From Brady Dale at The Observer
. . .
With e-books rising and print’s share declining, there’s a fierce debate about what e-books should cost. The publishers recently won the right to raise their prices on Amazon at will, but signs suggest it’s not paying off. At least, if you measure the payoff in dollars. Evidence suggests higher prices may not be the best way to make more money in the digital literature market, but publishers may have other reasons for jacking up costs.
. . .
If any books were necessary, one would think it would be the books from major publishers. Those are the books you are most likely to get quizzed about at cocktail parties or that your boss is most likely to say that you should read. Yet even for these stickier titles, higher prices lower sales. In fact, lowering sales so much that the publishers are making less money than they made before.
Meanwhile, all told, more writers are producing more books and making more money than ever before. A lot of that increase has occurred outside major publishers, though.
This is a point that Amazon has made in the past. Last summer, it gave the public a peek into its data around prices and e-book sales. The Amazon Books Team posted on the Kindle Forum, writing:
For every copy an e-book would sell at $14.99, it would sell 1.74 copies if priced at $9.99. So, for example, if customers would buy 100,000 copies of a particular e-book at $14.99, then customers would buy 174,000 copies of that same e-book at $9.99. Total revenue at $14.99 would be $1,499,000. Total revenue at $9.99 is $1,738,000.
Smashwords, the online retail giant’s little baby brother, made a similar point on its blog. It wrote that, in its experience, lower prices modestly increase total income while majorly boosting readership, which the company contends better insures a writer’s future.
. . .
This question of perception may explain what’s going on with the major publishers. Booksellers still account for most of the publisher’s money and relationships. They no doubt fear that low e-book prices undercuts the sales of physical books in the storefronts of their old friends. Fair enough, but the world is changing.
. . .
Publishers, it seems, are making less, as well. Of course, they have the right to do whatever they want, but the move doesn’t seem to be helping anyone but—perhaps—booksellers. So, why are the big guys still raising e-book prices?
Link to the rest at The Observer
This post provided as part of a package of perpetual participation during PG’s vacation by Bridget McKenna