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The Price of Amazon

Posted by Soulskill on from the not-quite-enough-for-free-shipping dept.

An anonymous reader writes "As physical book stores continue to struggle and disappear, the NY Times puts the changing book industry into perspective as a cost of the existence of Amazon. Further, it's a cost that hasn't been fully paid, as other effects of Amazon's ascendancy have yet to be felt. Quoting: 'One consequence of this shift is that soon no one will know what a book's "real" price is. Price will be determined by demand and perhaps by whim. The first seeds of this can be seen in the Justice Department's suit against the leading publishers, who felt that Amazon was pricing their e-books so low that it threatened their viability. The government accused the publishers of colluding to raise prices in an anti-consumer move. Amazon was not a party to the case, but it emerged the big winner.' Economists, publishers, and readers no longer have confidence that a book will cost the same amount this week as it did the last."

10 of 298 comments (clear)

  1. NEWS FLASH by Anonymous Coward · · Score: 5, Funny

    This just in: the market isn't the same as it was 50 years ago! Some scientists are saying we need to observe our market differently. Panic ensues.

    1. Re:NEWS FLASH by fche · · Score: 5, Insightful

      Leave it to the NY Times to pen something so illiterate: "no one will know what a book's "real" price is. Price will be determined by demand and perhaps by whim."

      The "real price" of something is exactly determined by each transaction where it is sold. This is the realest price you can get. A MSRP printed on the book is not "real".

  2. one word ... by meekg · · Score: 5, Insightful

    ... Selection.

    Amazon beats any bookstore at finding older books.
    Brick and mortar stores are all about displaying 20 copies of the latest shit best-seller, sitting side by side, on the front shelves. No thanks.

    1. Re:one word ... by Anonymous Coward · · Score: 5, Informative

      If you want old books, Project Gutenberg might be worth your time.

    2. Re:one word ... by peragrin · · Score: 5, Interesting

      amazon wasn't selling below cost. amazon was selling books at low margin.

      The thing is regular bookstores have massive overhead, and old publishers where using that to keep thing artificially inflated. Why does an ebook cost more than a regular book?
      You have to pay the writer the same, you have to pay the editor the same, you have to give a publisher their same pie, but you no longer have to pay multiple levels of distribution, shipping, printing, storage, inventory costs. that right there is 20-40% of the price of a book.

      --
      i thought once I was found, but it was only a dream.
  3. Breaking news by WWJohnBrowningDo · · Score: 5, Interesting

    Economists, publishers, and readers no longer have confidence that a book will cost the same amount this week as it did the last.

    Breaking news: prices of goods change based on supply and demand. Film at 11.

    1. Re:Breaking news by Your.Master · · Score: 5, Insightful

      eBook prices are mediated by the supply of good writers, which is not infinite. Same goes for everything digital. Replication costs going to 0 isn't sufficient to remove supply to 0 as long as the cost of the initial thing you're replicating is nonzero.

      There's an interesting question about how to economically model that, of course. DRM is one way, extremely unpopular on Slashdot, but certain forms have had market successes (Steam, eBooks). There are others, many of which are more radical departures from the current model -- one is to assume that enough people will have the desire to do art for its own sake to supply worldwide demand and thus rely on "donated" art (free supply) and then infinitesimal replicated costs. Another is product placement, which isn't nearly as common in books as in TV and movies but could be done. Closely related is using the books as a platform to sell things that aren't reproducible, like kid's toys (Transformers and He-Man in book form). There's individual / corporate patronage. There's a model where the government (or a charitable foundation or something) sponsors a fixed amount per year, and distributes books for free and unencumbered by anything save a counter that tracks the number of downloads (or perhaps aggregate time spent reading the book or similar), distributing their money according to these stats. They could be written in less-common languages by companies that control professional high-quality translations, and kickstart a translation effort into English, Spanish, and Chinese. Lots of others.

      But there must be some model, whether it's explicit or implicit. Because the supply is restricted.

  4. Does this mean anything? by phantomfive · · Score: 5, Insightful
    I read the summary three times, but I'm still not sure how it relates to reality. For example, this sentence:

    'One consequence of this shift is that soon no one will know what a book's "real" price is. Price will be determined by demand and perhaps by whim.

    How is that a consequence? Haven't books always been priced based on demand and whim? They don't think the price of a $200 textbook is primarily in the print materials, do they?

    --
    "First they came for the slanderers and i said nothing."
  5. Re:New technology makes old technology obsolete. by Anonymous Coward · · Score: 5, Interesting

    Brick and mortar stores are doing just fine killing themselves on the electronics front.

    Just a couple weeks ago i wanted a usb cable. Nothing fancy... a to b. 3 foot.

    I wanted it now. So i hit all the stores as i was out that day. they either didn't have it. or in the case of staples... it was $34. thirty four fucking dollars for a 3 foot piece of cable. (not even a monster cable)

    After a loud 'FUCK THAT'. I went and got it from newegg. took 2 days total. price. $3 Thats even with state sales tax since newegg has a place in my state.
    And places like staples are actually wondering why nobody goes there anymore... they really can't figure it out.

    Fail on price? Check. Fail on stock? Check. Fail on service? Check. Fail on convience? Check.

    If these phsyical stores wan't to stay open. They're going to have to step up to the plate in a big way on one of those points... But so far... nope. nobody has.

    And bookstores are the same. Plus they get to compete with ebooks too. Can i bring my reader to their store and walk out with an ebook loaded? Nope. Fail.

  6. Re:When the shift hits the fan. by damnbunni · · Score: 5, Insightful

    Y'know, when Baen Books started selling e-books through Amazon, they had to -raise- the $6.99 prices of books sold through their own store - because Amazon would price-match their store, otherwise.

    As a result of this, Baen increased author royalties on e-books by 25%, so more of the customer's money is going to the author.

    So I'm guessing Amazon's $9.99 default price isn't hurting fiction authors much unless their publisher's an asshole.

    (Though really, buying them through Amazon instead of direct from Baen is silly - Baen gives you your books in Kindle's .mobi, Nook/everyone else's epub, EBookwise, Microsoft .LIT, Sony Digital Reader, HTML, and as a .rtf file.)

    You're right that the publisher and author should set the price of the ebook - they should set the WHOLESALE price, that Amazon - or whoever else - pays them for the book.

    If Amazon wants to sell books below cost as a loss leader for Kindle sales, that's up to Amazon. The publisher should take their stated wholesale price and be happy with it.

    That's actually how it USED to work before the 'agency pricing model' came in.

    You know what else happened when the 'agency pricing model' came in?

    Most of the indie e-bookstores closed.

    Great job letting the publishers set prices, there. With publisher-set pricing, there was nothing else for the smaller stores left to compete with Amazon, Barnes & Noble, and Apple over.

    The one I used had a 'book club' program, that offered discounts with multiple purchases. Suddenly, they couldn't do that any more.

    And they only avoided going under entirely by getting bought out by B&N.

    So, in short: Fuck the 'agency pricing' model. And fuck the publishers using it.

    Set a wholesale price for the thing, sell it wholesale, put a 'suggested retail' price on it, and let the retail channel decide what to actually sell it for.

    You know, like almost every other product on the market.