If you’re involved in the book industry in any form you might have heard recently about a little stoush between the behemoth US online retailer Amazon and US publisher Macmillan over the matter of ebook prices.
In a nutshell:
*Amazon has been selling many ebooks (in its Kindle format) for US$9.99 for a while now (buying the books from publishers at about 50% of the equivalent print edition and making their profits from selling the Kindle ereader device you need to access them).
*Because Amazon isn’t the only big cheese talking ebook sales anymore (Hi Apple! Hi iBooks! Hi agency model!), Macmillan decided it had something of an advantage and tried to enforce new pricing terms…
*In response, Amazon removed the ‘buy’ buttons from Macmillan’s titles.
*Many booksellers were happy at Macmillan’s stance (because who wants consumers getting the mistaken idea that you can sell books—in any format—for less than they cost to produce?)
*But many customers were peeved (because who wants to believe they should pay a price for a book that reflects the actual cost of production?)
*After a tense weekend and some negotiating, Amazon agreed to the new ‘agency model’ terms demanded by Macmillan and started selling Macmillan titles again—but this time at prices decided by Macmillan.
*(Of course, there’s some worry this might be…. well, kind of anti-competitive.)
Why is this so important? Well, as the world comes to terms with ebooks, the issue of ebook pricing is a concern for publishers, to say the least.
The good news at yesterday’s digital publishing symposium held at the State Library of Victoria and attended by all sorts of publishing folk, came from Michael Tamblyn, vice-president of content, sales and marketing at ebook distributor Kobo (which recently partnered with REDgroup retail and will be providing ebooks for Borders, Angus & Robertson and New Zealand’s Whitcoulls stores by May). Ebook readers WILL pay more than Amazon’s $9.99 price-point for a title, he said. The bad news is, they’ll never pay as much as they would for a real book.
Kobo’s survey of its readers found that in ranking the reasons ebook consumers choose ebooks over print books (‘p-books’) the issue of price was way down at number five, after (1) the fact that ebook downloads are ‘instant’ and don’t involve going to the store, (2) ebooks are convenient—to carry, to buy, (3) (with the Kobo platform at least) they can be read on any kind of device—laptop, mobile, ereader, and (4) You can move them between these devices.
‘This suggests there is some room to move on price,’ said Tamblyn. ‘Just not much.’ Apparently no-one thinks they’d pay more than US$14.15 for an ebook.
And the reasons why not? What exactly does that US$4.16 premium represent? Well, apparently all the things a p-book can do that most ebooks can’t (be lent and shared with family) and all the things you risk with an ebook that you don’t with a p-book (being tied to a particular retailer or a particular device, having your books abruptly taken back by the retailer or publisher), being tied to proprietary digital rights management (DRM). Readers won’t pay more than US$14.15 because, as Tambly put it, an ebook ‘lacks the permanence of paper’.
Oh, and as for the fact that in some cases (Hi Kindle!), you need to buy a dedicated device to read ebooks? Akin to a bookseller selling a customer a book and then stipulating that they can only keep it on one particular bookshelf (which the bookseller will sell them), with certain other books (which must be bought from same bookseller), and warning that the books cannot be lent, moved and may disappear without notice.
Let’s call that bookshelf the Ikea Billy. What if you want a new bookshelf? Bad luck, says Tamblyn. ‘It’s like being trapped with Ikea furniture for the rest of your life.’
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Tags: digital, digital publishing symposium, ebooks
Hi Matthia,
Great post, I was recently talking about this very same issue at my blog and you’ve brought up some interesting points. e-books (E-books? Has anyone defined whether that ‘e’ gets capitalised on a new sentence?) have yet to find their comfortable price point, and the marketing strategies being employed by various publishers aren’t making that terrain any more easily traversed by new users. It’ll be interesting to see what develops over the next few months.
Oh, and on the subject of e-readers, there was recently a poll at the tech news site slashdot that asked which e-reader was the best. There seems to be a lot more options than people are aware of, with Sony’s e-reader being the most open to different formats. I have a feeling that being open to .pdf transfer will be a massive drawcard for any e-reader as we move forward through the Google Books deal.
Thanks Phill, had a look at your post on ebook pricing—some creative ideas about pricing models in there! Regarding letting buyers set their own price, did you hear about Faber’s experiment with Ben Wilson’s ‘What Price Liberty?’ in the UK? Faber’s Stephen Page presented at the publishing digital symposium in Melb and Syd too and said the experiment got them lots of publicity but most people paid nothing for the book and most of those that did pay offered only ₤5.