Nov 21 2009
TBIResearch believes that Amazon is losing quite a bit of money on the ebook market as it tries to drive down prices of books. Publishers are trying hard to maintain a higher price, but researchers and retailers believe that consumers will not pay a high price for ebooks. The good news according to the research paper is that publishers can still maintain a 10% margin with ebooks because of savings in manufacturing and shipping costs.
Publishers should be able to sell e-books to distributors like Amazon at $5 and still maintain the profit margins they enjoyed on print book sales. In turn, distributors like Amazon should be able to sell e-books at the current $9-$10 price and still enjoy a healthy profit.
The bad news for authors is that their royalties will decrease since they are based off of retail sales price.
It’s a pretty interesting article and includes a mock profit and loss statement. I wouldn’t agree with all the points in the article such as author royalties which are increasingly off the net making the publisher margin more manageable.
Three major writing organizations are urging Harlequin to make changes to the Harlequin Horizon business venture. SFWA wants Harlequin to divest itself entirely of the venture (I hope they urge RandomHouse to sell its 49% interest in Xlibris and HarperCollins to shed Authonomy); MWA hasn’t said what would make it happy and neither has RWA. I guess the next move is up to Harlequin. It occurs to me that Harlequin could sue if these other writers’ organizations do not apply their standards evenly across the board so I wonder if we’ll see more publishers unrecognized by the writers’ organizations.
Lori posted her thoughts on the Amazon’s top 2009 books. The customers’ favorites are quite different than Amazon’s top 10 list.
The list for customer favorites is:
- Vision in White
- Bed of Roses
- Lover Avenged
- Skin Trade
- Black Hills
- Hidden Currents
- Dream Fever
- Bad Moon Rising
- Dark Slayer
Editor’s top picks are:
- Angels’ Blood
- Smooth Talking Stranger
- Kiss of a Demon King
- The Perfect Poison
- Bending the Rules
- What Happens in London
- A Duke of Her Own
- Immortal Outlaw
- Angel Lane
I haven’t read a lot of those books.
According to a press release posted over at Teleread.org, Smashwords has purchased BookHabit Limited, a New Zealand author community. Earlier, Smashwords announced a partnership with Shortcovers.
Toronto, Canada-based Shortcovers, an eReading application owned by Indigo Books & Music, will distribute eBooks published by Smashwords on a worldwide basis. Shortcovers will distribute the eBooks in 189 countries. Smashwords has more than 5,000 original eBooks from 2,300 self-published authors and small publishers from 20 countries.
I do think the advantage of digital books is the ease of international delivery. Perhaps what will be lost in margin can be made up in volume.