So, briefly, what do you think about the Kindle now?

[Alisa]

Originally Posted by rlauzon

Since you agree that the scarcity of eBooks is artificial, how do you justify paying $10 for something that costs nothing to duplicate?

I don't think $10 is usually justifiable but I believe free is too cheap. It's about what the people who produced it want me to pay and whether that is reasonable. I'm hoping that ebooks create a more direct relationship between producers and consumers once there is not need for the traditional gatekeepers to the manufacturing process.

[Alisa]

Originally Posted by Nate the great

He meant scarce as in a finite supply, or "if I have this copy, then you don't". neither of which apply to digital media such as mp3 or ebooks..

They apply if you choose to obey the fair use rules and only use what you paid for.

[pilotbob]

Originally Posted by rlauzon

All physical objects are scarce by nature.
Since you agree that the scarcity of eBooks is artificial, how do you justify paying $10 for something that costs nothing to duplicate?

Apparently you never wrote a book. While it costs nothing (not really nothing since you need a PC, storage space, etc... but I digress) to create the container of the work, creating the story took effort and that is worth more than nothing.

As a software developer I have a similar issue. To "develop" a product itself can take many man years plus all the training of everyone on the team including developers, testers, writers, product managers, etc. However, once it is complete and we have the deployable files it takes maybe $1 a CD to create the container for what was perhaps millions of $'s of R&D cost. Are you going to say that the software is "worth" $1 cause that's what it cost us to create the CD copy the customer gets?

BOb

[Nate the great]

Originally Posted by Alisa

They apply if you choose to obey the fair use rules and only use what you paid for.

Let me clarify: Digital media is only as scarce as the electrons it is made from. Everything else that makes it scarce is a mutually agreed upon fiction.

I wasn't trying to defend Rlauzon, only explain how he was using the word scarce. For the most part, I do not agree with him.

[Alisa]

Originally Posted by Nate the great

Let me clarify: Digital media is only as scarce as the electrons it is made from. Everything else that makes it scarce is a mutually agreed upon fiction.

I wasn't trying to defend Rlauzon, only explain how he was using the word scarce. For the most part, I do not agree with him.

I understood him and i disagreed with how he characterized the resource of a "book".

[bingle]

Originally Posted by pilotbob

As a software developer I have a similar issue. To "develop" a product itself can take many man years plus all the training of everyone on the team including developers, testers, writers, product managers, etc. However, once it is complete and we have the deployable files it takes maybe $1 a CD to create the container for what was perhaps millions of $'s of R&D cost. Are you going to say that the software is "worth" $1 cause that's what it cost us to create the CD copy the customer gets?

This is the part of the equation that's changing, though. Currently, that's the way it works - people have to pay for a copy of everything in order to subsidize the massive up-front costs of the product. But the fact of the matter is that it's easy and free to copy certain products, and that's not going to change.

Someone earlier said that the free market didn't include things like The Pirate Bay - except, it does. If you set up an apple cart next to the guy with the "free apples" sign, you're not going to be doing a lot of business. It may not be fair, or even legal, but the invisible hand doesn't seem to care. Consumers know how to easily get free copies of books and music and software and movies. If you want to make money off of those things, you'd better find a way that doesn't involve selling copies.

To clarify, I'm not advocating piracy. But if you're planning a business that revolves around intellectual property in this day and age, you need to keep piracy in mind (and YouTube, MySpace sample tracks, fan fiction, Open Source, and all the other legal ways of distributing content for free.)

[Alisa]

Originally Posted by bingle

If you set up an apple cart next to the guy with the "free apples" sign, you're not going to be doing a lot of business. It may not be fair, or even legal, but the invisible hand doesn't seem to care. Consumers know how to easily get free copies of books and music and software and movies. If you want to make money off of those things, you'd better find a way that doesn't involve selling copies.

Though I'm curious to see how that would change if the sign said "Stolen Apples".

[ginolee]

I think, like stocks, people will be willing to pay what they think a piece of digital content is worth. If they think a particular item is overpriced, less people will buy it and over time the price will come down or the product will be discontinued.

With Amazon and Kindle, the ability to preview the first chapter or so of an ebook will help people to determine more accurately whether they are willing to pay for the rest of the ebook.

I think it shows an incredible naivete to assert repeatedly that digital content ebooks are each worth a dollar a piece because the cost to distribute is close to nil. This shows a profound ignorance of the work involved in producing the digital content as well as marketing it.

Gino.

[rlauzon]

Originally Posted by pilotbob

As a software developer I have a similar issue. To "develop" a product itself can take many man years plus all the training of everyone on the team including developers, testers, writers, product managers, etc. However, once it is complete and we have the deployable files it takes maybe $1 a CD to create the container for what was perhaps millions of $'s of R&D cost. Are you going to say that the software is "worth" $1 cause that's what it cost us to create the CD copy the customer gets?

I'm saying that to equate the price of a pBook to the price of an eBook is meaningless. The vast majority of the price of a pBook has to do with the physicalness of the pBook: the paper, the printing, the distribution, etc. None of those costs exist with an eBook.

The price of an eBook should cover the costs of creating the work, divided over the number of copies made. That price should be very small.

[Liviu_5]

Originally Posted by rlauzon

The price of an eBook should cover the costs of creating the work, divided over the number of copies made. That price should be very small.

What are these costs? What are the costs of creating a book by a bestselling author that makes tons of money vs the costs of creating a book by an obscure author that sells 400 hc's?? Books are not widgets, so there is no such a thing as the cost of creating a book.

The market is determining the price of an e-book and right now the discrepance between the offer and the bid is so huge that the commercial e-book market is just a drop in a bucket. Personally I just do not see the bid (the price people are willing to pay for e-books in general as a mass not few enthusiasts like us here) coming up, and the laughed at NYT futurist that estimated the price of e-books for large scale adoption to be 0$ may be quite right.

Personally I paid up to 15-20$ for select e-books (though only drm-free e-arcs from Baen or convertible lit books) and I wouldn't pay more than 1$ for a non-convertible drm book, but I just do not see large scale adoption of e-books at current prices

[pilotbob]

Originally Posted by bingle

This is the part of the equation that's changing, though. Currently, that's the way it works - people have to pay for a copy of everything in order to subsidize the massive up-front costs of the product. But the fact of the matter is that it's easy and free to copy certain products, and that's not going to change.

I assume when you say "copy" you are talking about functionality and not implementation... such as Open Office which is free (as in Libre) vs MS Word which is not free.

Or, are you saying that since MS Word can be coppied easily it is ok to copy it?

BOb

[tklaus]

Originally Posted by rlauzon

Since you agree that the scarcity of eBooks is artificial, how do you justify paying $10 for something that costs nothing to duplicate?

You're not paying for the cost of production, any more than you are paying for the cost of the paper in a physical book. You are paying for all of the hours of hard work that the author put into producing the words.

[petermillard]

Originally Posted by ginolee

I think, like stocks, people will be willing to pay what they think a piece of digital content is worth. If they think a particular item is overpriced, less people will buy it and over time the price will come down or the product will be discontinued.
Gino.

Interesting analogy; if more people buy a particular stock the price rises (demand) whereas if more people buy a pbook, we'd expect the price to fall (economies of scale, retailer competition etc...) - I wonder which direction we'd expect the price of a poplar eBook to go in? And why would a low-selling (unpopular?) ebook be reduced in price, given the near-zero cost of storing and distributing digital content?

I agree, though, that books (e or p) are only 'worth' what people are willing to pay for them. Just to bring the music analogy back for a minute, Radiohead (a popular music group, m'lud...) recently released an album available as download only, and let people pay what they liked for it; the average turned out to be something like £2.90 (~ $6 USD) and the headlines in the press were of the 'most fans download album for free' variety. It' not as simple as that, though. Maybe people downloaded the album just to see if they could. Maybe they downloaded it and didn't pay because they were planning to buy the £40 ($80) boxed set anyway - or maybe it was a terrible album, and people just didn't want to pay for it?

Either way, 1.2 million downloads at $6 a pop is still a nice piece of change - and possibly more than the band would have earned had they released the CD through their record company. Here's the thing, though; musicians don't earn that much from 'content' sales - their main income comes from selling £75/ticket concerts and tours (and yes, I'm aware that I'm generalising). But if you write books, there's not much else you can do. Sure there are signings and readings, but I don't think they attract the same sort of crowds as a pop concert.

I've wondered for a while if we'd ever see CD and download sales almost as a 'loss leader' for concert ticket sales and in that same vein, if eBooks (or parts of) will be regarded as a loss leader for books. And maybe Amazon's 'first chapter free' approach with the Kindle is a step in that direction.

Sorry, this thread seems to have rambled off-topic a bit...

So, Kindle. Haven't seen one in the flesh (different continent) but from the pictures I have seen, and other people's responses to it, I like it. I think it'll do well. Even the look is growing on me - striking, perhaps, rather than atractive. As for the negative comments from the ebook 'old hands' (and please don't take this the wrong way - I mean no offense here) well, the more they complain about what it doesn't do for them, the more I think it's probably meant for me; it's a mass-market device, and I'm pretty sure my needs are more mass-market than most on this board. PDF support? Closed loop? Clunky browser? As long as it works, I don't care. Expensive? Don't buy it - it's only worth what people are prepared to pay for it.

My two-penneth. Cheers, Pete.

[rlauzon]

Originally Posted by Liviu_5

What are these costs? What are the costs of creating a book by a bestselling author that makes tons of money vs the costs of creating a book by an obscure author that sells 400 hc's??

Hardcover sales are irrelevant in eBooks.

According to the people in the publishing industry who have spoken on this, the author gets about $0.70 per book. I figure that $2 of the price of a single book represents the costs in creating the content.

[schulzmc]

And now this thread has been almost completely hijacked.

How about you guys start a new thread on this (because it is an interesting discussion) and let this one go back to brief "now that I've had mine a few days" reactions?