The popularity of E-readers and E-books seems potentially at a tipping point. But publishers and some prominent authors, in our humble opinion, are doing everything they can to keep the new dawn at bay. And why wouldn’t they? With the publishing industry showing record profits, growing like crazy, and connecting so well with customers, what possible incentive do they have for change?
Tap your sarcasm meter now if your needle didn’t register the tone of those remarks by flicking into the red zone. In the meantime, let’s think about what publishers are trying to accomplish by raising e-book prices and delaying e-book release dates….
The music industry dipped its toe into the digital waters with the arrival of the CD. People rightly complained that the album buying experience was diminished by the smaller packaging and narrower range of sound. But CDs prepared people for the real digitization of music. Napster turned songs into (illegal) data streams. i-Tunes legitimized that transaction, but more importantly, it set music sales at a price point that encouraged consumption — and not just any consumption, but “spur of the moment / try something new / buy stuff you’d lost but wanted to own again / own more than you can possibly listen to” consumption.
Record labels didn’t like it. But consumers and musicians largely benefited. i-Tunes now dominates digital music sales, but other economic models are also working. See emusic.com, etc. And music consumption overall is up. We’d get the numbers but we’re too lazy.
In the publishing industry, a good analogy to the transition to CDs is Amazon.com. Amazon prepared us for buying books online. Yes, it hurt independent book stores; but so did the prominence of the big chains. E-readers, and perhaps the i-Pad in particular, represent the i-Tunes stage. As record labels before them attempted to do, publishers are now trying to control that market by impeding it.
Publishers don’t want to cut into traditional book sales, which require people to go to stores or shop at Amazon and put an actual book in their hands. Publishers are delaying the e-release of some big books in order to encourage traditional sales. In what sane industry would you ever tell people to hold off on giving you their money? How many impulse sales are lost when someone gets over the euphoria of a good review or the excitement of a new release, and doesn’t find the time to visit the bookstore?
Then comes price. Amazon tried to set a standard $9.99 price, inspired no doubt by i-Tunes $.99 model. Publishers want that to be $14.99. New hardbacks are priced around $25, which already seems outrageous, but discounts generally lower that price to under $20. Is a $5 discount really going to encourage you to buy that book digitally? Unlikely, since book lovers like to hold books and possess them. An E-reader’s basic advantage is portability and impulse purchasing power. For business travelers in particular they seem like the perfect tool. But when the price of an e-book is close to an actual book, why wouldn’t you hold off on that purchase and see if you really want it later? Consumers know when they are getting squeezed. It makes no sense to be charged a similar price for a digital book when the costs of printing, binding, and shipping that item have been stripped away.
Imagine, on the other hand, a world in which e-books were priced low enough to encourage consumption. Since we’re in fantasy land, let’s say they cost $5 instead of $10. Or maybe you join a club where, for $25 a month, you can download 5 or 10 books. Wouldn’t you buy more books? Perhaps you wouldn’t read them all — perhaps you would only read some of them — but wouldn’t you be excited about them, and talk about them, and share your thoughts about them with your peers? If you really liked a particular book, we bet you’d even go out and get a bound version.
For publishers and authors, isn’t it possible that the margins on higher volume would be attractive? And if you were locked onto your customers digitally, perhaps you could sell them other works, and get direct feedback, and enlist them in viral campaigns?
Inevitably, and eventually, this will happen in spite of misguided efforts to prevent it. Publishers and authors, like musicians and music producers, deserve to be well-compensated for their talent and work. And we’d like to see the industry grow.
