Are Amazon or other e-book sellers’ prices too high? That’s the question many experts and e-book fans have been asking in the past few months. When Amazon launched the Kindle product line, it started pushing the fact that “most” e-books were priced at $9.99 as a way to grab more market-share. After all, if you get a bargain price on all your purchases, your device will pay itself off in a short period of time. But is charging $9.99 for e-b00ks what you would call a bargain? Let’s not forget that Amazon does indeed a whole lot more than $9.99 for a decent number of books, so chances are that you don’t really save too much money on your favorite books. But regardless of that fact, paying $9.99 for a book that you can’t sell or transfer to someone else is not getting a bargain.
A recent story on Wall Street Journal mentioned a report by Forrester that confirmed what most of us have doubted for months. Serial readers have a lot of options when it comes to picking up a device to read e-books on. You can always pick up a netbook or a smart-phone to read your books on the go. So if you can find a way to pay less for e-books and read them on those devices, you may end up saving a whole lot of money in the long run. Amazon and other e-book reader makers need to lower e-book prices not just for us consumers but to make e-b00k readers more than they could be in the current situation. Here is what the Forrester analyst had to say about the future of e-book readers:
will never be mass-market devices like MP3 players, but they can exceed current forecasts for adoption.
One could argue that she may be right about the future of this business in the short-term. But at the same time, you should never use the word “never” when dealing with technology. With e-book prices too high and e-book readers using primitive hardware systems, the above statement may in fact be true. But even the most pessimistic experts expect Amazon and its rivals to not only improve their hardware but also lower e-book prices. These are issues that Apple had to deal with in its early days with the iPod. The iPod hardware was not perfect in those days, and the music came with DRM that put a limit on what people could do with their songs. Amazon needs to loosen up its restrictions on e-books, work on a way to get developers involved in improving the Kindle platform, and build better Kindles in the future. It may sound like a challenge, but if e-book readers are to become mainstream, something’s got to change. At the end of the day, it all comes down to innovation (product development and business model).
Your turn: are e-books too expensive currently?
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3 comments
#1John HagewoodSeptember 4, 2009, 2:35 pm
I buy a LOT of ebooks. By and large, I do NOT feel they are to expensive, but of course Amazon has done a LOT to bring the prices down the last year or so.
I used to buy a lot of eReader.com (from 2001 to 2007), and I always felt their pricing was fair. when a book was only available in Hardback, the ebook price would be higher (but still several dollars less than the hardback). Once the book hit paperbook, the ebook price would be substantially reduced, again to less than the physical book. This always made COMPLETE sense to me. If you really want to read a best seller when it’s only in HB, then you have to pay more….whether you ready pbook or ebook. If you can wait for the paperback to come out, you will save dollars.
I would like to say that I think Amazon (and now others) selling best-selling hardbacks for $9.99 is probably not a good thing in the long run. For one, it’s not a sustainable business model for Amazon if they are truly “taking a loss”, as everyone seems to think they are, just to grab early market leadership. For another thing, if they do start making demands of the publishers to reduce the e-pricing on new releases, what does that do the the authors? Can’t be good. I, for one, want best-selling authors to keep doing what they do well….what has made them best-selling authors.
So, in summary, I feel the ebook should be priced some percentage lower than the pbook, perhaps 20-40% lower. This seems like a fair discount to account for the fact that the publishers are not killing trees, using ink, shipping books and bearing the cost of returns. No one wants to see the publishers driven out of business because of too-low ebook prices, but I think it’s fair to say they (the publishers) are going to have to continually reevaluate their value proposition to the consumer and authors as we proceed further into the digital age.
#2cameronSeptember 7, 2009, 6:22 pm
I think that the amazon pricing model is perfect for ebooks. Enough for publisher profit, but low enough to be an impulse buy for the consumer.
On the issue of sustainability, the problem is much more with the publishers then with Amazon.
The publishing industry is, for the most part, terrible. They loss tons of money and are run as vanity entities which people like to say they own. There are few parts of the industry that are always profitable. Anything that can force the industry to become more modern is needed.
With that said i would look at the recording industry to see what will happen.
When Apple started itunes and offered songs for .99 cents and albums for 9.99. People made similar arguments about this hurting the industry and artists. Today there are more albums being released then 10 years ago. More people are making music and making music a career. Even though the price of music has dropped significantly.
It is hard to say if we will see the same thing for authors, but i think we probably will.
#3JohnSeptember 7, 2009, 10:06 pm
In short, yes. Actually, I don’t see it as an issue of price. What is being sold right now is some sort of ‘limited reading rights.’ What people want are books.
When someone buys a paper book, or a CD, or other intellectual property, they have the right to sell/gift/lend that property to someone else. Not so with these DRMed e-books. What you buy now is not the electronic equivalent of a book, you are buying the right to read a book and never give, lend, or sell that book. However, you should have that right. If they are going to stick to this limited reading right (as opposed to selling you an e-book) then the price should be a lot cheaper.
Think about this, I can walk into Borders, B&N, etc. and sit down, and read any brand new best seller for free. I cannot sell this book (since I didn’t buy it) and I cannot lend or give it away (for the same reason). However, this is what Amazon is really selling me – the limited right to read a book. Retail stores give this right away for free. Granted, Amazon let’s you read wherever you want but that is simply an improvement and does not constitute actually selling you an e-book.
If they can (and they can) implement the technology to allow lending/selling/gifting of used books then I think a reasonable price could even be $15 or perhaps $20 (e-books get very profitable at that rate). However, with the giant limitations they have put in place, a more reasonable fee would be $1.
On the topic of overcharging, I noticed that some e-book stores (I’m looking at you Borders) sell ‘classics’ which are well out of copyright for $5. These same books are available for free (at Project Gutenberg, etc.). They are making money on nothing more than consumer ignorance. For me, this is the exact opposite of putting the customer first.
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