In class we covered why e-books cost so much and we learned that it was due to the fact that publishers controlled the prices of the e-books. This article discusses why publishers make their prices high http://t.co/6s4l0DMu . In this article the publisher argues that the price of paper and shipping is really not that much and is only a couple of differences in dollars. The traditional publisher and e-book publisher still have to pay for author advances, design, marketing, publicity, office space, and staff. When e-readers such as the Kindle first came out the prices of books were cut in half to sell help promote Amazon’s e-readers (Kindle). These prices devalued the books though which made it hard for other companies to compete with Amazon because Amazon had an advanced start over other companies and was able to make revenue from selling their Kindles rather than from selling books.
Later publishers and Steve Jobs came to an agreement in which it was decided that publishers would make 70% of the price of the e-book price. Publishers took that deal raised the prices of their books and then imposed it on Amazon. The deal however did not allow them to make more money. What raising the price and standardizing it did was stop competition on pricing between e-books and keeps e-books relatively competitive. This is not a long term solution though because e-books continue to become increasingly more popular.
