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The ebook revolution

Sunday, January 10th, 2010 | Posted by Theo

First, my apologies for an extended absence from this blog. I recently published a book unrelated to the fantasy field, (although given its grim take on the economic situation, we should probably all hope it turns out to be fantasy), and wound up getting swamped with requests to discuss all sector credit market instruments and aggregate bank reserves for the next six weeks. You have to wonder what you’ve done with your life when you realize that writing obscure fantasy novels full of untranslated Latin is the less nerdish aspect of your literary career.

However, as a result, I have acquired some information that may be of some interest to any authors who happen to frequent this site as well as ebook aficionados. Being interested in the concept of price elasticity, I convinced my non-fiction publisher to experiment with the pricing of the ebook edition and introducee it at a price cut from the usual $9.99 to $1.99 while the hardcover was priced normally. Interestingly, the Amazon rank of the Kindle version has generally run around 1/5th to 1/7th lower than the hardcover version, (lower being better), whereas most books from the same publisher show Kindle rankings roughly 2x the dead tree version.

I took this information to the publisher of the aforementioned fantasy novel, Summa Elvetica, in the middle of November. The Kindle version had been out for a while and was priced at the usual $9.99. Since he already knew how many ebooks had been sold, we knew we would have a reasonable comparison to make; selling 5x more at $1.99 would mean that the lower price would make more sense for him. As it turned out, the book sold 8x more in the first month without the benefit of any marketing or even a press release. As the first experiment predicted, the Kindle version now has a much better rank than the paperback, which had previously never been the case. And while these results may not be directly relevant to bestselling books or anyone but minor authors of obscure books and their publishers, they nevertheless point to some potentially significant ramifications.

First, it is obvious that the $9.99 price point for ebooks is not going to hold for long once the idea of charging similar prices for ebooks and conventional publications is rendered unacceptable by the book-buying market. Second, while it’s hardly news that the long-promised electronic revolution is finally arriving – the panoply of new ereaders that were introduced this week at CES is much more important than Amazon’s self-serving announcement of the fact that people who get Kindles for Christmas tend to turn them on and try them out – it is evidence that paper is going to go the way of stockbrokers and other unnecessary analog anachronisms much faster than anyone presently believes possible. It’s never going to go away, of course, but almost surely going to become an increasingly specialist format for the elite customers who are willing to pay 10x more for it.  And third, electronic sales are likely to revive the short story market and possibly the serial market in much the same way that digital music sales has caused some musicians to begin dropping albums in favor of a pure focus on singles.

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