That’s the title of an article by Meredith Greene in the Sacramento Book Review. Here’s a couple of paragraphs to start you out:
‘Antitrust’ is an emotionally packed word capable of stirring up and smelting public suspicion into a vaguely sharp foil; this weapon is often used for little more than lashing out at shadowy figures in the mist, simply for the sake of ‘looking really busy.’ As much as we like the idea of making certain that the ‘big’ companies stay on the lesser side of Greedy, we must remember that pulling out the Antitrust Card tends to lead towards government ‘regulation’ of yet another aspect of our lives. Next thing you know we’ll be told what we can and cannot write about, all under the guise of ‘fairness.’ Personally, I want to see federal regulation of eBooks like I want to see federal censorship of the Internet; just ask folks in some foreign countries how that’s going for them.
It seems to me that threatening the use of antitrust laws for eBooks is giving the issue undeserved credence. If indeed Apple, Amazon and the ‘big six’ are price-fixing, then the average consumer has lost only the convenience of getting their eBooks in trendy places. There are hordes of Indy writers on the Internet with little websites of their own, many of them offering eBooks at half the cost of those by larger companies; some Indy writers even offer free titles as an enticement, not to mention Project Gutenberg and many other web sites where free eBooks can still be found. In Amazon’s own backyard, The Kindle Store is home to thousands of eBook titles going for less than $5, prices set by the writers themselves. Thus, the eMarket is still broad enough for consumers of digital literature to meander about.
That is a pretty ridiculous article and argument the writer makes. -Price fixing is Ok because there is an indy market.- That’s like saying that it’s OK for the big supermarket chains to fix the prices on major brand items of food because you can always go to a farm to buy your produce or cereal, etc.
Her comment “If indeed Apple, Amazon and the ‘big six’ are price-fixing, then the average consumer has lost only the convenience of getting their eBooks in trendy places” shows her ignorance of the market.
If it’s OK to price fix you cannot buy your ebook at “trendy places” or any other place for a lower price!!
Masseven – If one really read the article, one would know that I never said price-fixing is “OK”; my concern is that pulling out the anti-trust card comes with a hefty price-tag: government regulation.
As of now, the eBook market–as a whole–is so broad and varied that even if these companies price-fix, (which is not “OK” by any standard) then consumers can still get eBooks elsewhere.
All American antitrust laws date back to the Sherman Antitrust Act of 1890 that was passed by Congress to remove limits on competitive trade. On the whole, these particular laws are the most applicable when one company, or a few companies, become so large that they swallow up all competition and then set prices and when consumers have NO OTHER OPTION but to buy from said companies at the ‘fixed’ prices.
I don’t like what’s happening to the big six eBook prices any more than any other consumer, but screaming out “anti-trust” is a bit of a knee-jerk reaction, at this point in time.
I just read your article again and you imply that, as an example, if someone wants to read a new book by Stephen King, published by one of the ‘big six’, and they don’t like the “fixed” price, they can go indy. Many people shop for books by specific authors and/or titles. Under the current situation if the book is published by the big players you cannot, legally, get the book at a price lower than that set by this publishing ‘cartel’.
In a capitalist economy the government needs to ensure that monopolizing or controlling pricing is stopped dead.
To the end user there really is no difference if one company gobbles up the competition or if all the major companies conspire to fix prices on their products. The result is stifling of competition and increased prices to the end user.
It’s only a matter of a short time before the US and EU get their teeth into the anti trust issues that are all over the eBook market – and it won;t be soon enough. The author of the original article “Meredith Greene” is clearly one of those insane anti government nutters who tries to justify the unjustifiable simply because his hate of the government is greater.
We need eBooks to be distributed to a wide range of non-monopolised eRetailers at a wholesale price and for THEM to decide on the final retail price.
Clearly this person thinks books are fungible. Wrong. And writers aren’t fungible either.
As an author of ebooks that will soon be in print form, I’ve realized that my work can be pirated and given away for free. My novels can be purchased online, made into an audio book, print novel, or translated into another language. Statistics say I will probably only see 20% of my work every be credited to my bank account. Of that 20% I will receive between 30-50% of ebooks and 6-8% of printed novels.
When my novels are sent to third party sites for sale, that site takes a HEFTY percentage, then my publisher and I get what’s left…not much.
The only reason consumers have ebooks to put on their shiny new Kindles and Nooks, is because I write and am willing to take a loss. I know that my publisher sets the prices, percentage and makes deals with other countries for my work. But I always get paid SOMETHING.
So when you get upset because the big six are protecting their authors by setting a price on a novel, remember how little gets to the writer. Remember that it costs money to hire editors, promotional advertising marketers, website designers and technicians, bookcover artists and that some of the money will go to the starving writer.
So stop complaining when an ebook is $13.00 from Stephen King and you can’t find it cheaper somewhere else. Who says the consumer or third-party sites have the right to expect a discounted or wholesale price. Bull$#!+ It’s MY work and I sign a contract that I expect my publisher to protect my work, my money and give discounts on my behalf. You as a consumer have the right to pass up Block Buster books, movies, DVD’s, CD’s and high-ticket items.
I don’t want to see what happened to music, happen to my novels. It’s unfair, and theft…period. The government is struggling to protect my rights and work as China and Russia are the two largest pirateers of ebooks currently.
Please respect the talent and hard work of your local author who busts their butts to write great novels for you to enjoy on your ebook reader. Buy less books, but pay the price for what the publisher and author ask. You can always wait for the 25% discount coupons my Publishers dole out monthly.
I agree wholeheartedly with Meredith (who is a “she” BTW, Howard). In the free market, consumers can choose where to spend their money. If Steven King’s books are too expensive, then go out and find a fabulous new author at an indy publisher – you just may be surprised at the quality, diversity, and great writing you can find outside of the big name authors at the big publishing houses.
Call me insane any old day. Let the consumer choose instead of bringing in the government to make our choices for us.
Seriously folks it is not serious, the author may have intended it to be, which makes it quaintly ridiculous, but I like meatier stuff that actually makes sense.
Desperate defenses of corporate actions, are like the rational defense of the rights of aristocrats; that is always, and in every way, a hurried retreat from the enlightenment into abject mysticism.
Meredith should read articles rather than right them.
Either the agency pricing model is price fixing, or it isn’t. Let the investigations determine that. Asking for anti-trust laws to be applied selectively defeats their whole purpose. If the big 5 and Apple aren’t doing anything wrong, they have nothing to fear and investigations will bear that out. But no company is above our laws, so I’m content to let this play out until a legal determination is made.
And Cherie, you have every right to expect your publisher to get what you consider to be a good deal for you. But when readers can now quickly find out that authors can make 70% royalties for books priced below $10 if they publish through Amazon, we also know that they aren’t getting that from a big 6 publisher. And if authors aren’t getting all that extra money that comes from a $15 ebook, then the publishers are. That combined with DRM and no first sale rights with ebooks is a perfect storm to create piracy. It’s not right, but surely cannot be a surprise.
you missed the point. To an author, publisher and consumer, this subject is important. “Desperate defenses of corporate actions.” Really? That’s where you scoff? Please. . .
Most of the N.Y. “Big Six” are losing their @$$ right now in publishing. They were behind the eight ball when indy ebook publishers blazed a new trail for Kindle and Nook users. “The Big Six” found out that Barnes and Noble sold more ebooks than print in 2009 and are gearing up for an ebook blitz. But their in the infancy stage, hoping to get big $$$ from consumers who are getting into the ebook for the first time.
Not going to happen! Indy ebook sellers have already reduced their novels to a moderately priced ebook. N.Y. and other big publishers are scrambling to make up for the time they were printing books that no one was buying. Stupid.
There is big money involved, huge politics, international ramifications and pirates who decided to offer ebooks they didn’t own for free. Those nasty bottom feeders will be surprised when they get slapped with a class-action suit of all the authors they’ve scammed.
Greg, when you distance yourself from corporate publishing houses, you aren’t making a statement. No one will support your grandstand. Publishers have the right to price a book as they damn well please in the author and publishers best interest. We’re not talking milk, a roof over your head or clean water here…
By the way, maybe you should learn to spell and correct your words before bellying up to the adult table of conversation. “Meredith should read articles, rather than “write” them. Frankly, Meredith knows what she’s talking about, catch up or find a nice fantasy game to play on your XBOX.
As an ebook author myself, I agree with Meredith and Cherie.
Vicki – thanks for the new word.
Greg, did you perhaps mean “write” them rather than “right” them? A pun comes to mind but it is perhaps better “left” alone…
I am still trying to figure out how Meredith is professing “antitrust laws”, which have a solid legal precedence in the US mind you, being broken by say several major publishing companies that might control a huge portion of the publishing market place and let’s say they are caught price fixing, which we all know they are, and then say they get sued for ripping off the consumer like they should probably be…
HOW is that suddenly an example of over reaching government regulation? That what is supposed to happen it’s called consumer protections!
Then the whole fairytale about the whole convoluted “trendy” thing.
I can’t resist here’s my rewrite of her last bit mindlessness…
There are hordes of Pirates on the Internet with little websites of their own, many of them offering DRM free eBooks at no cost!
I bet good old Meredith would not think that shutting them down would be an example of over reaching government regulation.
Chérie De Sues, Romance Author e-books
P.S. “right” instead of “write” was intentional (a political reference), not terribly clever I admit.
Meredith’s problem is her arguments. The issue remains obscure, how does anti-trust actions not benefit the author
The State’s function, definition and existence is predicated on regulating society. The question is not a quantitative one but qualitative understanding of the interests served and the effects upon society wrought by some rule or other.
Non-regulation is a State given license, a guarantee to do whatever one wants, and moreover have this backed against all challenges by the power of the State through law.
Sorry the above post was sent by mistake the bottom bit was ruminations which I intended to cut and the post is unfinished.
It should have read:
Chérie De Sues, Romance Author e-books
P.S. “right” instead of “write” was intentional (a political reference), not terribly clever I admit.
Meredith’s problem is her arguments. The issue remains obscure, how does anti-trust actions not benefit the author, the small publisher and distributor?
What has it got to do with piracy and copyright infringements?
As for the state regulating, the question is always in whose interest and to what effect.
Sorry about the messy post previously.
Not sure where Cherie is getting her statistics about her loses. From what I’ve read, the most pirated author is J. K. Rowling. I don’t think she’s having any problems earning a living. She’d probably earn even more if she would allow her books to be sold in e-book form.
There are a lot of examples of authors giving away their work in the beginning and becoming successful as a result. Jeff Kinney started on Funbrain.com. His online version of Diary of a Wimpy Kid has had more than 80 million visits and is read by 70,000 kids a day. His book deals and movie deal are a result of the audience he built over the Internet. That success wouldn’t have been possible without building his audience by giving away his content.
The Internet and e-books have leveled the playing field for authors. They now have a way to reach readers without a publishing house behind them. And many of them find a publisher after building a reader base.
I think that the losses due to pirating are highly inflated. First of all most of the people who pirate books wouldn’t have purchased the book anyway. Secondly, just because a book is downloaded, doesn’t mean it will get read. Amazon gives away free books all the time. I have 98 unread freebies on my Kindle. Right now I’m reading book 3 of a series that I probably wouldn’t have read if the first one had not been free. The point is that I’m still buying books even though I’ve got 98 books in the TBR pile.
Cherie doesn’t have to worry about people stealing her books, she needs to worry about people reading them. If her books are good, they’ll be recommended to friends, who will recommend them to other friends, etc., etc. It also seems to me that if someone is going to go to the bother of pirating a book, it wouldn’t be a book that is already available as an ebook, or from a relatively unknown author.
I know the only books I’ve been tempted to pirate is J. K. Rowlings Harry Potter books. That being said, I have enough ebooks to read, I don’t have to steal any.
And by the way, I don’t think the big six are protecting their authors. They are only thinking of themselves. If they cared about their authors, they would offer them a higher royalty percentage on their ebooks. The whole system is weighted in favor of the big name authors who get the huge advances at the expense of the midlist and newbies.
What has it got to do with piracy and copyright infringements?
Oh sorry maybe I needed to elaborate…
You can’t sell me unsubstantiated fears of antitrust laws supposedly ruining Meredith’s grand free market of publishing while she is obviously leveraging other government ‘laws’ to protect her piece of the pie.
As an author Meredith needs to understand readers are her “bread and butter” and maybe she needs to empathize a bit better because I do not think her “customers” would be too impressed with condescending ghost stories and being cast in her stories as overly entitled for simply wanting reasonably priced eBooks.
Chérie De Sues is way off base here. The issue is not you making or losing money, but the fact that a lot of eBooks by the Agency 5 are actually priced higher then the paper versions. And even when the eBooks are priced the same as the paperback at $7.99, there is no discounts or sales allowed where the paper copies can be discounted or put on sale. All of this is unfair to the consumer. Also, the Agency 5 lied to us. They said that once a paper book is published in a cheaper version (i.e., hardcover > paperback) that the eBook prices would drop right away. Well, that’s not the case. And we also have to blame Apple for making a deal that says that nobody can undersell them for the Agency 5’s eBooks.
Basically, I can see this driving people to the library to get the books (eBook, audiobook, or pBook) instead of buying the eBook since the price of the eBook might be out of proportion with reality.
I’m hardly off-base, I live in this industry. I talk to the publisher’s, authors and editors of my chosen field. The government has on numerous occasions in print stated that they are impotent to stop pirating. I’m not wary of the government stepping into the publisher’s business of selling ebooks whether they are higher or not with the paperback/hardcopy.
Look at what’s happening. Ebook readers have revolutionized reading your favorite author and the “big five” publishers and most other publishers were caught with their pants down around their ankles. They have to recoop money from a sagging printed book industry. The publisher’s can’t GIVE-AWAY their books and authors don’t want them to. Consumers shouldn’t ask an author to give-away their work. Do you give-away the paintings you make, the services you render? Hell no.
I do sympathize will consumers that we are in a bad economy, but have you gone to a blockbuster movie and paid $10.00. At least with an ebook you get to read the book over and over again. And here’s another reason to defend the prices of ebooks. Ebooks can and are shared with friends, family from reader to reader. How would like it if you never saw a return on your work and it was passed around for free. You wouldn’t.
So please don’t tell me to sell my work for free. Don’t tell me you aren’t willing to pay $4.00 to $10.00 for an ebook you really want because you have 100 free ebook downloads on your ebook reader. Support the author, and yes, the publisher who’s trying to figure the whole ebook industry out. Give it time, in a year you’ll see a difference.
Chérie De Sues: “Look at what’s happening. Ebook readers have revolutionized reading your favorite author and the “big five” publishers and most other publishers were caught with their pants down around their ankles.”
This I agree with and have been saying it for years — inevitably they are going down the drain, its called technological progress and they are heavily invested in past technology, (just as their typesetters were when they disposed of them).
They can’t stop piracy any more than they can stop people photocopying. But they can dramatically reduce the scope of piracy by reducing the e-prices to something closer to the production costs than hold them artificially at the level of print.
Authors and publishers deserved to be paid and policing and enforcing fair copyright is in everybody’s interest.
But protecting corporations? And where did all this give-away nonsense come about who is actually proposing that as any type of solution for anything.
I am preparing five classic works of Anthropology (all in the public domain) along with the works of a small number of live authors (who should be paid for their work and will be).
None of this will I be giving away, or putting in DRM!
The Public Domain works will have edited and HTML text given to Gutenberg, but the Epub version will be copyrighted to me because of its structured reorganization and paragraph numbering, indexing and other added features (new introductions cross-referencing etc.,.).
I will only be charging cents for the public domain works and only a few dollars for living authors works.
Fair pricing for my work and a better royalty payment for my authors than they got with their paper publishers.
It is not the big publishers that ebooks help but a new era of small ones. The publishers too heavily invested in print and its costs will die, those that can manage a transition and have on form of publishing help the other will thrive.
The writing is on the wall and so anything hastening the process is a good thing.
Is there something Ebook publishers and readers can learn from the music industry? I think we are in a transition period where Ebooks are slowly taking off and will at some point overtake print books. At present there is a lot of trial and error as to what works and what doesn’t work. It will take time for things to settle down and a technology to emerge with respect to Ebook readers as in the case of Betamax and VHS video format. But the main concern is government regulation which I think will make matters worse.
Let not forget that copyright is government regulation. It’s a “temporary” monopoly granted by the government. When this was extended to life plus 50/70 years (permanent) that was more government regulation. If Meredith is so worried about the slippery slop of government regulation she should be calling for the removal of copyright laws as well.
If you believe in copyright you believe in regulation. This is just an offsetting balance for consumer protection. It’s necessary but too slow and ineffective.
Chérie De Sues: You are correct in recognizing that your work can be pirated and taken away for free. In printed form it could also be taken and read for free. The government writing they can do nothing to stop it is also reality. People have to want to compensate you, they can’t be forced.
The good news is that there are enough people that want to do the right thing and pay. The bad news is that they are being driven away by stupid actions and policies of the publishing industry.
Chérie De Sues – I don’t believe a word of your claims about pirating. You are either confused about the extent of pirating or listening to entirely the wrong kind of people. your reference to the Music industry shows that you have been completely taken in by their propaganda because a) pirating was exaggerated by orders of magnitude simply to get government support and justify outrageous prices, and b) many studies proved that downloaders were also the biggest purchasers of music. I don’t value any of the books on the market now or before at the kind of silly prices you imply they should be sold for and I suggest that your representation of costs are wholly misleading. Writers who have talent earn good money from their work. Writers with marginal talent earn marginal income. This is the way of life.
Thank you for that correction Candace. Appreciate it.
Well said Greg and Jon. Commons sense has clearly been abandoned on this thread in favour of hysterical and irrational over reaching and personal insult. No amount of self justification will hold back the determination of at least the EU to prevent the kind of slicing up of the market that is going on now. Naturally it is the infancy of the new eBook market and this kind of kind of corporate grabbing is going to happen. But I give it at a maximum 2 years before the whole thing is reigned in in favour of the consumer, who is the one that matters.
It’s not the ‘big six,’ it’s the ‘big five.’ Random House is not participating in the agency pricing model (not yet). I’m sorry, but such a glaring mistake just tends to weaken the entire premise for me. And quoting John Sargent of MacMillan does not help. At. All. (He with the history of overpriced ebooks and silly library lending comments).
Also, the article doesn’t even mention the effect agency pricing has had on independent ebook stores. Four months after agency pricing began and only the major retailers have access to all five of the ‘agency 5’ publishers. The independents are still struggling with getting some of them back. Some have dropped them all together.
If the publishers each decided on their own to move to the agency model and set prices independent of each other and independent of Apple, that’s their right. (Just as it’s my right as a consumer to reject that pricing model. I agree with the author on that point.) But if Apple was involved in negotiating prices that were then forced on other sellers, which in turn has hurt independent ebook stores, how is that not a violation of some type? Why shouldn’t that be investigated? One of these is not like the other. I’d like to know how involved Apple was in the pricing.
On my next round of business ethics courses, if there’s a question on negotiating prices with a vendor and demanding the vendor sell to all others at the same price, I think I’ll answer “Yes, that would be Ok” and see how that goes. Somehow I don’t think responding with “if they don’t like it, they can go elsewhere” would earn me any bonus points.
It is rather ‘Uptopian’ to spout out that “all government laws are as good as they were intended to be”, swallow them all down at face value and then sneer at those questioning whether or not the timing is right to apply them. Reading over some of the remarks to my article I shake my head at how freely my words were taken out of context. Anti-trust laws can indeed be used for the benefit of the consumer, author and musician (accolades be due to Sheriyar for drawing the comparison to the regulation-laden music industry); all I said is “be careful what you wish for”. Crying foul every time you feel companies are being greedy will leave you hoarse.
Again, my point is that–at this time–there is no grounds for anti-trust as there is still a vast amount of competition in the market. As far as getting a certain famous author’s book when you want it, to my knowledge there are yet working libraries where you can get it for free. Speaking of ignorance, I actually wrote a lengthy article on book piracy and ways the consumer and author can combat it and also use it to their own advantage.
I am not advocating some kind of book anarchy, nor do I harbor ingratitude towards the laws which protect thew populace, BUT take care what you ask the government to regulate. Once a ‘eBook czar’ is established, that position will always be filled and a myriad of new regulations and laws will issue forth; companies will become over-burdened with fees, paperwork and stipulations… and authors will make even LESS than they do now. All I wanted in writing this piece was for that aspect to be considered, verses the maelstrom of tweets which lean decidedly to one side; thank goodness, many here took a second look and some responders showed great presence of mind.
Okay, I’m not in the publishing business in any way (or any other business), so what am I missing here? Meredith claims that there is “still a vast amount of competition in the market.” Huh? As Vicki said, books are not fungible, which is why I’m puzzled by Meredith’s claim. There may be plenty of competition for apples (indie e-books), but there is no competition for oranges (e-books from the Agency 5, which include the majority of today’s most popular authors). When the Agency 5 mandate that every single retailer selling their e-book sell it for the exact same price, there is NO competition for that particular e-book. Perhaps I’m mistaken, but isn’t the basis of a free market economy the ability of retailers to adjust their prices to what they think is appropriate, in order to compete against other retailers? Think loss leaders at your local grocery store.
That leads to the question, if Apple did indeed have something to do with these pricing mandates by the Agency 5, doesn’t that mean that Apple has effectively prevented other retailers, notably Amazon and Barnes and Noble, but also all the smaller retailers such as Fictionwise, from using the free market to compete against Apple? Even if Apple had nothing at all to do with it, haven’t the Agency 5 fixed the market so that there can be no competition among retailers for those e-books available only from the Agency 5?
There must be something retailers bring to the table, or the publishers wouldn’t bother with them; they would just sell directly to the public without a middleman. But, why eliminate all the competition among the middlemen? I thought that the idea behind competition was that it kept the overall business healthy by weeding out the inefficient. In the long run, how will a lack of competition among e-book retailers help the overall business?
Again, I’m not a business person, but I thought that competition among retailers was part of a free market economy. So, what am I missing when I have this niggling suspicion that there is something wrong with this price mandate by the Agency 5? Aren’t there enough questions surrounding this matter to justify some level of investigation? And aren’t the issues of piracy and author compensation red herrings when debating the core issue of the lack of competition for Agency 5 e-books?
‘I don’t believe a word of your claims about pirating.’ Why should you Howard, you aren’t the one emailing ebook pirate sites to take your work off the internet in seven countries. Someone said, “people who pirate ebooks wouldn’t buy them anyway,” then someone said “people who pirate ebooks are the biggest consumers of ebooks.”
Really? Sorry, you can’t have it both ways…let’s just agree that somewhere in the middle of these two diverse opinions lies the truth. To me, it’s annoying to have my work stolen.
Howard says, “Writers who have talent earn good money from their work. Writers with marginal talent earn marginal income. This is the way of life.”
Um…no Howard, this isn’t true. Case in point: Best-selling authors are created. With big money, these authors get promoted in radio, tv, print and internet. Patterson doesn’t even write his own stuff anymore, he has a stable of writers who use his outlines to write his books. These authors are deeply edited, and promoted by the “big five” to have a living icon for their company. There are thousands of great writers, it’s the lazy readers who continually go to “the big names” for a myriad of reasons that don’t always include a good read.
As for the “big five” and their desire to “fix” prices. Ah, gee, come on. Don’t you get it? If a publishing company sets Nora Roberts hardcover at $25.00, then sells the ebook at $25.00 that’s their right. Period.
For a third-party bookseller to sell the same hardcover novel for $15.00 and the ebook at $7.00, the site decided to take a huge cut in their profit margin to generate mass sales. I understand why the big publishers don’t want to let third-party sites do this. I take a HUGE cut when third-party sites sell my ebooks, but I think it’s a good plan for my career in the long view. Big name authors don’t need that kind of brand name recognition.
Government. We the people… We ARE the government. We vote and decide whether the protection of creative work is necessary or not. Get involved in writing your Congressman/woman and other officials who beg to hear the opinions of their constituents. I write them often, whining about pirating, finding my work in distant countries in new languages, etc.
Nobody has yet mentioned the huge used-books market. An author makes nothing on these secondary sales.
Compare that to software from a commercial software company. Software is licensed to the purchaser who does not own it outright. The licensee cannot legally pass it on to another person to load on his computer. Sure, it’s done all the time, but the secondary user cannot get technical support for his copy and may even be held legally responsible for using an unlicensed copy of the software.
I’m not sure how this concept might translate into the book market, but setting used printed books aside where there is probably no possibility of an author cashing in on secondary sales of his book, there might be a way to license the reading of e-books so that they cannot be passed around from computer to computer, printed out, and re-sold as hard copies.
We the people do not want eBooks that cost less then pBooks to make and sell then the pBooks to cost the same or more than the pBooks.
So why do we have stupid pricing that has a lot of eBooks selling for more then their paper versions?
Chérie De Sues: “As for the “big five” and their desire to “fix” prices. Ah, gee, come on. Don’t you get it? If a publishing company sets Nora Roberts hardcover at $25.00, then sells the ebook at $25.00 that’s their right. Period.”
That is also their problem, they can do it if want but what they make on the e-book sales is normally called profiteering.
If they want to form a price-fixing arrangement so they can better get away with that sort of profiteering, well there is a good enough reason for breaking them up.
Chérie De Sues: “For a third-party bookseller to sell the same hardcover novel for $15.00 and the ebook at $7.00, the site decided to take a huge cut in their profit margin to generate mass sales”
Using imaginary figures all rounded and reduced to a single item.
Hard Cover: print production, storage and transport costs $17,
Author’s royalty $1,
Publishers profit; absorbing advertising, editing, typesetting and other costs $2,
Wholesale price $20,
Recommended retail price $30,
Actual sale price $25.
Now take away $17 because ebooks require none of the listed production costs (editing and typesetting costs remain about the same, but they equate to the whole production cycle).
E-book recommended retail price $13,
Sale price $8.
That is the point. Price fixing delivers superprofits, to the publisher but to no-one else. Profiteers areas great a blight on society as pirates — actually I think more so (they are also far more common IMHO).
A small publisher’s ebook cannot afford traditional advertising, it is not subsidizing large buildings filled with accountants, lawyers, management, etc.,.
Ebooks can easily break down to:
Author’s royalty $1,
Production costs and publisher’s profits $0.50,
Retail margin $0.50,
Recommended retail price $2,
Sale price $1.75.
That is why I would call this the era of small publishers, and as for same medium advertising — perhaps in the end the costs will be similarly small (the advert becomes the retail agent @$0.25 a sale may be a viable model).
Big publishers with rare exceptions are post-meteor dinosaurs, their fate hangs on the horizon and races towards them, They are literally the living dead.
Leave them to their fate, not many deserved to be morned.
I made a mistake in the examples above by not point out that when an ebook sells for
E-book recommended retail price $13,
Sale price $8.
The profiteer is actually the retailer, the wholesale cost being $3, the full retail earning being still $10 and the sale price producing $5.
Margins growing from 33% to a whopping 150–300%.
The idea that against a $30 Hard Cover that any big publisher would produce effectively a $4 ebook version (wholesale $3 33% retail rrp $4), was so absurd I mentally neglected the figures.
My apologies. Hopefully the magnitude of the profiteering rip-offs being perpetrated has been conveyed nonetheless.
Excellent and comprehensive post Jon. Cherie I see nothing in your arguments except irrationality. I see no evidence of large scale pirating of your eBooks and your claims make no sense. Where you get this idea about:
I have searched for this above and don’t see it anywhere. Not surprising I guess.
I specifically referred to talented writers, not best sellers. As I said talented writers will always make money. Life is tough sometimes and not always fair. Arguing silly points in favour of monopolies, and in favour of profiteering and an imaginary pirating of your work, describing eBooks as being shared around depriving you of income while paper books were never shared around (?) is not very convincing I am sorry. And if the quality of your writing is of the same standard as your arguments then ……
Howard. . .
You can’t win a friendly argument by bullying and making an insult to my writing. It’s called “poisoning the well”, look it up, learn something for the sake of the next argument you wish to join. You’ve made two statements, let’s deal with those first.
Above, Diane said…’I think that the losses due to pirating are highly inflated. First of all most of the people who pirate books wouldn’t have purchased the book anyway.’
Then Howard, YOU said to win your argument that pirated ebooks are like pirated music and over-inflated. You insinuated quite clearly
‘a) pirating was exaggerated by orders of magnitude simply to get government support and justify outrageous prices, and b) many studies proved that downloaders were also the biggest purchasers of music.
You aren’t paying attention Howard, I am. So now let’s look at your lame duck argument about piracy being over-inflated.
(CNN) — When Dan Brown’s blockbuster novel “The Lost Symbol” hit stores in September, it may have offered a peek at the future of bookselling.
On Amazon.com, the book sold more digital copies for the Kindle e-reader in its first few days than hardback editions. This was seen as something of a paradigm shift in the publishing industry, but it also may have come at a cost.
Less than 24 hours after its release, pirated digital copies of the novel were found on file-sharing sites such as Rapidshare and BitTorrent. Within days, it had been downloaded for free more than 100,000 times.
Digital piracy, long confined to music and movies, is spreading to books. And as electronic reading devices such as Amazon’s Kindle, the Sony Reader, Barnes & Noble’s Nook, smartphones and Apple’s much-anticipated “tablet” boost demand for e-books, experts say the problem may only get worse.
“It’s fair to say that piracy of e-books is exploding,” said Albert Greco, an industry expert and professor of marketing at Fordham University.
Soooo, I think piracy is here to stay and is eating at the profits of the big five and everyone else. So don’t tell me 100,000 good people in 24 hours will never do this again. Don’t tell me piracy is over-inflated, and don’t tell me the big five aren’t losing their ass when they put an ebook out for sale.
GREG, I got a headache trying to follow your imaginary math skills for what a publisher’s costs are for ebooks. This is a new industry of over six different delivery systems for various ebook readers. Making all these copies takes time because errors are found during the transfer of information. I know, I’ve done this myself. Providing a website and platform to sell this ebook material costs money, and when a customer says they have a corrupted file, the sale must be made again. That means tech support. If you aren’t a publisher that deals with audio, print, digital books and braille, step off the accounting soapbox.
New industries mean new costs and unforeseeable changes in routine. I admit, there are serious mistakes in the new system and there is some unfair practices as everyone jockey’s for position in this digital age. But to shout “profiteering” when you truly don’t know the complete story is a bit like chicken little saying the “sky is falling”.
Wait it out for a few months, authors, publishers and digital bookstores are going to figure this all out.
Dear Chérie De Sues,
I was in the print industry for 10 years. The costs are simply not commensurate, there is a huge difference between print and anything that is purely digital. It is an absurdly big difference.
You don’t have the costs of printing, the cost of warehousing, the cost of transportation, the cost or the materials used in making the paper book, nor the cost of the books that get remaindered. All of these do add up.
Baen Books sells both print and ebooks. They’ve been in business since 1983. They sell their ebooks without DRM and most ebooks are $6 or less. Their example is proof that selling ebooks at reasonable rates can be profitable.
I certainly don’t expect authors to write for free. I buy an average of 10 ebooks a month. I don’t pirate books, but I do take advantage of legal freebies from Amazon and Baen. Usually I end up buying all the books in the author’s backlist.
As to the 100,000 downloads–I don’t dispute those figures. It could be 200,000–that still doesn’t mean that those people would have bought the book. If they weren’t able to download for free, they would do without. I’m not alone in this opinion. The actual losses due to piracy are open to debate. I have excerpted part of the text from this web site to support my argument: http://www.tomsguide.com/us/Piracy-China-USITC-RIAA-MPAA,news-7120.html
“According to Fritz Foley, a professor in the Harvard University business school, U.S. industries assume that a pirated music CD, game or movie blocks the sale of an authorized copy, thus those numbers are factored into industry estimates. However that may not be the case at all.
“It seems a bit crazy to me to assume that someone who would pay some low amount for a pirated product would be the type of customer who’d pay some amount that’s six or 10 that amount for a real one,” he said. “Be careful about using information the multinational [companies] provide you. I would imagine they have an incentive to make the losses seem very, very large.”
The web article goes on to say: “Earlier this year the Government Accountability Office told the U.S. Congress that there was no evidence of the million dollar losses claimed by the industries crying piracy. In fact, the firm argued that copyright infringements might actually benefit the entertainment industries and third parties.”
I’m not condoning piracy. I just feel that a better way to combat it would be to keep prices reasonable and do away with DRM. DRM only hurts the “honest” customers.
Diane: “Baen Books sells both print and ebooks. They’ve been in business since 1983. They sell their ebooks without DRM and most ebooks are $6 or less. Their example is proof that selling ebooks at reasonable rates can be profitable.”
Amazed at how off topic a thread can get :).
The simple fact of the matter is that publishers can charge book stores whatever they want for their books. Individual publishers can even force retailers to charge a certain price for their books. But when a group of retailers all decide, more at less at the same time to do the same thing, (especially when they all work with the same retailer to accomplish this) it starts looking an awful lot like a trust.
I too am distrustful of governmental overreach into our private lives. However, this is not what we are talking about here. We are talking about the majority of the big players in their industry taking advantage of government granted monopolies to subvert the free market. It does us no good at all if we escape the tyrrany of a government only to trade it for the tyrrany of corporations.
Tyranny: arbitrary or unrestrained exercise of power.
Sure, okay, I’d go along with that. But we are not talking about food, air, water or a roof over our heads. We are talking about an eBook that is by a well-known set of authors from five large publishers (corporations) who have made a move to protect the interests of their “art”, “authors” and “product”.
No one wants to believe on this thread that piracy (theft) exists. No one wants to look through the eyes of a publisher who is scrambling to deal with a new digital technology that can be stolen, translated and sold in countries all over the world within 24 hours.
I can’t afford a Porsche, so I drive an economical car with great gas mileage. I don’t complain to Porsche that they have four wheels, an engine and a radio just like my car, and they should lower their prices. I don’t tell Yves St. Laurent to lower their prices on a dress I want, I buy the cheaper knockoff at a dress shop.
Publishers have the right to make mistakes and ask for high prices on their eBook novels. YOU have the right to buy from an indie author or another publisher to show your disapproval.
But why charge MORE for an eBook then the pBook? The eBook? Plus, they are not allowing any sales or discounts for these eBooks. So in a lot of the cases, this makes the eBooks MORE expensive then the pBook.
This is not about the rights of the publishers to “protect” the authors. This is about the publisher asking too much money for eBooks. Plus, I’ve seen cases where the paperback has come out yet the eBook prices remain at the hardcover level and they promised us this would not be so.
So, not only do they gather together to cheat the public, they lie to the public as well. This smacks of anti-trust big time. And Apple also needs to get in trouble as well.
I agree with you Jon. The simple answer to your first question is “because they can”. When there is no competition. When a company has a monopoly on a product they can charge what they think people will pay. clearly they have seen a market of well heeled early adopters and feel they will pay the asking price.
I personally believe we are in the middle of the early birthing phase of a new market where all kinds of s**t is happening because the publishers are trying desperately trying to gauge as much profit as possible before things settle. They each are trying to leverage their own little monopolies and they are not ready to lift their eyes up high enough to see the potential of expanding the market through pricing. From recent articles here on Teleread it is apparent that this second phase is beginning but it will only really take off when the EU and US get their teeth into these monopolies. Imho.