On entitlement

TeleRead's Paul Biba spots a great article at Chamber Four on the pricing fiasco.

In it, the author, Nico Vreeland references this NY Times article about some backlash to eBook price increases of best sellers and new releases.

In fairness, Amazon did this to themselves - and the publisher's helped by waiting until Apple suggested a different pricing model to demand a change. Everybody let Amazon take over the eBook market (I'm looking at Sony, who created the consumer eReader market and ceded it to Amazon). Everybody let Amazon establish $9.99 as the going rate (except Sony who has held the pricing higher in many cases to ensure no losses). Everybody let this happen for two years. Now Steve Jobs waltzes into the game, sees books that cost $12 wholesale selling for $9.99 and decides this is not going to work... but the consumers have already seen the price and nobody likes it when anything goes up.

The article has a quote from bestselling author Douglas Preston:

“The sense of entitlement of the American consumer is absolutely astonishing,” said Douglas Preston, whose novel “Impact” reached as high as No. 4 on The New York Times’s hardcover fiction best-seller list earlier this month. “It’s the Wal-Mart mentality, which in my view is very unhealthy for our country. It’s this notion of not wanting to pay the real price of something.”

While Nico gets fairly livid over this comment, I'm a little more tolerant. If authors are currently getting either a percentage of the physical book's gross (retail) price, it really doesn't affect them yet. If it's a percentage of the net, it's a big deal - the net on a $24 hardcover dwarfs the net on a $10 eBook.

With the agency deals, those percentages could change drastically on the gross end, as (I'm assuming) the consumer retail price changes to $10 to $15, as the eBook gets viewed as a separate product.

Still, the correct answer is to view the eBook market as somewhat different, and negotiate a different deal on your next contract.

Now where Nico nails his criticism is when he notes that Preston's current release, Impact, sells for $14.29 at Amazon (and well under $18.50 in retail stores). So he's correct that $15 may not be the correct price for this book electronically. eBooks cost a bit less to about the same. One figures if you drop 10% out for printing, you might add a little back in for formatting (although one would hope publishing houses started taking more care in doing this - formatting gaffes are in every book I read on a Kindle or nook these days). On top of that, in some cases, there's a cost to deliver - just a few pennies via 3G, but real nonetheless.

So assuming nobody buys books cheaper than Amazon and Wal-Mart, who sell the book for $14.29 and $14.00 respectively, perhaps $13.50 is about as high as I might expect to pay to not wait 4 months to read the book. And when it's $8 or so in paperback, I better be able to buy it for $7.50 to $7.99 or so.

I'm not convinced we need to reduce best sellers another 30% from their already reduced prices at Wal-Mart and online, but I am fairly sure that paying an extra dollar is a bit much.

I'm not very concerned over guys like Preston - they'll get top dollar thanks to competition for a contract signing and can make a lot of money off a small percentage thanks to the huge volume - but we can't forget new and budding authors, who may not sell 6 digits worth of copies.

I'm not quite as angry as the author on the matter, but working full time in an industry (IT) that has seen outsourcing and H1B imported workers threatening my ability to earn one year what I earned the prior year perhaps I'm a bit more sympathetic. I've had to manage projects on a tight budget (makes you look towards outsourcing) and been threatened by it (makes you hate it). As consumers, we need to understand that constantly driving the cost of products down can hurt many people, which long term hurts availability of books as "would have been authors" look to other fields to make a living.

If the answer is an increase now ($11 to $14) and a decrease later (matching paperback pricing rather than reverting back to $9.99), I can live with that - can you?