ebook pricing

I have wanted to write this post for a while but simply have not had the time. Either at cons or online, I've heard a lot of authors say the following: "Amazon is for authors."*

Amazon is a business. They are trying to do to publishing what they tried to do to independent bookstores and eliminate the competition. Period.

I am so sorry to be the one to break this to you, but Amazon (and in all fairness: Apple, Google, etc.) doesn't give a monkey's ass about authors.

Likewise, Amazon is not the Great Satan. They are a company operating on the business model to perform at a loss until they have amassed enough content to require a subscription service. For authors publishing through Amazon: it's all right to be used as long as you're using Amazon back and do not allow Amazon to take unfair advantage of authors or their works.

You must also realize that Amazon's business model is unsustainable on a long-term basis. Amazon can offer cheap ebooks because: 1) Amazon doesn't have to pay taxes like other companies; and 2) Amazon is intentionally undercutting everyone else the same way Wal-Mart undercut the competition to rise to the top.

Now if you want to see the Wal-Martization of books, keep going on the current track, because here is how a little company called Westlaw rose to the top in much the same way:

Back in the eighties and nineties, Westlaw digitalized case law and court opinions. They created a searchable database, and unlike Amazon, they charged a lot of money for it, probably nowhere near the amount that it took to run the system and have qualified attorneys online to answer questions, but they stayed with it even when others said it would never work. Then Thompson West started buying the competition (kind of like Amazon is doing now). The DOJ blocked a couple of purchases to prevent Westlaw from acquiring a monopoly and to maintain some market competition; however, Westlaw remains the leader and the most expensive of the lot.

Ring in Amazon (and just for the record, the Google Book Project worked the same way). Same business model, different content. Amazon isn't worried about offering $0.99 ebooks, because once they've demolished the competition, they can clean up their database and jack the prices as high as they want.

Authors will be forced to deal with Amazon and if authors don't like Amazon's terms, then Amazon will treat authors like they are currently treating the publishers--Amazon's way or the highway.

In terms of people who think ebooks should be cheaper because of lower overhead ... I want you to think about a few things:

  1. A well-written ebook is going to have all of the costs of print book in terms of editing, good cover art, which includes licenses to replicate images, and formatting.
  2. Ebooks aren't just floating around out there on the ether. Ebooks are on servers (factor in costs in terms of equipment, electricity, cooling expenses--those servers generate a lot of heat, and personnel to run that equipment, including benefits for any full-time personnel).
  3. Marketing costs
  4. Royalties to the author

Now you take that $0.99 and divide the pennies between the recipients as outlined above.

Finally, and this is really all I have to say on the subject, if you, like me, have a problem spending $13.00 or more for a LICENSE, which is what you are purchasing when you purchase an ebook, then buy the hard copy. That is what I do.

Now if you want to discuss, discuss, but I've said all I have to say.


*John Scalzi did an excellent write-up on this topic at his blog and you can read it here.