Books | Shelf Life

What's an e-book really worth?

Oh, if only Johannes Gutenberg could read the Amazon message boards, he would probably be…horrified. Readers turning against authors, publishers, and each other; readers lamenting $10 price tags because new books just aren’t worth that much; readers admitting that they read more from a screen than they ever would on paper. The value of the printed word that Gutenberg invented, some 500 years ago, just isn’t what it used to be.

Until the iPad came along, that is, and breathed new life into a wilting publishing industry. The device’s iBook store follows an agency model approach to selling electronic copies, meaning publishers can set their own prices (from $12.99 to $14.99) and keep 70 percent of the profits. Naturally, five of the country’s six biggest publishers—Hachette, HarperCollins, Macmillan, the Penguin Group, and Simon & Schuster—cut deals with Apple to be part of its new e-book marketplace even before the iPad launched. These newly empowered publishers also began rethinking their deal with Amazon.com, which has dominated the e-book market since the Kindle’s 2007 debut. Despite competition from Barnes & Noble and Sony, the company still enjoys 90 percent of the e-book market, thanks to a $9.99-per-book mantra that helped lure millions of customers to the Kindle store (and also pissed off publishers, who had to settle for a much-slashed “cover” price until the iPad’s promise of pricing autonomy went public).

So the publishers took their post-iPad bargaining chip—their revalued content—straight to Amazon and demanded more per e-book for the Kindle. First it was Macmillan, who won their case when Amazon agreed to raise consumer prices; and then it was HarperCollins and then Hachette Book Group. All of them argued for higher price points that, as Hachette CEO David Young said, “reflect the value of our authors’ works.” In other words, something that the Amazon.com bargain-basement prices do not.

Another wrinkle in the saga, according to last Thurday’s New York Times, is that Apple may have added its own discounting terms into their contracts to keep its competitive edge. Which begs the question at the heart of this pricing melee between publishers and Amazon (and now, frustrated readers and authors): What is an e-book really worth, when you can’t share it or store it on a (physical) shelf once you’ve finished it? Does a higher price tag validate an author’s craft, or just make it more inaccessible to the audience?

If you just looked at the Kindle store, and examined which titles are flying off the virtual shelves, books would seem to be one of the company’s least valuable commodities: 15 of Amazon’s top 25 e-book bestsellers are free, and eight more cost less than $9.99. There’s no doubt these deep discounts also help sell the Kindle itself—the lower the book prices, the more useful the device is, so more people buy the e-reader and the company can compensate for the lower per-book price. It’s great for the devoted reader—many commenters on the company’s Macmillan deal discussion thread say they read way more on a Kindle than they ever did before.

What do you think, Shelf Lifers? Do you think that e-books devalue the published word or promote authors and reading itself? Would you pay $14.99 for an e-book?

Originally posted February 22 2010 — 10:50 AM EST

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