drop them thereafter because I don't buy from major publishers?

Er, no. I read what I like, and for the most part, I'm willing to pay for it.

It's about getting paid for the value and services that you add and not about maintaining what you were previously paid. If you are adding value (like the author) you have nothing to fear.

If you are an author, you have an enormous amount to fear, because the publisher is how you are reaching your audience and getting paid for what you do. If the publisher goes away, what do you do? (And since I suspect I know what some of the answers will be, the next question is "How do you keep a roof over your head and food on your table while you're trying to make the switch?")

If you are taking a larger percentage then the value you're adding then you have something to fear. That's all this is about. It's about the publishers no longer being in the driver seat cutting up the pie and telling everyone else how little they deserve.

And the argument is about the value being added.

The perception of "publishers being in the driver seat cutting up the pie and telling everyone else how little they deserve" is an unfortunately naive view of the process. That's not really how it works.

Amazon and Apple didn't get in a price war with music and drive it down to the point that nobody could make music or that I can't find music to listen to. They wouldn't do this with ebooks either. It's just fear mongering.

No, they didn't, and I don't recall anyone suggesting they did. Apple did fundamentally change the music industry, but books and music can't be directly compared.

For the record I don't believe that Amazon deserves 30% for the value they're adding either. Removing the requirement from them to compete in the marketplace for that percentage is one of the worst things about the publisher price fixing.

What do you feel Amazon does deserve?

But it didn't remove the requirement to compete in the market, as price is not the only element on which purchase decisions are made.
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Dennis

[DMcCunney]

Originally Posted by BearMountainBooks

And some of those software writers take donations and would like to make a little money on the side too...Just sayin' The models, in some cases, aren't all that different.

And none of those software authors who take donations are making a living on it, or even part of one.

There are a few folks making a living in open source software because they do it as a day job. They work for places like Red Hat, which makes its money supporting commercial Linux installations, IBM, which uses a lot of open source code and pays some of their own people to help maintain and enhance it, or the Mozilla Foundation, most of whose revenue derives from search functionality incorporated into things like Firefox.

The vast majority of open source developers write open source code on the side and have day jobs.
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Dennis

[GA Russell]

Originally Posted by DMcCunney

Apple did fundamentally change the music industry, but books and music can't be directly compared.

Not so fast, Dennis. I think that it was Napster that changed the music industry, not Apple. For that reason I think that books and music can be directly compared.

[Barcey]

The big six publishing houses are not providing an irreplaceable service. If they were they would have nothing to fear and they wouldn't have to price fix. If they shutdown tomorrow they aren't going to off all their authors. The authors would find other companies to provide the same services and get their product to the market. Some of them are doing it already. There is nothing to fear as a reader.

I also don't believe that the big six publishing houses are stripped to the bone and at the edge of collapse with the only choice of the "agency pricing" to stay in business. They were running the risk of taking less income from a much more efficient distribution system. Amazon is now big enough to tell them that their piece of the pie has to be smaller and they didn't like it.

I personally think that Amazon deserves around 5-10% of the sale for the services they are providing. Running a website, downloading a 1MB file and running a credit card transaction is not that much value. They sell enough volume that they don't require a guaranteed 30% to make a substantial profit. It's not for me to decide though and it's not for the publishers to decide. They should have to compete in the market place for what the correct price is.

[elcreative]

In retail of any form, I personally wouldn't even get out of bed for 5-10% margin as a general rate even with economies of scale... if your margins aren't enough then you still won't be able to afford proper staffing, equipment, premises etc. So then you go back to small isn't beautiful approach. Businesses, of course, can never win... evil people wanting to make a living, nasty professionals wanting to design a website & sales service that can deal with all of their customers (most of the time)... everything should be run for the joy of it by happy amateurs living off the land the rest of their ample time....


[QUOTE=Barcey;1277722
I personally think that Amazon deserves around 5-10% of the sale for the services they are providing. Running a website, downloading a 1MB file and running a credit card transaction is not that much value.[/QUOTE]

[Barcey]

Originally Posted by elcreative

In retail of any form, I personally wouldn't even get out of bed for 5-10% margin as a general rate even with economies of scale... if your margins aren't enough then you still won't be able to afford proper staffing, equipment, premises etc. So then you go back to small isn't beautiful approach. Businesses, of course, can never win... evil people wanting to make a living, nasty professionals wanting to design a website & sales service that can deal with all of their customers (most of the time)... everything should be run for the joy of it by happy amateurs living off the land the rest of their ample time....

Amazon is a volume based business that should run on a smaller percentage then a typical retailer. If they sell 1 million James Patterson ebooks at $10 each do you really think they earned $3 million? With the volume of business they run yes I still believe that 5-10% average provides them with enough profit and a return to their investors.

btw, I don't challenge the 30% on the self published authors because there is a lot more overhead to manage that business.

[elcreative]

If they didn't sell them and shut up shop then Patterson book sales drop to 50 then ask him if he thinks they're worth the percentage... and yes I'm exaggerating the numbers but that's the only thing that seems to work round here... and operations like Amazon don't exactly operate on 3 generation old tech in a back bedroom... I have an idea, why don't all those who are so passionate in their hatred of all business models and large retailers (such as Amazon, Apple, Microsoft, Walmart, whatever...) set up their own versions of the businesses run on their idyllic terms and see how well they manage?

[TallMomof2]

I've dropped a number of authors because of the Agency 5 agreement. A few have remained because their books are available as library ebooks or the books are reasonably priced. I've actually discovered new authors by looking at non-Agency 5 publishers. Even then if the books are priced too high, purely subjective but that's my reality, I won't buy.