Overpriced Ebooks

As an Indie I struggle to gain new readers. I’m virtually unknown in the market, so I must use whatever tools are at my disposal to draw in new readers. Price is one of those few tools that help to do this.

The lower prices you see on my books are not because I don’t value my work. I’ve put in countless hours into each of those titles. Many of them spent 4-6 months being rewritten and revised, and that is before an editor looked at them. No, the low price is not measure of quality; it is there to attract readers who have never heard of me before. The market is flooded with thousands upon thousands of books by both traditionally and indie published authors. If my book is up next to another book in the same genre, the price “might” be the deciding factor for a customer. It’s for that reason alone that I’ve set many of my titles to $0.99. People are a little more willing to take a chance on you when the item they are purchasing is priced in their comfort zone. If they like the book, they’ll be more willing to try another, or maybe even suggest it to their friends.

There is a huge debate about the $0.99-$2.99 price point among indie’s, but that’s not what I want to talk about here.

Price in general is a big concern when making a purchase on anything, whether it is books or groceries. Let’s face it; the economy is not that great right now and people are holding tighter to their money.That plus the fact that we "indie authors" want to be more attractive to you the reader, is why we price our books so low.

So with that in mind, I have to wonder why traditional publishers have adopted a more expensive model for pricing their ebooks?

I’ve said it many times before, I’m a huge fan of Patricia Briggs. I adore her Mercy Thompson series. I had been eagerly awaiting the release of River Marked (book 6 in the series). Now that I finally have my Kindle too, I was even more excited because ebooks WERE generally priced better than print.

So today I had a few free moments and was browsing Amazon.com. I pulled up River Marked and to my horror, found that the ebook price was $12.99!!!

Oddly enough, the hardbound edition was only a few cents more at 13.86.

This makes no sense. And it will make no money from me either. I love the series. I have absolutely nothing bad to say about Patricia Briggs or her books. I’d been waiting for the next book to come out, and now that it is available I’m angry that the publisher has priced it so high.  I’m not paying that price. Period.

Please don’t think I’m being cheap. I’d easily pay anywhere from $1-$6 for an ebook.

Ebooks themselves are cheaper to produce and do not require any form or printing or warehousing.  By that reasoning alone they should be priced lower than the print versions. So why is it that major publishers are moving to a higher pricing model, putting the ebook titles at or above the cost of hardbound books?

The whole Agency model for ebooks makes no sense to me. It seems almost insulting to me as a reader to be forced to pay more for a product I know cost less to produce. For readers like me, who are unwilling to pay these high prices, sales are lost.

Now, maybe down the road when the paperback version is released at a more reasonable price, say $7.99, I’ll go ahead and buy it then, in print. Why then and why paper when I have an ereader at my disposal? Because the print version can get more use. I can legally lend it to my friends; I can put it on my shelf to re-read later. With a DRM protected ebook, the book in question becomes a one-time use commodity.  I may read the book once and then not again for several months-years. With technology always changing who knows what ereading device I may have by the time I want to read the book again. DRM prevents me from storing it on my hard drive and uploading it to the next ereader I get in the future.

With thousands of ebooks out there at reasonable prices (remember I said I’d be willing to pay $1-$6 for an ebook) it makes no sense to spend more for the same type of product. It has no additional value, it has limited sharing/lending capabilities, with DRM it is limited to the current device I have today (but maybe not tomorrow), and it cost the publisher less overall to produce.

I hope (but seriously doubt) that the Big 6 will get their acts straight and consider their customers when pricing their books. However, on the flip side, their ridiculous pricing is helping to drive the indie self-publishing movement forward. Customers appreciate value and that will ultimately give our books a little more consideration.


Susan Helene Gottfried said...

The Big publishing houses insist they are making next to nothing on e-books, and in fact are losing money on them. I don't know that I buy that, myself. I think the e-book profits are underwriting their other costs (like books that never earn out their multi-million dollar advances), and that their math is starting to look like that of the movie studios.

Of course, I could be wrong. I don't work for a publisher. But from where I sit, something sure smells funny.

Katie Salidas said...

I'd love to see the "per" book math of these publishers. Lumping them all together allows the sellers to pay for the non-sellers and I'll bet that is where publishers cry "we're losing money."

Ebooks are cheaper to produce. Ebooks do not have print runs. Ebooks are not warehoused. The only cost up front for an ebook is the cover, formatting, and editing (which are all part of the production of the print versions).

After all is said and done and the books are uploaded to the sellers website, there is no additional cost, only sales and their profits.

Now, some may argue "marketing cost," but to that I would say, what cost are specific to the ebook version vs. the print version. I'd argue that very little is spent in marketing the ebook itself.

Like I said, I'd love to see the math broken out per book. That's where the real truth would be told.

Raven Corinn Carluk said...

It's almost like the Big 6 are trying to kill ebooks, when they're really killing ALL books. Some of the prices on books are ridiculous. when two print books of the same length are priced differently only because of the authorc's name, something is wrong.

but i have thought all books overpriced for a while

Joel Blaine Kirkpatrick said...

In the pre-published book world, many ebook titles are freebies. Every publishing house has a stable of older and classic works that are given away, many already available pre-loaded on the devices or ready for instant download. Those free are counted along with the 'sales' which are the more current releases. That means, for the whole lot of pre-published books moving, hardly any money comes in per book.
One reason the Big Six price structure thumbs its nose at reality...they've not lost millions yet on that structure. Every penny they earn is profit, but hidden by the sheer number of books they move. Second reason they thumb their nose at lower prices...the public has been conditioned to think a $12.99 book is reasonable, even if it is electronic. Until Indie books hit their stride, the Big Six get all the purchase clicks.

Lorelei Bell said...

Oh, if we were flies on the wall at these places, hum? Who would be getting canned next, and why. Hmmm.

I had no idea that they were doing this.

Once the paperback comes out, you would think these yutzs would realize the error in this pricing. Who would buy it at that price? I can't afford a hardbound book, and I wait until the paperback version comes out well after everyone has read it.

I don't pretend to understand any of it. It's almost as though--let me just get this out without sounding vendictive or anything--like they are trying to make the money before a debacle? Sort of like the lending houses have gone? I don't know. It's almost scary, really.

But, yeah. We consumers do have a voice. We have to use it. Maybe they'll get the idea someday, hopefully it won't be too late.

Anonymous said...

This post from Michael Hyatt breaks it down a little, but not per book. http://michaelhyatt.com/why-do-ebooks-cost-so-much.html#

To be honest, when I read this post a while back (and still), it mostly sounds like whining to me. There are lots of folks who can format and upload an e-book quickly and inexpensively. Why can't they outsource? Lots of companies do it. I suspect eventually we'll see publishers biting the bullet and outsourcing to freelancers and letting employees work from home to reduce overhead.

Really, I don't have a lot of sympathy for the big 6 and their medium-sized counterparts. I mean, they all made their poopoos. Why not look at the returns model and fix that? Among other things.... So many broken pieces of the publishing industry as a whole that it's not even funny....

I'm totally with you on this, Katie. If an e-book is anything about about $8, I start to really question if it's worth it. I'll just put it on hold at my library and read it for free.

Maybe I'm a cheapskate. ;-)


mooderino said...

It's explained quite well here:

Katie Salidas said...

And that is exactly why I said they are helping to push the indie movement forward.

Sure, there are many people out there who will pay top dollar for the "a-list" authors, but the mid to low lister's will be hurt. That will send those authors looking for other means and generally that equates to another traditionally published author going Indie.

Add to that the fact that indie prices are more attractive to consumers.

I'm not saying it will happen tomorrow, but over time, if the big 6 keep pushing the higher prices while indie authors continue to put out quality work at a reasonable price, the balance will shift.

Today's higher price and profits may become the final nail in Big6's coffins.

Of course this could be avoided if they would simply adopt pricing that makes their titles more attractive. As I said in my post. I'll happily pay up to $6 for an ebook. With the cheapest print books usually priced at $7.99 a $6 ebook seems more than reasonable for a traditionally published author.

Look at Amazon's royalty rates. 70% back to the author/publisher for any book over $2.99. That $6 ebook nets the publisher roughly $4 per book sold.

Also, setting a flat, reasonable price for ebooks might also change the way indies look at ebook pricing too. Which might also stem the race for the bottom pricing. We could then see a more evenly price rate for books across the board. Perhaps $6-$4 for novel length and then shorter works priced accordingly. That of course is all speculation.

Katie Salidas said...


Nathan makes a great post on the nubmers. But here is my big problem with it. You have to treat each version of a book as an individual commodity because they are individual items with separate cost to produce.

Each item should be priced according to it's cost and value. A hardcover book requires: printing, warehousing, etc... These all cost the publisher additional money per book.

One of the things Nathan's post did not mention is the cost to print each book. That is also something that needs to be factored into the "profit" of hard bound over ebooks.

Each book will cost the publisher a certain amount of money to print, package, and ship. Subtract that from their 50% profit on the sale to a bookstore and you will see the overall profit per book numbers drastically reduced.

As an indie, my numbers will be quite a bit higher as I cannot make the same deals with printers, but for example.

A printed 300 page book cost around $4.5 from my printer. That goes against any of my potential profits. If I charge $10 for my books, I'm only making $5.5 one each one after printing. Now, add to that the fact that I have to further discount the books to get them into sales channels (25%-50%). If I want to be on store shelves I have to give the industry standard of 50%. That's on the total sales price, not the price after printing. Now that $10 book only makes me around $0.50 when all is said and done.

If you just looked at the flat math of price vs seller discount, it looks differently.

That $10 book at %50 discount to the seller, it looks like I make $5 from each sale. But as you can see, once the individual print cost are added in, the real "profit" is drastically reduced.

Taking that into account changes the way you look at book pricing. It is understandable for hardbound books to cost more because they cost more to produce. Prices have to be higher to cover all of the cost and still make some kind of profit.

An ebook does not have these additional costs per book. Therefore ebooks should not be priced in the same category as hardbound book.
they cost no additional money to the publisher once they have uploaded them to the seller. Amazon pays them a flat 70% on each book sold.

This is why it is outrageous to expect us to pay the same amount or higher for the electronic version.

mooderino said...

As I understrand it (which isn't very well) if they priced ebooks appropriately it drive up ereader sales and kill off print books quicker, and they think they can make more money if hardcopy is still viable. They don't care how things will panm out or what's best in the long run, only in what is the most profitable right now. And if retarding the growth and progress of ebooks by this pricing structure will enable them to make the most money, even if it ends up destroying them (obviously they don't think that will happen) then that's what they'll do.

I'm just guessing though.

Katie Salidas said...

And that's the big problem. They don't care about tomorrow, they are just fighting for today. If evolution tells us anything, you have to either adapt or become extinct.

Rather than fighting by attempting to drive cost up, they should be adapting and making themselves more attractive to consumers. If ebooks are the wave of the future, then they should look for ways to use them to their advantage rather than trying to fight them.

Price gouging will only hurt them in the long run.

Robert Collins said...

I think part of the pricing problem is that the big publishers view ebooks as no different from print. "We have certain costs in putting out books, and our prices have to reflect that." Fair enough, but as you and others have noted, ebooks don't have the same warehousing and shipping costs as print books. It's just easier for them to keep doing business as normal.

mooderino said...

There's a similar refusal to get with the program in the music industry. As things evolve there's just as much money to be made, but not necessarily by the same people as the old system, so they don't really see any point helping to create a better, fairer, stronger sytem in which they personally make less money.

Also, there's their general mercenary attitude. If I gave them a money tree that grew $100 bills and told them, you can harvest up to half of the leaves and they'll grow back forever, they would immediately strip all the leaves off the branches and then offer half the money as a reward for anyone who brings them another money tree.

Katie Salidas said...

LoL Mooderino... I love that analogy!

Unknown said...

I agree, when I first started buying ebooks, they were somewhat cheaper than the counterparts in the print variety. Now, I can almost always find the print edition at the same if not lower price than the ebook. Why is that? Is digital suddenly more expensive to fling across cyberspace by to put ink to a page (and kill a tree)? No, the publishers see another (and book sellers) see an opportunity with the influx of cheaper ereaders (as well as the ipad) to make some quick easy cash. I don't blame them for that, it's the American way. But, let's be reasonable... how can an indie writer make money (and I've seen some of the sales for a couple of indie writers, and they're doing okay) and traditional publishers are sinking fast? I don't know if any author will become rich, well outside of some really big names who've been around for a while..., but still... it seems like we're taking one for the team we don't even play for... And what is it with offering 30, 40, 50% off a print title, but have to pay full price for the ebook edition??? I actually called B&N to ask if my coupon they sent me was good on ebooks, and customer service said it violated copyright laws.... really? and discounting the print copies doesn't have the same effect? Please... the only difference is that I can't take the ebook off my iPad and give it to my sister to borrow. Please make up a different story to tell me, one that's at least believable.

Dottie :)

Unknown said...

As an employee at a big-box bookseller, I am actually glad they have these high prices on ebooks. This is one of the only things that keep people coming back into my store. But at the same time I am supposed to be pushing ebooks on people because that's the direction the market is going. I fear our bookstores, which I love so much, may go the way of the dinosaur soon, especially if ebook prices drop.


Katie Salidas said...

I can certainly see your side of it too, but I don't think publishers hiking prices on ebooks will solve any of our problems. It will push people to either hold out for better prices (they are supposedly adjusting them to match their current print prices) or they will turn to libraries for the chance to read for free.

On the other side of it you're still going to have indies driving the other end of the spectrum down as far as it can go.

Ebooks are taking a larger hold on the market. I don't think it will completely kill print, but it will drastically reduce print. What is needed is a more balance pricing model across the board.

Katie Salidas said...


The traditional publishing pricing structure is all screwed up. Period. LOL on coupons violating copyright. I can't believe they actually said that! WOW.

Chrystalla Thoma said...

Great post and discussion. Thanks, Katie!

Butter Pecan said...

"when I first started buying ebooks, they were somewhat cheaper than the counterparts in the print variety. Now, I can almost always find the print edition at the same if not lower price than the ebook. Why is that? Is digital suddenly more expensive "
-Dottie (at Lottie's Place)

Dottie, publishers need the hardback sales to sustain themselves. They know they can't charge $25-$30 for an ebook (although I read a comment on another article by a woman who mentioned seeing a $30 ebook from a publisher), so they're trying to push you back into buying print/paper. That's where they want/need you...buying PRINT because that's what their model is based on: selling to booksellers, distribution, ect.

By looking at the high ebook and then a print paperback and then running off to by print you have given them what they wanted : another print sale.

I'd suggest sending them a message by simply not buying either. Find some new entertainment for a little while or read a cheaper author in ebook format. It's important for ALL consumers that publishers get a wake up call.

About The Author

Katie Salidas is a USA Today bestselling author and RONE award winner known for her unique genre-blending style.

Since 2010 she's penned five bestselling book series: the Immortalis, Olde Town Pack, Little Werewolf, Chronicles of the Uprising, and the all-new Agents of A.S.S.E.T. series. As her not-so-secret alter ego, Rozlyn Sparks, she is a USA Today bestselling author of romance with a naughty side.

In her spare time Katie also produces and hosts a YouTube talk show; Spilling Ink. She also has a regular column on First Comics News where she explores writing from a nerdy perspective.