What Price Ebooks?Click here to read in Microsoft Reader. 11 December, 2000 This week I'm going to talk about ebook pricing. I'm sure all of my readers have noticed that there's a wide variety of ebook pricing schemes out there, ranging from giving it away to charging even more than for the hardcover edition. Who's right? Pricing of anything is not an exact science, but it seems like ebooks have even further to go than other media. Gemstar's CEO Henry Yuen talks a lot about "perceived value", the concept being that if ebooks are priced about the same as hardcovers, people will be associate with them the same prestige associated with hardcovers. While I can understand the reasoning, it fails the "real world" test. A hardcover book is a physical item that clearly takes effort and resources to produce. It simply doesn't make sense to the average consumer to equate that with digital content that costs nothing to manufacture and in fact does not even exist in the physical world. On the other hand, it is possible to drop too low. While the word "free" may be the most searched keyword on the Internet, the fact is that most people in a capitalist society interpret "free" as "low quality". After all, if it was any good, why wouldn't you charge money for it? By the same token, how often do you hear, "you get what you pay for"? Most consumers are going to think that a $1 ebooks won't be as good as a $10 ebook. It's just the way we're conditioned. If you charge too little, people think it's not going to be good enough to be worth their time in the first place. So what's the answer? The first thing to ask yourself in pricing is what are you charging for, the media or the message? I agree that authors should be compensated for their work, and that publishers have to pay their bills as well. Perhaps there's a better way to look at this. Maybe content should have some sort of base price, the value of the information itself. Onto that publishers could tack on the actual cost of producing the media. For example, let's suppose the "base price" for a typical novel is $4.00, split evenly between the author and publisher (to cover editing, publicity, etc.). That's already much more than most novelists make per copy sold. So onto that four bucks, we add:
In this model, writers get what they'd currently get just for hardcovers for every copy sold, publishers get a fair share of the pie, and the rest of the saving are passed on to the consumer. The actual content costs the same, regardless of media, and the price differentials are based only on the consumer's choice of medium. So what do you think? Does this modest proposal also fail the "real world" test, or does it sound about right? Join the discussion on my eGroup. |