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July 15, 2009

E-Book Distribution, Pricing and Sales [2:06 pm]

When to Schedule E-Book Releases - A New Worry for Publishers (pdf)

No topic is more hotly debated in book circles at the moment than the timing, pricing and ultimate impact of e-books on the financial health of publishers and retailers. Publishers are grappling with e-book release dates partly because they are trying to understand how digital editions affect demand for hardcover books. A hardcover typically sells for anywhere from $25 to $35, while the most common price for an e-book has quickly become $9.99.

Amazon.com, which sells electronic editions for its Kindle device, has effectively made $9.99 the de facto price for most best sellers, a price that publishers believe will reduce their profit margins over time. Barnes & Noble, through its Fictionwise arm, also sells best sellers in e-book form, for $9.95.

Ms. Herz said that Doubleday was primarily worried about the security of Mr. Brown’s book, which is being kept under a strict embargo until the Sept. 15 publication date. But she acknowledged that the e-book’s possible effect on hardcover sales was also an issue, among others.

Similarly, Stephen King, whose novel “Under the Dome” is being published in November by Scribner, an imprint of Simon & Schuster, said in an e-mail message that “we’re all thinking and talking about electronic publishing and how to deal with these issues,” adding, “but I can’t say anything right now.”

Later, in Slate: Does the Book Industry Want To Get Napstered?

What has kept illegal e-books from taking off? First, all the electronic reading gadgets on the market are subpar, if you ask me, making the reading of books, newspapers, magazines, and even cereal boxes painful. [...] Second, the hassle factor is too great. [...] Third, not all bootlegged e-books are created equal. [...] If a nicely produced Kindle version of The Telephone Booth Indian that doesn’t have to be monkeyed around with can be easily nabbed for $9.99, which it can, why bother breaking the law to obtain an inferior edition for display on a rotten device? It’s like using an acetylene torch to loot a kid’s piggy bank.

[...] So far, few consumers think books should be free—a fact that I attribute to the klugy Kindle and its affordable Amazon store. I conducted an informal census of friends and associates who read lots of books, and I found none who partake of the bootlegged variety. But that could change in a matter of months if the book industry insists on 1) jacking up the price of e-books and 2) withholding potential best-sellers from the e-book market. Cool devices that make electronic reading painless are just around the corner, and the e-book market is about to explode. If publishers insist on pushing prices too high and curbing availability, consumers could rebel—as they did with the sharing of MP3s—and normalize the trafficking of infringing e-books.

My sense that not all publishers understand their readers is shared by Forrester Research analyst Sarah Rotman Epps. “Publishers are in denial about the economics of digital content,” she told the Wall Street Journal this month. “What we’ve seen in other industries and in the evolution of digital content is that consumers are not willing to pay as much for content that is separated from its physical medium.”

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