e-books only make economic sense if they are new releases in my experience. The hardcover (there aren’t paperbacks yet) are $25 or so while the e-book is $10.
But despite the fact that there are less economic steps in an ebook (nobody has to print it, nobody has to ship it, no storage fees, etc) they are still more expensive than used paperbacks most of the time. Many of the books I buy or look into buying are $3 or less when used plus another $3 to ship them. The new e-book versions are $10. As it stands I can’t justify buying them at the higher price.
It seems opening up the market to used e-books so people can resell their e-books when done with them would really lower prices. But I don’t think anyone in publishing or website retail has any incentive to do that voluntarily. So I guess you’d need a consumer driven lawsuit to make that happen (as a guess) to establish ownership rights.
It seems like it would be a practical nightmare to implement. There’d have to be a way of selling your e-book that deprives you of it, otherwise you could just sell the e-book as soon as you get it, and you still have it for yourself.
There’s already a system in place for lending e-books, which deprives you of the e-book while it’s lent out.
The main problem I see with the idea is that there is no such thing as a “used e-book”: there is absolutely no difference between a “new” e-book and one that has already been owned by someone else. (“Hey, these bits have been accessed before!”) All else being equal, I’d rather have a new copy of a paper book than a used copy, because it doesn’t have any wear and tear, creases, markings, etc. But that’s not an issue with e-books.
As long as people are buying e-books even though they can get a used paper copy cheaper, there’s not much incentive for the publishers to lower their prices. But I’ve seen a few e-books offered at lower prices (e.g. $5.00, which strikes me as about fair for the e-equivalent of a mass-market paperback), and I suspect, and hope, that the publishers will learn that they can sell a lot more copies of older titles by lowering prices.
Printing and warehousing don’t cost as much as you’d think. I found this breakdown indicating that the cost of printing is about 17% of the total cost of producing a book. Most of the other stuff – editorial costs, promotion, royalties, etc., are not going to be significantly different for an ebook vs. a paper book.
Warehousing is not included in the 17% for printing costs from your link. Overhead and “plant” costs at least should be significantly lower for e-books too.
I was expecting that counterpoint and it’s a fair one. I believe that production costs for a paper version (sans printing) is more labor intensive and inefficient but I concede that it may or may not be significant.
I do think that part of what may be keeping the prices up is the fact that right now, publishers are producing ebook versions of paper books; i.e., they are still incurring the cost of printing/warehousing for that book even though you can buy it in an ebook version if you wish. If we ever see a large-scale shift to ebook format such that publishers are producing books in only ebook format, costs may come down somewhat at that point, IMO. (Although likely still not a huge amount, again IMO.)
I don’t understand why book pricing doesn’t reflect production costs in general, even assuming a fairly low 25% difference between paper and digital costs. Especially as I derive less utility from digital books that paper. Why can’t paper books support paper costs exclusively? I’m really curious although I will readily admit my bias to discredit most claims from the publishing industry on the basis of greed.
I just randomly picked a few books off the front page of Amazon’s Books section.
The Girl Who Kicked the Hornet’s Nest, by Stieg Larsson. $27.95 list price. $11.90 Amazon discounted price. $9.99 Kindle ebook price.
Decision Points, by George W. Bush. $35.00 list price. $18.89 Amazon discounted price. $9.99 Kindle ebook price.
The Immortal Life of Henrietta Lacks, by Rebecca Skloot. $26 list, $14.29 Amazon, $9.99 Kindle.
Everything I looked at was significantly cheaper as an ebook even without taking into consideration the potential additional shipping cost for the regular hardback versions.
Yeah, as a die-hard Dead Tree Book Reader, I’m jealous of the insanely cheap prices of e-books.
And if you want cheap, what’s stopping you, Mr. Slip My Kindle Into My Pocket, from stopping by a used bookstore and slipping a $2 paperback in your other pocket?
As Ms. Whatsis pointed out in the chart, if e-books cut out the warehousing and printing costs, it will only reduce their costs by 25% or so.
And that’s on the wholesale price. So if they’re selling a hardcover for $30, they get $15 for each book sold (bookstores typically get half the cover price). Reduce that by 25% and you get $13.25. For an e-book selling at $10, Amazon gets $5 (do you think they’re not making money on this?). So the amount the publisher gets – $5 – does not begin to cover their expenses.
Note that many books don’t make a profit for a publisher. I’d estimate 20-30% just earn back their advance. The publisher makes profits on best selling books and (sometimes, but rarely these days*) on long-term sales of books that made back their costs (usually this only works for textbooks and reference books). Those profits allow them to take a chance on a first-time author who may not succeed at first, but who, given time, can be a best seller (e.g., Jim Butcher).
*A tax ruling in the 80s – Thor Power Tools – made publishers realize that they needed to dump their books at the end of the tax year and not allow a book to be available to find an audience. I know of one publisher who found it cheaper to ship his entire inventory to himself over January 1 than to pay the taxes involved. It once was that a publisher might keep a book in print for a couple of years to find an audience; those days are gone (and will never come back, even if Thor was repealed).
Could you explain this, specifically how/whether it applies to e-books? I had assumed that there would be little cost and risk to a publisher in keeping a book “in print” electronically, or in making a book electronically available that had gone out of print but that they still owned the rights to.
That is not what I’m seeing for “Computers & Internet” books. It’s very common to find kindle editions more expensive than paper editions (Amazon prices).