Image via WikipediaThere's a fascinating article in the New York Times yesterday breaking down paper book and electronic book prices, suggesting that there's a floor to e-book prices, and it's not $0.00:
On a typical hardcover, the publisher sets a suggested retail price. Let’s say it is $26. The bookseller will generally pay the publisher $13. Out of that gross revenue, the publisher pays about $3.25 to print, store and ship the book, including unsold copies returned to the publisher by booksellers.And then for electronic books:
For cover design, typesetting and copy-editing, the publisher pays about 80 cents. Marketing costs average around $1 but may go higher or lower depending on the title. Most of these costs will decline on a per-unit basis as a book sells more copies.
Let’s not forget the author, who is generally paid a 15 percent royalty on the hardcover price, which on a $26 book works out to $3.90. ... the publisher is left with $4.05, out of which it must pay overhead for editors, cover art designers, office space and electricity before taking a profit.
on a $12.99 e-book, the publisher takes in $9.09. Out of that gross revenue, the publisher pays about 50 cents to convert the text to a digital file, typeset it in digital form and copy-edit it. Marketing is about 78 cents.The article goes on to say that while these numbers look transparent, there's no good reason to believe that they are solid, since they come from publishers, etc.
The author’s royalty — a subject of fierce debate between literary agents and publishing executives — is calculated among some of the large trade publishers as 25 percent of the gross revenue, while others are calculating it off the consumer price. So on a $12.99 e-book, the royalty could be anywhere from $2.27 to $3.25.
All that leaves the publisher with something ranging from $4.56 to $5.54, before paying overhead costs or writing off unearned advances.
I have to wonder why in an age when food products can carry Guideline Daily Amounts that are easy to read and understand why books a) have fixed prices, and b) aren't broken down graphically to represent the pie slices described above.
Whenever possible I buy books used online, in part because they're cheaper, because I rarely need to read bestsellers that are on the run, so to speak, and because in various online marketplaces book prices float (a little) and I have some idea what I'm paying for: the seller's purchase price, shipping, and profit.
Is there really a good reason why I can't get the same kind of price transparency out of every book I buy? Why should every new book price end in "00" or "99?"