back to article Sci-fi and fantasy authors wade into Amazon spat

The writers' group Science Fiction & Fantasy Writers of America has cut links to Amazon after the retailer removed, and then reinstated, titles from Macmillan publishing. The spat is all about ebook pricing - Amazon claims that $9.99 is all punters will pay for the ethereal presence of an electronic book, but Macmillan reckons …

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ebooks at vaious price levels

Amazon charges 9.99 for new hardcovers so they can sell Kindles. I'm not clear why authors need to subsidize that though. After first release ebook prices usually drop to 6.39 when the paperback version is out. Why not variable pricing? You don't want to pay 14.99, wait for the price to come down.

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Online distribution costs are not Zero, people!

• Server costs

• Initial sale and/or lease

• Bandwidth

• Energy

• Cooling

• Personnel

• Server Admins

• Website coders

• Technical support

• Customer service

• Security (i.e. "Lets not get hacked and then sued for punting pr0n")

• Payment processors

• Lawyers to write the EULAs

• DRM licensing fees (even though we wish they didn't...)

I've probably missed some/loads, but as you can see, the cost of publishing an eBook is not zero!

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Coffee/keyboard

Trim the fat

Get shot of the last two items for a start.

Lawyers gone,. DRM gone.

Theres a large chunk costs gone.

Tech support and customer service?

Get the job right in the first place and these costs should be minimal.

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But manufacturing costs are zero

All of that stuff is carried by the retailer when selling downloaded media (it's the same for music and films), so the publisher just needs to recoup the origination costs instead of all the manufacturing and distribution costs they have with a physical product. So really all the publisher does with an e-book is:

* Commissioning and advance payment (where applicable)

* Editing

* Proofreading

* Artwork (not really necessary for the e-version, though)

* Saving in ePub or PDF format (wow, that must be hard...)

There are no printing or distribution costs at all (barring emailing the finished files to the retailer), so all they need to do is recoup the above costs, most of which at the moment are still being covered by the print versions anyway. So a sensible price for an e-book should be significantly less than the paperback, say 50%.

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costs

A nice way to reduce costs,

Lawyers to right the EULA - use the CCNA licence, it's free!, (works for Charlie Stross and Cory Doctorow)

DRM - licensing fee's, DRM doesn't work so why penalise the legal buyers at no cost to the pirates just do away with the DRM, (it hasn't done O'Reilly any harm).

and many of the rest are incurred anyway if you have a website, sure the costs ain't zero but they are considerably lower than they are for paper books.

Viva Feedbooks

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The savings versus books are enormous.

Have you ever seen one of the warehouses where thousands of books you might order for next day delivery are stored?

Server costs to store a couple gigabytes are close to nothing compared to maintaining a warehouse full of books.

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Pint

Er...

Hmm, let's see, if I'm Amazon or Baen, or some of the others that already have all the infrastructure for this sort of thing that came along with the website and... you know, being businesses, what does it take? Oh yeah. Another hard drive, or allocation of space on an existing multi-terabyte array. How much do e-books take up these days, 10 megs? There, sorted.

In other news, I am quite happy to see after a little check, that book prices for Kindle do indeed ease back to paperback levels. I could have worn that at one time I was seeing the eBook version of a book I own in paperback for $12, more than 4 years after I'd bought said paperback! Now if only I could send my paperbacks to Amazon and they'd exchange them for eBook versions. This need to rebuy is my barrier to embracing the movement to digital.

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FAIL

Bearing in mind that it's AMAZON who want to sell them cheaper...

Let's just quickly go through that list:

Services paid for by Amazon:

• Server costs

• Initial sale and/or lease

• Bandwidth

• Energy

• Cooling

• Personnel

• Server Admins

• Website coders

• Technical support

• Customer service

• Security (i.e. "Lets not get hacked and then sued for punting pr0n")

• Payment processors

Services paid for by publishers:

Lawyers to write the EULAs

• DRM licensing fees (even though we wish they didn't...)

As you can see, the cost of publishing an e-book is not zero, but those costs are quite easily swallowed up by normal retail sales. Charging that much for an e-book is what is causing people to not bother going anywhere near them, which is why those costs HAVE to be covered by normal retail.

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true

it's probably more like 5pence/8cents.

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Trust neither

> Commission/advance, Editing, Proof-reading and art

Those make up a sizable chunk of the costs of a paper book. From what I 've read on various author's comments, it's around 60-75% for most books (excluding the insanely popular ones on one end, and specialty stuff on the other).

For anyone who suggests that authors could do it themselves and go straight to Amazon, go read comments by professional writers. For the most part they don't want to do it themselves and want someone (whether you call them a publisher or not) to do that.

> most of which at the moment are still being covered by the print versions anyway

Why does everyone (on various sites) keep saying that? I don't think that pricing eBooks on the basis that they make up a negligable amount of sales is a great plan, if they're hoping to increase the amount of eBook sales.

Also, I would assume that some portion of the eBook sales is cannabalising the paper sales - I wouldn't buy both the eBook and paper version. eBooks should share their part of the production costs.

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Gates Horns

Readers of the lost work

What is causing THIS person not to go near e-books is e-book readers. They're not a substitute for books, and some brands want me to buy my own books twice just to see them on a screen. I spend considerably more than $9.99 for new hardcovers, of course, but that is made up for by spending a LOT less on used books. And who is selling $1US used books for e-readers? No one unsued!

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I'm with you on that

eBooks are convenient but I won't go anywhere near them until I get a free 'e' copy with my paper copy.

First, I like reading a physical book. In technical books I'll actually write on the pages as well. Second, I like to be able to swap books with friends. Try doing that with an eReader. Third I like to recoup a small amount of my original investment by taking a bag of books to the local second hand bookshop every now and again.

Granted you might be able to make notes on a reader but with an eReader you're only buying the right to read, not the ownership of the file. I suspect at least half the reason for eBooks is that publishers hope to sell more in the long term because you're not able to lend or sell on.

Just like the music business though they insist on keeping prices (relatively speaking) sky high despite the savings in physical inventory. The only reason they're in a better place than the record companies is it is so much harder to digitise a book than a CD...

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Happy

eBooks done more or less right?

Baen Webscriptions and CD Libraries.

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FAIL

Ummm

The initial article kind of missed a few important points. Must have been a deadline to meet for a space-filler I guess?

Amazon's objection wasn't entirely about the ideas of eBook pricing themselves, it was objecting to the agency model Macmillan was trying to put in place that recognizes the "new" technology. Macmillan was trying *to* adapt to new technology - but it would have meant *Amazon* didn't make as much money per copy sold.

Read Charles Stross' analysis of the whole situation for a better idea of what happened - http://www.antipope.org/charlie/blog-static/2010/01/amazon-macmillan-an-outsiders.html

Even better, try the letter Macmillan sent out to agents and authors, there's a copy at http://www.facebook.com/note.php?note_id=282306625809 - note that the agency model was proposing *dynamic* pricing, no different than current markdowns of physical books over time.

As a side note, Amazon didn't pull the same stunt with Hachette - http://www.publishersweekly.com/article/CA6717788.html?desc=topstory

Bill Ray should have done some actual research for the article a little more - I've seen more balanced party political broadcasts.

Amazon is trying to be to publishing what Apple is to people deciding what to run on their i*'s. I don't know about you, but I've got about as much interest in *Amazon* deciding what I get for my books as anyone else does in Apple deciding what you can run on your iPhone or iPod.

As for why SFWA got involved - It's doing what it's supposed to do, and stand up for its members.

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Joke

What's the operating temp of a kindle CPU

Fahrenheit 451 ?

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on topic

it WOULD help if more than one line was on the headline... this is shoddy reporting, B.

e-books? lovely thought, stupid exe.

I buy dvd's at used prices instead of going to movies.

e books will wait till the deadwood has died off.. by refusing to change, as usual

evolution IS conservative, etc.

packrat

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Anonymous Coward

Shirley?

Amazon have the right to charge what they want for anything they sell? And MacMillan have the right to charge Amazon whatever they want for anything they sell to Amazon? Now if Amazon want to make a loss on something then that's up to them. They have no right to tell MacMillan what to charge them, any more than the customer has a right to tell Amazon what to charge them. OTOH if Amazon think that they as a customer of MacMillan can dictate the price then surely they would agree that it's OK for Amazon customers to tell Amazon what to charge?

Amazon are acting like twats, but then so are MacMillan.

Retaillers can't dictate to it's suppliers the wholesale price, but then neither can the suppliers dictate to retaillers what they should stock. It's entirely up to Amazon whether they choose to sell a particular publisher's books.

Both sides should pull their necks in and get round the table and talk like adults.

FWIW I think it's ridiculous that MacMillan expect me to pay more for a data file than I would normally pay for hard copy. It's about time customers explained to MacMillan that they are charging too much for their ebooks. So that would be customers and Amazon vs. MacMillan then.

Why is that publishers are so keen on ebooks anyway? Simply because publishers have never liked the idea of selling used books, nor do they like ideas like book sharing or passing on previously enjoyed books. They hope that ebooks and DRM will put a stop to this uncapitalist behaviour and increase their profits. If they want to try that, good luck to them, but when they try to make even more profit by increasing prices they can whistle for it.

Does the author get any more from these overpriced ebooks than they would from a paperback? Doubt it. Does the retailler make any more profit? Probably not. So who is it that's trousering the extra wedge? MacMillan of course. Fuck em.

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Re: Shirley?

"Why is that publishers are so keen on ebooks anyway? Simply because publishers have never liked the idea of selling used books, nor do they like ideas like book sharing or passing on previously enjoyed books. They hope that ebooks and DRM will put a stop to this uncapitalist behaviour and increase their profits."

Actually this is exactly wrong. Unlike the music industry, almost every publishing house is well aware that the vast majority of fiction titles are promoted via word of mouth of readers

There is an extraordinary range of titles released each month, and only a fraction will ever get shelf space in a bookstore. The biggest challenge a publisher has is getting a book even noticed. Unlike music, you can't just blanket the airwaves, or put it in as background on TV.

Every single author who has been around a while welcomes used books as a marketing tool - it doesn't matter much if their title is being passed around so long as *someone* reads it, likes it, and will sooner or later buy more by that author. Compared with the challenge of actually getting a book into someones hands .. the marketing potential is fantastic.

Also the primary driver for DRM on ebooks is in fact coming from Amazon itself, every title it sells is DRM locked to the Kindle, coincidentally a device it sells.

All the other publisher backed e-tailers are selling a range of locked and unlocked titles. Webscriptions and Fictionwise are mostly without any kind of DRM at all.

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eBooks are not for me!

I can lend real books to friends, sell them, put them on a shelf nearly indefinitely and read them again in 20 years.

While eBooks are tightly coupled to certain readers and can be removed from that reader by whoever sold me the reader, can't be lend and can't be sold.

I think I might buy eBooks in adition to real ones if the price for this limited "ownership" is much much lower then $15.

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If you are affriad of the ebook maker screwing you over

simply don't by the Kindle or Sony.

Have a look at the BeBook. It supports almost any format you care to think of (though of course not Amazons own) and will manage DRM on epub and mobi should for some reason buy from somewhere that does.

Alternatives do exsist.

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Authors

The typical fiction book writer gets about 25p-45p per book sold. There is no money in book writing for all bar the biggest names, certainly not enough to make it a career. A lot of books are being sold but publishers, wholesalers and retailers are all pushing to get more cut with the authors being squeezed every time.

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FAIL

@Ryan7

No Ryan, not zero... But an absolute fraction of what they would be for hard copy.

Server costs, bandwidth, energy costs etc are very minimal. You can lease your own completey dedicated managed servers for literally tens of dollars a month.

So you would need a halfway decent developer to set things up for you and a couple of phone droids to manage customer services. Oh and a one time fee to a lawyer to check your EULA is watertight.

Payment processing costs cents when you get up to proper volumes (and only tens of cents before that).

All that is irrelevant though - Amazon is already providing everything you describe for the 'publishers' - The point is that all the original publishers are doing for their money is providing a one off copy of the text to Amazon, who deal with everything else, but they want to still charge exactly the same as for a product they have to physically publish and ship to a retailer. They have obviously been reading the RIAA 'big book of fail'.... Shame they didnt realise it was a comedy of errors.

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Re: Online distribution costs are not Zero

Given that most of the costs you're listing are applicable to print versions, and the publishers already have a web presence, the *actual* cost of selling an ebook is still in the order of pence per copy. Subtract the cost of printing and distribution and an ebook version should be free when you purchase a paper version.

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Stop

Price difference between e-books and real books

Newflash: Books also cost next to nothing to produce. Most of the price pays for the edition job, paying an artist for the cover, typesetting, etc. A $20 book costs 50 cents to print. Even with transportation costs, you barely get $2 of price for the physical object; the rest is for content.

And as Ryan said, e-books are not "free" to distribute either...

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Nice one Amazon

As the title says, I'm with Amazon on this - the publishers are just taking the urine when it comes to eBooks at the moment. Plus isn't $15 pretty near the price for the hardbook edition of most books? In which case, surely pricing the eBook at (or better still slightly less) than the price of the paperback seems more equitable to me.

But then again, I'm not exactly a good person to talk to about eBooks - I used to buy a lot of them from the eReader.com site. Then B&N took it over and suddenly you had to be a US resident to get pretty much all of the techno thrillers that I was interested in. Needless to say, I'm not US-based, so effectively the amount of content I could get went to near-zero. And no, I'm not interested in the latest teen-based movie tie-up or the latest scribbling from Dan Brown. And they wonder why I suddenly stopped buying 'product'!

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