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HFQ ebook Pricing - Unconsionable

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HFQ ebook Pricing - Unconsionable
Post by Mark Time   » Thu Sep 17, 2015 11:26 am

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As much as I enjoy David Weber's books I find the pricing of HFQ on Amazon to be outrageous. The Kindle version is $14.99 while the hard cover is $15.70. Of course there is an intrinsic value to David's work and he deserves all the royalties that he gets. (I'm assuming here that David's royalties are the same whether it's an electronic or physical copy that is sold.) What I find unconscionable is that there is only a $0.71 cent price difference between the electronic and the hard cover version.

You can't tell me that the cost of manufacturing, distribution, delivery, and remaindering of the hard cover edition is only $0.71. Pricing the electronic version so close to the hard cover version is merely price gouging on the part of the publisher. As much as I enjoy reading David's books, I'll hold off until I don't feel that I'm being taken advantage of.

David - go back to Baen.
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Re: HFQ ebook Pricing - Unconsionable
Post by Charybdis   » Thu Sep 17, 2015 12:43 pm

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Mark Time wrote:As much as I enjoy David Weber's books I find the pricing of HFQ on Amazon to be outrageous. The Kindle version is $14.99 while the hard cover is $15.70. Of course there is an intrinsic value to David's work and he deserves all the royalties that he gets. (I'm assuming here that David's royalties are the same whether it's an electronic or physical copy that is sold.) What I find unconscionable is that there is only a $0.71 cent price difference between the electronic and the hard cover version.

You can't tell me that the cost of manufacturing, distribution, delivery, and remaindering of the hard cover edition is only $0.71. Pricing the electronic version so close to the hard cover version is merely price gouging on the part of the publisher. As much as I enjoy reading David's books, I'll hold off until I don't feel that I'm being taken advantage of.

David - go back to Baen.

MAYBE - Maybe it is Amazon involved as well. I believe that there has been contracted agreements between the publishing houses and Amazon over the pricing between 'dead tree' and 'eBook' versions, to the detriment of eBook purchasers.

FYI: I found that having bought the physical hard back of HFQ (when it was initially announced), I was given the discounted eBook pricing of $2.99 (actual eBook cost?) :)
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Re: HFQ ebook Pricing - Unconsionable
Post by khameirsith   » Thu Sep 17, 2015 12:56 pm

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Are there rules on new books? Are royalties a percentage or fixed pricing?

If it's a percentage, then you're saying David only deserves a percentage of 2.99 ebook vs same percentage of hard cover?

The bulk of the profits from a book come at the release of the book. In order for the publisher and author to make money, you'd have to make both equally or similarly priced.

Is it really fair to David that you pay 3 bucks for his latest work?
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Re: HFQ ebook Pricing - Unconsionable
Post by Olegreyowl   » Thu Sep 17, 2015 1:05 pm

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Mark Time wrote:As much as I enjoy David Weber's books I find the pricing of HFQ on Amazon to be outrageous. The Kindle version is $14.99 while the hard cover is $15.70. Of course there is an intrinsic value to David's work and he deserves all the royalties that he gets. (I'm assuming here that David's royalties are the same whether it's an electronic or physical copy that is sold.) What I find unconscionable is that there is only a $0.71 cent price difference between the electronic and the hard cover version.

You can't tell me that the cost of manufacturing, distribution, delivery, and remaindering of the hard cover edition is only $0.71. Pricing the electronic version so close to the hard cover version is merely price gouging on the part of the publisher. As much as I enjoy reading David's books, I'll hold off until I don't feel that I'm being taken advantage of.

David - go back to Baen.



Here's the thing. The book costs 27.99 as the publishers price. Amazon is running it at 44% off. If you buy that book and nothing else on your transaction, Amazon loses money. It's what's called a "Loss Leader". The idea is that customers will come to you to get the "New Thing" and pick up a couple of other things as well. On the entire transaction you make money and you deprive your competition of a customer. That's partly how Borders went out of business. Roughly anything above 35% off is a profit loss. Of course this varies slightly from case to case depending on the publisher but no more than a couple of percent usually. Now ebooks are not usually part of a multi item transaction and so "Loss Leaders" are generally contraindicated. Not always but mostly. So they need the extra margin on the ebooks. Amazon's operating margin is razor thin, last I checked it was under 1% and I have seen it below .5% in the last couple of years. They are operating on the model of scale and their numbers are right on the egde, if there is the slightest downturn in their profits it's going to be a huge bubble pop. Their P/S ratio is so very high for a company that if investors have any reason to doubt there will be a rush.

Source: 25 years retail management with 10 in books.

My two cents for what it's worth.
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Re: HFQ ebook Pricing - Unconsionable
Post by SWM   » Thu Sep 17, 2015 1:10 pm

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The price of the e-book version is demanded by Amazon as part of the deal to sell the print book. As part of the contract, Amazon requires the price of the electronic version to be within a certain percentage (I believe) of the price of the print edition.

When the paperback version comes out, that price will be the one which sets the price of the e-book.

And Amazon is such a big part of book sales that no publisher, including Baen and Tor, can afford not to sign the contract.
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Re: HFQ ebook Pricing - Unconsionable
Post by khameirsith   » Thu Sep 17, 2015 1:20 pm

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SWM wrote:The price of the e-book version is demanded by Amazon as part of the deal to sell the print book. As part of the contract, Amazon requires the price of the electronic version to be within a certain percentage (I believe) of the price of the print edition.

When the paperback version comes out, that price will be the one which sets the price of the e-book.

And Amazon is such a big part of book sales that no publisher, including Baen and Tor, can afford not to sign the contract.

Is that good or bad? Signing with Amazon?
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Re: HFQ ebook Pricing - Unconsionable
Post by Olegreyowl   » Thu Sep 17, 2015 1:27 pm

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khameirsith wrote:Is that good or bad? Signing with Amazon?


They have a huge customer base. But you had better make sure that you never let them become your "make or break" customer. Amazon has been known to require more and more stringent contracts, demanding your product at lower and lower prices once they have you over a barrel. If you can balance other customers who carry your product with Amazon and allow yourself the negotiating tactic of walking away, you'll do well to sign with them. But seriously tread carefully and do your research.
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Re: HFQ ebook Pricing - Unconsionable
Post by khameirsith   » Thu Sep 17, 2015 2:15 pm

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So what is the real value of an ebook? Excluding the obvious argument that it costs next to nothing to copy/paste a digit file and minimal to distribute it.

What is the value of the book it contains without the paper/hardcover it was printed on.

That, I think, is the real question.
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Re: HFQ ebook Pricing - Unconsionable
Post by SWM   » Thu Sep 17, 2015 2:28 pm

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khameirsith wrote:So what is the real value of an ebook? Excluding the obvious argument that it costs next to nothing to copy/paste a digit file and minimal to distribute it.

What is the value of the book it contains without the paper/hardcover it was printed on.

That, I think, is the real question.

That is a question that the publishing industry (and the reading public) have not quite resolved.
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Re: HFQ ebook Pricing - Unconsionable
Post by Olegreyowl   » Thu Sep 17, 2015 2:31 pm

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khameirsith wrote:So what is the real value of an ebook? Excluding the obvious argument that it costs next to nothing to copy/paste a digit file and minimal to distribute it.

What is the value of the book it contains without the paper/hardcover it was printed on.

That, I think, is the real question.


Much of the cost of printing a book is the same no matter the format (Hardback, paperback, ebook). Author advance & royalties, publisher & editor costs, distributors percentage, etc. And just like in other forms of media these costs are up front and prior to selling the first copy. Yes, with ebooks there is a lower cost to distribute the finished work but lower is not free contrary to popular belief. Server costs, web management, digital security, e-transaction costs with the banks (they love their transaction fees), IT support both internal and external (Can't tell you the # dumb questions we get on how do I read an ebook), and many other small $ figures go into the cost of putting out an ebook. The cool thing about ebooks is that as time goes on and sales defray those initial upfront costs the prices of ebooks tend to go down. You also see this in physical books, bargain hardcovers, special priced paperbacks, anthologies, etc. but the you usually see a greater discount on ebooks.

In general if you see an ebook below the $8-10 and it's brand new someone is cutting some/all of the profit from it. But 5 years down the road once all the initial costs are recouped you can see books at $4-5 and still be making a decent profit. But the market will bear what it will bear so you see some books forced into lower price points by public perception and you will see some books making HUGE margins by pricing at 7.99 because the public sees that as reasonable as well.

Look at the cost of small print publishing (e.g. print on demand & self publishing). You see these books often priced at 24.99 for a paperback and 19.99 for the ebook. That's because they are not working with much scale and have to pay the costs.
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