On the Economics of the Kindle

perlow writes "Just how many books a year would you need to read before the cost of Amazon's Kindle is justified? The answer is not so cut-and-dried. If you're a college student and all of your texts were available on Kindle (possible but unlikely), you could recover the cost of the reader in a semester and a half. For consumers to break even with Kindle's cost in that time, they would have to be in the habit of buying and reading four new hardback books per month — if the convenience factor wasn't part of the equation. At two books per month, breakeven would be in three years." Here is the spreadsheet if you want to play with the numbers.

Comments

i like the idea of the kindle

[ionix5891]

but I want something with a color screen at least (i know its too much to ask but oh well)

Re:i like the idea of the kindle

[hedwards]

I take it that you've never taken biology or chemistry. The books use color illustrations for a reason, and it's not to justify the price gouging.

Or that you've not read many books talking about basic art concepts or novels that have illustrations in them. Sure they cost more, but there's definitely a reason why the illustrations are there.

Re:i like the idea of the kindle

[Glendale2x]

An electronic reader could be a killer application for education. Textbooks are large, heavy, and you usually have more than one per semester. (For the sake of this argument, we'll assume engineering/science/bio/med students.) Electronic substitutes fail completely because they're lacking color, suitable resolution screens for rendering technical drawings, and textbook availability. Yes, we all have laptops now, but honestly, reading a book (or 5) on a laptop sucks. I could care less if I couldn't sell books back if it lets me carry an entire semester's worth of material (plus *all* of my other year's worth of references) in a tiny device vs. tons of dead trees.

Re:i like the idea of the kindle

[lysergic.acid]

i completely agree. however, i think there are several things that need to happen before we can take full advantage of electronic textbooks in colleges and perhaps even high schools. first off, like you and the GP have already mentioned, e-book readers need drop in price and employ higher resolution color displays (either e-ink or low power OLEDs), and WiFi capabilities should also come standard. secondly, there needs to be drastic reforms in the publishing industry, or at least in regards to attitudes towards IP enforcement and DRM. lastly, the business model currently employed by textbook publishers of forcing schools and students to buy new editions of books every other year needs to be dropped.

once these changes have occurred, Universities could simply purchase electronic subscriptions to certain texts, which would allow them to check these subscriptions out to students who need them for classes they're enrolled in. all a student would have to do is connect their e-reader to the school's WiFi network and they can check out the textbooks they need. the subscription would give the school permission to distribute "loaned" copies of the electronic textbooks to as many students as needed (rather than enforcing physical limitations on a virtual commodity) and also allow the school to receive updates from the publisher to keep their digital textbooks up to date. if a student finds a textbook particularly helpful they can pay the publisher for a modestly priced static copy, or they can purchase a single-user subscription that will receive automatic updates.

this model would save students a ton of money, and greatly lower the financial barrier to higher education. however, i imagine the textbook publishing industry would be strongly opposed to the necessary changes as it undermines their strategy of planned obsolescence, which is the basis of their current business model. and the true financial/economic advantages of using paperless textbooks won't be realized (at least not by anyone except for the publishers) until e-book publishers stop charging print prices for non-printed materials.

Re:i like the idea of the kindle

[billcopc]

The problem with that idea is that textbooks are too profitable an industry to risk modernizing.

Scratch that - education is too profitable an industry to risk modernizing.

The bottom line is: textbooks are a cash cow for the publishers and schools, and while a lot of people talk about saving dead trees, very few actually care because we don't see those dead trees. We see them on TV, we read about them in craptastic magazines (irony!), but that's always "somewhere else" and the idea fades as quickly as it came.

If you really want to save the trees, kill a lawyer. I'd bet one lawyer wastes more paper in a year than an entire classroom.

Re:i like the idea of the kindle

[AlecC]

The trouble with "saving students a ton of money" is that it would cost the publishers a ton of money. OK, half that money goes to the bookseller who, as a no-longer-needed intermediary would disappear. But the remainder is lost income for the publisher. The publisher will say that this will produce a dramatic drop in the number of textbooks they publish, to the consequent loss of the whole of academia. Whether that is true or not, if someone's income from a source drops dramatically, they are going to do less of it.

And if the University us paying a block fee for the e-textbook, they are going to have to get that money from somewhere. So either they will charge students for it or they will drop something, presumably worthwhile, that they are doing now (tuition, library books, formal dinners...).

What's the point of this analysis?

[tyler.willard]

...if the convenience factor wasn't part of the equation.

Isn't this largely the point? Who the hell is making a decision to purchase this based on book cost?

Convenience

[jamesl]

... if the convenience factor wasn't part of the equation.

The convenience factor is the equation. The whole equation.

Re:There is more to it...

[James_Duncan8181]

Also, even if it were not about the experience, I cannot resell books from the Kindle. So the TCO is much higher than the books assuming that I resell all those that do not rock my world.

Re:There is more to it...

[calmofthestorm]

And you're locked in to the kindle forever, until they stop supporting it at least:/

Not to be a ra-ra anti-DRM fanboi at every story, but it's somewhat relevant here.

Re:There is more to it...

[modestmelody]

Amazon needs to offer electronic copies of books I order for a small up charge. I still want the real book. I still want the experience of having a real collection even when the tech is old/broken/unsupported. In bed at night I still want to turn the pages. However, I'd love to have the convenience provided by the Kindle when traveling and even for purchasing. Buy the book now, read instant on the Kindle, get the hard copy in the mail two days later. I'd buy a Kindle regardless of generation/tech in an instance if this plan existed.

Cost estimates off by factor of ten, inconvenient.

[slashnot007]

With a real hardback book I can resell it on amazon for most of what I paid for it. Moreover I can buy it used to begin with. So the cost estimates here are off by a factor of 8 to 10 at least. Of course here is some inconvenience i reselling. On the other hand I can also buy a lot more books at one time for the same price and keep them till I'm ready to read. Conveience to me is being able to toss a book in my airplane bag or beach bag. I'm not taking my kindle to the pool or the beach. I'm not going to leave it outside on the patio table while I go take a pee or refill my drink. And I'm certainly not parking it beside the piss pot, or taking it in the bathtub with me. Besides, being old school, I find there's a great deal of visceral nature to books that somehow is part of the reading. Even being able to dog ear a page or write in the margins of certain kinds of books is a very good way to use them effectively. Not to mention...convenient.

Re:There is more to it...

[DavidTC]

No shit.

Look, give me a black and white epaper device that can display things.

Forward, back, select, exit, it doesn't need more controls or intelligence than a cheap-ass MP3 player. You can probably steal the chip from those 'picture frame' things.

Don't give me one with a damn wifi connection, or a computer in it. A single USB connection, or a single SD card slot, would be fine. Rechargeable batteries would be a bonus, but not required. (From what I understand, those things use almost no batteries.)

Hell, it doesn't even have to display 'text'...if it can just display GIFs with consecutive filenames, and requires a conversion program to put books on there, I wouldn't mind one bit.

Something like that should actually cost 50 dollars, and 45 dollars of that should be the epaper.

Re:Cost estimates off by factor of ten, inconvenie

[rtfa-troll]

It's not just about selling. Most of the value in culture is sharing. If I have a real physical book, I can lend it to my friend. I can give it to a family member. I can say "read this; I loved it". If it's locked into my Kindle then that's much less likely to happen. That may not happen with every book, but you don't know which ones are going to be important till you read them.

A real book is worth much more than a DRM controlled image of one.