Reader devices [LWN.net]

Reader devices

Posted Aug 2, 2012 0:31 UTC (Thu) by dlang (guest, #313)
In reply to: Reader devices by nix
Parent article: The Nexus 7: Google ships a tablet

The savings to the publisher in not having to print, store, ship physical books will eventually make a significant difference to the price of e-books vs paper books. At that point it will cost less to give someone a free reader if they buy X books than to print the paper books.

most publishers are making record profits from e-books because they have far lower costs, but they still charge more for the e-book than the paper book. Baen books is the most prominent publisher that I know of that's bucking this trend.

I don't expect that situation to last.

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Reader devices

Posted Aug 2, 2012 7:37 UTC (Thu) by madhatter (subscriber, #4665) [Link] (5 responses)

The situation is complicated in some jurisdictions (such as the UK, and I suspect the rest of the EU but don't know for sure) because paper books attract no sales tax while e-books do. That gives the poor e-book an instant 20% markup over its paper cousin here, or to put it another way, the first 17% of savings you make on an e-book are promptly eaten up by the Exchequer.

I happily stipulate that I know of no rational argument whatsoever why that should be the case; but it is.

Reader devices

Posted Aug 2, 2012 8:04 UTC (Thu) by dlang (guest, #313) [Link] (1 responses)

currently many of the publishers think that they should be able to charge more for the e-book than for the paper book, their stated theory is that the e-book is 'more convenient' and therefor worth more to the purchaser

Reader devices

Posted Aug 2, 2012 20:49 UTC (Thu) by khim (subscriber, #9252) [Link]

IOW they trying to have theirs's cake and eat it too. They play “market” games with this approach which nullifies their initial bargain. At this point we suddenly get another choice: free PDFs and MKVs found on the internet. Convenience drives prices up but wider availability drives them down. I don't think the prices they try to demand will stay.

Reader devices

Posted Aug 2, 2012 16:57 UTC (Thu) by anselm (subscriber, #2796) [Link]

Here in Germany, e-books are taxed at the standard rate of 19%, while paper books qualify for a reduced rate of 7%. In principle, the rationale behind the reduced rate is to make it easier for the poor to afford the basic prerequisites for civilised life; apparently anyone who can afford a PC, tablet computer, or dedicated e-book reader does not require that sort of assistance.

On the other hand, some of the 7% exceptions are really weird; donkeys are taxed at 19% but mules, like horses, at 7%. Donkey meat as a food item, on the other hand, is taxed at 7%, too. Tomato juice is taxed at 7% but tomato ketchup and tomato sauce at 19%. The junior partner in the German coalition government, the Liberal party (FDP), recently made itself quite unpopular by arranging for the tax on hotel accommodation to be lowered to 7%, in a move that was widely considered catering to minority interests.

Reader devices

Posted Aug 9, 2012 21:05 UTC (Thu) by Wol (subscriber, #4433) [Link] (1 responses)

Not sure why e-books (and books with CDs) attract VAT, but it's an unfortunate fact that once VAT has been imposed it can't be removed. But I suspect it's a hangover from the old "VAT is charged on luxury items, not essentials", and when they first came out CDs and e-books were classed as luxuries.

That's why VAT is now 5% on gas and electric - once UK law put it on, European law prevented it being taken off.

Cheers,
Wol

Reader devices

Posted Aug 10, 2012 16:22 UTC (Fri) by nix (subscriber, #2304) [Link]

Well, that's a classic example of the UK's tendency to over-implement EU directives far more officiously than anyone else. Other EU nations have occasionally removed VAT on existing things, EU directives be damned -- and the directive in question does not prevent you from making anything be VAT-rated at 0% (which is not technically the same as making it VAT-exempt but has the same effect).

Reader devices

Posted Aug 2, 2012 22:18 UTC (Thu) by nix (subscriber, #2304) [Link] (3 responses)

The savings to the publisher in not having to print, store, ship physical books will eventually make a significant difference to the price of e-books vs paper books.

All of those costs come to less than 15% of the price of a paperback. The majority of the cost to the publisher is editing, proofing, and advances, all of which are committed before the book hits the shelves and none of which are affected by e-books (modulo the regrettable tendency for e-books to be 'published' with no editing at all).

Reader devices

Posted Aug 2, 2012 22:30 UTC (Thu) by dlang (guest, #313) [Link] (2 responses)

> All of those costs come to less than 15% of the price of a paperback

Bzzz, the retail markup itself is normally around 50% of the cover price of the book. These other costs may be 'only' 15% of the cover price, but that would mean that a direct-from-publisher e-book has avoided almost 65% of the costs for that copy.

but even if you were right, that's still not an excuse for the e-books costing MORE than the paper versions.

Reader devices

Posted Aug 4, 2012 11:40 UTC (Sat) by nix (subscriber, #2304) [Link] (1 responses)

Bzzz, the retail markup itself is normally around 50% of the cover price of the book.

The figures I've seen suggest 30% each for distributor and retailer.

but even if you were right, that's still not an excuse for the e-books costing MORE than the paper versions.

True enough -- at least if by 'the paper version' you mean the hardback. Not all books sell well enough to come out in paperback: the publisher relies on the high price of the hardbacks to make back their costs (at least UK publishers do and I can't imagine it's significantly different in the US). Small- or slow-selling books, including a lot of technical works, can be expected to remain quite costly even in ebook form.

Reader devices

Posted Aug 4, 2012 22:03 UTC (Sat) by dlang (guest, #313) [Link]

I'm not saying that all e-books should sell for $6 or something like that. I've happily paid $70 for a technical e-book where the paper copy was $100.

But when the e-book costs more than the hardcover (when it's released) and more than the paperback (when it's released), the publisher is just gouging the purchaser.

> The figures I've seen suggest 30% each for distributor and retailer.

If you have publisher, distributor and retailer that's actually worse than the 50% I was thinking.

something to keep in mind, When Amazon started selling e-books they were paying the person who listed the book 35% of the purchase price (i.e. Amazon was keeping 65% of the purchase price) and nobody was screaming about Amazon gouging the publishers, it was in the range they expected. It was big news when Amazon started offering an option to give the person who listed the book 70% of the purchase price.

Note that when publishers list books for $12.99 or $14.99 they (and therefor the author) get paid significantly less than if they listed the book for $9.99, but many of them insist on continuing to do so.

Any publisher could start selling e-books directly from their own website, and the costs of doing so would be significantly lower than the cost of selling through Amazon. This works even for customers with Kindles or Nooks. Baen books does this, others could as well.

Apple forbids the publisher from doing this inside apps for their products, but I'll bet publishers could get convince them to alter their policies if they really wanted to.