Customers may not be able to control a publisher’s price, but they can control the reviews a book gets on Amazon

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If you want to watch how book publishers can accelerate their own demise, watch what happens when the giant book publishers exercise their new-found freedom to jack up the price of e-books sold. I’ve written previously about the work of book industry veterans and Harvard Business School professors in examining pricing scenarios for digital versions of books. The objectives of book publishers in increasing the price of e-books is nuanced, but has more to do with protecting legacy channels and business models than in increasing the money that authors receive or decreasing the price that readers pay.

Those of us who read books on Kindles (and on iPhones and soon, on iPads) have no power other than our wallets to set pricing. And while there is talk of “boycotting” book purchasing if the price is above $10, I don’t think that’s a “boycott” — or, if it is, that’s like saying I’m boycotting Lamborghinis. Not purchasing something you feel is priced higher than its worth (or that you can’t afford, in my case, a Lamborghini) is not boycotting. It’s a fundamental principle of economics. Something to do with pricing elasticity, I believe.

That said, this item in today’s New York Times about the e-book pricing controversy looks into the “reflexive hostility to prices higher than the $9.99” that “voracious readers of e-books have shown.”

According to the article, those who purchase lots of e-books — at least, the ones who are prone to boycotting — are going beyond “not buying” books over $9.99. They are going onto sites like Amazon.com and posting one-stars and negative reviews of such books. And if you are a publisher, you know what that means. Ouch.

While the author-loving part of me cringes at such tactics, the consumerist side of me hears the song, “Do You Hear the People Sing” from Les Miserables, when I envision such tactics.

Here’s the deal: Economics, not legacy-protection tactics, should set the market price of books. Authors and publishers should be compensated fairly for e-books sold. But the costs of paper, binding, warehousing, shipping and associated expenses should not be. (Or, at least, that’s what the experts say.)

Raise prices above what the market considers fair and not only will they stop buying, they will burn down Paris.

  • byobobby

    People are reading less than they did even a few years ago. How does the publishing industry think this is a good thing to make the prices higher? If anything, they should be going lower to attract more readers. Libraries allow readers to read a book for free. Borrowing books is also a “free” method of reading. Paperbacks are $7. This is what many readers are use to as far as price. Free or less than $10. E-readers give you convenience, but no one wants to pay an unfair premium for this while losing the flexibility of a printed book. (When you buy a printed book, the book is yours to do with what you want…loan out, sell at a yard sale, whatever, not so E-books). We want publishers and authors compensated, but we don't want to be taken for a ride or else many of us will just go elsewhere. A movie rental is $4…that's your competition.

  • byobobby

    People are reading less than they did even a few years ago. How does the publishing industry think this is a good thing to make the prices higher? If anything, they should be going lower to attract more readers. Libraries allow readers to read a book for free. Borrowing books is also a “free” method of reading. Paperbacks are $7. This is what many readers are use to as far as price. Free or less than $10. E-readers give you convenience, but no one wants to pay an unfair premium for this while losing the flexibility of a printed book. (When you buy a printed book, the book is yours to do with what you want…loan out, sell at a yard sale, whatever, not so E-books). We want publishers and authors compensated, but we don't want to be taken for a ride or else many of us will just go elsewhere. A movie rental is $4…that's your competition.