Answer as to why ebooks cost more than print books (1 publisher)

[elcreative]

Thanks for your insight from within as it were... could you help put it in a little more perspective as well, I understand if you decline the info but am interested. How many titles would you expect to publish in a year and how would this relate to dealing with back-catalogue requiring scanning and OCR?

Originally Posted by TFWpublisher

Well I'm a publisher, and I can tell you there's absolutely no reason why any eBook should cost more than the paperback version.

The costs that are the same for both versions? Cover art, editing, and promotion, and that's where it stops.

The process of producing a properly formatted eBook file from a .doc or .rtf file is straightforward and seldom takes more than an hour or two. Once the eBook is uploaded to our distributors (Amazon.com, Smashwords, Sony, Apple, etc.), we're basically done with it. Oh, and if we spot something in the finished product that we overlooked, or simply want to change, we can do that quickly and easily, at no cost to us.

Compare this to the production of paperbacks (which we also produce). It takes far longer to format a paper title, and once it's off the press, you'll tear your hair out if you spot a mistake or something you simply want to change.

Just because eBooks are easier to produce than paperbacks doesn't mean you can just throw them out there on the market and rake in the cash. Far from it. The author and publisher have to work together to get as much exposure for the title as possible. There's a LOT of competition, and that's a wild understatement.

The Fiction Works was one of the pioneers in the eBook biz (I started the company about 12 years ago). Am I thrilled with what's happening now? You bet I am! The eBook market is set to explode.

Ray Hoy, Publisher
The Fiction Works
http://www.fictionworks.com

[Kali Yuga]

Originally Posted by TFWpublisher

The costs that are the same for both versions? Cover art, editing, and promotion, and that's where it stops.

So you don't pay your authors any advances or royalties, then? Got it.

Or, perhaps you charge shipping on your ebooks?

Originally Posted by TFW

Just because eBooks are easier to produce than paperbacks doesn't mean you can just throw them out there on the market and rake in the cash.

Why not?

Again, companies are most certainly not obligated to pass on any and all cost savings to the consumers. It is downright routine to lower costs in an attempt to increase profit margins.

If you pay one author a $10k advance, and another author a $30k advance, do you break out the abacus to determine exactly what the price differential ought to be on those books?

Or, you can start out by raking it in to begin with. The profit margins on a box of breakfast cereal purchased without coupons is allegedly close to 40%. Is this bad for their business? (Apparently not.) Is it immoral, if people are willing to pay the price?

Or, perhaps Harlequin is seeing a larger demand for the ebooks than the paper versions, despite the price parity. In which case, is there even an economic necessity to lower the ebook price?

Originally Posted by TFW

The author and publisher have to work together to get as much exposure for the title as possible. There's a LOT of competition, and that's a wild understatement.

OK, but "price" doesn't have anything to do with "exposure."

And I'd guess that Harlequin knows better than almost anyone how price affects sales. Unlike many publishers, their titles are nearly a commodity; the brand and series heavily define and/or indicate to their customers what a book is going to be like. They do a lot of direct sales to the public, and it is highly likely that they analyze all the sales data extensively.

So even by now, I'd think they know better than anyone what the price elasticity of demand is on their books. If they believe they can charge 3¢ more for an ebook than for a paper book, there must be a reason for it.

[TFWpublisher]

Originally Posted by elcreative

Thanks for your insight from within as it were... could you help put it in a little more perspective as well, I understand if you decline the info but am interested. How many titles would you expect to publish in a year and how would this relate to dealing with back-catalogue requiring scanning and OCR?

My company has been publishing just one or two paperbacks per month. However, we'll probably drop back to publishing just a few each year because we are devoting most of our time and resources to growing our eBook line.

We'll probably publish five or six eBooks each month, maybe more if the quality is there. My editorial director gets 100 or so queries each month, and that number is growing. However, out of that 100 or so, only five or so will be considered for publication.

Regarding back-catalogue scanning: I'm happy to say that this problem doesn't apply to The Fiction Works, as we've always had electronic files to work with from the get-go.

Ray Hoy, Publisher
The Fiction Works
http://www.fictionworks.com

[neilmarr]

Good to have your company, Ray. Very best wishes from Neil at BeWrite Books.

Although I agree that ebook editions should never cost more than treebook editions, when it comes to ebook publication of existing catalogue titles it's a different thing.

Although we never price above half of paperback price for ebooks ($5.95 across the board), we save almost 40% on high per-item PoD print costs and can just about justify lower ebook prices and loss of print sales on that basis (even with some ebook-only releases recently). Bigger houses, though, who save only about 12% on print because mass-runs are so much cheaper -- and even taking into account warehousing, physical distribution and a return rate averaging around 50% -- do face a problem because most costs are constant and every treebook sale is likely to take away a treebook purchase.

We're all in a bit of a tizz over ebook cover-pricing right now, and the Agency 5 Model won't help publishers, retailers or readers any more than DRM does. I hope things will settle down much more quickly than they did when mass-run paperbacks were introduced in the last century and offer a fair deal all round to author, publisher, retailer and reader.

(And if you want a real rant, compare the current ebook retail store sales commissions with the penal discounts that have been demanded by brick and mortar stores in the past -- some make the high street bookshop owner/manager look like a philanthropist. How can that be justified in a no-risk, no inventor, shoe-string cost operation offering nothing but a place among throusands in a crowded and virtual shop window display?)

Cheers. Neil

[OtterBooks]

Although I agree that ebook editions should never cost more than treebook editions [snip]

Not hardcover or trades, but for me an ebook is easily worth more than a mass-market paperback. For that matter, so is a cup of coffee or a friendly hello. The material costs for an ebook are also less than the material costs of a bucket of tapeworms, which is still worth more to me than an m-m paperback because at least I get a bucket.

Fact is if I want to read a book I will almost always be able to pay less than ebook price, often buying it literally right off the same product page online. As I type this I am shopping for a copy of Franzen's The Corrections on Amazon. Ebook: $9.99. One line beneath that listing is a link to resellers where I can get a "like-new" hardcover of it for $4.42 shipped. Hardcover. It's a seller I've used before and the books have been perfect. Is that a fair comparison? My credit card says yes.

Neilmarr, as a publisher do you find that such market realities make price comparisons between ebooks and treebooks rather problematic?

[Crowl]

Originally Posted by OtterBooks

Fact is if I want to read a book I will almost always be able to pay less than ebook price, often buying it literally right off the same product page online. As I type this I am shopping for a copy of Franzen's The Corrections on Amazon. Ebook: $9.99. One line beneath that listing is a link to resellers where I can get a "like-new" hardcover of it for $4.42 shipped. Hardcover. It's a seller I've used before and the books have been perfect. Is that a fair comparison? My credit card says yes.

While used books obviously can be cheaper, to be fair my comparison will be between equal situations i.e. i'll compare the ebook with the cheapest new paper edition that is out so the hardback until the paperback comes out and at that point the paperback.

[TFWpublisher]

Originally Posted by neilmarr

Good to have your company, Ray. Very best wishes from Neil at BeWrite Books.

Although I agree that ebook editions should never cost more than treebook editions, when it comes to ebook publication of existing catalogue titles it's a different thing.

Although we never price above half of paperback price for ebooks ($5.95 across the board), we save almost 40% on high per-item PoD print costs and can just about justify lower ebook prices and loss of print sales on that basis (even with some ebook-only releases recently). Bigger houses, though, who save only about 12% on print because mass-runs are so much cheaper -- and even taking into account warehousing, physical distribution and a return rate averaging around 50% -- do face a problem because most costs are constant and every treebook sale is likely to take away a treebook purchase.

We're all in a bit of a tizz over ebook cover-pricing right now, and the Agency 5 Model won't help publishers, retailers or readers any more than DRM does. I hope things will settle down much more quickly than they did when mass-run paperbacks were introduced in the last century and offer a fair deal all round to author, publisher, retailer and reader.

(And if you want a real rant, compare the current ebook retail store sales commissions with the penal discounts that have been demanded by brick and mortar stores in the past -- some make the high street bookshop owner/manager look like a philanthropist. How can that be justified in a no-risk, no inventor, shoe-string cost operation offering nothing but a place among throusands in a crowded and virtual shop window display?)

Cheers. Neil

Hello Neil. No doubt about it, the larger publishers face many problems we don't have to contend with. However, prior to the creation of ePublishing, they also enjoyed advantages over smaller publishers because they could get their books printed offshore so inexpensively. Win some, lose some, I guess.

We price our books at $6.99 across the board, which I believe is a fair price.
--Ray Hoy, Publisher
The Fiction Works
http://www.fictionworks.com

[TFWpublisher]

Originally Posted by Kali Yuga

So you don't pay your authors any advances or royalties, then? Got it.

Or, perhaps you charge shipping on your ebooks?

I've been writing professionally for 53 years. I got married, bought homes and cars, put my kids through college, then married them off, all on the money I made as a freelancer writer. I may be a publisher, but I'm still a writer at heart. I pay my authors 20% royalties based on the retail price, while many ePublishers pay royalties based on the net. Big difference. Also, my authors are never charged for anything.

Advances? Unless your name is John Gresham or Stephen King, it's unlikely you're going to get an advance on any eBook, especially if you're an unknown writer. With the competition in the eBook field, that would be suicide for a publisher, in my opinion. It's just too financially risky.

--Ray, The Fiction Works
http://www.fictionworks.com

[GA Russell]

Ray, do your eBooks have DRM?

[TFWpublisher]

Originally Posted by GA Russell

Ray, do your eBooks have DRM?

No, I dislike DRM, Big Time.

If someone really wants to steal your title, it's not that difficult anyway.

I recall one time I was speaking to a group of authors (years ago, when eBooks just started to show up), and one of the authors said, "Yes, but someone can easily steal my title if it's in eBook format, and send it to someone else."

I asked the lady, "Have you bought a paperback lately?"

"Yes, I have," she said.

"When you finished reading it, did you give to anyone else?"

She got a very sheepish look on her face, then said, "Yes, to my mother."

"And when she finished it?"

"She gave it to a friend of hers," the woman said.

"You then, effectively cheated the author of that book out of several sales," I said.

Everyone looked around and nodded. Clearly they had never thought of their "lending" practices that way.

There's no protection from that. And let's face it, we've all done it.

DRM just gets in the way, I think.

- Ray
The Fiction Works
http://www.fictionworks.com

[OtterBooks]

Everyone looked around and nodded. Clearly they had never thought of their "lending" practices that way.

You're lucky she didn't point out that the lending did not magically result in her, her mother, and her mother's friend all having flawless copies of the book without the original ever leaving her possession.

[Forster]

Originally Posted by OtterBooks

You're lucky she didn't point out that the lending did not magically result in her, her mother, and her mother's friend all having flawless copies of the book without the original ever leaving her possession.

True but to do what with? Most books aren't reread and if they do fall into that category I always got the original back at some point.

[FF2]

You folks have just sent me searching out the value of a somewhat decrepit hardbound original printing Vonnegut's Cat's Cradle. I've had it for about 40 years, it was first loaned to me and then on second reading given. It was clearly used even back then - it has penciled in $1.00 on the inside. So it made the rounds but then stopped with me. Only I have this particular copy but if it had been electronic - how many would be out there now?

[OtterBooks]

Originally Posted by Forster

True but to do what with? Most books aren't reread and if they do fall into that category I always got the original back at some point.

I guess to do the same you would do with an ebook you paid for. I don't re-read books, though. Not sure where I'm going with this. Have a nice day.

[gmw]

Whether or not a person will re-read a book has popped into conversation before on these forums. I wonder if there is room for sellers to make use of this. Sell ebooks with strong restrictions - presumably more cheaply, essentially on the assumption you will read once and discard, but keep records so that buying a second loan of the same book is much cheaper, in support of those that do re-read. Sort like a "user-pays" system, those that make the most use of a book pay the most. Not that this would appeal to me, I think that any book I like enough to want to re-read I will probably buy in paper.