e-Book Prices Rise to High

I love using my Kindle for a number of reasons; I can carry a bookshelf of books with me, I can change the font size, I can review books before reading them. But one of the most important is the price of a book. I often spend $5 for a book, sometimes $1. Not any more…

Since Barnes and Nobles released the Nook and with the release of the iPad the publishers got greedy and the new contracts for book prices are in some cases the same as the cost of the book store. This does not make any sense since the cost to create an ebook $0.00 and to distribute $0.00 should significantly reduce the price of a book. I am not the only one upset about this. Online groups are starting a PR war giving best seller authors 1 star on Amazon because the book is over priced for an ebook or released late after the hardbound release.

Think about the effect of  this…a one star reviews on good books just because of the price. This throws the whole online crowdsourced marketing campaign into tail spin with long term effects.

Here is a cost example:

$20 book % of list price Cost Profit e-book
bookstore 40% $12 $8 $6 (Amazon 30%)
book Wholesaler 60%, $8 $4 $0
Publisher 30%   $8 $8
Author 10%   $2 $2
Agent 15% or Authors %   $0.30 $0.30
Author final     $1.70 $1.70

*Data from: http://en.allexperts.com/q/Writing-Books-675/writer-profit-book.htm

So let’s take out the costs if we had an e-book. The bookstore is now Amazon at 30% of list. The wholesaler does not exist. Assuming the publisher still gets 30%, e-books should cost 70% less that list or for a $20 book would be $6.

The publishers have to take note to what happened to the music business. If they increase the price too much piracy will increase. I have found sites where I was stunned to fine compete collections of top authors for free.

I think Amazon is upset about this, you will noticed they now say “ This price was set by the publisher”.

Interestingly Borders is about to go bankrupt and I heard Barnes and Nobles had a 70% increase in digital sales due to the Nook. Not sure what the time frame was but it is clear that the digital book era is well on its way. And everything digital costs less, companies have to be more creative in their business models to survive.

Don’t get me wrong I would happily pay a few extra dollars if I new the author was getting the money… Funny I am starting to rediscover the public library again.

Greg Ahern
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Author: Greg Ahern

Greg Ahern Founder and President of Ometrics® is a fanatic about conversion rate optimization and AI chatbots. Greg has been a successful Internet entrepreneur since 1994. He speaks at conferences and webinars and has built a number of internet businesses. You can follow Greg on Twitter @gregahern and join his CRO Hacks Groups on Facebook and Slack. When he is not in front of a computer he can be found unplugged with his family, drawing or sculpting, endlessly learning guitar or running around in the mountains biking, climbing and skiing.