Physical vs Electronic Pricing

ukbootlegs

Doesn't it just frustrate you?

Steve Jobs: The Exclusive Biography is 50p more expensive on the Kindle than the physical hardback.

I know ebooks are subject to tax, but there are no printing costs, and no transportation costs.

I accept there will be a cost for a server to house the files, and for someone to format it for the ereader, but this kind of price difference frustrates me, as I much prefer an e-version.

nheather

In fairness, they have been getting their act together with electronic download prices.

When the Kindle first cam out I almost bought one but then spotted that in practically every case the Kindle version was more expensive than having the paper copy sent to me.

So I didn't buy straight away.  The electronic prices have since fallen (in general) so that they are cheaper than the paper copies - so I have since bought a Kindle.

You still find odd examples (like you have done) often in less popular publications (although I doubt the obne you found is unpopular) - for example I'm into military history and those books are still often more expensive on Kindle.

I agree the VAT argument doesn't cut it.  Even excluding the paper costs, surely the cost of postage and packing outways the VAT on the download.

Cheers,

Nigel

Manky

Interesting reading here regarding ebooks and publishing.

Incidently, the author's last novel was around £3 cheaper for the Kindle than the UK paperback on its release.

Theydon Bois

Is there any other product that when it charges its 'form' becomes subect to VAT when the original was VAT exempt, or vise verca? Ludicrus.

nheather

I think there is currently a request\petition (not sure what form) for electronic books to be Zero-Rated.

The problem is that downloading books is fairly new, being pre-dated by music, movies and software.

This is why downloaded media has VAT.  The trick now is to get HMRC to sub-divide 'downloaded media' so that books can be treated differently.  They are under a lot of pressure to do so, but as it is not in their interest I doubt they will be in a hurry to do anything about it.

Cheers,

Nigel

richardb70

I had to laugh when I saw which title the OP was using as an example. By all accounts, it was Steve Jobs himself who is largely responsible for the current publisher agency model!

Take a close look at the Amazon page for the e-book and you'll see "This price was set by the publisher". Then check out the following article:

How Steve Jobs Ruined Amazon's Ebook Pricing Model | Brad's Reader

KCooperman

People seem to forget that you are paying for the material not just for the cost of printing and distribution.

They should be priced the same but you will always find physical books to be cheaper because companies will offer promotions/sales to reduce surplus stock. This doesn't happen with the e-downloads so they usually remain at the RRP.

Its the same as with game downloads on Xbox live & PSN.

richardb70

This situation is a little more complicated. Amazon has been running a perverse business model for some time where they'll buy books from a publisher and then sell them at a loss to the customer. All to get market share, and also because Amazon sells a lot more than books.

The publishers have been unhappy with this for some time, as they feel that the perceived value of books has been diminished, and they're not making as much money as they should be (which is disputable). So basically they threatened to stop selling their ebooks to Amazon unless Amazon sold them for a price that they had set. Amazon fought this for a while but capitulated. Most publishers have signed up to this "agency pricing model" now, which was encouraged by Apple when the iPad was released.

So when you see a Kindle book going for more than a hardback, it's due to Amazon selling the hardback at a discounted price, but the ebook price is fixed and out of their control.

Billy Goodgun

Yep, that post is how I understand the situation, too.  I'll see if I can dig out a couple of interesting articles on it later.

The short version is that the pricing structure/model is different for the different formats.  As Richard has pointed out, Amazon sells paperbacks and "physical" copies at a loss to gain market share, while making more money from the Kindle sales.

Just because a Kindle copy is more expensive doesn't mean more money goes to the publisher/author, however - nor is it necessarily an unrealistic pricing model for Amazon.  It's just that Amazon has driven down the perceived value of books.

mitchec1

The OFT are investigating ebook sales and are working with European Commission's own investigation

Investigation into arrangements between certain publishers and retailers for the sale of e-books  - The Office of Fair Trading