Here’s a question I got on our Facebook page. Maybe you’ve wondered about it too.
Why do your Kindle books cost more than a paperback copy? The Kindle version of Life or Debt on Amazon costs $9.73, but they’re selling the paperback for as little as $6.00. Since e-books should cost much less to produce, why do they cost more to buy? This seems unfair, especially when you’re writing about how to save money to pay off debt.
The first time I attempted to answer this question, I quoted an article called "Why Do eBooks Cost So Much? (A Publisher’s Perspective)" by Michael Hyatt, CEO of Thomas Nelson Publishers. Here’s how he justified the high cost of e-books…
…physical manufacturing and distribution expenses cost less than you think. Some people assume that these two items represent the bulk of a book’s costs. They don’t. Together, they account for about 12 percent of a physical book’s retail price. So eliminating these costs doesn’t do much to reduce the overall cost structure.
Even if this is accurate, shouldn’t the price of e-books be 12 percent lower than physical copies? No, he insists, because there are other costs associated exclusively with e-books, like formatting them to fit e-readers. He goes on to say…
“The elimination of manufacturing and distribution costs are being offset by retail price reductions and the additional costs I have outlined. The good news is that we are making about the same margins, regardless of whether we sell the book in physical form or digital.”
Despite this publisher’s claim, the reason e-books are as expensive, or even more expensive, than traditional books isn’t because they cost as much to produce and distribute. Anyone who produces anything digital that was formerly physical knows digital is cheaper. A website is cheaper than a newspaper. A digital version of a video costs less to deliver than a tape. An e-book costs less than a physical book. Anyone suggesting otherwise, like this publishing executive, probably has a dog in the fight.
If you want a single answer to why e-books are more expensive, it’s in the last few words of this publishing CEO’s explanation: ”The good news is, we are making about the same margins, regardless of whether we sell the book in physical form or digital.”
The lion’s share of the retail price of a book, whether in digital or physical form, is going to the publisher. And what’s good news for him is bad news for you. Want cheaper books? Eliminate the fattest fingers in the pie – the publisher’s.
Read on here....http://www.csmonitor.com/Business/Saving-Money/2013/0112/Why-do-e-books-cost-so-much