1 2 3 35 Replies Latest reply on Mar 2, 2012 12:23 PM by Omnigeek Go to original post
      • 15. Re: Nook book prices higher than other ebooks.
        Thanks for the hint about double tapping the book cover, Kamas! I'm not specifically picking on B&N. It just seems to me like, with the lower overhead (no inventory to stock, no buildings, no shipping costs, no salespeople to pay, no printing, no paper, no unsold copies to dispose of), eBooks should be significantly cheaper than their printed counterparts. If it's the publishers' restrictions, it seems to me they are artificially inflating the prices of books since it's the book stores who bear much of the cost of stocking, selling, and (in some cases) shipping books, as well as maintaining the staff and stores and/or warehouse space to do it in. (Example, I could buy all three volumes of the Lord of the Rings in paperback at $7.99 each for a total of almost $24; the e-book containing all three books is $19.99, so I'm only saving $4 on 3 books by buying the eBook version!) Given the above, I was expecting to save a lot more than that on books when I bought my Nook. I was hoping an eReader would allow me to buy and read more books, but I'm finding it primarily useful for sideloading and reading other electronic documents. Buying an eBook from one of the "Big 6" seems like a splurge to me, and if I'm going to splurge, I'd like a hard copy to show for it.
        • 16. Re: Nook book prices higher than other ebooks.

          tygerlili wrote:
          Thanks for the hint about double tapping the book cover, Kamas! I'm not specifically picking on B&N. It just seems to me like, with the lower overhead (no inventory to stock, no buildings, no shipping costs, no salespeople to pay, no printing, no paper, no unsold copies to dispose of), eBooks should be significantly cheaper than their printed counterparts. If it's the publishers' restrictions, it seems to me they are artificially inflating the prices of books since it's the book stores who bear much of the cost of stocking, selling, and (in some cases) shipping books, as well as maintaining the staff and stores and/or warehouse space to do it in. (Example, I could buy all three volumes of the Lord of the Rings in paperback at $7.99 each for a total of almost $24; the e-book containing all three books is $19.99, so I'm only saving $4 on 3 books by buying the eBook version!) Given the above, I was expecting to save a lot more than that on books when I bought my Nook. I was hoping an eReader would allow me to buy and read more books, but I'm finding it primarily useful for sideloading and reading other electronic documents. Buying an eBook from one of the "Big 6" seems like a splurge to me, and if I'm going to splurge, I'd like a hard copy to show for it.

          If you're really interested in understanding the pricing, you should search the forums for ebook pricing, agency model, agency 5, etc.  There have been numerous discussions on this.  You can read this NYT article which puts the printing/shipping costs of books at about 12% of the total cost.  So at most, you might expect to see a 12% decrease, except that there are costs associated with creating and distributing the eBook, so the difference is going to be less than the 12%.

          • 17. Re: Nook book prices higher than other ebooks.

            bklvr896 wrote
            You can read this NYT article which puts the printing/shipping costs of books at about 12% of the total cost.  So at most, you might expect to see a 12% decrease, except that there are costs associated with creating and distributing the eBook, so the difference is going to be less than the 12%.

            Very interesting to read this pre-agency analysis knowing what came after.

             

            Even more interesting is the mention of the 12.5% printing and shipping cost. The suggestion that printing and shipping are the only extra costs incurred in producing and selling DTBs is disingenuous and misleading. Here are a few others, just off the top of my head:

             

            • Inventory tracking (publisher + distributor + retailer)
            • Warehouse space (publisher + distributor + retailer)
            • Overruns (which are inevitable; extra copies end up either being sold at a steep discount or destroyed -- yet another cost)

            None of the above apply to ebooks. Furthermore, retail prices for DTBs are set to allow all three players (publisher, distributor, retailer) to make a profit. That brings additional costs into play at the wholesale and retail levels that have to be covered too (e.g. retail space and employees).

             

            Ebooks, in sharp contrast, are bought directly from the publisher with just one additional profit added: the 30% agency commission. I believe that's less than the typical retail markup for DTBs, which I think is 40%. Of course in 2009 it was different, but the essence of the sale was still direct from publisher without more than one middleman.

             

            Bottom line: I don't think that N.Y. Times reporter probed deeply enough.

            • 18. Re: Nook book prices higher than other ebooks.
              kamas716

              Here's one I found where the eBook is a few cents higher than the hardcover, though you can apparently get it cheaper used other places.

               

              http://www.barnesandnoble.com/w/they-fight-like-soldiers-they-die-like-children-romeo-dallaire/1100191049?ean=9780802779564&itm=1&usri=romeo+dallaire

              • 19. Re: Nook book prices higher than other ebooks.
                Omnigeek

                Sun_Cat,

                 

                Yes, there are other expenses with DTBs but everyone seems to want to compare the cost of overage, used or paperback release books against ebooks rather than the hardback release which is the one that generally recoups the baseline cost of publishing.  I can imagine the items you mention account for the 10% difference between the seller's cut for ebooks and their cut of MSRP for DTBs.

                • 20. Re: Nook book prices higher than other ebooks.

                  Sun_Cat wrote:

                  Bottom line: I don't think that N.Y. Times reporter probed deeply enough.

                  Bottom line:  Publishers will charge what people are willing to pay no matter how that price is derived.

                  • 21. Re: Nook book prices higher than other ebooks.

                    Sun_Cat wrote:

                    bklvr896 wrote
                    You can read this NYT article which puts the printing/shipping costs of books at about 12% of the total cost.  So at most, you might expect to see a 12% decrease, except that there are costs associated with creating and distributing the eBook, so the difference is going to be less than the 12%.

                    Very interesting to read this pre-agency analysis knowing what came after.

                     

                    Even more interesting is the mention of the 12.5% printing and shipping cost. The suggestion that printing and shipping are the only extra costs incurred in producing and selling DTBs is disingenuous and misleading. Here are a few others, just off the top of my head:

                     

                    • Inventory tracking (publisher + distributor + retailer)
                    • Warehouse space (publisher + distributor + retailer)
                    • Overruns (which are inevitable; extra copies end up either being sold at a steep discount or destroyed -- yet another cost)

                    None of the above apply to ebooks. Furthermore, retail prices for DTBs are set to allow all three players (publisher, distributor, retailer) to make a profit. That brings additional costs into play at the wholesale and retail levels that have to be covered too (e.g. retail space and employees).

                     

                    Ebooks, in sharp contrast, are bought directly from the publisher with just one additional profit added: the 30% agency commission. I believe that's less than the typical retail markup for DTBs, which I think is 40%. Of course in 2009 it was different, but the essence of the sale was still direct from publisher without more than one middleman.

                     

                    Bottom line: I don't think that N.Y. Times reporter probed deeply enough.


                    That may be, it also may be that the reporter simply used printing and shipping as all incompassing.  On the other hand, people seem to think there are no ongoing costs associated with eBooks.  That once the file is created, that's it.  And yet, those books have to housed on servers somewhere, there has to be software to distribute those books, software to protect everyone using the servers and people to maintain the servers/software etc, so that we can buy books at 2:00 a.m.  (And yes, I know servers are cheap, rent on a building to house them, maybe not so much and the people to maintain them, not so much)  While these costs may not be as significant as costs associated with printing, etc, they do exist.  And in some cases, there is a middleman here.  Kobo and some other retailers get their books through Overdrive, so in essence, Overdrive is the distributor.

                     

                    And as AlanNJ said, in the end, they're going to charge what people will pay, and people seem to have no issue with paying the current prices. 

                    • 22. Re: Nook book prices higher than other ebooks.

                      Why is the pricing on the following so far apart?

                       

                      Tim Sandlin's GroVont Trilogy has the following prices:

                       

                      On Amazon:

                      Skipped Parts: $1.99

                      Sorrow Floats: $1.35

                      Social Blunders: $6.37

                       

                      On BN:

                      Skipped Parts: $7.35

                      Sorrow Floats: $10.49

                      Social Blunders: $10.49

                      • 23. Re: Nook book prices higher than other ebooks.

                        Sun_Cat wrote:

                        bklvr896 wrote
                        You can read this NYT article which puts the printing/shipping costs of books at about 12% of the total cost.  So at most, you might expect to see a 12% decrease, except that there are costs associated with creating and distributing the eBook, so the difference is going to be less than the 12%.

                        Very interesting to read this pre-agency analysis knowing what came after.

                         

                        Even more interesting is the mention of the 12.5% printing and shipping cost. The suggestion that printing and shipping are the only extra costs incurred in producing and selling DTBs is disingenuous and misleading. Here are a few others, just off the top of my head:

                         

                        • Inventory tracking (publisher + distributor + retailer)
                        • Warehouse space (publisher + distributor + retailer)
                        • Overruns (which are inevitable; extra copies end up either being sold at a steep discount or destroyed -- yet another cost)

                        None of the above apply to ebooks. Furthermore, retail prices for DTBs are set to allow all three players (publisher, distributor, retailer) to make a profit. That brings additional costs into play at the wholesale and retail levels that have to be covered too (e.g. retail space and employees).

                         

                        Ebooks, in sharp contrast, are bought directly from the publisher with just one additional profit added: the 30% agency commission. I believe that's less than the typical retail markup for DTBs, which I think is 40%. Of course in 2009 it was different, but the essence of the sale was still direct from publisher without more than one middleman.

                         

                        Bottom line: I don't think that N.Y. Times reporter probed deeply enough.


                         

                        I can agree that the NYT reporting didn't go deep enough - because you're forgetting all the overhead of an e-file:

                         

                        Each file format (Nook, Kindle, any other RETAILER you sell through) requires someone to redo layout, and make sure each layout is correct for the device.

                         

                        You don't buy an ebook directly from the publisher, you buy it from a retailer too (Amazon, B&N, Whomever).

                         

                        Server Costs:

                        -Maintenance (and IT guys demands a higher salary that warehouse guys)

                        -Upgrades (warehouses don't have to buy new shelves every 12-18 months, computer servers often do)

                        -Physical Server Space (cold rooms for servers can require far more overhead than a warehouse to maintain)

                        -Inventory Tracking (you still need to report number of sales, that's a whole other program)

                        -Computer Programs to track sales, track user accounts, downloads, report sales.

                        -Bandwidth (yes - this costs money, it costs the server owners money every time you download a book, heck, it costs them money every time you load a web page).

                        -The Computer Servers Themselves: you'll often have hosting servers for the website, storage servers for the books, yet more servers for all the bookkeeping and accounting)

                         

                        Two of your three "none of the above apply to ebooks" actually apply to ebooks in a different way than they do to DTBS, but they still apply. Obviouslt the NYT reporter did need to go into more detail because you have no idea what infrastructure is required for digital anything.

                         

                        ebooks still need to be priced to let three companies profit, Publisher, Retailer, Distributor (and that may be two seperate distributors: the Internet Provider charging bandwidth usage fees and the Storage Company that owns the servers).

                         

                        The model has no changed, just the format. The only people not getting a cut on ebooks is a Printer.

                         

                        • 24. Re: Nook book prices higher than other ebooks.

                          GordonF wrote:

                           

                          The model has no changed, just the format. The only people not getting a cut on ebooks is a Printer.

                           


                          And the lumberjacks and tree farmers.

                          • 25. Re: Nook book prices higher than other ebooks.

                            kamas716 wrote:

                             

                            The other thing I find funny is that people have complained about Agency pricing since its inception.  The books are the same price everwhere.  And yet, people also complain because there is a difference in prices, at times, for non agency books.  So we don't want agency pricing but we want prices to be the same everywhere.



                            I think the problem people have with the Agency pricing is not that the prices are the same everywhere, but that the eBook prices tend to be higher than DTB prices at times.  There's no logical reason for such a price difference between eBooks and DTB since production and distribution costs should be massively lower for eBooks.

                             

                            I also haven't found B&N prices all that bad for eBooks.  And, when I don't like their prices, at least I have the option of purchasing from another site if I want and then loading it on my NST very simply.



                            How should it be lower for ebooks? Having server farms running 24/7 with staff on hand to fix things that break right away, cost of bandwidth, and unlike brick and mortar stores they can not make room for new book by not stocking old book (since you have the ability to redownload the book it has to stay on the server) so they have to keep adding new capacity.

                             

                            And what does direct cost of a product have to do with its price? Are you willing for your paycheck to be determined by what it cost you to commute to work?

                            • 26. Re: Nook book prices higher than other ebooks.
                              kamas716

                              scott88 wrote:


                              How should it be lower for ebooks? Having server farms running 24/7 with staff on hand to fix things that break right away, cost of bandwidth, and unlike brick and mortar stores they can not make room for new book by not stocking old book (since you have the ability to redownload the book it has to stay on the server) so they have to keep adding new capacity.

                               

                              And what does direct cost of a product have to do with its price? Are you willing for your paycheck to be determined by what it cost you to commute to work?


                              Here's my reasoning.  Granted, I don't know a whole lot about the IT industry, and I'm not sure who would actually have the servers, the vendor or the publisher.  So, my reasoning may be seriously flawed.

                               

                              But, how much does a server cost (several $K, but less than $10K?) and how many are you going to need to run for your business?  As far as having the IT staff on hand 24/7, I'm not so sure about that.  I've worked for a research University, and while they may have someone on call, they don't have anyone on site after normal business hours (other than some students manning the help desk phone, and even then, after midnight you'd just leave a message and whoever is manning the desk in the morning would call you back).  I would guess that the largest yearly expenses would be for bandwidth access and the electric load, followed by personnel/benefits, equipment and building expenses.

                               

                              How many server farms are required to allow B&N customers all across the country to purchase eBooks? 1 or 2?  Someplace like Sioux Falls would be a less expensive area to place a server farm than, say, San Francisco.  As long as they have access to the bandwidth, it doesn't really matter where they are physically located. My impression is that the printers aren't setting type by hand anymore, but using a computer program.  So, it should just be a file format conversion to put the eBook on the server for upload and available for purchase rather than feeding it into the printer.

                               

                              As opposed to have a couple of hundred brick and mortar stores across the country to staff and house the DTB's.  Plus, the warehouse(s) [I'm guessing B&N has multiple warehouses across the country, and each publisher probably has at least one] for extra product.  Not to mention the costs for paper, ink, glue, binding, transportation and the built in markup for discounted books that didn't sell.  And then there are the costs associated with producing physical copies of audio books versus downloadable audiobooks.

                               

                              To me, it seems like one or two server farms could probably sell more books than a hundred brick and mortar stores.

                               

                               

                              • 27. Re: Nook book prices higher than other ebooks.

                                kamas716 wrote:

                                scott88 wrote:


                                How should it be lower for ebooks? Having server farms running 24/7 with staff on hand to fix things that break right away, cost of bandwidth, and unlike brick and mortar stores they can not make room for new book by not stocking old book (since you have the ability to redownload the book it has to stay on the server) so they have to keep adding new capacity.

                                 

                                And what does direct cost of a product have to do with its price? Are you willing for your paycheck to be determined by what it cost you to commute to work?


                                Here's my reasoning.  Granted, I don't know a whole lot about the IT industry, and I'm not sure who would actually have the servers, the vendor or the publisher.  So, my reasoning may be seriously flawed.

                                 

                                But, how much does a server cost (several $K, but less than $10K?) and how many are you going to need to run for your business?  As far as having the IT staff on hand 24/7, I'm not so sure about that.  I've worked for a research University, and while they may have someone on call, they don't have anyone on site after normal business hours (other than some students manning the help desk phone, and even then, after midnight you'd just leave a message and whoever is manning the desk in the morning would call you back).  I would guess that the largest yearly expenses would be for bandwidth access and the electric load, followed by personnel/benefits, equipment and building expenses.

                                 

                                How many server farms are required to allow B&N customers all across the country to purchase eBooks? 1 or 2?  Someplace like Sioux Falls would be a less expensive area to place a server farm than, say, San Francisco.  As long as they have access to the bandwidth, it doesn't really matter where they are physically located. My impression is that the printers aren't setting type by hand anymore, but using a computer program.  So, it should just be a file format conversion to put the eBook on the server for upload and available for purchase rather than feeding it into the printer.

                                 

                                As opposed to have a couple of hundred brick and mortar stores across the country to staff and house the DTB's.  Plus, the warehouse(s) [I'm guessing B&N has multiple warehouses across the country, and each publisher probably has at least one] for extra product.  Not to mention the costs for paper, ink, glue, binding, transportation and the built in markup for discounted books that didn't sell.  And then there are the costs associated with producing physical copies of audio books versus downloadable audiobooks.

                                 

                                To me, it seems like one or two server farms could probably sell more books than a hundred brick and mortar stores.

                                 

                                 


                                As was pointed out, cost rarely determines price.  The market apparently is ok with the current prices.  

                                 

                                As to having someone onsite 24/7.  If the servers go down in the middle of the night, there's going to be a lot of unhappy customers if problems are only fixed during business hours.  They may not be physically on site, they may be able to remotely connect to the servers, but if so, they still have to paid. 

                                 

                                But it comes down to regardless of how much it costs to create the book, they're going to sell it for the highest price the market will bear.

                                 

                                Conversion - Files for printed books are formatted to be fixed pages, fixed lines.  eBooks need to reflow.  This is one of the biggest problems with PDF on eReaders.  You can see where someone has tried to take the printed file and simply convert it, if you've ever read an eBook where a sentence simply stops in the middle of line and goes to the next line, or there is one word on a page.  The hard formatting was completely removed.  So, there is more too it than simply file save as or file convert.

                                • 28. Re: Nook book prices higher than other ebooks.

                                  kamas716 wrote:
                                  How many server farms are required to allow B&N customers all across the country to purchase eBooks? 1 or 2?  Someplace like Sioux Falls would be a less expensive area to place a server farm than, say, San Francisco.  As long as they have access to the bandwidth, it doesn't really matter where they are physically located. My impression is that the printers aren't setting type by hand anymore, but using a computer program.  So, it should just be a file format conversion to put the eBook on the server for upload and available for purchase rather than feeding it into the printer. 


                                  Oh... Gods.. NO

                                   

                                  it is NOT just a "file format conversion" it's not SAVE AS.

                                   

                                  It's an entirely new layout process to shift from what a printer wants to a different format. Find the crappiest formatted ebook and that's probably some idiot just changing formats and not making sure the layout flows correctly.

                                   

                                  Also, high end servers can START at 10,000$ - and go up fast.These are machines that should never even Reboot, much less shut down, that's a lot of wear on a hard drive. RAID-5 at the least per SERVER DRIVE.

                                   

                                  One ebook may be a MB or 2. A couple hundreed thousand ebooks? B&N and Amazon claim, what, a million titles?

                                   

                                  Putting a server farm in an out of the way place probably means running you're own OC-12 (that's the smallest fiber line available), that's gonna be in the 10s of thousands of dollars. Which means you want to put your server farm near an already existing high speed high bandwidth connection, like a city. They don't run these things on tiny little T-1s.

                                   

                                  Anyway, go on believing what you want about pricing, or whatever. The cost of an ebook isn't too far from the cost of dead tree.

                                  • 29. Re: Nook book prices higher than other ebooks.

                                    I have found many ebooks to be more expensive from B&N compared to Amazon, sometimes as much as almost double the price.  Hunger Games trilogy, James Herriot collection, Whatever You Do Don't Run, and Runt are just a few (James Herriot collection was about $12 from Amazon and $20 from B&N, Whatever You Do Don't Run was about $10 from B&N and about $6 from Amazon).  If B&N doesn't get their act together and start charging decent prices for ebooks, they are going to lose business.  I have already purchased the Hunger Games trilogy from Amazon (I have an ipad, so I can easily download Kindle books to read) and will probably purchase the other books mentioned through Amazon as well because I just can't afford B&N's prices!

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