Hacker Newsnew | past | comments | ask | show | jobs | submitlogin

People always think that e-books should be cheap because they don't have the physical costs associated with paper books--but really, how high are the actual physical costs of paper books?

Doing some back of the envelope estimates I can't see how the marginal cost of a book could be over a couple dollars or so for the typical novel or mass market non-fiction book, including shipping it to the bookseller. Add in some more for the costs of storage of the physical book while it is waiting to be sold, and the costs of handling at the seller--and I still can't see it going over a few dollars.

Thus, I don't see why it would be surprising for publishers that sell a hardback for $20 to expect to sell an e-book for $15 or so.

Of course, it is possible that if they sold e-books for a lot less, it would so greatly expand the market that they would come out ahead overall. However, I don't think that is likely--I don't think most people's amount of reading is determined by the price of books.



Ugh. The standard argument, normally from a publisher's mouth.

Physical shops in prime retail places with appropriately paid staff are more expensive than essentially equivalent staffless operations (I'm talking per unit, retail side only). One of the reasons Borders folded was it overpaid on its leases.

Some numbers: "Retailer (discount, staffing, rent, etc.) – $12.58. That’s 45%."

Taken from: http://ireaderreview.com/2009/05/03/book-cost-analysis-cost-...

Now compare remote physical-book retail (Amazon) with ebooks, and you see the effects of the publishers' new pricing model. Your argument applies here, but doesn't describe the price difference.


I think that is a different comparison: physical shop vs "e-shop", where the post you reply to is about paper book vs e-book.

Question is: what is, for the likes of Amazon, the difference in costs between distribution on paper and on bits?


The difference between (free) digital delivery and physical delivery is massively overshadowed by the publishers' ebook pricing model. That's the problem: the price increase is invented, and as a further kick in the nuts the cost savings from digital delivery aren't passed on.


Except price isn't about cost for anything this side of commodities.

Price is set by willingness to pay, and the price-point at which a company believes it can profit off those willing to pay it, is largely what drives costs.


Beyond manufacturing, eBooks also don't have the rights of a paper book. Can I buy and sell it on the used market? Can I loan it out? Can I return it?

Aren't those worth something too?


Those reasons led me to put my kindle in a drawer and forget about it. Buying a used book from amazon is cheaper and grants me full rights to the item.

Paying 2-2.5x the price for a restricted digital version with no gift or resale value is not worth it except in limited cases (e.g. Hitchhiker's Guide to the Galaxy purely based on its weight).


I don't see how that could be the only reason for ditching your kindle. Stripping the DRM is trivial, and for convenience of sharing, ebooks win hands down. If you want to share a book with friends it's much easier to send an email attachment than go to the post office.


>I don't see how that could be the only reason for ditching your kindle.

What other reasons do I need besides cost and true ownership? What an odd response. Do you think i have some ulterior motive for ditching a device I paid $260 for?

I literally handed a book to a friend last night. She doesn't own an ebook reader. Now she has the book and can hand it off to someone else.

My father doesn't own an ebook reader and I give him plenty of books. Although now that I think about it I should probably just give him my kindle so he can increase the font size (an actual use case!) and stop leaving reading glasses all over his house.

Your response is essentially "Just torrent the book" because stripping the DRM off an ebook and emailing it someone is just the same as that person going to the pirate bay for content.


You're right, of course, but it's entirely possible that parfe doesn't want to find himself on the wrong side of the law just so he can share "The Art of Fielding" with his friend.

That is, you or I or parfe may completely agree that e-books shouldn't have DRM, and that removing said DRM shouldn't be illegal, but doesn't mean parfe is willing to consciously violate the law, no matter how objectionable he finds said law.


I think parfe is doing the right thing by putting his money where his mouth is.

If I lived someplace like Portland, with Powells, I'd probably be less enthusiastic about my Kindle. But English language books delivered instantly to Italy at US prices is a dream come true.


You can't gift a book, or inherit a book collection either.


http://www.amazon.com/Fall-Giants-Book-Century-Trilogy/dp/04...

Kindle price: $18.99, paperback price: $16.50

That's pretty outrageous, if you ask me. The paperback has to be physically distributed, and I can resell the thing, yet I'm paying less for it.


If a publisher sells a book in a store, they typically split the revenue 50/50 with the store.

So, that $20 book gets the publisher $10 in revenue.

Then, they had to print the book and ship it.

Plus, they don't get paid for the books that they print but don't sell. This is a surprisingly high number on some books.

Out of that they have to pay the author (usually 10% of the revenue, or $1) and the printing and shipping costs of ALL the books, not just the ones that sold (say $2-$3 per book sold).

Plus they have to pay to get the books a good placement on the shelves and pay for the people to go to all of the bookstores and arrange for them to buy the books.

That doesn't leave much.

Selling an e-book for $10 and getting 70% of that from Amazon or Apple seems like a good deal in comparison.

The real benefit of ebooks, though, is that publishing a book is way less risky when you don't have to sink a lot of costs into printing books.

Looking at this from the viewpoint of an author leads to an even more obvious answer...


Spot on, but a minor correction. The 70% (or 60% for print-on-demand) revenue split advertised isn't what it seems. This is how it breaks down in reality:

Paperback retail price: $15 Amazon takes 40% of retail: -$6 Amazon charges you full cost of printing: -$2.72 Your cut: $6.28, or 42%.

Ebook retail price: $5 Amazon takes 30% of retail: -$1.50 Amazon charges you a "digital delivery fee": -$0.35 Your cut: $3.15, or 63%.

This method of calculation, if not the specific values, are standard. Note that this is a MUCH better per-unit that you'd get from a traditional publisher. Often they will take 15% of retail for their margin, but they have to sell copies to bookstores at 60% off retail. So a $15 book might net you a buck, while they take home three.

It's justifiable because they take the risk on printing large numbers of books, distribution, contacts, marketing, etc. But a justifiable deal and a good deal are not always the same thing.

A publisher would have to sell 6-8X more books than you can by yourself before you'd make the same revenue. Meanwhile they would own your copyright and other things like the right to publish a sequel.


Your example prices the book too low. Even at 100% it would be impossible for the author to make the same amount of money. 9.99 is a price point that most people seemed to think was reasonable. If a $15 paperback book was prices as an ebook on Amazon for 9.99, the author's cut would be 6.64. This would allow an author to sell the ebook at 2/3 the normal price while still receiving a larger payment.


Not sure I get your point. At a higher price, the net would higher, yes. But it is still not and will never be "70%" as advertised by Amazon. The total cost of printing the book or "digital delivery" is taken out of the author's cut. Traditional publishers offer much worse deals, in return for marketing muscle.

Btw, those are the real prices of my book. It's not expensive, not cheap. Maybe I'm pricing the digital version too low, but figuring that out is part of the game.

http://www.amazon.com/Lauren-Ipsum-ebook/dp/B0069ZG8MY/


I thought you were just giving a made up example to make a point. I do think you are pricing your ebook too low. As long as your paperback is selling decently at 15.00, I think that most people would consider 9.99 for the ebook more than fair. Using the math that you did, it would give you 6.64 instead of 6.28, while also giving the reader a substantial discount. If your ebook is only 5 dollars, you will lose money in comparison to your paperback.

I used the number 9.99 because for a long time it seemed to be the "standard" price for an ebook. Lately the costs have been going up pretty rapidly.

Pricing a product does take a lot of time and research. I haven't published a book before, but I have bought lots of ebooks. When I look at a book on Amazon, if the price of the ebook is at least 33% less than the price of a paperback or hardcover, I'll at least consider it. If there isn't a significant price advantage, I wouldn't ever purchase an ebook that is readily available on paper.

I think that the best bet is to first decide how much money per book you want to have in your pocket once all is said and done. The amount of money you are comfortable receiving should guide your prices. Once you have a ballpark figure, you can tweak the price just a little to see if you can increase your volume.


You're right, I completely forgot the digital delivery fee.

It's, if I remember correctly, $0.15 per megabyte, rather than a flat $0.35. So this can be significant for books with lots of images.


FWIW, my book is 3.something MB. I don't care that much, though most people assume that revenue splits come after costs. It turns out that most/all book contracts give everyone's cuts out of the retail price, then costs. The rest, if any, goes to the author.


e-books are pretty much pure profit, depending on how the author is paid. They don't have the overhead of print books. Print books are printed in batches - a lot end up in bargain bins and eventually recycled. There are also the shipping and storage and manufacturing costs.

Perhaps eventually a netflix or spotify-like e-book model will emerge, where you pay a monthly fee (or see ads in books) to get access to most any e-book. 24symbols is trying this, but apparently not nearly there yet. Amazon is working on it too http://mashable.com/2011/09/12/amazon-netflix-books/


Ebooks are most definitely not pure profit. I mean, you can look at the balance sheets for any publicly traded publisher, or a large book retailer, and notice that they are not swimming in piles of money.

You may not think you take value from the publishing ecosystem (discovery, marketing, editing, publishing, etc. of content, and reliable delivery, storage, security, etc. of retail), but you probably actually do. And, you know, even if you actually don't, you can just go right ahead continuing to buy 1.99 or 3.99 or whatever is the "right" price of ebooks either direct from author websites (although it's still really hard to get the margins down to zero unless you're meeting on street and paying cash and accepting delivery over a thumb drive or something) or from Amazon or B&N's self-publishing programs.

In any case, comments like this are really hard to square with how much criticism my employer (B&N: although I don't work on ebooks, and certainly this is my own opinion) has gotten from investors for the money they've put into NOOK and the ebook ecosystem.


I can sell any book I buy. Some books can become collectibles and attain a high value. A private library of a few thousand books can be a very nice heirloom (or donation). These are some of the factors that make me think that books are worth more than eBooks.


I have a kindle, and I have yet to buy any books for it and wonder if I ever will. To tell you the truth the whole DRM thing is a complete put off for me.

Though I do love reading from the e-reader. I have it loaded up with the classics, but still buy in books in print.

I love the idea of electronic books though. But it should be easy for me to just hand one over to say a partner to read.


Yeah and you can't just pass on your ebooks to a charity shop.


I can accept that the ebooks is nearly as expensive as the real book.

I cannot, accept what happens so often on Amazon now -- the physical book is cheaper than the Kindle version.

Cheaper.

It is a slap in their own face too, since I refuse to pay more for a bag of electrons than for the physical book.

And it isn't a rare thing, it has happened twice on Amazon already - I imagine I can't be the only one who is pissed about it.




Consider applying for YC's Fall 2025 batch! Applications are open till Aug 4

Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact

Search: