I don’t know about you but I am really tired of all the whining, complaining, and teeth-gnashing we’re hearing from the mid-size and big publishers these days on the subject of e-book pricing.
If they hadn’t had their collective heads firmly up-and-locked for so long, they could have seen this coming and taken a proactive stand. But no, most of them just drifted along trying to ride out the tide and then stay afloat when the stormy e-seas sent e-breakers crashing against the rock-strewn market shores.
It certainly seems to me that those publishers should have the upper hand when dealing with Amazon and all the other online retailers of e-books. After all, those retailers need the latest books by the big-name authors. And those bigger publishers control that content. Right at the outset, they, collectively (maybe through AAP?), should have said, “Whoa! Hold on there, Amazon. We’re not going to let you dictate the price at which we sell those e-books to you. You want our content? Here’s our retail price and the discount we’re willing to give you.”
After all, most of us truly small publishers (and self-publishers) have little choice but to make our Kindle editions available to Amazon via the Digital Text Platform, which means we get only 35% of whatever retail price we set. And few of us can sell many e-books at prices above $6 or so (certainly not above $10). There are exceptions, but not really very many. And the less well-known the author, the lower that retail price probably needs to be.
So, what would happen if the bigger publishers refused to sell e-books to the online retailers at arbitrarily low prices (assuming you believe that e-books should be priced at more than 50% of the print edition price, which I don’t)? Those retailers would have only three choices:
- Relent and accept the higher prices, discounting the actual selling price to whatever they think the market dictates and absorb the losses
- Relent and accept the higher prices, selling them to customers at prices that allow a reasonable profit
- Ignore the bigger publishers and only sell e-books of public domain, self-published, and small, indie publisher books
So, if the situation is now untenable for the bigger publishers, it’s their own damn fault, not the fault of Amazon or any other online retailer.
I have but one message to all those mid-size and larger publishers whining about how unfair the marketplace is to them and their e-books — man up, folks, and figure out how to adapt to the realities of the world. Or wither away. The choice is yours.
That’s my take on the situation. So, what’s your opinion?
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Addendum: Here’s an interesting article by Diane Mehta on BNet.com — Book Publishers Make Their First Move Against Amazon
4 Comments
December 21, 2009 at 12:27 pm
It’s my understanding Amazon does, in fact, take a loss on many if not most of the mainstream-published Kindle books they sell for $10. They use them the same way they did King’s UNDER THE DOME hardcover–as a loss leader. They bank on the idea that people who buy the deeply discounted title will buy others at regular retail.
The problem the mainstream industry has is that they’ve decided having ebooks sell for $10 cheapens the product. They like the idea of charging the same or only slightly less for the ebook version as they do for the hardcover because those sales then supplement revenue from the hardcover sales. What they fear is that consumers will get used to the cheaper Amazon price and won’t pay more in the long run.
In other words, they are completely disconnected from the ebook market and dedicated ebook readers. They either don’t know or refuse to accept that people who want ebooks have never been willing to pay a hardcover price for them. Amazon did know that–they did their homework before launching Kindle. In other words, mainstream publishing is trying to cram the toothpaste back in the tube, and we know how well that works.
December 21, 2009 at 12:36 pm
Yes, you’re correct. But I think those publishers are complaining about something — setting a selling price — that is strictly within the purview of the retailers. Publishers can set a suggested retail price and a wholesale discount, what price the retailer actually sells at is out of their control (can you spell price fixing?).
A product is only worth what the market is willing to pay for it. It doesn’t really matter what they creator thinks it’s worth…unless he can convince the marketplace.
December 21, 2009 at 5:50 pm
Most of those guys also settled for 30% bookstore returns as normal – what makes us think they’d be any smarter with ebooks?
BTW – thank you very much for the Christmas card, Walt! I hope the tour was very successful for Lisa!
December 22, 2009 at 8:18 am
Good point, Diane!
Big Publishing is, with a few notable exceptions, locked in the “we’ve always done it that way” mindset. And they want to be the ones to invent the next wheel…it’s just that they have not yet realized that the new train has left the station and they’re running to catch up with the caboose.