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Archive for August, 2014

Hachette vs. Amazon

Hachette Publishing should change its name to Hashshit Publishing. Really!
But all joking aside, the dispute between Amazon and Hachette is really a dispute between the past and the future.
As Amazon correctly points out, “Just ahead of World War II, there was a radical invention that shook the foundations of book publishing. It was the paperback book. This was a time when movie tickets cost 10 or 20 cents, and (hardcover) books cost $2.50. The new paperback cost 25 cents – it was ten times cheaper. Readers loved the paperback and millions of copies were sold in just the first year.”
Now I must confess I have no idea how much money Amazon makes from a Stephen King novel
sold on Amazon for $18 in hardcover, $17.75 in paperback and $11.99 as an ebook. I don’t care. Nor do I know how much Amazon makes from a Stephen Colbert book sold on Amazon for $28.99 in hardcover and $12.99 as an ebook. I don’t know and I don’t care because at any price I have no intention of buying any book from either King or Colbert – not because I have anything against either man but because I have become bored with King (last book read by him was the overly wordy The Stand) and I get all the Colbert I can take or stand for free on TV.
What I do know for certain is there is a real difference in the manufacturing cost between hardcover, print and ebooks. I also know neither King nor Colbert are depending on me buying their books for them to make a living.
You get some idea of what a hardcover actually costs to manufacture by looking at the price of a hardcover by Stephen King. The only reason there is so little price difference between a King hardcover and a paperback book is the result of print volume. Simply put, the greater the print run, the lower the manufacturing cost. This is true for both paperback and hardcover. But when it comes to ebooks the volume sold has zero effect upon the cost to produce. Selling one ebook is no more expensive than selling 1,000,000 ebooks. Whatever the profit might be for the author or the publisher of ebooks changes only by the number of ebooks sold.
Let’s let the cat out of the bag. When I list an ebook on Amazon for $3.99, I make $2.76. If I list the same book at $2.99, I make $2.04. If I list the exact same book as a paperback that sells for $13.99, I make $4.26.
Obviously, I would make more money selling paperbacks than ebooks. Not quite so obviously, I sell more ebooks than print books. Price does seem to matter.
But I don’t believe price is the only reason many are switching to ebooks. While I admit there is nothing like opening up a paperback or better yet a hardcover book, they do have their problems.
When was the last time you moved and had to move all of your books? Next to the sofa and the refrigerator, they were probably the heaviest items you had to move. Not fun. And when was the last time you went on vacation and needed to decide which books to bring and which to leave at home because of their bulk and weight? But with ebooks, you can carry as many as you have wherever you move or vacation to without any weight or bulk beyond the weight of your reading device. It is for these reasons (plus cost) that I believe ebooks are the future whether anyone likes it or not.
I don’t know if it matters to you. Maybe it does and maybe it doesn’t. But do you the reader feel comfortable knowing you are paying $11.99 or $12.99 for something that cost less than 95 cents to manufacture and deliver to your reading device?
This is what the fight is about – the future vs. the past and fair price vs. high price.

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