Monday, March 16, 2009

eBook pricing - 2009 edition

kindlecapture As a bookseller eBook pricing is pivotally important to me. It impacts my daily business life and is often a source of frustration. I am bound to pricing as set by the publisher, evidently Amazon is not. 

Over the last few years a pricing structure has evolved where the list eBook price was the same or slightly lower than the trade paper.

And then  -- along came Amazon loudly touting that every Kindle eBook is priced at only $9.99.

Evidently, Amazon intended to use the Kindle in the same way Gillette used the razor.  People might pay for the Kindle but Amazon saw the real money in on going book sales. 

Or maybe Amazon was trying to emulate the Apple iTunes model and inject a little conformity into eBook pricing. 

Either way one thing was clear:  this was a clear attempt to muscle in on the pricing of eBooks.  Amazon was putting the world on notice that they have the clout and the resources to set eBook pricing at any level they want.

You have to admit, that for the average book buyer the pitch is great.  Buy any book for only $9.99. 

A year later, it turns out that the $9.99 price per title is (depending on your point of view) disingenuous or a downright lie. According to Knipfty on the Amazon blog, a more accurate statement is that only  33,000 of their 240,000 titles are listed to sell in the $9.01-10.00 range.  That is only 13.75%; a long way from 100%!

A close look at Amazon pricing shows that:

  • 79,250 or 33% sell for between $0.01 and $10.00
  • 105,000 or 43.75% sell for between $10.01 and 19.99
  • 55,750 or 23% sell for over $20.00
  • 80% of all the new books added by Amazon since Jan 20 have been priced above $9.99

Should all eBooks should be priced at $9.99 or lower?  Maybe.  But that isn't really the point.  The point is that when Amazon arbitrarily sets prices, everyone suffers.

Authors are the biggest losers in this scheme since they are usually paid a percentage on the actual revenue derived from each sale.  Publishers,book reps and booksellers also take a hit.

But ultimately it is the consumer who suffers when decisions about what can be read, in what format and how much can be charged are made by any one large company. That is a monopoly we can't afford.

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