Rupert Murdoch: "Amazon pricing devalues books"

Thanks, but no thanks Mr Murdoch

He must think consumers are stupid. The value of a DRM-laden electronic book is far lower than that of a hardback and it should be priced accordingly.

Similarly, not many people will want to subscribe to micro-payments to see his news sites (they will just go somewhere else).

By atomz on 3 Feb 2010

What's happened to capitalism?

If he sells to Amazon at $14 and they choose to sell at $10, surely that is up to them? The complaints about such loss-making pricing should come from competing retailers and bookshops, not the suppliers. If Amazon was stromg-arming him to sell to them at $5 then he might have grounds to complain.

By bendel_boy on 3 Feb 2010

making the same mistakes that the music biz made. p2p books anyone?

By TimoGunt on 3 Feb 2010

From the man whose motto is "screw everyone"

Comes the suggestion of price fixing, because anything else might threaten a monopoly.

Well, damn!

I can read paperbacks I bought as a child and lend them to my children. Can the same be said of eBooks?
Limited scope, fixed document format and draconian DRM mean eBooks have a fraction of the worth of a paperback, yet sellers are demanding higher than hardback prices!
Something has to change and I don't think it is the consumer Mr Murdoch!

By cheysuli on 3 Feb 2010

Well, let's just wait

for old generation of publishers to die off.

"Books are sold to retailers in a process that resembles consignment. Bookstores pay for the books they order, but they are able to return any unsold books for a full refund (though they usually have to pay shipping). This practice began during the Depression, when publishers wanted to keep selling books in bad economic times, and it continues today despite frequent calls for its abolition.

This means that if a publisher ships 100 copies of a book to a bookstore and only 50 sell, the remaining books are shipped back and the bookseller is given credit for them. (The returned books are sometimes destroyed, although increasingly they are sold to "remainders" dealers who in turn supply retailers with reduced-price sale books.) The estimated cost of these returns is also figured into the price of a book.

"When you're buying a book, you're not only paying for that book, but you're also paying for the book that will be returned and destroyed," explains Jason Epstein, former editorial director at Random House."

e-Books do cost just a fraction of paper books, everything else is just pure greeeed.

By Lomskij on 3 Feb 2010

Another fine proof of the sad fact that the Better Tomorrow was yesterday. My friend used to say that human stupidity will eventually grind the progress to a halt. On par with greed as it seems.

By Josefov on 3 Feb 2010

Murdoch is a monopolist who simply doesn't know how to operate in a truly free market. For TV, Newspapers and Publishing, ownership of the means of production and distribution affords great power and influence.
On the internet, it's the gatekeepers, Google, Amazon, Yahoo, Microsoft &c who have the most power and Murdoch doesn't seem to know how to work with them.

By milliganp on 3 Feb 2010

When will they learn...

Really, one would think that book publishers should have learned from the music and film industries. High price hardbacks are dying and cheap ebooks are coming. The sane route would be for the publishers to embrace this, lower prices and encourage buying legitimate copies of ebooks. Instead, greed gets in the way and they opt for the insane route of going into denial until black market p2p ebooks force their hand.

What total morons.

By David_Arno on 3 Feb 2010

I'd just like to say this is an ideal opportunity for a global self publishing site where authors price their books as they want, then pay for a printed copy if they want that.

I admit to being biased. It's nigh on impossible to publish a book these days - JK Rowling went all over the place before Bloomsbury picked up Harry Potter. Publishers want safe books that sell well. It's a complete gambling act. In an ideal world readers could choose the books they wanted to read, pay a small amount for them and then take that evidence to publishers (or even the printers directly) who then must take a smaller piece of the pie.

But yes, Murdoch just wants to control the market completely. Can't really blame him. It makes making money a lot safer.

By bubbles16 on 3 Feb 2010

How can lowering the price of an ebook affect their profits! I wonder what the cost is for printing the books on chopped-down trees is, to producing an ebook? I bet it is most definitely cheaper to produce one ebook, and then have the internet to distribute it!

Murdoch, you are a prat.

And Amazon, you're gonna have to make the Kindle cheaper before I'd buy it. I'd probably buy an iPad instead anyway.

By treadmill on 3 Feb 2010

As I think I have mentioned before, the intellectual content of most books - the words, and perhaps the layout on the page - is worth around £2.50-£4 to me. This is what they typically cost at a second hand bookshop.

By Penguat on 3 Feb 2010

As everyone who's ever done a semester or two of economics knows the hardback book is a way to get more money from people who are willing to buy at a higher point on the price-supply demand curve.

You then later bring out a lower priced paper back to hoover up the lower end of that market. This is how they've almost always done it. £15 hardbacks on day of release, £7.99 paperbacks a little while later. Somehow this doesn't cannibalise hardback sales.

By steviesteveo on 3 Feb 2010

(Un)ethical and (Im)moral Business Practices

I have observed that most publishers and manufacturers are operating with "Monopolistic and Anti-Competative Trading Practices"

This can be seen in the cost of the materials an manufacturing processes, whether the product is a tangible product or a digital product.

Compare the real cost of developing a product with the sale price and you can clearly see that many items are over priced.

When all or the majority of business in a particular market for example book publishers, film and music publishers for example, set grossly inflated prices that are way over the real cost of development and way beyond the levels that would result in a reasonable profit, then it is blatantly obvious that these businesses are taking advantage of customers.

Digital books cost nothing to produce beyond the intitial authoring process which is the same as for a hard copy book. The difference is that a digital book does not incur the cost of the paper manufacturing or printing process, the shipping costs or other overheads. Add to the fact that manfacturer set prices which include markups from wholesalers and retailers where relevant and include a sufficient excess to allow for substantial retail discounts during sales by as much as 80% without seriously harming profits.

It is about time such practices ended, and as such the business should be legislatively required to declare business plans providing budgetary information, costs, and charges allowing for a reasonable profit and reduced pricing once profit levels are achieved. Pricing should be strictly but fairly controlled.

By j_woolliscroft on 3 Feb 2010

I get most of my books from the library or, failing that, in paperback.
A digital book, IMHO, is not worth anywhere near as much as a hardback book which you tend to buy to keep. Is it worth as much as a paperback? Not in my opinion as you can give your paperbacks to others to read.
A hardback is something people buy to keep - a digital book just isn't.
Until publishers realise this I really can't see digital books taking off no matter how good the readers are.

By neilwar1 on 3 Feb 2010

This price point is totally ridiculous, ebooks are still a fledgling format but gaining a lot of public interest and not just from us geeks. The publishers have an opportunity to do something amazing and reach new markets, revolutionising their industry like mp3 revolutionised the music industry (and increased revenues in spite of what the BPI etc. claim).

Publishers could even cut out WHSmiths, Amazon etc. and start selling direct and get direct access to their customers for a change.

Instead they have pushed a ton of people to go looking for pirated versions as the prices are just way too high to justify. They can say it’s to bring on new authors but we know that isn’t true, they’ll just continue to pump out the next Dan Brown tat.

I hope some well known, established authors decide to direct sell via their websites to get the ball rolling. I for one would much rather know the £3 (for example) I’ve spent has gone to them rather than £18 to Waterstone’s for a new hard back when the author sees around 50p of that!

I know there is the issue of marketing and promotion but how many authors get prime space in WHSmith and ads on the tube? I’ve discovered a raft of new music based on the fact it is actually good and not just heavily marketed by companies. Word of mouth from forums, websites, blogs, Twitter, Facebook and a huge number of other sources will get people know and bring on new developing authors more than trying to openly rip off all your customers.

By Deano on 4 Feb 2010

This man is deeply unpleasant

It is nice to know that he is demonstrating his inability to 'fix' his situation. Just not quite enough power eh, Rupert?

By Alperian on 5 Feb 2010