From The Bookseller:
Amazon’s publishing chief David Naggar has said publishers should slash their e-book prices to 99p to sell more books. However, publishers have retorted that this move would be “economically unwise” and would damage the whole book supply chain.
Speaking to the Daily Mail, David Naggar, v.p. of Kindle Content at Amazon.com, suggested that traditional publishers should follow the lead of self-published authors when setting e-book prices, arguing that a lower price point is a form of marketing which would encourge more people to buy digital books.
“I look at price as a tool for visibility. You can either spend a lot of money on marketing or you can invest it in a super-low price until they get the flywheel going of the recommendation engines – and this is just for Amazon”, Naggar said.
He added: “What self-published authors will do is they will publish a book and sell it for 99p right out of the gate… Publishers [with new authors] could much more afford to do that than self-published authors. If I have two books in front of me and I don’t know either author, and one book costs £9.99 and the other is £2.99, which one am I going to take?”
However, professionals in the industry have pointed out there are big differences between traditional and self-publishing business models, with Nicola Solomon, chief executive of the Society of Authors, branding Naggar’s comments as “naïve”.
“He makes a direct comparison between publishing companies and self-published authors, but conveniently avoids the fact that the economics are completely different”, she said. “Self-published authors on the Kindle Direct Publishing (KDP) platform earn between 35%-70% of the e-book retail price (where traditionally-published authors earn 25% royalty on e-books)– that’s why they can discount to that level and still enjoy a decent income if their book is successful. But I doubt Naggar has considered the likely impact on the incomes of traditionally published authors if their e-books were discounted to 99p as standard. The routine discounting and implied devaluing of printed books – often at the authors’ expense – is already a big problem. The last thing we need is to encourage even more discounting on digital platforms.”
Stephen Lotinga, chief executive of the Publisher’s Association, also noted the difference in business models and added that Amazon thinks they have publishers “over a barrel” because of its high e-book market share – estimated to be around 90% in the UK.
. . . .
According to statistics from the Publishers Association’s Annual Yearbook, sales of trade e-books fell by 17% in 2016 to £204m.
Alessandro Gallenzi, publisher at Alma Books, argued that publishing books and nurturing authors requires long-term investment and that lowering the selling price of titles is “not only economically unwise”, but “damages the whole book supply chain – author-agent-publisher-wholesaler-bookseller-end user”. He added that cheap prices damage authors the most because it “devalues” and “homogenises” their work.
He added: “It is damaging also, in the longer term, for Amazon, because it is devaluing its offer across the board, when in fact it should be looking at encouraging publishers to increase their available e-book range. I think some publishers (and authors) are still reluctant to see their books be digitised, and perhaps Amazon’s drive towards skeleton pricing is one of the deterrents. I know I have already said it, but I’ll say it again: a book is not like a banana!”
. . . .
However, Matthew Lynn, c.e.o. of e-book publisher Endeavour Press, which recently launched a print arm, on the contrary maintained that “the market decides the price, and it’s the job of the publisher to make money at that price”, adding: “If you can’t make money, then lower your costs”.
. . . .
Andrew Franklin, m.d. of Profile Books, added that the self-published 99p Amazon e-book “bears no comparison whatsoever to a real book properly published”, and alluded to Amazon’s unwillingness to share data about the e-book market.
“The self-published 99p Amazon e-book bears no comparison whatsoever to a real book properly published. That is why the successful self-published authors will always move to mainstream publishers when they have a chance,” he said. “And there are almost no examples of people moving the other way. Of course I respect David Naggar’s position. He has access to an enormous amount of data that nobody else ever sees. But I wholly disagree.”
Link to the rest at The Bookseller
- Amazon sells more books than anyone else.
- Amazon sells more ebooks than anybody else.
- Amazon owns the world’s largest cloud computing system, Amazon Web Services.
- Among many other things, Amazon uses AWS to track:
- the impact of pricing upon the behavior of hundreds of millions of customers
- choosing from about 400 million different products (including books)
- sold and priced by hundreds of thousands of independent merchants (and Amazon)
- on a world-wide basis
But the chief executive of the Society of Authors (who hasn’t performed a math calculation beyond determining the amount of a restaurant tip in dozens of years and who calls tech support to reboot his iPhone several times a week) knows more about the optimum price of a book than Amazon does.
The cruelest insult of all was mentioning that self-published authors understand ebook pricing better than the humphing old boys of British publishing.
PG suggests that when someone says Amazon is devaluing books, what they really mean is Amazon is devaluing publishers.
It costs money to nurture. The price of nurts has soared over the past several years. Amazon is a mortal threat to nurticulture.