The Cost of eBooks - Who Benefits and What is Fair?

This post will deal with two issues. The first has to do with why large companies still charge high prices for digital books. The second is concerned with whether the self-publisher or the publishing house receives more financial benefits from ePublishing. For this article, I will use ePublishing and digital publishing interchangeably.

Here is the bottom line – It is more costly to print books on paper than to create digital files. This, however, is a superficial view of publishing that many people have. Printing books isn't all that publishing is about... but that is for the next blog post.  I won't name any names, so just consider Company A to be a big-time publisher and Self-Pub Man to be a self-publisher. Now see my thoughts on each and how they relate to print and digital publishing.

Company A

• They are big with huge costs.
• They acquire much better printing rates (volume discounts) than small companies so they keep their costs low.
• If they print in-house, they have even lower costs because they do not factor in shipping.
• They have lots of staff who want good pay.
• Their overheads are high.

Pub Man

• He is a self-publisher who has few or no overheads and no real staff.
• He doesn't get volume discounts on printing so print costs are high.
• He probably does all his marketing himself which he has to charge in his time.
• Except the possible cost of hiring a designer, he has few costs associated with digital publishing and is likely to try to design his book on his own if he thinks he believes that he can master the online tutorials. 
• His major upfront costs are likely to be print-related.

Both  Company A and Pub Man may end up making a similar investment to create a book. It's just that one may be paying staff and overheads while the other spends all his investment on printing. Ultimately, the cost by way of overheads is much higher for Company A than Pub man and as such, Company A's high digital book prices can be considered somewhat justified. Still, who is to say that Pub Man's time isn't equally valuable?

In terms of profit, however, Pub Man benefits most from ePublishing. Printing cost would have been his main cost if her were not doing an ebook. Digital books do not attract a printing cost and hence, the self-publisher who does not have to pay staff and overheads etc. stands to make a lot more from the sale of his book. His main cost is eradicated and he is mostly investing his time. Of course, he may have paid a freelance editor (if he was smart) and designer but ultimately, his costs are likely to be lower.

Are the costs of ebooks justified if there is no printing involved? I say yes. Leave your comments and let me know how wrong or right I might be. I always love a healthy debate. I hope to hear from my BookBlogette readers on this one.

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