On Books: Value in an eBook World

eBooks have changed the way we think of value in regards to books. For myriad reasons, ebookers think that the price of ebooks should be no more than the price of a mass market paperback, and often less. Price is a reflection of value. Much of the thinking revolves around a central point: unlike pbooks, ebooks are intangible -- just a collection of bits and bytes. Yes, there are other reasons, too, such as the lack of secondary market value, lower production costs, restrictions on usage, and the like, but the reality is that most of the conscious and unconscious reasoning revolves around the matter of intangibility.

When I buy a pbook for $15, I have something solid to hold in my hand. I can put it on a shelf and admire its cover beauty; I can open the book and feel the pages as I turn them. An ebook lacks all of the sensory qualities of a pbook -- it is intangible. The sensory experience lies with the reading device itself, not with the ebook.

I am aware that many ebookers pooh-pooh the sensory argument, but it really is not so easily dismissed. Many of the things that ebookers complain are restrictive about ebooks are not restrictive about pbooks because of the sensory experience. More importantly, it is difficult to become enamored with bits and bytes, yet the beauty that a pbook can project addresses the needs of multiple senses.

I think it is this sensory deprivation that drives the value argument. eBooks are of less value because they provide less of a sensory experience. We pay $100 for an ebook reader without a great deal of thought because it appeals to multiple senses; we complain about a $14.99 ebook price because it appeals to a limited number of senses.

Think about a rose. Do we value the magazine photograph of a rose the same as we value the physical rose in our hand? The photograph will last longer than the physical rose, yet we value the physical rose more than the photograph rose because the physical rose provides a more complete (and better) sensory experience.

Or consider this. Many more ebookers are willing to pirate an ebook -- regardless of the rationalization given for doing so -- than are willing to steal a pbook from a bookstore. Why is that? If the value is the same, the willingness to pirate/steal should be the same, yet it isn't. I think it is because ebooks are intangible and thus viewed as of little to no value -- ebooks simply do not ignite the same sensory experiences as pbooks.

Of course all of this ignores the fact that real value of a book -- p or e -- lies in the writing, not in its physical structure or presence. Yet when we talk about the value of books, the value of the content is rarely addressed. There is good reason for this. If we were to address the content value, then ebooks and pbooks should be equivalently valued. After all, the word content is the same, only the physical wrapper is different.

Another problem with addressing the content value is that the content value is not altered one iota by production costs. If we value the content, we should value the content identically whether it cost $1 or $100 to produce. The production (excluding editorial) costs are wrapper costs, not content value.

eBooks have upset the valuation process. Prior to ebooks value was determined largely by content. With the rise of ebooks, the wrapper has come to dominate the valuation argument and there is little to no discussion of content value. And this has consequences for the pbook world. This is what lies, I think, at the heart of the fear of the publishing industry: the idea that content will have little to no value, only the wrapper will determine pricing.

This tension between content and wrapper valuations is further fueled by the rise of the indie author. Readers are unwilling to gamble large sums on indie-authored ebooks from authors with whom they have little to no familiarity. If an indie author publishes a pbook and prices it similarly to other pbooks in its genre, readers are willing to pay that price even if they do not know the author because the price is aligned with what they expect to pay.

Yet this does not translate to indie-authored ebooks, where there is resistance to paying the higher pricing found with traditionally published ebooks. Consequently, indie-authored ebooks tend to be drawn to the lower end of the pricing scale. With the large number of ebooks found at that lower price point, that lower price point becomes a standard for the ebook. Again, valuation is based on the wrapper, not the content.

The next few years will be interesting as regards ebook pricing. Will the valuation of ebooks change so that content is the decider or will the wrapper valuation continue to dominate and also make inroads in pbooks? Although it is often heard that content is king, ebooks appear to be the exception. For ebook valuation, the wrapper is king.

image by Images_of_Money

11 Comments on On Books: Value in an eBook World

  1. “Prior to ebooks value was determined largely by content.”

    Um… NO. Bibliophiles value the history of the book, the binding, the quality of the paper, the font chosen… so many things that drive book collectors other than than the content.

    If you mean for the general readers… the answer is still NO. Most people only read 1-5 books a year and will not be invested in the tech that you’re discussing. As for the prolific readers, they devalue ebooks for the reasons you dismissed without discussing. You can’t resell them, many you can’t lend. That makes them worth less. One can buy gently used hardcovers for much less than the cost of an ebook.

    Now there are a few people that love the smell and feel of books, but that doesn’t speak for people as a whole nor does it accurately describe everything about bibliophiles. You do realize that the people who prefer the tactile experience of the paper book are not buying ereaders and are not part of the valuing an ebook discussion.

    I think that this article is without merit, this is not at all why people perceive ebooks as being worth less than paper books.

  2. There is more to the value equation than just the content.
    And more to pricing that unilateral terms.

    With ebooks, accessibility, customizability, timeliness, and transportability all contribute to the valuation of the product. In fact, it is the traditional publishers themselves who point out the convenience factor as their justification for pricing ebooks at a premium over print.

    When consumers value ebooks low they aren’t making a statement about the content (they haven’t read the thing yet, after all) or even the format but rather they are making a statement about the fungibility of the product. Its not as if ebooks are solely the domain of indie publishers; traditional publishers also offer up ebooks in the same formats.

    Looking from the distributor side of the transaction, each title may be seen as unique and irreplaceable, but consumers, with their aggregate behavior, are saying over and over; “Not so much.”

    Pricing in a competitive marketplace is a conversation; it behooves suppliers to *listen* to what consumers are saying instead of just trying to guess based on how things look from afar. To the extent that pbooks face different treatment from consumers it can be argued that this is due more to the nature of the consumer, not the product.
    (Let’s not forget that the bulk of pbook sales today go to casual readers, not avid readers. That makes a big difference in the valuation conversation.)

    Let’s not forget that indie books aren’t the only ones under pricing pressure (there’s several cases in court over how some publishers responded to the market’s pricing pressure) but rather indie publishers are the ones that are *responding* to the pricing pressure and letting the market tell them how it values their product.
    As a rule, indie publishers have more room to manuever because of their lower overhead and they tend to experiment more; if a given cover isn’t doing the job, they can try a different one. If the promotional copy is confusing consumers and leading to bad reviews, they can change it. These are all things that traditional publishers could also do… if they were willing. So far, not many are.
    Too many are still looking for a magic bullet that will restore past glories instead of taking advantage of the opportunities to maximize sales and revenue for themselves and their authors.
    I suspect things will have to get messier in the industry before the hardcore traditionalists start listening to the market instead of projecting their hopes and dreams on it.

  3. I agree with David.

    Also, the wrapper was part of the valuation before ebooks, that’s why we have paperbacks, hardbacks, and trades. If the valuation was simply for content, then why could I buy a paperback at a fraction of what the hardback costs?

    Frankly, I probably would have never noticed indie authors if the Big 6 hadn’t have implemented the agency model. When most of the prices of books on my wishlist went up, I went looking for something else to read. I’ve never gone back.

    With all the free and low cost ebooks, I now have my own library of thousands of books. I don’t need to buy another one as long as I live, and that has certainly changed my perspective on value.

  4. Rich’s musings about the perceived value of ebooks miss the mark with me.

    I value portability above almost everything else. Before ebooks existed, I would occasionally buy a hardcover novel that I wanted to read immediately. Later on, I would buy a paperback copy of the same book and get rid of the hardcover because the paperback was smaller and lighter. When ebooks became available I downloaded ebook copies of all my public domain paperbacks, and then I got rid of those paperbacks, because ebooks take up so much less space. Logically therefore, I value, and I am willing to pay MORE for an ebook because ebooks are more desireable to me than paper books.

    My willingness to pay more, however, runs up against another guiding principle in my life. That is, I expect goods and services to be priced at cost plus a reasonable profit.

    In the case of ebooks, I am convinced, but I can not proove, that ebooks are being priced at an artificially high level in order to benefit the publishers’ best customers, the bricks and mortar book stores.

    This really annoys me, because this cross subsidization does not benefit me in any way. Instead it makes me pay higher prices than are necessary for the products that I do want to buy.

    • I generally agree with you but I would suggest ebooks are priced artificially high to benefit the publishers themselves as I don’t think they give a flying fig over B&M retailers.

  5. If the value is soley attributable to the content then why would/should anybody pay above the paperback price or why would/should a publisher offer different price points for different formats?

    “Prior to e-books value was determined largely by content.”

    So, thats why all the classics can be generally found on the bargain shelves of any bookstore. It’s all about the quality of the content?

  6. It’s similar to the debate with CDs or vinyls vs. downloads. It is much nicer to have a thing to hold, artwork you can really study and lyrics you don’t need to Google… But I only care about that with artists I know I like; I’m happy to trial an unknown author or musical artist via a download, and if I like them enough I’ll consider their tangible releases next time. Saves me having to put crap on eBay, as well as money.

  7. I think the author is totally missing the boat. People think ebooks should be cheap or free because they have been set up by the different prices of paperbacks and hardbacks to assume that the cost of producing the physical book strongly influences the cost of the book (although I understand that in fact there isn’t actually that much difference in production costs). A new hardback is $25, a paperback $7-10. Therefore, an ebook, which is a computer file, and which we all know costs nothing to ‘produce’, since we all share files and copies of Word docs, photos and so on all day long, ought to cost less than paperback. I think if the publishers want to price ebooks the same as paperbacks or higher, they need to demolish the myth that production costs have an influence on the price of the book.

  8. You say: ” Or consider this. Many more ebookers are willing to pirate an ebook – regardless of the rationalization given for doing so — than are willing to steal a pbook from a bookstore. Why is that? If the value is the same, the willingness to pirate/steal should be the same, yet it isn’t.”

    I would submit that the main reason people are willing to steal an ebook over a print book is that it is so much easier, and they are much less likely to get caught pirating an ebook.

  9. I have read several blog posts on the value of ebooks like this one. I’ve got mixed feelings about the arguments for high prices of some ebooks is because what goes into the price is just the content. I realize that we are paying for content, and I fully believe that the author should be paid for their work. In fact I believe authors should get higher royalties, one of the advantages of selling your ebook on Amazon is the ability for authors to get 70% royalties. But I do have a problem with paying the same price as the hardback copy for an ebook if the only basis for it is I am paying for the content.

    The problem with the argument that it’s just the content we are paying for and format should have nothing to do with cost is that hasn’t been true of paper copies. The idea that it doesn’t cost for the materials so even though there is no printing involved ebooks should cost the same as print books (even as high as hardbacks) is not how paper books have themselves been priced. Hardbacks cost $30-$20 then trade paperbacks which cost $13-$15 and mass market editions are priced less $7-$5. They all contain the same content, but as the cost of the materials go down the price does. Publishers have basically been saying for years that materials do affect the price by their own pricing models. 

    While printing might not cost a lot (I am not entirely convinced), distribution does and that gets added to the cost. You can’t ship an equal number of hardbacks as cheaply to a store as paperbacks because of the weight. Also if a I shop at a B&M store the cost of paying for employees is factored in to the stores pricing. If I buy a pbook from Amazon the cost of shipping plus paying someone to package it gets added to the cost. With an ebook no one is required to process a purchase or package the book. The cost of delivery is significantly cheaper for ebooks.

    Why shouldn’t ebooks reflect this as well? If its really just the content we are paying for then why the difference in prices for other formats? 

    I had wanted to get an ebook for a history book club the publisher wanted $17.99 on Amazon. That’s almost as much as the hardback. I have switched to ebooks for a variety of reasons, but I still think they should cost less then pbook. I am not going to resell it, or loan it more than once.

  10. Cindy Dashnaw (@cdashnaw) // 16 August, 2012 at 2:40 pm // Reply

    Ebooks have changed the way we value books, but not in the way this author has in mind. Using data from almost 2,000 publishers, the Association of American Publishers reports in 2012 that e-books have outsold hardcovers for the first time. Would those same purchasers have bought as many print books? I doubt it. Ebooks deliver ease, convenience, variety and access that print books simply can’t match in today’s digital, on-the-move world.

    Newer e-publishers like Booktango are recognizing this phenomenon and meeting the needs not only of the readers that are enthusiastically embracing the new platform, but of authors, too — making it easy to publish and more lucrative, too. (Booktango offers 100% royalties on books sold in its online bookstore — unheard of!)

    We’ll always have people who prefer the feel of a print book in their hands. Meanwhile, more and more people are finding the same type of reading joy from the feel of an iPad or Kindle in their hands.

    For my money, anything that brings more books to more people is a good thing!

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