For those not intimate with publishing, Hachette is one of the major publishing houses that everyone lovingly refers to as the “Big Six.” Except now there’s five. They’re kind of dinosaurs and resistant to change, in evidence is that even the nickname doesn’t change. Part of the dispute is that their business practices and policies don’t change and Amazon takes exception to that.
In fairness, Amazon some of the time needs a swift kick to the backside themselves, but they’re better. Some companies (by this I mean the Big Six) have been in business so long, they’ve forgotten how to be flexible in their thinking. In today’s world, that’s not a good business plan.
Amazon's mad Hachette wants to charge too much for eBooks. The cost of eBooks is a long-standing debate. Why do they cost what they do? If you’re Stephen King, you could sell an eBook for $19.99 because you’re (ahem) Stephen King. However, Stephen King is cooler than that. On Amazon, Doctor Sleep is currently $13.36 and The Shining is $1.99. I even looked at Amazon’s Best seller list, and the most popular price point appears to be $4.99. Of course the prices vary, from $0.99 to $13.99 for a single book. (There's a reason for $4.99) Oh, the $13.99 book is HarperCollins, not Hachette, by the way.
Is cheaper better? It’s a balancing act. Free is a great deal, but it doesn’t demand respect from the reader. If they pay for the book, they will take the time to read it. Frequently readers download anything that's free and looks halfway interesting. It’s fine. It means if a writer doing a free promo weekend, and getting 5,000 downloads, can't really excited. It’s not really a success. Pricing the book at 99 cents for that same weekend and getting 500 sales? That’s a lot better. Pricing the book at $5.99 will not still get the same 500 sales though. Don’t be naïve. But maybe there's a good cover, good description, and the writer can get 150 sales a week at $5.99. If you raise the price to $7.99, sales will drop. If you lower the price, sales will rise.
The more novels the writer has, the longer he's been writing, the more books he's sold (not given away on promotions), and the more readers that are loyal to him all add up to the more he can charge for his books. It’s a basic of economics and the Big Six and Amazon are aware of it. Amazon addressed it in their letter, and I’ve found it to be true when I’ve played with my pricing. Still, there is a point to free or cheap eBooks. It encourages new readers to take a chance on an author or series they're not familiar with.
There are costs involved with bringing any book to the market. Yes, even eBooks. The writer puts in a lot of time. A lot. Some of us more than others. I will grant some writers are blessed with the ability to type like the wind, or pristine first copies. Others take a year to get that first rough draft finished and it’s something that needs to go through another year of revisions, alpha and beta readers, and five rounds of professional editing before its fit to be seen by a reader. There’s a range of skill level out there. Then you add in costs of formatting and artwork (if needed) and cover design.
At this point an eBook might be done, but a print copy isn’t by a long shot. Print copies need paper, forecasting, stocking, distribution, a whole other host of costs that eBooks simply don’t have to deal with. So why should an eBook cost anywhere near what a print copy does?
From a publisher’s perspective, they’re paying for the editing and artwork once, the formatting twice (you have to format eBooks and print differently, but it’s not rocket science and these are professionals), the cover twice (eBooks don’t need a spine or back and print needs a ‘bleed’ area), and the same marketing (if they bother which they rarely do now anyway). In other words, they’re paying a bit more to bring out two versions, but not much. For the most part, the cost is a fraction of a cent per book. Publishers tend not to give advances anymore, so where is all the overhead in the eBook they’re trying to recover by pricing it at $15 or $20?
It isn’t the overhead that’s making them price it high. It might not even be greed. Their statement is they don't want to 'devalue' books. It's still a book, so that doesn't wash. They need to grab a dictionary, I assume Hachette prints one. It could be that they don’t want to drive readers toward eBooks faster than they already are. It’s a losing battle, but I can see the Big Six thinking that way. As I said, they’re dinosaurs in their thinking.
If their readers are faced with buying the latest best-selling novel as a hardback at $20 or an eBook at $19.99, they’re going to choose what’s convenient for them. If they’re faced with the eBook at the reasonable price of $4.99, many would choose that, even if it’s not their preferred format. The publisher loses $15 they didn’t have to and it’s another nail in the coffin of print books – which the Big Six can’t afford.
Do I understand? Yes. Do I agree? No. I’m sorry boys, pull the Band-Aid off quickly. Embrace change and update your business model. As it is, you’re driving authors and readers to a plethora of independent publishing companies, some not very reputable (from an author standpoint). Corruption is gripping the publishing industry. Companies like Amazon and Smashwords make it too easy for people to self-publish with no quality control and standards are falling. Even your own editors aren’t as good as they used to be. Every time a poorly written or edited book comes out of a major publishing house and every time an indy author gets a movie deal or hits a national best seller list, it makes more authors and readers alike become more dismissive of the power the publishing houses used to have.
It’s probably too late. We should have had this talk a decade ago. So, damage control: put some younger, forward-thinking CEOs in charge. Purge the dead weight. It's a business, not a dynasty.
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