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Amazon initially charged a little over $15 for a version for its Kindle reading device, and readers revolted.
Several posted reviews objecting that the electronic edition of the book wasn’t selling for $9.99, the price Amazon has promoted as its target for the majority of e books in the Kindle store. Hundreds more have joined an informal boycott of digital books priced at more than $9.99.
“I love Baldacci’s writing,” wrote one reader, who decided not to buy. “Sorry Mr. B price comes down or you lose a lot or readers. Now, in the evolving Kindle world, $9.99 is becoming the familiar price. The lower e book price “is not sustainable,” said Mr. Baldacci, whose novels regularly rise to the top of hardcover best seller lists. But publishers argue that those costs, which generally run about 12.5 percent of the average hardcover retail list price, do not entirely disappear with e books. What’s more, the costs of writing, editing and marketing remain the same.
“The concept that because a book is an e book it should automatically be priced significantly lower than a paper book is one we don’t agree with,” said Carolyn Reidy, chief executive of Simon Schuster. “What a consumer is buying is the content, not necessarily the format.”
In making such arguments, publishers risk being viewed much like recording labels were a decade ago: greedy corporate titans who hide behind claims of high costs and creative entitlement as they resist the transition to a digital landscape.
For the moment, say some publishers, Amazon is effectively subsidizing the $9.99 price tag for new book titles in digital form by paying publishers the same $13 it pays them for a new hardcover title with a list price of $26. It’s a classic “loss leader” situation. Although Amazon won’t comment on the arrangement, the online bookseller is using low price e books as a lure to persuade consumers to pay $359 to buy a Kindle, or $489 for the new, larger Kindle DX.
But for now, at least, it is Amazon that publishers fear most, because it has spent the most to popularize the idea of the e book. Already, Amazon, which commands 5 percent to 15 percent of the book market, claims that for titles with Kindle versions, digital sales represent about 35 percent of total sales.
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The doomsday scenario for publishing is that the e book versions cannibalize higher price print sales.
“It’s like a flood of cheap houses onto a real estate market,” said Michael Norris, senior analyst at Simba Information, a market research firm. “I don’t think the content providers have to be in a worse position.”
There is some precedent for that theory. When the smaller format mass market paperbacks that now populate airport bookstores and grocery checkout racks were introduced, publishers expressed fears that the lower priced books might destroy the market for hardcovers. They didn’t. Instead, they expanded demand for books beyond elite readers. While the $9.99 price is an attraction, she says she is more swayed by the instant gratification made possible by electronic books.
After buying the first in Stephenie Meyer’s “Twilight” series, Ms. Albarella finished it at 1 in the morning. She bought the next installment on her Kindle from her bedroom and began reading right away.