The Cost of Selling eBooks Too Cheaply

By Melissa Foster for IndieReader

There’s a lot of controversy circulating throughout the publishing industry about the pricing of ebooks, and it’s a significant topic that warrants discussion. Independent authors are rallying around the controversial 99-cent price point. Some authors feel the 99-cent price point devalues their hard work, while others feel that readers will not take a chance on new authors at a higher price point. To further complicate the matter, it’s not just new authors that are using the 99-cent strategy, and the issue doesn’t only affect independent authors, but publishing houses and agents as well.

Readers are scooping up ebooks for 99 cents, that alone speaks of a demand for material at that price point. After all, to some readers, an ebook is seen as nothing more than a download. Many authors spend a year or more writing their books, and 99 cents seems ridiculously low and unfair. At the same time, an ebook for $9.99 seems equally unfair to the reader.

Let’s look at the dollars and cents of the 99-cent price point for independent authors. If an author is self-published through Amazon KDP, he or she earns 34 cents per 99-cent book sold. Not only do authors put time and energy into their writing, there are other associated costs to publishing a quality book, including cover artists ($125-3000), editors ($800-5000), marketing, etc. If you add up the average cover cost of $350, average editing job of $1400, then divide by 34 cents, the author would have to sell 5,134 books just to break even, and that’s nearly impossible without an additional amount for advertising. This would also assume that the author receives no income for actually writing the book. Most independent authors will sell less than 100 copies of their ebooks.

What about the author published through a small press? For that author, that 34 cents in earnings is reduced to roughly 12 cents per book.

Traditional publishers cannot even begin to price books at 99-cents, as they have far too much overhead to do so. In addition, how can a publisher sell a hardback book for $26 if the ebook version is 99 cents?

To read the complete article, visit the Huffington Post at http://www.huffingtonpost.com/2011/12/20/ebooks-cheap-price_n_1160383.html

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