An Interesting View on E-Books
Tim O'Reilly is a smart book publisher, and he took a look at some of the numbers that e-book enthusiasts tossed around with the advent of Amazon's Kindle. His argument is that even if prices do tumble for e-books, it will likely be only temporary. It's worth the read.
I'll add an additional angle. Let's assume that he's wrong and prices do drop and stay at $5 a title. What publisher and author combination can make money that way? Reading hasn't reduced in volume because the prices are too high - books just aren't that expensive. If you have a current business model under which most titles don't even make back the pitiful advances that authors get, and where the cost of the actual paper is only about $1.50 a copy, then dropping the price by 60 to 80 percent is going to mean that publishers won't be able to afford to print anything that isn't going to be wildly successful.
Current backlists may stay around (if the publishers have acquired the necessary rights), but forget the variety of titles coming out now. You'll be down to a handful of authors who can generate the necessary sales. Some individual authors might be able to self publish, but if they're getting 35 percent of $5, that's $1.75. Take out costs of design and production, and maybe they're at $1 a book if they're lucky, which is the inadequate stream of money they made from publishers - too low to support self-publishing. So $5a copy, if really gutting the paper model, would actually leave book publishing virtually dead. Then supply and demand will kick back in, because there are those massive infrastructures to feed, and prices will head back up anyway.
I'll add an additional angle. Let's assume that he's wrong and prices do drop and stay at $5 a title. What publisher and author combination can make money that way? Reading hasn't reduced in volume because the prices are too high - books just aren't that expensive. If you have a current business model under which most titles don't even make back the pitiful advances that authors get, and where the cost of the actual paper is only about $1.50 a copy, then dropping the price by 60 to 80 percent is going to mean that publishers won't be able to afford to print anything that isn't going to be wildly successful.
Current backlists may stay around (if the publishers have acquired the necessary rights), but forget the variety of titles coming out now. You'll be down to a handful of authors who can generate the necessary sales. Some individual authors might be able to self publish, but if they're getting 35 percent of $5, that's $1.75. Take out costs of design and production, and maybe they're at $1 a book if they're lucky, which is the inadequate stream of money they made from publishers - too low to support self-publishing. So $5a copy, if really gutting the paper model, would actually leave book publishing virtually dead. Then supply and demand will kick back in, because there are those massive infrastructures to feed, and prices will head back up anyway.
Labels: books, e-books, electronic, publishing
posted by Erik Sherman | 4:35 AM
2 Comments:
The big problem of ebooks is the protection of copyright.
While to copy a printed book has its cost, to copy a digital one is a matter of very little.
So, either the price is so low it is not worth to cpy, and that could be done just with a best seller, where millions of copies would pay for one original, or they have to find better ways of distribution.
One could be publishing books with commercials inside which would pay the writer.
No need to pay the publisher, because publishing an ebook costs nothing and distributing it even less...
Since on the net most of the content is apparently free, a good ebook could be paid by a company and used as commercial for the company.
Patrizia
www.easymediabroadcast.com
Copyright is one issue, but the financial models are just as significant. A company could sponsor an e-book, but that might greatly constrain what the writer could do. If you read the Tim O'Reilly article I mentioned, you'll see his compelling argument that advertisements in books probably won't bring enough money to make them worthwhile. Also, publishing a quality e-book does cost. Although you don't have printing, there is production, design, editing, and writing. The perception that all this happens for free is what will help keep e-books from becoming widely viable, at least in terms of finance.
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