Comments on: Amazon, Macmillan, and the eBook Price War

By: speedball

speedball — Wed, 04 Aug 2010 17:06:28 +0000

not completely true
there ARE costs to converting a real book to an ebook
so that it will be readable and usable in that medium

ebooks also have unique costs that real books do not

one big factor that is overlooked is all the middlemen with their
hands out wanting a percentage. if i gave a percentage to everybody
who asked then i would be paying 120% or more for the privilege of
publishing my books.

i pay fixed charges based on value. then i can guarantee a profit
so that i can afford to keep creating books, and authors will want
to keep writing them.

By: David Stillwell

David Stillwell — Sun, 07 Feb 2010 17:20:43 +0000

Retail price being different from sale price? There is no way that a 350 page hardcover book with it’s slick magazine cover can be produced for under two dollars. Even under four dollars sounds suspicious to me. paper, ink, binding and that slick cover. Even with cheap paper that yellows in six months it would have to cost four dollars. Then there are the other costs mentioned by previous posters.

The publishers could always sell the electronic books on their own Web sites in PDF form. $4.99 would be very profitable for them done that way. If people want the books at that price in that form then word will spread. If I were Amazon that is what I would be worried about, that Amazon would just become an advertiser to drive buyers to the publishers Web site for the E-book.

By: David Fouch

David Fouch — Fri, 05 Feb 2010 15:22:18 +0000

Jim,

Can you site your sources, I could actually use that information for a current paper I’m working on.

By: Jim Henley

Jim Henley — Sun, 31 Jan 2010 21:13:50 +0000

Right. 10% of the retail price is a significant amount! That’s 20% of the publisher’s take on a trade book at standard wholesaler discounts. And if you’ve previously followed the book business, you’ll know that you can’t get through a season without publishers complaining of “rising printing costs” and their dire effect on pricing.

The other thing none of your sources bring up is returns and never-sold stock. Together they average 40% of all copies printed. Together, manufacturing costs and returns reserve will run $6-9 dollars on a new hardcover, depending on where that book falls in the typical $25-30 price range. THAT is the size of the windfall when the business moves from paper to bits. What Macmillan and your friend Jeremy are implicitly saying is that NONE of that surplus value should go to readers; we should keep paying what we’ve been paying while the institutions upstream from us pocket the savings.

By: K. T. Bradford

K. T. Bradford — Sun, 31 Jan 2010 13:31:22 +0000

I’ve gotten numbers from some other sources, too, and found a pretty wide range, but I updated the post to reflect the 8 – 10% average seen by most publishing houses.

By: Jim Henley

Jim Henley — Sun, 31 Jan 2010 08:33:00 +0000

Dear KT Bradford: Every other source I’ve checked the last couple days indicates that printing costs are TEN TIMES what you quote your source claiming – 10% of cover price, not one percent. At face value, your source is saying it costs A QUARTER to print most new hardcover books. Did this pass your smell test? Did you attempt to verify the claim? Or is this an uncorrected typo?

By: Michael Canfield

Michael Canfield — Sun, 31 Jan 2010 00:47:07 +0000

I’m really surprised the hear that print costs amount to only 1% of retail price point. It seems like I hear all the time that publishers now don’t want books longer that 125000 words (and lately I’m hearing 90 – 100K0 especially from newer writers, in order the keep the retail cost of (in particular) hardbacks low.

Good post, K.T. Lots of thought-provoking information.

By: John Chu

John Chu — Sat, 30 Jan 2010 22:20:12 +0000

The 70/30 split applies only if you use the Kindle Digital Text Platform. i.e., only if you publish via Amazon’s self-publishing arm.