Quote:
Originally Posted by jagur
Just Noticed tonight, Ed Miller's most recent books are on huge discount right now over at Amazon.com
Hi Everyone:
We're getting a lot of these posts relative to Miller's pricing, and as a believer in capitalism and free markets, it's my opinion that he should be free to set whatever price he wants. However, there's probably a little more going on than most of you are aware of. So let me explain.
I think what is happening is that Amazon has a funny deal when it comes to paying a publisher royalties on a kindle sale. While there are some exceptions, it works basically like this.
1. Amazon pays the publisher 35 percent of the suggested retail price as long as the kindle is sold with a suggested retail price that creates a wholesale price (to Amazon) of greater than $10.00
2. If the publisher is willing to lower the wholesale price of the kindle (but not the printed book) to $10.00 or less, Amazon will then pay the publisher at a 70 percent rate.
So suppose you have a book where the suggested retail price of the printed edition is $30. Amazon will pay the publisher $10.50 for the kindle as long as the publisher sticks with the $30 retail price (for the kindle). But if the publisher lowers the wholesale price on the kindle version to $10.00, Amazon will pay the publisher $7.00 per sale.
Now this is a decision that all publishers today have to make. If by lowering the price of the kindle allows the publisher to sell many more copies, then he can actually make more money this way than by going with the original suggested retail price.
One of the reasons why publishers are willing to do this is that sales of printed books, because of ebooks, are dropping, and when you go to shorter print runs, even if you go the "print on demand" route, the unit price for production can be very high. And the bottom line when a publisher does this, and yes, Miller is now a publisher, is that we're being pulled by Amazon to make decisions that can look strange.
Best wishes,
Mason