As you may have heard, a dispute over pricing of eBooks caused Amazon to stop selling all Macmillan books, electronic or not, this past weekend. That includes Priceless, in "a move not without humor," as blogger Peter Kelton notes. At issue is the charm price of $9.99 Amazon is using for eBooks. Amazon is said to be losing money on every eBook sold, in order to promote its Kindle. Publishers are uneasy about that, fearing it will create pressure to lower prices to unprofitable levels. That, combined with the "information wants to be free" ethos, leaves them feeling a bit like the Russian aristocracy before the revolution. The Apple iPad announcement brought matters to a head: Apple will let publishers charge higher prices such as $12.99 and $14.99 (still charm prices, you'll note).The publishing world viewed Amazon v. Macmillan as a game of chicken: Amazon needs to carry all publishers' books as much as all publishers need to be carried by Amazon. As of this morning, the standoff has reportedly been settled in the publishers' favor. Amazon is promising to match Apple's pricing and restore the sale buttons to the delisted titles.
How much should eBooks cost? I suspect I'm not too different from most avid readers in feeling this way:
• If all books were free, I wouldn't read any more than I read now. My reading is limited by time and interest, not the cost of books.
• If books cost twice what they do now, I wouldn't read any less than I do now.
• Of course, there must be some price so high that it would cause even me to cut back on reading. I haven't a clue what that price is.
Priceless is collateral damage in all this. It is not presently available in an eBook, and there's no word from the publisher when it will be. Kelton reports that third-party sellers are offering Priceless at prices ranging from under the (former) Amazon price to $155.75. The latter is from a seller called Origin, which promises "Excellent customer service!"
At least the publishing industry can look at what happened and is happening to the music industry and know what to expect. Freer and cheaper flow of information and expression seems to be inevitable, so the best thing publishers can do is embrace it and use it as an opportunity to innovate.
ReplyDeleteI'm afraid my comment isn't very insightful, but I check your blog every day or two and don't know why there aren't more comments. Keep up the fascinating work!
I was hoping this one would be available in e-book. I'll keep an eye out for it.
ReplyDeleteI'm set on the $10 maximum for books. If I can't get that from Macmillan, I'll go elsewhere. C.J. Cherryh, a favorite author of mine, is selling her ebooks on her own website, all under $10. Baen has their free library, and reasonably priced e-books. I have no problem finding pleanty to read.
Competition in publising is very complex. Macmillan isn't just in competition with other publishers, they're in competition with podcasts, with video games, with movies and DVDs, with television, with Facebook and Twitter and all sorts of other hobbies.
Macmillan and Amazon have chosen not to accept my money for three books since this started. I've been listening to The Secret World Chronicle from podiobooks instead.
Very good question on how much eBooks should cost. Unfortunately, Amazon's price leadership has set a reference price of $9.99 and publishers are only now waking up to the long term effects of this pricing. Fortunately eBook penetration is very low and it is possible to train the big majority. (see NYTimes article http:/nyti.ms/coYxZe)
ReplyDeletePricing for books or any other product should depend on what the customers are willing to pay and not based on what it costs the publisher and distributor to produce and sell it. But the hardest part is how to make a credible value proposition to the readers and hence we see the dominance of reference price effect in pricing books.
-rags
http://twitter.com/pricingright
-rags
Speaking of the iPad-
ReplyDeleteYesterday I picked up a copy "Priceless" and got to the point on page 68 where you suggested the transcripts should be heard online. The problem is- I was nowhere near the web and was frustrated as hell since I wanted to hear it before continuing. I thought "this is when the iPad would be COMPLETELY handy. A link to the audio could have been embedded in to the book and I could listen right then and there while riding the train underground!" The iPad is built for that. The kindle is not. It's nice to see Amazon and booksellers are hashing out the problem in advance before the eBook market blows up but Amazon needs to speed up its technology if it wasn't to start fights on price considering it has only 2 months before it will be retired/discounted technology.
The publishers and authors could leverage stuff like this. They could tell Amazon "We're not going to let you publish our book on the kindle because the readers are not getting the full experience! We might as well blog the damned book!" Pow!
Fast forward 10 years in to the future when eBooks are used daily in schools, hospitals and by basic consumers. The price structure will probably be different but still scalable like it is today. I would gladly pay $30 for "Priceless" during the first month or two of its run while still not wanting to pay more than $5 for a copy of Machavelli's "Prince." Newer books may be a bigger gamble because they could turn out to be flops, however readers would be getting cutting edge information instead of information that has been circling around for hundreds of years. (We pay more for first run movies in theaters so why not pay more for first run books). This is what publishers and eBook manufactures should be discussing in terms of pricing.
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Anyway- So far the book is great and I'm enjoying it! It's one of my favorite books I've read in the past 6 months!