In the middle of a ‘what do books really cost’ post and there’s this HUGE question tripping me up – Hoping one of you have an answer or an idea.
Let’s look at Mary Higgins Clark’s Just Take My Heart. Amazon shows -
Digital List Price: $25.95 (What’s this?)
Print List Price: $25.95
Kindle Price: $9.99 & includes wireless delivery via Amazon Whispernet.
You Save: $15.96 (62%)
Also, the What’s This? Digital List Price is the Suggested Retail Price set by the Publisher.
Everywhere there are publishers complaining that Amazon gets 65% and that’s bleeding them dry.
My question is, is it that -
- Amazon is giving publishers 35% of the $25.95 list price (suggested retail price set by publishers) i.e. $9.0825, and selling ebooks for $9.99. OR, is it that
- Amazon is giving publishers 35% of the $9.99 price i.e. $3.4965.
Here’s why this is important -
If it’s the former and Amazon is giving publishers 35% of the suggested retail price, then Amazon is making ALMOST NOTHING on Kindle Edition books. It also would make sense why they have ended associate referrals on kindle edition books.
I do think it’s the former since my kindle calendar is discounted 20% from its $1 suggested retail price, and I’m still getting 35% of the $1 SRP.
Amazon must discount books to below $9.99 since kindle edition books would not sell at higher prices.
The question of what part of the $9.99 goes to publishers is important because everywhere publishers are complaining that Amazon takes away 65% of book prices and leaves them nothing. However, if Amazon is taking the hit for $9.99 prices i.e. giving $9.0825 to publishers and only making 90 cents or so itself, then it’s a bogus claim by publishers.
You also get cases where publishers actually list their suggested retail price for digital editions as higher than that for print editions (crazy huh), giving you an infamous >$9.99 kindle edition book. This is for ’30 Ways in 30 Days to Save Your Family’ -
Digital List Price: $27.95 What’s this?
Print List Price: $24.95
Kindle Price: $14.82 & includes wireless delivery via Amazon Whispernet
You Save: $10.13 (41%)
Notice how listing the price higher forces the Kindle Edition price over $9.99.
Also, the discount is less (41%) than for a book priced at $24.95 (which gets 62% off). Two possibilities -
- An upper tier for premium books just as iTunes has added >$1 mp3s.
- A setting that discounts books priced higher than the standard $24.95 hard cover price less as they might be technical or niche books (and thus sold for more in their print editions and asking to not be discounted as much).
Filed under: content, publishing Tagged: | $9.99 kindle, kindle book prices
From what I have heard, Amazon automatically discounts any retail list price between $1.24 and $12.49 by 20%. They hold the discounted price at $9.99 all the way up to a retail list price of $24.99, but still pay the royalty based on 35% of retail list, so that they pay $8.75 on their $9.99 if you set retail list at $24.99.
I’ve read from several people involved with writing or publishing Kindle books that Amazon pays 35% of the Kindle list price so that if a book is $25 but Amazon charges $10, then Amazon pays the publisher et al almost $9, retaining $1.25 from a sale.
Yes, I’m pretty sure that’s why there are no referrer fees for Kindle books.
I missed seeing that Joshua had already replied!
I guess emphasis is on cornering the market.
Computer books on complex subjects tend to sell for more but I’ve held the line on the Photoshop books, to $10 for the most part because the graphics on the Kindle 1 made them not that useable. And some prices did come down.
Bezos was quoted by Businessweek as saying that e-books now make up 10% of their unit sales. Businessweek points out that Amazon’s “margins are squeezed as that percentage grows.”
Actually, if you speak to people who work in more traditional publishing venues (off the record), you’ll find that the percentage given back to publishers ranges from 40%-<60%–nobody gets 60%, not even Random House.
The percentage is always off the suggested retail price, however negotiations between Amazon and the “majors” are apparently a bit more involved.
It’s all very hush-hush, though, with only Kindle store and DTP folken not signing NDAs.