Eli5: Why is the purchase price of e-books basically the same as print.

222 viewsEconomicsOther

I would expect e-books to be considerably cheaper than printed books, since there are reduced distribution and production costs. Yet the retail price often doesn’t match those savings versus an e-book. I would hope that the authors royalties would reflect some of the savings in production costs.

In: Economics

16 Answers

Anonymous 0 Comments

It basically comes down to (just like all pricing) – would you rather sell two e-books for $20 a piece or three for $10 a piece?

Lowering prices isn’t an automatic way to increase revenue, even if it does increase volume sold.

Additionally, book publishing is in some ways monopolistic in the sense that a single publisher will own the rights to a specific book.  So even though there is A LOT of competition to get you to buy different books, there isn’t multiple publishers selling Harry Potter, for example.  It’s not like you and I can both sell Harry Potter books and then have to compete on price.

Anonymous 0 Comments

In the vast majority of cases it isn’t. For star authors, especially on first publication, it may be. This is probably a simple case of making the books appear reassuringly expensive. But it soon settles down.

Take for example the Cormoran Strike books by J. K. Rowling’s alter-ego Robert Galbraith. Book 7, which is the latest, at Amazon costs £12.99 for both hardback and Kindle editions. Book 6 is £7.49 in paperback but only £5.49 for Kindle.

Anonymous 0 Comments

It depends on the book. I have a lot of guitar instruction books from Fundamental Changes, and they are $10 on Kindle, $20 for the printed version.

Anonymous 0 Comments

“Because they can”. 

The publishers *do* save on production costs…and they keep those savings as profit. Because they can. 

Once upon a time ebooks were indeed cheaper than physical books, when they were new and not many people read that way. Now that people *are* buying lots of ebooks, publishers are charging more because they want more money. There’s no trick or secret here. 

Anonymous 0 Comments

The price charged for a good or service in a capitalist system is entirely unrelated to the cost of production. It’s the seller’s best estimate of the price that will maximize their revenue. If you were willing to spend X dollars on a print book, why wouldn’t you be willing to spend X dollars on a digital book? There are some reasons, e.g. the loss of the ability to resell; potential obsolescence; etc.; but you’ll note that they aren’t related to the production price (other than potentially *spite*, meaning being upset that the price hasn’t come down with the cost of production).

Cost of production is a starting point for price, since manufacturers don’t want to sell for a loss, but manufacturers aren’t going to reduce prices for materials on which they have a monopoly (like that provided by copyright) just because it’s cheaper to make them. They’re going to take higher profit instead.

Anonymous 0 Comments

Authors do often have better royalties on e-books but that’s not really the reason that the cost is so close. In practice the cost is so close simply because people are willing to pay it. E-books have much lower overhead costs than a physical book however they also come with a high degree of convenience. Which makes people willing to pay a similar price as they would for a physical book. I have a few hundred books on my tablet and can get more nearly instantly anywhere there’s wifi. This convenience has a value that some people (myself included) are willing to pay for.

Anonymous 0 Comments

Business is going to business.

It’s hard to know how much a company saves on distribution. There are still costs associated with making a digital book. Often, the layout can’t be identical to what would be done for a physical book, especially for books with diagrams and complex figures that will have to account for e-readers with sizes from “phone” to “tablet”.

There’s also market forces. When Amazon prices e-books at the same price as print books, people don’t stop buying e-books. That means Amazon has no real incentive to lower the prices. People would probably complain, but STILL buy e-books if they were MORE expensive. That technically means Amazon is setting the wrong price. The market only cares about profit.

How it affects royalties really comes down to the author’s contract. Digital books might have different conditions than print books. Unless the author is very popular, they don’t get a lot of say and contracts usually favor the publisher and distributor. So I bet it’s common that even if the costs of distributing e-books are less, it’s reflected in authors having a smaller royalty percentage for that revenue. (But most authors don’t get royalties at all.)

Anonymous 0 Comments

the reason for that depends entirely on where you are located.

in many countries book prices are the same regardless of where you buy the book or in which format you buy it as there are laws preventing stores from selling books for lower prices.

Anonymous 0 Comments

It’s because to the consumer (or more broadly, the market) the content is where the value is, not the physical object. If the market valued the physical object more than the content, Then you would find ebooks selling for much less or possibly even non existent.

Anonymous 0 Comments

Because there’s more costs than just printing the book. You have to pay all the people that went into making a book. The author might have spent hundreds or thousands of hours on their work. If you are able to get published through one of the large publishing companies, they’ll have teams of editors, illustrators, sales, marketing, distribution, all the things needed to get your book into Barnes and Noble or Amazon.

As for the cost of printing a book, these companies have contracts with massive printers where they turn out 100,000 books for less than you self-publishing 1,000.