Thinking The Wrong Things About E-Book Pricing

I yammered about this on Twitter the other day, and it felt like the subject needed some more oxygen, and thus I’m staplegunning it to the blog post. *kachunk kachunk*

Feel free to comment. And agree. Or object. Or send me doodles of your pets as characters from various science-fiction and fantasy novels. Whatever makes your grapefruit squirt.

Okay.

E-books.

I’ve seen some pushback — generally very smart pushback — about why publisher e-books cost so much. The answer, in short, is that producing e-books costs more than you think. You’re paying for editors and cover design and, of course, for the book itself, and the mechanics of putting those things into a container are not the bulk of a book’s cost. Hence, e-books are always going to be close to their physical counterparts in cost. After all, you’re buying a story, and the container is largely incidental. The experience is slightly different from format to format, but over all my Kindle version of THE STAND is no different from the hardback version, except I can use the hardback to bludgeon a hippo to death should I so choose.

It’s a good point.

And probably true.

And it really doesn’t matter.

Here’s the thing: the “what should e-books cost?” question often takes into cost the actual cost of producing the e-book when, in reality, it needs to look at perceived value, instead.

Now, caution — I’m not an ecomonom… economonist… mathemeconom… whatever. I’m not great with money or numbers, so bear with me. (I’m also not great with elevators, escalators, tiny rodents, sporks, chopsticks, ferrets, or fingerless gloves. Just in case you’re making a list.)

An e-book is a digital good. Ephemeral and intangible. Sometimes we don’t even have access to the e-book itself in the form of a file — in the case of Amazon, we’re just “renting” the e-book the same way you rent Taco Bell food. You bought it. It’s inside your device. But if Amazon decides you don’t need it anymore, one snap of the wizard’s fingers and the e-books are poof, gone, siphoned from your reader like gas from a gas-tank. E-books have no supply — if I buy one, it doesn’t reduce how many remain, because theoretically infinite copies remain. No cost to reprint. No cost to remake. It just… sits out there, attempting to be the very embodiment of the Long Tail.

This is what the audience sees and believes.

It matters little what the e-book actually costs.

It only matters what the audience thinks they should cost.

Now, the audience won’t agree on an actual number (they’re cagey, those fuckers), but what they do seem to roughly agree on is, e-books should be cheaper than their print counterparts. What the e-book actually costs is irrelevant. What matters is the expected value loss by going with an ephemeral digital item — and, further, added into that is the expectation of, “I bought a device to read this, which cost me money already.”

Further cognitive dissonance is born of the fact that smaller producers (smaller publishers or individual authors) can produce a digital version of a book far more cheaply and easily than they can a hardcopy.

Publishers have themselves helped to confuse this issue by creating the expected release structure of books — from hardback to a trade paperback and then maybe to a mass market paperback. The e-book interrupts this chain because you can’t put out a book without an e-book counterpart, and so e-books don’t fit into that progression. The others are tiered and timed, but e-books don’t really fit into a tier or a timeframe.

To price e-books, there then exists a fight against some rational concerns and some very irrational behavior on the part of this active audience. But that’s normal — the freaknomics of the audience is always irrational. You can’t fight the flood; you can only try to swim in it. Certainly if enough big-ass epic motherfucker authors (think Stephen King-sized) made it a point to focus this meme or if Amazon enforced a higher price on e-books, the perception might shift. But neither’s likely to happen anytime soon.

One hopes and assumes that as publishers get better at making e-books, their costs will go down. Further, we must remember that e-books are in the “formative technology” phase right now. They’re VCRs and tape-decks. We won’t see CDs and DVDs for a little while down the line, and when we do, price will need to change (up or down, I can’t say). Also: infinite supply is a key component, here.

So. What to do, what to do? What’s the appropriate range of e-book prices you hope to see? Throw some thoughts into the ring, let ’em fight it out all scrappy-like.

(Related reading: e-book data, viral catalysts, and spurring word-of-mouth.)

119 comments

  • As a reader who paid $100+ for her device, of course I think snapping up a book for 99 cents is the shit. But as someone who sometimes agonizes over a sentence for days, I think 99 cents is heartbreaking.

    Paulo Coelho (http://paulocoelhoblog.com/2012/05/01/book-for-the-price-of-a-song) recently reduced all his e-books (except The Alchemist) to 99 cents and he hopes other authors will follow this pricing trend. He says…

    “In lowering the price of a book and equaling it to the price of a song in iTunes, the reader will be encouraged to pay for it, instead of downloading it for free.”

    …but when an writer’s choice is 99 cents or reader piracy, I mean, that kind of blows.

    I guess right now my vaguity-vague answer would be: more than 99 cents, less than a printed book.

  • If I had the slightest drawing ability, I’d send you a doodle of my Doberman as a Starship Trooper or a Rohan warrior princess.

    Fun filled fact, I work at a library that now has e-book loans. However, the e-books are not, in fact, infinite digital copies, but singular ones for each title, as though it were a physical book. Try explaining that to people every day.

  • As someone who rarely pays full-price for books, anyway (I’m a tightwad and perpetually broke — the used bookstore is my friend!) I especially cringe at the $10 ebook pricing. Then again, $10 is certainly better than the $30 that a hardcover sometimes sells for, and I can get it instantaneously — often the same day the book is released. If ever there were a time I want to pay full price for something, it’s the day it comes out.

    I think at some point, things just cost what they have to cost. People will have to get used to it.

  • I’ve seen quite a couple of reports on German TV where they set up a booth on the street and offered a handful of products where the labels were removed, and told people they could buy them for whatever they think they’re worth. In 83% of the cases (or something) people always offered substantially more than the actual worth of the product. So the Germans totally support you on this one, and if the Germans say it, it’s true.

    Less than the “real” counterparts, but not .99, that’s just ridiculous and makes me question that writer’s abilities. In some rare cases (mostly non-fiction), I even trust the price more than I trust the stars.

  • Perceived value is everything. And since ebooks are not tangible in the same way hard copy books are, they *seem* to have less value. And, in a way they do since ebooks aren’t our own property, nor can we loan them to our friends. Right now I’m interested in what TOR Books is doing since they are going to start releasing their books DRM free. That will create a lot of perceived value in their books since we’ll now be able to load our books up in our Calibre programs, reformat and lend to our hearts desire.

  • I’m waiting for a few more years to see what happens when authors can get a better handle on what this long tail is going to offer. If it’s possible to maintain a slow and steady burn in sales over a long period of time instead of having to make or break within weeks of publication, then price becomes much more flexible. Already we can adjust pricing at a moment’s notice without deploying an army of bookstore monkeys to slap stickers over cover prices. The time-dependent tiering would probably work pretty well with e-books if publisher paranoia about cannibalizing hardcovers and wacky Amazon pricing algorithms didn’t bugger it up.

    The medium just isn’t mature enough for us to have a good picture of what normal looks like. Between technological innovation, industry turnover, and authors/publishers getting a grip on the format, we’re not going to see what works until there’s enough history to see how things shake out.

  • I have no inside information of note on the economics. But the ebook skips:
    Printing (and all the proofs, etc)
    Distribution, warehousing
    The retailers need a higher % profit because of the costs of a retail store front, and holding stock on hand.
    Capital and time needed to do all of the above.

    Surely all that is worth a decent chunk of the pie? If it was so easy and cheap to do all those things, we wouldn’t have needed publishers in the first place.

  • I don’t buy all those publisher arguments about the cost of ebooks. Publishing is a hugely lucrative business, which, together with the monopoly of distribution publishers have enjoyed, has allowed the industry to become inefficient and spendthrift. Publishers are going to have to change their ways to survive, and a good thing too.

    Btw, I wouldn’t try bludgeoning a hippo with a hardback. Not a good idea for all sorts of reasons…

  • I don’t like the publisher markups. Obviously they’re going to charge more because 1) they can same people into thinking an e-book costs more to make than it really does and 2)they’re a publishing house, being so is like putting on Jay-Z’s skin and walking into a nightclub. It’s going to happen and eIle aren’t going to question the reality.
    Now, with a little time, money, and buyer savvy you can essentially do the same thing that the publisher’s do (professional editor, cover artist, paid advertisements) for less. Minus if course the early reviews, that kinda goes in line with a publishing house but I’m sure there are ways around it. The thing that needs to be overcome is oeople’s (general) unwillingness to take the time and find all the necessary information out.
    A little testing period with self-pubbed authors wouldn’t hurt. If its true that people will pay more for the same product if there aren’t any labels or brand names, then logically a self-pubber

  • Damn iPad! Anyway. A self-pubber should be able to pick their own price and charge it. If it’s too high people won’t pay it. Too low and the work is not making any profit. There’s a balance in there and with no discernible “bar” price set on what ebooks “should” cost, there’s a little wiggle room.
    What worries me is the DOJs backing of Amazon in the price-fixing lawsuit. Are we going to see an ebook price standard after this, I wonder?

  • Another thing affecting perceived value is how much I can do with the book. If I buy a paper book, I can pass it on to a friend when I’ve read it, or sell it on Ebay, or donate it to the library. I can’t do any of that without breaking the law with an e-book. There is also the matter of how long I expect it to last. I expect my paper books will be passed on to my family when I’m dead. I don’t even expect to be using my e-books in 10 years, because we will probably be using different formats and different reading devices by then.

    That being said, I prefer e-books and I am more than willing to pay $10-20 USD for them. I just expect them to be at least a few dollars less than the paperback edition.

  • One thing to keep in mind is that the physical-book aspect of a book is actually a surprisingly small percentage of the cost AND price of a book. You’d be amazed at how little it actually costs per unit to print, bind, ship and stock a book. What’s more, even that percentage doesn’t entirely vanish when you go to e-books; there ARE still things like distribution involved with them. Not to mention that selling a book in electronic format does add costs, like converting to all the myriad formats so that you can assure wide availability (which carries with it, for example, yet another round of proofreading, because those conversions are NOT error-free).

    None of this makes e-cost the same as printed-book cost, but the gap is a lot tinier than we knee-jerkily assume. And it could VERY easily be argued that that gap pays for the convenience of having an e-book; storage, portability, instant bookmarking, etc. are all plusses of e-form. On the down side, of course, is the (current) inability to loan e-books out to anyone anywhere, that sort of thing; this IS something I miss. And, in principle, I do prefer printed books to e-books overall… but e-books end up being a better buy for me, if for no other reason than infinite storage, complete mass portability and overall convenience.

    None of that, of course, covers the difference in cost, but it does inform us better on how the Big Bad Publishers aren’t cheating us. (For the record, the whole DRM thing, especially when it’s been used to yank back e-books that people have bought, annoys the piss outta me, and I’m looking forward to the fallout from Tor’s move away from DRM.) If anything, Amazon’s cheating us by making us think that $9.99 is a perfectly appropriate price for an e-book, while all they’re doing is hooking us on their Kindle with that loss leader (and yes, it *is* a loss leader) until we’re all funneled down the Amazon Highway and have to pay their SURPRISE! toll later.

  • Here’s an article that pretty much sums up the situation in Germany:
    http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2012/04/22/BUN81O6F65.DTL

    Right now, it’s nigh impossible to get a resonably priced ebook in English language here, as we can’t shop in America or the UK (DRM, you soulless bastard!), whereas I can order the cheaper paperbacks there without any problem. In Germany, books are generally more expensive than on the English market and it makes me furious that these higher prices apply to ebooks as well. As long as I can IMPORT a paperback cheaper than buy and download an ebook, I’d say there is something seriously wrong with pricing.

    I’m happy to pay for my books, but the English version of the fourth volume of Eragon, for example, was 30 € as an ebook. More expensive than the German hardcover edition. I fear for the well-being of our translators.

  • Here’s another thing…..reader disconnectivity with the issue.

    You are concerned. I’m concerned. The publishers are concerned.

    The readers? They don’t give a fuck.
    They are not joining in the discussion. The discussion is out there, but most of them miss it.

    This is important to remember. They are coming at this problem of what to price an ebook as a consumer, ergo, the lower price wins.

    And, because readers, by and large, are not in the discussion I think they do not understand the Amazon component nor do they know that ebooks are growing rapidly in marketshare.

    To most readers creating an ebook for a publisher is viewed as an incidental cost.
    You can’t tell them about the editing, the cover design, or anything else because they expect (and rightly so) that those things were covered already in making the paper version.
    To them, new cost has NOT been incurred, the ebook is incidental, and to them should be lower in cost.

    It actually makes sense.

  • I buy books in two ways: hardcover, to collect; and e-book, to read. I have an iPad, a Nook, and enough Kindles that I should be able to claim them as dependents on my taxes. I broke blessedly free of the need to cart around huge reams of paper (particularly troublesome on long trips), and I don’t want to go back.

    Personally, I believe e-books should cost author payment + publishing overhead (editing, formatting, etc.), whereas I assume physical copy prices reflect author payment + publishing overhead + retail markup + retail overhead. So yes, I do believe that (for better or ill), e-books should be cheaper than their printed counterparts. They should reflect the intrinsic value of a creative work, and the more technical aspects of getting that work distributed to the public at large, but I find little reason to subject e-book prices to markups beyond that. If an e-book is priced higher (or the same) as a physical copy, something has gone terribly wrong in that system.

    Now here’s what I’d *truly* like to see (drumroll please)…combo packs. My dream would be to see publishers offer an option whereby you purchase a hardcover (I’d jettison this for paperbacks, as the incentive for purchase is lessened, but I’d love to hear thoughts) and receive a download code for the e-book at the retailer of your choice (to ensure compatibility with all major ereaders [iPad, Kindle, Nook, etc.]). Film distributers already do this (Blu-ray/DVD/digital copy packs are the norm nowadays), and I see no reason for book publishers not to follow suit. Hell, I’d personally be willing to pay up to an extra $2 for an e-book copy at time of purchase.

  • I think the role of books is to replace mass market paperbacks as the cheap, lowest quality (materials wise) form of book and it should be priced comperably. $10 for a book I rent, can’t back up and Amazon can delete at any time is ridiculous.

    That said I have 2 books out at $.99, but they are both novella, about 50 pages and it doesn’t feel right to me to charge more for them.

  • May 2, 2012 at 7:39 AM // Reply

    There are good points in this, but it’s fundamentally *not* true that all that matters is perceived value. That’s dot-com bubble thinking. Through enough people at it, give them what they want, and surely you’ll make enough once you scale. Right? (Bubble popping sound effect here.)

    We as Internet consumers have been trained to think we should get everything for free, period, and it’s notoriously unsustainable for most businesses. We can be trained to look at things more responsibly, though; this has more or less been won in the movie and music industries, and there’s no reason it can’t happen for books.

  • The real question we should be asking is how such a low perception of value was generated in the first place. We can take it back to $0.99 songs (though I would argue that the equivalent to charging a buck a song is charging a buck a chapter-which means that an entire ebook should cost $20+ rather than $9.99.) I spent more than a decade as a wholesale book buyer, so I do understand the economics of the business end of the industry. What scares me is that we have a near monopoly of ebook product by a retail giant which told us that an ebook is only worth $9.99–and had the deep pockets to *lose money* on every sale so that they could crush competition. So now, here I am as an illustrator, who depends on people valuing the content I produce (it’s how I pay the mortgage), and because this retail giant created the expectation that an ebook’s value is no more than $9.99–no mater how expensive the content was to produce–I must work for less.

    My vote is that we go for the $0.99 per chapter model. Scary as Apple can be sometimes, that at least seems fair.

    • “The real question we should be asking is how such a low perception of value was generated in the first place. We can take it back to $0.99 songs (though I would argue that the equivalent to charging a buck a song is charging a buck a chapter-which means that an entire ebook should cost $20+ rather than $9.99.) I spent more than a decade as a wholesale book buyer, so I do understand the economics of the business end of the industry. What scares me is that we have a near monopoly of ebook product by a retail giant which told us that an ebook is only worth $9.99–and had the deep pockets to *lose money* on every sale so that they could crush competition. So now, here I am as an illustrator, who depends on people valuing the content I produce (it’s how I pay the mortgage), and because this retail giant created the expectation that an ebook’s value is no more than $9.99–no mater how expensive the content was to produce–I must work for less.

      My vote is that we go for the $0.99 per chapter model. Scary as Apple can be sometimes, that at least seems fair.”

      Couple concerns here.

      First, “fair” is — sadly — not a marker for how much e-books should cost. Fair is meaningless. We’re talking capitalism. We’re talking irrational consumer culture. We’re talking about a mound of complicating issues (leasing e-books, early tech stages, self-pubs versus trad-pubs) that care little for “fair.”

      Second, a buck a chapter? You’re easily looking at a $20 e-book, which is a very good way to kill the industry and murder innovation. Writers will die on the vine at those prices. Trade or mmpbs don’t cost that (and in many cases cost less than half that) and assuming that e-books should be twice as much than those is… well, I don’t think you’d find many people who would pay that. Not at least until e-books have a value add beyond portability.

      Finally, this isn’t purely an Amazon problem. They’re a contributing factor but so are a lot of things — the nature of digital content, *assumptions* about digital content, publishers timing and tiering releases, books (physical) being priced as luxury items (think the way CDs used to cost $16.99 at CD stores), a down economy, etc.

      — c.

  • Very well put, Chuck. I have paid $10+ for some ebooks. I am invariably disappointed, usually in the shoddy formatting. If a self-publisher can do it right for 99 cents, major publishers have no excuse for selling badly formatted books. Unless it is their conspiracy to make us go back to buying $35 doorstops that we end up selling at garage sales because even libraries don’t want them.
    I won’t pay more than $8.99 for an MP3 album and I am tired of paying more than $9.99 for an e-book. The publishing industry needs to realize this isn’t a 2 year cycle. The e-book can be in print forever (especially if they bully the writer into giving them the rights for 35 years). I want them to survive. They need to alter their models. DVDs are now available soon after a movie leaves theaters. No one wants to wait a year for a paperback anymore, and if you price e-books too high, people will pirate it.

    (re: your link– you got some spur in your mouth, spit next time or you’ll get a viral catalyst on your lip.)

  • Man… so many thoughts going through my head on this one, I don’t think I can include them all in a comment.

    First, the 99cent per chapter idea is not a good one. You can pay 99cents a song, because you do not need the entire CD to enjoy the songs. A book is a whole piece of work, you can not pick and choose what chapters you want to read.

    One of the problems, as hinted in the comments, is that the internet has devalued a lot of things. Sadly writing is one of these things that has dropped considerably in perceived value. Today’s society already does not choose reading as their first form of entertainment so to them it is not worth it to buy books in ANY format.

    Personally I have paid as much as 9.99 for an e-book. I don’t think that I would go much higher than that. If it is a reference book or some kind of technical manual that costs a lot more than that I would be buying the hard copy anyway so it can sit on my shelf and I can flip through it.

    I have a lot of 99 cent books on my Kindle. It is easy for me to drop a buck on a book and start reading. I don’t feel like I lost much if I do that. I am a big fan of reading samples before buying a book, but if it is only 99 cents sometimes I don’t even bother with the sample.

    That being said, I think a lot of self pubbed authors are selling themselves short for 99cents. I read something in an article about artwork about not undervaluing your work. Your work is worth something so charge what it is worth. Good consumers are willing to pay for quality. Just look around at some of the things people pay more for… cars.. electronics… designer bags… flesh lights… You can get perfectly fine cheaper versions of all these things, but most times you get what you pay for.

    I am working on my second novel and am yet to be published… If I go the self pubbed route I would probably charge $3 or $4 for the book… I believe this is a good medium. Not too expensive for the casual consumer but not too cheap to lessen the value of what I do.

    Okay… I better stop rambling now.

  • I don’t think ebooks need to be cheaper than the print books, I think print books need to be cheaper and ebooks seem to be the only thing that might make that happen. Looking back ten years or so I guarantee that if the price of print books hadn’t gotten so out of hand (I’m looking at you $30 hardcovers and $9.99 weird shaped pbs) we wouldn’t be having any of these conversations about ebooks because they would still be relegated to fringe status.

    There was no clamoring for ebooks. Ebooks did not meet a product need or a quality need or a technology need. Ebooks met a pricing need. It wasn’t until Amazon gave readers a way to get brand new books for $10 that ebooks took off.

    I think $9.99 is fair for a brand new book from a major publishing house. I think $15 is fair for a new hardcover (which, incidentally is what most people pay if they get it without the absurd mark-up) and I think $10 is about fair for a trade paperback. They may bitch about it now, but smart Big Publishers WILL find a way to survive on $9.99 ebooks because if they don’t, savvy independent publishers like Tyrus and Angry Robot will big up the next generation of talent and make all of the money.

  • I’m going to agree with Janet that $.99 is a good starting place…and then I’m going to radically diverge.

    iTunes has trained us that an album should cost somewhere between $5.99 and $9.99, with individual tracks going for $0.99. (So if you like more than three songs on the album, it rapidly approaches a curve where it’s more cost effective to buy the whole thing.) If books were to go on that model, then a chapter would be $.99 and a whole book would probably land somewhere around the $9.99 price we’re seeing now. I actually think somewhere in the $7.99 range is about right, assuming you can buy the ebook concurrent with the hardbound, because it’s a lot like getting a paperback instead of the eight zillion pound first release.

    That said, I would love if ebooks came at $7.99, with additional materials released for them either free or *very* cheap. Things like author interviews (you know, the kind they always put in the “buy this for your book club reading” version), short stories in the same universe, the author’s favorite drink recipe. If they were free, I would want it to be contingent on owning the eBook (like DVD bonus content).

    I also think we’re at the very beginning of what ebooks will eventually do. I had a prediction that some day the great american novel would be written…and it would be a blog, or a wiki, or something like that. I think ebooks are probably going to turn into something we can’t even imagine.

    • “iTunes has trained us that an album should cost somewhere between $5.99 and $9.99, with individual tracks going for $0.99. (So if you like more than three songs on the album, it rapidly approaches a curve where it’s more cost effective to buy the whole thing.) If books were to go on that model, then a chapter would be $.99 and a whole book would probably land somewhere around the $9.99 price we’re seeing now. I actually think somewhere in the $7.99 range is about right, assuming you can buy the ebook concurrent with the hardbound, because it’s a lot like getting a paperback instead of the eight zillion pound first release.”

      Problem, though — why would anyone ever buy a chapter of a novel? A short story, maybe. But not a chapter. That’s almost a non-starter, I suspect.

      Though I think your “topped-out-at-$7.99/9.99” idea is spot on.

      And this:

      “I also think we’re at the very beginning of what ebooks will eventually do. I had a prediction that some day the great american novel would be written…and it would be a blog, or a wiki, or something like that. I think ebooks are probably going to turn into something we can’t even imagine.”

      Yeah. Heck yeah. We’re just at the start of e-books. I hope they adapt and grow — I like PDFs because they retain some of the craft of putting together a book. They *look* good.

      Alternately, I hope e-books don’t demand too many bells and whistles — soundtracks for e-books is strange. But additional content? Marginalia? Rabbit holes of character information? Hell. Yeah.

      — c.

    • “Why would anyone ever buy a chapter of a novel?”

      Serialization.

      That’s fine for serialized novels, which are not common and which I don’t suspect most novelists want to write. And at that point you’re still looking at something that’s not “chapter-by-chapter” but rather, “episode-by-episode,” ala THE GREEN MILE.

      — c.

  • Actually, that soundtrack thing might be awesome…hear me out. Not a soundtrack in the traditional sense…but like, I’m writing a novel, and when I’m done I also export the iTunes playlist I was listening to while I was working. Then I bundle that with the book (okay, maybe not the songs themselves, but at least the list) and people can access it like marginalia! When I wrote the death chapter, I listened to Flying Turnips “You only live once” on endless repeat and the like. I think that’s actually got some really interesting potential!

    • @Rowan —

      Track list would be great, and a lot of authors do this already (see: Adam Christopher). I guess I meant the, “I turn the page and the drum beat quickens!”

      — c.

  • Right (especially about episode instead of chapter), but you were saying buy, not create. There was some discussion of this, and there’s no reason it can’t happen. What it may do is help regularize the idea that chapters cost so much, therefore a full book costs some aggregate amount.

  • As a reader reluctantly wading into picking up ebooks when I’d really rather have the paper copy in my hand… I am 100% okay with ebooks costing about as much as the paperback edition, with occasional sales for cheaper.

    That said… there needs to be general agreement on the price across vendors. I am NOT okay with buying a mass market paperback for $7.99 from one bookstore chain and my husband buying the exact same book as an ebook from a certain large chain and paying $2 more simply because that chain seems to always choose to sell the more expensive paperback versions. To borrow a line from the Addams Family movie – “Dirty pool, old man.”

  • “I bought a device to read this, which cost me money already.”

    The thing that gets me about that argument (especially when coupled with “therefore, ebooks should be free!”) is this: If someone buys a new refrigerator, do they then complain that they have to pay for food to put in it?

    I’m in the camp of “ebooks should cost more than a buck.” I like writers being able to make a living off of their words, and from what I understand of ebook pricing, you get a much smaller cut when the books are at 99 cents or below.

    As for what their ideal price should be, I don’t have a solid answer. There are writers whose books I will buy in hardcover the day they’re released. There are other writers whose work I like, but will wait for the paperback instead. So I can get my head around the idea of ebooks being slightly more expensive when the book is published and the price dropping after it’s been out awhile. Doesn’t bother me.

    I’ll admit to having a different outlook and knowledge set than the everyday ebook reader. I work for one of the Big Six. I used to work in an independent bookstore. I have this idea I can string words together and maybe sell them. It’s hard for me to separate out what I know about bookselling and the price of printing (and advertising, and all the other things that go into making a book before it hits shelves) and look at it from a pure reader perspective.

    So, less expensive than the hardcover? Absolutely. I’m cool with paying $10-$15 for an ebook if the book is new. More money for the author, yay! When it’s out in paper, pricing the ebook within a dollar or two of the cover price works for me as well.

  • I was just asked this question in an interview. I believe in the way that a writer who sells a fuckload of books actually helps all writers, ridiculously cheap eBooks tend to hurt all of us. Three or four bucks can be fair if the writer did all the legwork; the reader almost certainly will get what you pay for in terms of editing and formatting despite anyone coming up with several dozen examples to prove me wrong. I think most writers have felt the backlash of The Great Pricing Experiment. One good thing, I think many readers are starting to realize the value of spending the money on a professionally published book.

    Countless studies have been done to show that the 9.99 price point is a sweet spot for many, many professionally produced goods. I certainly won’t hesitate to spend that on a book I really want whether it goes on the shelf or not.

    All that said, go You! anyone who can make a bunch of money selling your words however you do it. I really do believe that makes it better for all of us. And I don’t see really much more cream rising to the top than before the self-pub craze.

    I’d like to see eBooks at the same price as a mass market paperback. I view eBooks as similar to MMPs, they are portable and recyclable.

    Incidentally, the MMP I’m currently reading just fell all the fuck apart in the sun the other day. So yes, I’ll be buying it for Kindle. Fortunately it was a publisher’s copy, so I’m happy to let the author make her royalty.

    • “I’d like to see eBooks at the same price as a mass market paperback. I view eBooks as similar to MMPs, they are portable and recyclable.”

      That’s a strong comparison I hadn’t necessarily drawn. Interesting.

      “I charge $1 an hour for entertainment.”

      Interesting, too. And capping at $6 certainly tracks, I think.

      All this gives me a lot to noodle.

      — c.

  • My pricing scheme is simple:

    10,000 words is about an hour’s worth of reading for the average reader.

    I charge $1 an hour for entertainment.

    I tend to cap the price of books at $6, even if the book runs over 60,000 words, simply because I like giving readers a bargain.

    I believe that as long as ebook prices are lower than or equal to the mass market equivalent, authors selling directly are going to do fine. I think $1 an hour for entertainment is defensible for entertainment from an author who has proved his skill down through the years.

    Mike

    • MMPBs are barely worth reselling.

      And, should one be overly concerned about the author, not good for an author’s bottom line (though perhaps good for generating new readers for said author).

      — c.

  • I’d like to purchase my e-books at between $5 and $10.

    Strangely, when I was going through the pricing arguments for my own upcoming book, I went the opposite direction than publishers. I chose the appropriate price for my e-book and then started adding the cost of the print version on top of that. I ended up at $5 for bits and about $11.50 to kill a tree. (But to deal with retailer’s discounts on print books, the “list price” is even higher.)

  • On the level of perception, I think the idea you don’t ever really own these things leaves a lot of people gobsmacked. Especially people on the fence about pirating. It’s one of the few arguments I find really compelling for significantly lower prices for ebooks.

  • I have a Nook and tend to pay $10-12 for e-books. I’ve only ever paid less when buying something from that range on sale. Interestingly, my willingness to pay more is also due to a perceived value, though in a different direction than mentioned in your excellent post. Although I know there are some gems out there for $.99 (and some $14.99 turds), the higher priced e-books get my attention first. Out there in the greater world, higher prices often equate to better products. That’s certainly a generalization, but with so many choices of e-books out there these days, I need a way to narrow them down.

  • I often hear the argument about e-books being ephemeral in this day and age and therefore needing to be priced to account for their fleeting nature in the world. People are more than willing to plunk down $10 or so for a movie ticket and popcorn. Even if I never reread a $10 e-book, it’ll stay with me for longer than two and a half hours.

  • You’re making me balance between my role as editor and my role as consumer of eBooks. Won’t this be fun!

    Last time I worked for a publisher, I was actually a huge part of the eBook initiative. And the process was relatively simple, but here’s something that most consumers don’t think of when they think of eBook pricing: the cost to convert text into ePub or Mobi. The publisher I worked for hired an outside company to do their conversion, then the operations team would hand off the converted eBooks to me to quality check (and I was specifically hired for this purpose, so there’s another cost), and if we found problems, it would go back to the converter. And I can assure you, there were frequently problems. The conversion process was not normally pretty. I especially grew to hate the Mobi format because it had special limitations.

    When you think about it, formatting a book for print and formatting a book for ePublishing are two very different tasks that require time and energy – and money. And most publishers are creating both the ePub and the Mobi formats (and probably the iOS formats, whatever those happen to be), and there are things that are unique to each format that can cause problems.

    Now, as the consumer, I don’t like it when I see a mass market paperback that’s cheaper than the eBook. It’s happened a couple of times, and it annoys the crap out of me. And I also hate it when I see any new release book priced the exact same between either paperback or hardcover and the eBook price.

    Part of that is the assumption about the cost of the book, and it’s an assumption I still have. What goes into the cost of a paperback book that doesn’t go into an eBook? Well, obviously, the paper itself. That’s gotta be expensive. The cost of printing – ink and whatever. I don’t know anything about that side of things. And shipping the book to retailers. And the publisher typically has a warehouse where physical books are stored before they’re shipped.

    Overall, my opinion is that it truly does cost more to create a physical book than an eBook. And the pricing should reflect that. Reasonable price differences – I’m not saying I want a massive difference between the eBook and the physical book. A couple bucks is reasonable. Something that would sell for $7.99 in-store shouldn’t sell for $2.99 just because it’s an eBook – that’s almost demeaning to the author’s work. But I’m comfortable with $5.99.

  • Espicially with that comment up at the top with piracy, this whole thing reminds meof being a poor high schooler back in the hey day of Napster a dozen years ago. I remember pirating the b’jebus out of stuff because cds were $24 a pop and they’d have that one good radio song and the rest sucked. I learned some bands I thought were good sucked but I also found even more I never would have and then I went out and bought their stuff for real. It took a few years for companies to get a handle on the changing market but in the end they found a happy medium. I can buy an itunes album for $12 to $15 or so… or I can pay an extra 5 or 6 bucks if I want a real cd.

    Books are going through that same tough digital growth. Ebooks are going to stick around. Real books are too. The market is going to find its happy medium. If prices go too low, people won’t find it viable to produce anything with quality and then consumers won’t buy. It’s a self correcting problem but it takes a while to smooth itself out.

  • The conversations about pricing are interesting to me. I find the $9.99 only works if it’s up at the same time the hardbound book comes out. I once paid that only to find out later that the paperback was $7.99 and I was pissed. I felt totally taken advantage of. I look for sales on ebooks. When I see titles I’ve been on the fence about listed at $4.99 I’ll often buy because I feel like I’m getting a deal.

  • What I seriously hate about the whole “debate” is that the argument of those claiming the e-books are too high (in most cases) seems to be. “But books are trees! E-books need no paper!” as if that’s the part that costs so much.

    The paper and ink are peanuts compared to other stages of the book’s development.

  • spot on as usual, but here’s fun; when I read your blog I try to guess how long it will be before you call someone a fucker and then when I read it I get a big smile on my face not unlike when the odometer in a car rolls over from 99,999 miles to 100,000 miles.

  • To come back to the hardback vs TPB vs MMPB comparison: most people don’t buy hardbacks because of the format (though there is a segment of the population that likes to fill bookshelves with big heavy books). When I buy a hardback it’s because I want that book NOW and don’t want to wait for the paperback versions. (Granted, this doesn’t happen often, because I’m a busy person, and by the time a book makes it to the top of my ‘to read’ list it’s already in PB. Also, my arms and neck prefer smaller, lighter books).

    But still, what a lot of people are paying for when they buy a hardback is not the added production value, but the privilege of reading it right away. In that sense I don’t think its unreasonable for just-released ebooks to cost more than MMPBs. I’m not sure the audience is ready for that line of thought yet, but as ebooks & readers become more and more common, I think we will get there.

    Imagine this scenario: the next George RR Martin book comes out in HB at $30 and the ebook is $25. I think there are hoards of people who will pay that to read it NOW. When the TPB comes out the ebook price drops accordingly, and again with the MM edition.

    Like I said, I don’t think the public is ready for this yet, thanks to the glut of cheap ebooks out there, but if big-name authors and publishers keep this in mind we could get there in the next decade.

  • I really dislike the implication that as an author, I am no longer commenting as a reader. I have read far more books than I have written.

    99 cent books are great for introducing myself to a new author I’ve never read before. If the book sucks, so what? If it’s awesome, I feel like I got a bargain and I tell everyone about it.

    But if I am familiar with the author’s work, and I value their craft and the time they put into making me happy or sad or confused or horny or whatever I felt while reading their work, I’ll drop my whole pathetic book budget on their next release because it’s worth it to me as a reader. Not because I want to pay for their kids’ college–that’s their business–but because I value the product they, and their publisher, put out.

    What should it cost? I don’t know. But if it’s worth it, I’ll pay it.

    And, I don’t buy paper books anymore. I just don’t. So their cost is irrelevant in my book-buying choices.

  • I think ebook pricing is a lost battle. Amazon did a pretty good job of getting people used to low prices, and when publishers push back, they don’t look like the good guys when the mess clears up. I’ve seen how much work is put into publishing a book, but that’s because I’m on that road myself. Other readers don’t care. People could see the value in paperback and hardback copies, and it’s not so easy with ebooks. The consumer and publishers are to blame. Ebooks do have the advantage of being a medium that could net authors compensation beyond prices. Yahoo has patented a way to put ads in ebooks that determines what a customer will pay. I don’t know if that will get any traction, but it’s the best solution I’ve seen. Unfortunately, I see amazon as the first company to move on this idea.

  • The funny thing about the discussion (aside from the earlier-raised point about the reader disconnect — publishers and writers care deeply about this topic, readers not-so-much), is that nobody in publishing is bothering to ask those of us in the tabletop RPG business who have been selling ebooks (in PDF form) for about a decade now.

    We’ve actually got a fairly good field of data to draw from, about price points, customer behavior, etc.

  • “But if I am familiar with the author’s work, and I value their craft and the time they put into making me happy or sad or confused or horny or whatever I felt while reading their work, I’ll drop my whole pathetic book budget on their next release because it’s worth it to me as a reader. Not because I want to pay for their kids’ college–that’s their business–but because I value the product they, and their publisher, put out.”

    Yes. This.

    I don’t value books by their format or how much they cost compared to other nearby books, but by what’s inside. A brand new book I’ve been dying to read is the same whether it’s on my Nook or my nightstand.

  • The thing I don’t understand is the implication if you have a paper book published and then want to do an ebook, all the editing vanishes? You have to do it AGAIN? I’m damn sure they don’t pay the author *again*. Formatting isn’t that hard either. I do it all myself using free programs and it takes me a few hours per book, max. It would be gratifying to say that’s because I’m a computer sooper genius, but that’s not the case. Really, if the book is already prepped for print, taking the file and cranking out an ebook should be trivial for publishers.

    As for price, the market will figure it out 😉 There will not be the same demand for Dielectric Constants of North American Hardwoods as Randy Ranunculi of Rio and the price will reflect that. Value also reflects what you can do with your purchase, as others have remarked. I can resell a physical book or even donate it to the library. Can’t do that with an ebook. And there is no frikken way an ebook costs the publisher MORE than a physical book that needs to be boxed, stored, shipped, and stocked, all by expensive humans.

  • $7.99 is my limit on ebook prices. I’m cheap… and most of the time I can get the paperback for the same price. Plus, the last time I paid over ten bucks for a digital copy the formatting was awful. And the $14.99 my friend paid for the latest book in her favorite series was formatted so horribly (I’m not sure what the problem was) she ended up buying the hardback for another $27.95.

    It’d be nice to actually see the cost numbers involved in producing an ebook because I’m willing to pay more as long as the quality is there. But when the ebook costs more than the printed book … and the formatting is crap… Well, just because it went through all the stages of book development doesn’t mean it’s always worth a higher price. It’s about quality for me. And regardless of how good the story is… there doesn’t seem to be a lot of quality in the ebook process right now. Getting a product on the market fast isn’t always a good thing.

  • Perhaps I’ve been spoiled by receiving ebooks for a decade from a publisher which offers ebooks, when the book is released in hardback, for $6 (currently) in DRM-free formats. Publish an ebook in a DRM-crippled format, locked in a single ebook format or a single ereader vendor? For me, $9.99 is overpriced.

    Now, is that reasonable? Perhaps not, but my understanding is that a hardcopy distributor receives 50% of the suggested retail price from the bookseller, and the publisher receives 50% of that (25% of the SRP) from the distributor. Since the most recent ebook I purchased from the publisher for $6 has a $26 hardback SRP, I suspect that is about the correct markup from the publisher to the consumer. So if an ebookseller takes 30% of the retail price, I’d expect a DRM-free ebook to cost about 35% of the hardback SRP – or about the $9.99 that many DRM-crippled ebooks cost. I put a significant value on being able to read books when and where I want, and that I’ll be able to reread it in another decade when the ebook formats have changed (I can and do reread ebooks I originally purchased in Palm format), so perhaps that’s why, despite being an original Kindle owner, the number of ebooks I’ve actually purchased from Amazon is in the single digits.

  • As I now live out of the U.S. and prefer to read in English rather than French, I have become QUITE the e-book reader. I cringe when I pay over $10 for a book (although I do it if it’s a proven author), but if it’s around the $7 range (just $3 cheaper) I don’t think twice about buying it even if it’s someone I’ve never read before.
    I think ebooks should be in the $6-$9 range depending on release.
    But on the other hand – I rarely buy a book that is less than $3 because for some reason I always think it’s probably going to suck if the author is selling his work for $.99
    I know, I’m a neatly packaged contradiction 🙂

  • I’m curious about what the ebook pricing is like in Australia. A regular paperback book which costs $8 USD in the states often ran over $20 AUD, and at that time (2009) the exchange rate was approximately equal.

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