Amazon Caves To Publishers On eBook Pricing

AusPublishingWorker writes "With the iPad arriving on the scene, it seems that Amazon is feeling the pressure on eBook pricing from publishers. ITNews reports that Amazon has agreed to deals with both Harper Collins and Simon and Schuster which would allow the companies to select their own prices rather than the default US$9.99 price tag. Given the recent deal with Macmillan, it seems likely that we'll be seeing eBook prices moving up towards $14.99 in the near future."

Comments

Before the anti-ebook posts accumulate,

[aussersterne]

let me just give a preemptive counterperspective.

I buy ebooks and I'll buy them at this price, too.

Yes, I prefer (by far) reading using ebook readers with eink displays. Since the first Kindle emerged I've probably read 10,000 pages or so using ebook readers. Love them.

Also, tools exist to unDRM and convert between just about every ebook format, including Mobi, Azw, Topaz, ePub, PDF, Lit, PDB, and others, so books can in fact travel with you as you upgrade devices in the future, should you choose to go this route.

The Real Issue

[sonicmerlin]

The problem with pricing books at $9.99 is the stickiness of the price tag. What is meant by this is consumer' perception of value. Although you can achieve large sales volume at price "below $10", if you ever try to raise the price by even a tiny amount, say $1, consumers *feel* like the markup was much higher than it really is, and sales subsequently drop off heavily.

The same phenomenon could be observed with iTunes' .99 cents pricing. Attempts to raise the price higher (especially without unilateral price raises across the board of offerings and publishers) resulted in significant sales drops.

It is also one reason we may never see a $99 netbook. That sub-factor of 10 number is quite magical for sales numbers, but kills any hope of raising prices in the future to combat inflation, increased salaries, admittedly raising profits, etc.

Re:The Real Issue

[TubeSteak]

You sound like a marketing major. They seem to be the only ones who believe that garbage. I don't know anyone who is fooled by pricing at 9.99 and being told "under $10". Just call it $10.

Almost everyone is fooled by 9.99 and "under $10" pricing.
http://en.wikipedia.org/wiki/Psychological_pricing
Endless studies have been done on the matter and it works.

We like to pretend that demand curves are smooth, but they aren't.
They go through all kinds of weird contortions because humans are not 100% rational market actors.

Re:$14.99 seems way too high for an eBook.

[Zumbs]

It is high. Particularly when you factor in that the DRM on eBooks locks you to read it using certain readers, and may cause you to loose access to the book you paid for if you buy a new computer, or the publisher takes the DRM servers offline (even accidentally). Unfortunately, putting DRM on books are expensive, as noted by Charlie Stross on his blog, and consumers get to pay the bill.

Re:I agree

[TheVelvetFlamebait]

This is why I hate conservatives. I can't get them to understand that a legal document written 200 years ago might, just might, not be 100% relevant any more.

It's not enough to simply show that a law might not be relevant; you have to show that it is not relevant. The law prevents expedient copying from devaluing new artworks, which are both in demand and (unlike the copies thereof) scarce. The faster and cheaper the copying technology, the less likely a person is to support the artist, the less likely the artist will create a new work.

Copying has only become faster and cheaper. Now, more than ever, copyright is relevant.

Now here comes the difficult bit: convincing you that a legal document written 200 years ago might still be relevant. It wouldn't be the first, and I believe certain other documents (e.g. magna carta) break this record.