Simon & Schuster is delaying ebooks by four months

[DawnFalcon]

Originally Posted by charleski

The principal cost is simply the cost of generating and promoting the work itself - paying the author's advance, editing the text as necessary, commissioning cover art, etc. Actual manufacturing costs represent only around 15% of the price of a physical book, which is why it's reasonable to expect ebooks to retail at a discount of 20-30%.

...from paperback costs, yes. There are other ways to replace the hardback, like Baen's eARCs.

[kennyc]

Originally Posted by charleski

The principal cost is simply the cost of generating and promoting the work itself - paying the author's advance, editing the text as necessary, commissioning cover art, etc. Actual manufacturing costs represent only around 15% of the price of a physical book, which is why it's reasonable to expect ebooks to retail at a discount of 20-30%.

See above, and frankly this myth has been debunked several times on this forum and elsewhere. eBooks do represent a saving on costs and overheads, but not nearly to the degree that some people seem to imagine, and much of the saving comes at the distribution and retail end, which is covered by the 55% the publisher never sees.

I don't believe it. With printing, distribution, stocking, returns. I don't believe it for a second.

[khalleron]

Originally Posted by Sydney's Mom

I read or heard someone say that musicians don't make money from CDs anymore, just live shows.

I had a friend who was both a record producer and musician (in the 80s) - his albums used to regularly sell over 100,000 copies, and I can tell you that this has always been true. Most records, CDs and books fail to earn out. This is nothing new.

Only major stars, in either books or music, make significant money from album or book sales. The cost of production is just too high.

I've heard this trotted out, too (Sherman Alexie was the most recent one), but it's really just same as it ever was.

[Moejoe]

Originally Posted by khalleron

I had a friend who was both a record producer and musician (in the 80s) - his albums used to regularly sell over 100,000 copies, and I can tell you that this has always been true. Most records, CDs and books fail to earn out. This is nothing new.

Only major stars, in either books or music, make significant money from album or book sales. The cost of production is just too high.

I've heard this trotted out, too (Sherman Alexie was the most recent one), but it's really just same as it ever was.

It's not so much about selling CD's as the music industry taking ALL the money.

There's a breakdown here from Steve Albini

http://www.negativland.com/albini.html

This is why when people download music (apart from indie artists who you should buy from) there is no longer any guilt about lost money.

There's also a well-known, at least second-hand tidbit that no matter who a publisher takes on, whatever advance they give they expect to make 10x-20x that back even if the book doesn't do well. So the publisher never really loses.

[Kirtai]

Originally Posted by charleski

The principal cost is simply the cost of generating and promoting the work itself - paying the author's advance, editing the text as necessary, commissioning cover art, etc. Actual manufacturing costs represent only around 15% of the price of a physical book, which is why it's reasonable to expect ebooks to retail at a discount of 20-30%.

This is incorrect.

Advances, editing, art etc are all sunk costs. They're paid only once, amortized over the whole run and eventually can be paid off entirely.

Manufacturing is a marginal cost that is paid per book and never ends. (The same applies to royalties).

What this means is that as the number of book sold increases, the sunk costs count for less and less while the marginal costs become totally dominant and eventually the only real cost after the sunk costs are completely covered.

[markbot]

Originally Posted by Kirtai

This is incorrect.

Advances, editing, art etc are all sunk costs. They're paid only once, amortized over the whole run and eventually can be paid off entirely.

Manufacturing is a marginal cost that is paid per book and never ends. (The same applies to royalties).

What this means is that as the number of book sold increases, the sunk costs count for less and less while the marginal costs become totally dominant and eventually the only real cost after the sunk costs are completely covered.

You are forgetting about the fact that not all books are successful....so the successful ones have to subsidize the failures. there are a lot of failures.

The marginal profit has to also cover the overhead of the publisher on an ongoing basis, not just the fixed cost of the book....and the sunk cost.

[Andurian]

Originally Posted by zerospinboson

Oh look. A graph that shows how ebook sale revenues went from .12% to .25% of the total market. Run!

Lets see, it goes from 7 to 9 million (hard to tell from the graphic) in 2002 to 120 million. That's a multiple of something like 15x. So by your math the book industry as a whole has had a revenue increase of about 7.5x since 2002.

I wish!

[kindlekitten]

Originally Posted by kennyc

I don't believe it. With printing, distribution, stocking, returns. I don't believe it for a second.

let's see... we've got the first runs just to check it out, the editors runs (come on we've all found a copy or two, and snatched them up thinking it was special!) the money for binding, the money for art, the shipping, the warehousing, this doesn't even go back to include the intial monies to get the tree down, to the mill, processed (and STINK! up the air! then to the printer. and this is all to be compared to the price to epublish a book!? which we have all seen by now can be done very effectively computer to computer.

what turnip wagon do they think we have fallen off of that would make us believe that the medium that makes it possible for me to get this message to you would come even close to costing the same as a dead tree book

[Kirtai]

Originally Posted by markbot

You are forgetting about the fact that not all books are successful....so the successful ones have to subsidize the failures. there are a lot of failures.

The marginal profit has to also cover the overhead of the publisher on an ongoing basis, not just the fixed cost of the book....and the sunk cost.

I didn't forget, I was merely referring to the base per-book costs.

FWIW, failures are also a sunk cost (you don't sell many failed books) and while the publisher overhead is a marginal cost it's spread over all the books sold.

My point though, was that in the end the marginal costs dominate and for ebooks those are much smaller than for pbooks.

[kennyc]

Originally Posted by Moejoe

It's not so much about selling CD's as the music (and publishing) industry taking ALL the money.
......... So the publisher never really loses.

Exactly.

[Spectrum]

Well well...market forces (including piracy) will take care of these people who want to hold on to old ways of making money. Expect several publishers to close their shops or merge in the coming years. And they deserve it unless they come up with a model to fit the consumers in a digital age.

I for myself almost never read books because they are new. I am still catching up with 19th century Russian literature and I am 52 years old!

[borax99]

SHEER STUPIDITY. MAYBE, AS A CONSUMER, I WILL CHOOSE TO WAIT A YEAR OR TWO BEFORE BUYING THEIR PRODUCT .... hmmmmm, how would that go over?

[AnemicOak]

I thought Sarah's post over at Smart Bitches was amusing so figured I'd share it here...

Do you like this hardcover book?
You should buy it! Look look look!

I do not like a hardback book
I will not read it, not that book.
I want to read it, yes, I do,
but not that hardback, no, thank you.


Will you buy it here, or there?
You can buy it anywhere!
This hardback book is just for you.
The only kind we offer you.

I will not buy it, here or there.
I will not buy it anywhere.
I do not want a hardback book.
I want to buy a digital book.

Would you buy it in a store?
If you buy one, will you buy more?
You can buy it here, or there.
You can buy it anywhere!

We only have this hardback book.
There are no others, if you look.
This hardback paper is for you,
and if you buy one, you can buy two!

Click here for the rest...
http://www.smartbitchestrashybooks.c...book-no-no-no/

[texasnightowl]

OMG, that's great! Love it!

[kennyc]

Thanks Brian. Love it!!