E-Book Pricing Impact on Print Formats?

Although I’ve been aware of e-books and have followed the trials and tribulations of the industry in figuring out how to negotiate this new technology, I hadn’t had direct experience with device-based e-reading until this week. Yes, Internet, it took me this long to get me an iPhone. In my defense, my mobile provider didn’t provide it until November. I’ve spent the past week with my nose to the screen, and much of it has been getting acquainted with my e-book options. When I encountered the prices, I found myself surprised; $20.00 for an eBook? Really?

All week I’ve been trying to unpack my reaction. Part of it, I think, comes from comparable e-buying experiences. The content I buy in electronic formatsongs, TV episodes, and now iPhone appsrarely cost more than $3 and it’s hard for me to go above that price for e-content without pause.

Whether or not this a realistic price point for the industry, there seems to be strong consumer opinion about how much e-books ought to cost. (I would reference the BISG consumer attitudes towards e-reading survey on this matter, but as Morgan’s pointed out, one of the qualifications for responding to the surveythe surveyed had to have purchased an e-book in the past yearautomatically excluded all the non-e-book-buying customers, which represent too large a percentage, if not the majority, of the market; of 36 000 respondents, only 868 qualified.) I’m thinking of last spring’s Kindle-users’ $9.99 price point push on Amazon, and the retailer and publisher response of lower and lower price points for e-books. The price of an e-book is an important discussion (involving consumer perception of value and content vs. production and distribution costing in addition to that content, for one) but not one I’m going to get into here.

My question is, will low e-book pricing drive down the price of printed books? The prices of hardcover, trade paperbacks, and mass market books have been established at levels that, with constant, mind-bending struggle (utilizing, say, analytics from BNC products!) can work for the book industry supply chain. Though everyone seems to get the short end of a very short profit stick, and despite the constant announcement that print is dead, print books are still selling. Though they may complain about, and affect the levels of pricing, here what’s important to note is that consumers accept the pricing relationships between formats. That is, a hardcover costs more than the trade paperback, which costs more than the mass market; if you are patient enough to wait for the MM, you will be rewarded with a significant price decrease.

Will print format pricing be insulated from the e-book price? Is the e-book reading market too separated as of yet to treat it the way you’d treat a reader who waits for the mass market version to come out, or the movie-viewer who waits for the movie to be released on DVD and then iTunes?

Mike Shatzkin proposed a debut pricing model in August of last year. Dominique Raccah of SourceBooks (who will be speaking at the BNC TechForum on March 25) weighed in last summer as well. To treat the e-book as a format similar to the mass marketcheap to make and disseminatewould help to protect the traditional print format price points, I think.

But the problem may be that consumers don’t think of the e-book as a format the way they accept the relationship between hardcover and mass market, or the movie in a theatre and a DVD. I suspect, as well, they don’t want to wait for the content. Maybe it is the task of publishers to push this message to consumers, to align the e-book with MM and identify it as a second-run format. Making the backlist available as e-books might be a way to start, as well as defining an e-book release date along with the MM release date. If movies aren’t released straight to iTunes when they go to theatres, why should an eBook be available at the same time as the hardcover?

It seems that several houses are taking the debut pricing model. Here’s the example of Sarah Palin’s memoir delayed e-release.

I think the delayed e-book release, along with its lower price point, is a good idea. As for me as a book consumer, I’ve never had a problem paying full price for a new trade paperback or hardcover. Anything above $25 may make me scowl for a moment, but ultimately I think it’s worth itfor the quality of the object and, in the case of hardcover, to satisfy my greedy need to read it right away. I am, I suppose, an ideal consumer of print books. Maybe it’s having worked in the industry and knowing all the work that goes into producing a book, and knowing that everyone along the way needs to pay their bills. Or maybe it’s just that I like that fresh-book smell.