Amazon Kindle -- A Year Later?

duckilama wrote:
SommerMatt wrote:

I think he meant razors as in SHAVING razors... as in they give the razor away for free and get you with the cost of the blades

Still not a valid comparison, however.

Hey, I never said it made sense

unntrlaffinity wrote:

But I'm okay with the pricing not being for everyone, and I agree that you're right, you vote with your dollars in a lot of ways. But in a lot of ways I can't see how comments like "for the Kindle to really take off" keep showing up, as it continues to sell. If it sells another 500,000 units this year, in a country where 30-40 million people are illiterate, and only about half of those left read regularly, depending how you define "regular", then 1 million people in 2 years isn't taking off, it's downright took. I keep using Blackberry as an example, but that would be an even higher percentage that Blackberry had in the early years, because many more people own cell phones than read. But I think this can be hard to see because people are viewing eBooks are an attempt to replace paper books, which is a flawed assumption similar to people believing television would end the film industry. .

HOnestly I didn't follow most of your last post and it was getting a bit long so I quoted the summary only.

I disagree when you say ebooks won't replace paperbooks. I believe they will. The movie & TV analogy seems flawed. I think it's more like the 8-track to cassette tape to cd to digital download format analogy. Each new format eventually wiping out the previous one.

I don't see much evidence that pricing shouldn't be lower. As far as I can see there are too many examples of the paper copy being the same price as the digital copy or too close to it. I don't think that should be the case given the fact that printing, retail distribution, storage and shipping to the consumer costs are ~infinitely lower. Not to mention there's no-reselling of Kindle text files nor sharing.

Kindle and devices like it are the future. I don't believe sales are that great. If they were that great then Amazon would announce them every quarter, but they don't. And they probably weren't good enough because Amazon has announced plans to make Kindle content available on other devices. However, it is inevitable that printed content moves to a digital format.

I'm tempted to get Kindle 2.0, but I can't do it at the current pricing. How many would have bought an Ipod if you couldn't have taken your current music collection and put in on there and digital music was only available by the album for cd prices?

It's why the AppleTV remains a hobby for Apple. No one is in a hurry to pay hundreds of dollars up front in order to pay even more to watch the same content they are already watching.

duckilama wrote:
SommerMatt wrote:

I think he meant razors as in SHAVING razors... as in they give the razor away for free and get you with the cost of the blades

Still not a valid comparison, however.

To make it valid, you'd have to have Amazon be one of the single biggest book publishers in the world, you'd have to have Amazon's published books ONLY work with Kindle, and you'd have to have the e-Ink degrade over time, so that you have to rebuy a book before you finish reading it. Maybe after every chapter, depending on how thick you(r beard) are(is).

You can't put a Schick blade on a Gilette handle.

Imagine buying a eBook reader that couldn't read 75-80% of the books on the market at all.

Hey, let's look at the king of consumer electronics.....
Does Apple subsidize the iPod to get you to buy expensive music?
Do they subsidize the iPod to get you to buy cheap music?

No, to both. The money is in the device. The content is a way to get you to buy the device. Apparently repeatedly.

The example is valid. Videogame consoles and videogames are considered a razor and razor blades business model. Yet games don't degrade over time do they? GAmes aren't made by just one publisher are they?

Apple's business model is the exact opposite. Make money on the hardware first. Content/software second.

I'm for either business model when it comes to the KIndle, but I don't believe the Kindle is cheap enough for the former or that the content is cheap enough for the latter.

rabbit wrote:

I guess I'd point out that ala cart, iTunes music has always been much more expensive than physical CDs if you apply the same "not retail" logic. The "real" price for a CD is about 12 bucks, assuming you're not paying full retail. Depending on the album, the per song cost has been more than that for some time, or just below it per album, although most people have been arguing for years that the CD is the superior format: not compressed, already backed up, sharable, etc. Going to the used market, you can get most recent CDs for well under 10 bucks.

So shouldn't we be thinking that getting a book digitally for 10 bucks, vs. 15 "real price" or 25 "retail price" is a bargain way better than we've received with music all along?

Yeah, we all want it to be free. But let's stick to real comparisons. Libraries are free, making buying ANY book suboptimal if all you care about is price.

You're ignoring the major benefit of digital content on iTunes. You can buy songs for $1. Albums on iTunes are over-priced.

With a real hardcover book I can read it and then give to my wife to read while I read something else or I can easily borrow it to a friend or I can resell if I don't want it or I can decorate my bookshelf with it.

And instead of Amazon having 1000s of employees and 300 warehouses and all those trucks and UPS drivers etc etc. Well one guy with a pc in their basement can store and ship all their books. Bezos can be CEO and packager, customer service, etc. That is a dramatic cost savings. I expect to see more of a dramatic price decrease all down the line.

AT that point no one will want to be without a Kindle.

Not saying it is bad product. Kindle 2.0 looks improved. Price isn't the end all be all, but I bet it is holding the Kindle back from being a big mass market product. And I am willling to bet it (price of content/Kindle) is not on the low side of things.

And instead of Amazon having 1000s of employees and 300 warehouses and all those trucks and UPS drivers etc etc. Well one guy with a pc in their basement can store and ship all their books. Bezos can be CEO and packager, customer service, etc. That is a dramatic cost savings. I expect to see more of a dramatic price decrease all down the line.

But... It's already done by computer. I'm betting the Kindle Store is backed by a set of tuned servers with fairly large memory and a good sized backing store, probably on disk. The orders would be taken and delivered automatically, without human interference. The profit margin is probably great, unless Amazon got held up by the publishers.

No need even for the one guy in a basement. Just the usual B2B programmers working on your app, the DB guys, and the sysadmins. But they are working on all the other stuff, too, so that's not as expensive as it might seem.

trip1eX wrote:

HOnestly I didn't follow most of your last post and it was getting a bit long so I quoted the summary only.

I disagree when you say ebooks won't replace paperbooks. I believe they will. The movie & TV analogy seems flawed. I think it's more like the 8-track to cassette tape to cd to digital download format analogy. Each new format eventually wiping out the previous one.

I don't see much evidence that pricing shouldn't be lower. As far as I can see there are too many examples of the paper copy being the same price as the digital copy or too close to it. I don't think that should be the case given the fact that printing, retail distribution, storage and shipping to the consumer costs are ~infinitely lower. Not to mention there's no-reselling of Kindle text files nor sharing.

Kindle and devices like it are the future. I don't believe sales are that great. If they were that great then Amazon would announce them every quarter, but they don't. And they probably weren't good enough because Amazon has announced plans to make Kindle content available on other devices. However, it is inevitable that printed content moves to a digital format.

I'm tempted to get Kindle 2.0, but I can't do it at the current pricing. How many would have bought an Ipod if you couldn't have taken your current music collection and put in on there and digital music was only available by the album for cd prices?

It's why the AppleTV remains a hobby for Apple. No one is in a hurry to pay hundreds of dollars up front in order to pay even more to watch the same content they are already watching.

Sorry, long posts are kind of my thing/blight upon the forum community.

Basically, for the first point, that certain industries operate wholly separate from other publishing worlds. A highly specific but important book in the sciences, technology, or medical fields can and will charge what it wants, regardless of format. Their audiences are small, controlled, and need, as opposed to have a vague interest in, the information. Your example cites what I believe to be such a book. I've had classes where the Kinko's printout was being sold for the same as the hard-to-get hardcover because that's what the licensing demanded. But it's a scenario where an entity like Amazon or whatever has little to no influence.

The second point was that saying Walmart can sell books for $5 isn't applicable. Walmart purposefully loses money on certain products purely to attract customers who will hopefully buy other products. If you can demonstrate Borders or Barnes and Noble doing the same thing, that would be understandable, but they generally don't unless items are on remainder. A paperback now costs $8, and they're even starting to introduce a new "easier to read" longer paperback to replace mass markets that costs $10. Or replace them with trades, which cost anywhere from $12-15. So in this case, the Kindle price of $5-8 is actually pretty competitive.

Third, that in your examples, the company also has control over another aspect of pricing that allows them to make their money back. I did humorously assume you meant the phone, but the shaving razor works too. The razor can be next to nothing because they'll gouge you on blades. Or with video game consoles, their money is made via game sales. In both cases one product is sold for less because the other is tightly controlled and sold for more. Hence my pointing out that wanting the Kindle (the "razor") to be "subsidized", and for the eBooks (the "razorblades") to cost less at the same time, is ignoring how the examples given work, considering that console makers recoup their money through game sales, which would be hard for Amazon to do if book prices were both even lower and they were simultaneously losing money on the reader itself.

I'm not sure if you're saying sales aren't great meaning that my estimate, taken from an article I read here, is inaccurate, or that 500,000 isn't very much. It is just an estimate by one analyst, so doubting it is certainly reasonable, but I'd say 500,000, given my elaboration on how fewer and fewer people seem to be reading in general, is a lot of units moved.

And the idea that they cannot seem to produce them at a fast enough rate to meet the demand, even after a year, would seem to imply any predictions of its fate, or doom & gloom over its "taking off", are ignoring that on a certain level, it's already become a success. I know Wii sales are slowing, but it was similar to that. Many people predicted the Wii's demise since it was being sold for a profit, and thus not that much cheaper than competing consoles at the time. Not only did that not happen, they were able to continue to make money the entire time.

I'm not saying that prices can't go down. I'm saying that I actually think that the price is fair, and that there would need to be some adjustment to how the industry works to make much of a difference. Like advertising, or shifts in how they're marketed. I can't think of a good way, honestly.

And the TV/theaters example was a historical example of how these things play out. When television first came on the scene, people thought that due to the convenience of having it in your living room, people wouldn't go out to the movies, and the movie industry would die. That didn't happen. Now they're both huge industries, and they both carved out different, but related, markets. With the 8-track, and vinyl, and cassettes, you're describing formats where the quality has increased or the difference isn't discernible to most people, and convenience has increased immensely. An eBook doesn't improve upon the book in many meaningful ways, as a book is pretty convenient already. You also don't have the limitations of the cassette vs. CD (a CD could let you skip to a chapter much easier than a tape, and while they get scratched my CDs have proven to be much more durable than my old tapes.) This explanation pretty much extends to the MP3 vs. CD formats too. Also, much like the movie theater, there are aspects of the experience that have nothing to do with how it's delivered, and while the scratch and feel of vinyl is pretty damn awesome, people weren't that attached to how an 8 track feels.

trip1eX wrote:

Not saying it is bad product. Kindle 2.0 looks improved. Price isn't the end all be all, but I bet it is holding the Kindle back from being a big mass market product. And I am willling to bet it (price of content/Kindle) is not on the low side of things.

And this is the point I actually see quite often, and to which I'm posing the counter-proposal that nothing is really currently holding it back, because they literally cannot make them fast enough to meet the current demand. If there were heaps of Kindles sitting in a warehouse waiting to be buried in the desert, this point would make sense. It's a new technology, and the company that provides it cannot create enough screens to meet the demands of Amazon and Sony and the like. Inevitably as the technology matures, they will be able to make more screens, more quickly, and the price will drop, but not as a direct product of people thinking it's too expensive.

Robear wrote:
And instead of Amazon having 1000s of employees and 300 warehouses and all those trucks and UPS drivers etc etc. Well one guy with a pc in their basement can store and ship all their books. Bezos can be CEO and packager, customer service, etc. That is a dramatic cost savings. I expect to see more of a dramatic price decrease all down the line.

But... It's already done by computer. I'm betting the Kindle Store is backed by a set of tuned servers with fairly large memory and a good sized backing store, probably on disk. The orders would be taken and delivered automatically, without human interference. The profit margin is probably great, unless Amazon got held up by the publishers.

No need even for the one guy in a basement. Just the usual B2B programmers working on your app, the DB guys, and the sysadmins. But they are working on all the other stuff, too, so that's not as expensive as it might seem.

I think these examples would be more valid if they didn't ignore Amazon's role in the process. Amazon doesn't generally make books, any more than Barnes & Noble does. Amazon's profit margin isn't actually that high on the new bestsellers that sell for $10 as opposed to the $25 hardcover. And their warehouses aren't just for books, they maintain a huge inventory of... well everything, that wouldn't change THAT dramatically. Even if the world went totally eBook tomorrow, you can't ship out an elliptical machine or television set over the Sprint network, or store a digital SLR on a webserver (the first person to take a picture of their Canon Digital Rebel sitting on top of their computer gets a punch in the face.) I mean hell, they're even doing groceries now.

And they charge for shipping, so you can't really put UPS drivers on that list, can you. If you did, it would be like expecting the Amazon price to be even lower if you drove out and picked it up (instead of just saving on shipping.) You're not "saving" them money on delivery so much as you're just negating an extra charge that would be borne by you, the consumer, for that service. Even with Prime, which is awesome, you're being charged a fee and then essentially encouraged to shop with them, so they are presumably making their money back (assuming you even go over that initial fee) by your increased patronage.

Not sure of the point you're making, Unter. I'm noting that the per unit cost of software can be essentially whatever you want it to be, since the cost of creating and shipping another copy is pennies or less. The bigger cost is likely to be royalties. But if you've already got the infrastructure in place, software distribution is extremely lucrative. E-books are software.

Robear wrote:

Not sure of the point you're making, Unter. I'm noting that the per unit cost of software can be essentially whatever you want it to be, since the cost of creating and shipping another copy is pennies or less. The bigger cost is likely to be royalties. But if you've already got the infrastructure in place, software distribution is extremely lucrative. E-books are software.

Basically that Amazon would still have 1,000 of employees, as you pointed out the people are working on other stuff too. Shipping isn't a cost they generally bear to begin with, so factoring it into the per unit cost isn't practical. They would still have all these warehouses and employees because they aren't just selling software, and it would still be overhead they need to cover.

To a certain extent, Amazon is getting held up by the publishers. In this way I think it's a common point of confusion to confuse the two, and to overestimate Amazon's influence over the publishing world.

I know we've discussed this before, but I don't want to dig it up at this very moment, but lets assume Amazon makes $1 or $2 on every book, selling it at $10 for the Kindle. The publisher takes the other 8-10 and divides it however they feel like. Now, if we want Amazon to sell the book for less, giving the argument that shipping/storage is essentially free (which it's really not, but let's just leave that assumption), we're picturing a world where all these warehouses and employees no longer exist/serve that function. I'm pointing out that because, as you said, employees and warehouses are working with/storing things other than books, they wouldn't go "poof". So they're still factored into the overhead and the transition to eBook wouldn't really reduce overall costs by that much on Amazon's end. At least, that's how I'm picturing it.

Even if we assumed it had that much of an impact, let's take that profit, and reduce it. Let's say you could save .50 on each book. Would that convince you to buy an eBook now, being $9.50 instead of $10? What about another $1. So, $9. Is that low enough? I think it still wouldn't entice the people who don't want to pay $10.

Well suffice to say Unnaffinity we disagree for the most part. except when you are making defenses to arguments I didn't make.

I think we need to look at the bigger points and not the minutaie.

Sell-out doesn't mean anything. A band can sell-out all the tickets to their concert, but that concert could be in a living room, pool hall, gymnasium, community park, dive bar, club, concert hall, theatre, large theatre, arena, stadium, outdoor venue, ....

Selling out doesn't indicate demand. Only that demand hasn't been met. I'm pretty sure the Kindle isn't lighting the world on fire yet. I don't see it taking off until the economics for the masses get better. (It's all about the masses!!)

It's easy to take the Walmart example too literally. And it's not like Amazon doesn't do what Walmart does and sell things for cheap to attract people. MP3 album of the day? $5 albums on the week? Videogame DotD? The list goes on, but that is beside the point. The big picture is where is the paperback pricing on the Kindle? Books should drop much lower in price after a few years save for the highest-in-demand books than they are now.

And I still don't see the connection between some people saying that TV was going to replace movies back in the day and ebooks replacing books in the future? What I see now is the economics to publish electronically are way too good for print to survive. You see it now with newspapers. There is no reason for paper to stick around. I don't see how that relates to TV and movies.

Anyway the main points is I think prices are too high. You disagree.

Here's a link to this entire thread in txt format so that you can easily transfer it to your Kindle and read it there. So much text here it hurts my eyes to read it on my laptop.

magnus wrote:

Here's a link to this entire thread in txt format so that you can easily transfer it to your Kindle and read it there. So much text here it hurts my eyes to read it on my laptop.

Sorry, I'll drop it. It's just a subject that interests me, so I've spent a lot of time thinking about it.

And there's no way I'm clicking that.

trip1eX wrote:

Well suffice to say Unnaffinity we disagree for the most part. except when you are making defenses to arguments I didn't make.

I don't feel there are that many tangents in what I addressed. You used the razor example, I pointed out it's flawed. You used Walmart, I pointed out that Walmart sells books at a loss on purpose. You used what could be considered a textbook as an example, and I pointed out such books are in a different arena (though I will agree you're right, it should cost less, but because they have you by the balls, they can do what they want, so it works differently than normal books.) You said you don't think the Kindle will "take off", I pointed out that in a lot of ways it already has.

The resale of books factoring into their perceived value was addressing an argument earlier in the thread, and the final part of my original LSP was my theory on how the economics of publishing might change.

trip1eX wrote:

Sell-out doesn't mean anything. A band can sell-out all the tickets to their concert, but that concert could be in a living room, pool hall, gymnasium, community park, dive bar, club, concert hall, theatre, large theatre, arena, stadium, outdoor venue, ....

Selling out doesn't indicate demand. Only that demand hasn't been met. I'm pretty sure the Kindle isn't lighting the world on fire yet. I don't see it taking off until the economics for the masses get better. (It's all about the masses!!)

In this case I gave the "stadium" a very tangible number. 500,000. And it "sold out". Which also explains my view of its demand. And I also expressed the view that technology decreases in cost and increases in popularity for reasons significantly apart from consumer demands. And if you're using "take off" as an indication of market dominance, I used Blackberry as an example of how you don't have to be the majority of a market to be a major presence. I will concede that I am theorizing the demand is currently limited by production, and could actually be much higher, and you're saying you believe that it is not representative.

trip1eX wrote:

And I still don't see the connection between some people saying that TV was going to replace movies back in the day and ebooks replacing books in the future? What I see now is the economics to publish electronically are way too good for print to survive. You see it now with newspapers. There is no reason for paper to stick around. I don't see how that relates to TV and movies.

It's a pretty fair comparison. You aren't "staffing" a theater with employees, or "driving" film reels across the country, etc. The product is being directly "beamed" to a device that is in the consumer's home. Plus, the concept of providing the content cheaply or "free" through advertising means they're not forking over money for popcorn and tickets too. So a change in how the medium is delivered led people to believe that television would eliminate theaters. And it didn't.

If we're talking strictly newspapers, and not the publishing world in general, I will admit ignorance, as I believe, as others have stated, the newspaper industry is its own beast.

I feel obligated to point out on the whole razor thing that Apple makes a billion a quarter on sales through itunes, vs. 4 billion on ipods. That said, virtually all analysts estimate a 10 percent *gross* profit margin, 18% or so tops, on iTunes sales. It's not unreasonable to say the same basic mechanics are at play here.

But then, I get into arguments like this all the time, and eventually the answer is "just don't buy it, please, so I stop hearing about it." I just had a good friend call my whinging about how upset he was his new iPhone doesn't include turn-by-turn GPS navigation and built-in voice dialing. Two things he would have known if he'd spent 10 seconds looking at it. Ditto e-books. You think it's a ripoff? See you in 5 years. Meanwhile I will have saved hundreds, possibly thousands on my wife's best-seller addiction. And saying that's ridiculous of her is no different than saying it's ridiculous to pay 60 bucks for a game, or 70 a month on cable, or 30 bucks on a bottle of wine. None of it's life support.

eBooks will eventually win me over, if only because I'm out of bookshelves.

Unter, where I think you go wrong is that the overhead for one e-book is all that's needed to sell millions. You only have to store and prep one copy, and you simply replicate that every time it's ordered. That's what, less than 100MB of disk? I can't believe Amazon is making 20% on these; I'd guess more like 50%, maybe even more. After all, the publisher has tiny expenses too. Pure profit all around.

I agree that dropping the cost by a dollar won't make *that* much of a difference, but it's pretty clear that they are making money on the device itself (otherwise it would be a *lot* less expensive). People who can spend for the device are probably buying at first release for many books, and so it's still perceived as a deal, not paying $17-$25 per book. The biggest barrier to adoption is the device price; it's like a gate that only admits those willing to pay a comparatively high price for ebooks.

Make sense?

Thin_J : yes you are getting a Kindle 2.0. They mentioned that anyone that ordered an original kindle and is still waiting automatically gets a new one.

I went ahead and placed my order for one of these. I read a lot and my current office is full of overpacked bookshelves and I have no more room for new ones.

Quintin_Stone wrote:
RedJen wrote:

Unfortunately, I share a local library with QStone and he's right, it sucks! It sucks so badly that I'm probably one of their major contributors of paperback books.

Library system, sure, but you don't really come to Cary to visit the library, do you? Cary library closes at 5pm on Saturdays and is closed all day Sunday. IMAGE(http://rps.net/QS/Images/Smilies/rolleyes.gif) Plus, it's tiny.

Tried this one yet?

Robear wrote:

Unter, where I think you go wrong is that the overhead for one e-book is all that's needed to sell millions. You only have to store and prep one copy, and you simply replicate that every time it's ordered. That's what, less than 100MB of disk? I can't believe Amazon is making 20% on these; I'd guess more like 50%, maybe even more. After all, the publisher has tiny expenses too. Pure profit all around.

One more example than I'll give up.

Common book publishing deal for a hardcover: 50% royalty on a $25 list price. [/i]In absolutely any case, the book publisher gets $12.50. The physical cost to produce that book. Of that, call $5 for printing and shipping, that means the actual gross to the publisher is about 8 bucks. That's what they get regardless of medium, and it covers payign the author, marketing, and the overhead of running a large company (call that 30 percent right there all by itself), so it's safe to say that's what gets passed on to Amazon: $8. And while that might mean a nice profit on a particular book, remember that MOST books sell like crap and never pay pack their advances.

$10 seems like a ripoff? When Amazon's cost is $8?

I give up.

I will reiterate my appreciation of the concept, especially as it regards quick access to new books. Typically if I like a book enough to make it through once I'll re-read it down the road so the device and business model hits me perfectly. Unfortunately, the existing model made so feasible by Herr Gutenberg and made so popular by my public library will triumph until the cost of entry drops significantly. I don't mind the cost of books, it's the up-front cost that defeats me.

ColdForged wrote:

Tried this one yet?

I have not. Didn't even know it was there.

I'm willing to be that the publishers would take $5 instead of $8 in return for ebook sales, both to stimulate a new medium that could greatly reduce their costs, and in acknowledgement of the fact that production of ebooks is much less costly. But that's just a guess.

Robear wrote:

I'm willing to be that the publishers would take $5 instead of $8 in return for ebook sales, both to stimulate a new medium that could greatly reduce their costs, and in acknowledgement of the fact that production of ebooks is much less costly. But that's just a guess.

If they were WILLING to, they'd have done it already.

In fact, I think I just saw an article somewhere a few days ago with a publisher saying that lower priced e-books would destroy the publishing business.

I think textbook integration with these could be genius.
I would be all over it then.

unntrlaffinity wrote:

It's a pretty fair comparison. You aren't "staffing" a theater with employees, or "driving" film reels across the country, etc. The product is being directly "beamed" to a device that is in the consumer's home. Plus, the concept of providing the content cheaply or "free" through advertising means they're not forking over money for popcorn and tickets too. So a change in how the medium is delivered led people to believe that television would eliminate theaters. And it didn't.

YEah, but you're not making the connection between why movie theatres survived despite the advent of TV and why (you think) books will survive despite the advent of ebooks.

Quintin_Stone wrote:
RedJen wrote:

Unfortunately, I share a local library with QStone and he's right, it sucks! It sucks so badly that I'm probably one of their major contributors of paperback books.

Library system, sure, but you don't really come to Cary to visit the library, do you? Cary library closes at 5pm on Saturdays and is closed all day Sunday. IMAGE(http://rps.net/QS/Images/Smilies/rolleyes.gif) Plus, it's tiny.

I browse the catalogs online and if they are in stock, I'll go pick them up or have them sent to a closer branch. I've been to most of the Wake County Library branches in Raleigh & Cary. I was actually at a few of the Cary branch openings (avid reader + librarian friend).

Edit - added link

Sticker shock is a bitch. I would get a lot of mileage out of a Kindle. But for 300 bucks, and mostly the same price as print costs to books, no thanks. I am currently leaning to Sony's because of their free 100 book credit deal currently. And when I think that an iTunes or Amazon download of a movie or album is less than the cost of a CD or DVD or Blue Ray, I wonder what makes books and newspapers so special. They are losing money by scores without real price competition on E-books.

KingGorilla wrote:

Sticker shock is a bitch. I would get a lot of mileage out of a Kindle. But for 300 bucks, and mostly the same price as print costs to books, no thanks. I am currently leaning to Sony's because of their free 100 book credit deal currently. And when I think that an iTunes or Amazon download of a movie or album is less than the cost of a CD or DVD or Blue Ray, I wonder what makes books and newspapers so special. They are losing money by scores without real price competition on E-books.

With movies and music, you're measuring an acceptable loss in quality due to compression. That doesn't really work with books.

And I'd take a closer look at those 100 free books they're offering, as you have to choose from their "classics". I suspect a great number of them are public domain by now.

Just skimming the top of the "free" books Sony was "giving" away, the titles I saw (things like Dracula, Frankenstein, etc) are also available to ANYONE for free on the Project Gutenberg site. A simple conversion to a compatible format and a USB cable is all that is needed.

In fact, I think I just saw an article somewhere a few days ago with a publisher saying that lower priced e-books would destroy the publishing business.

Again, I'm *not* arguing about whether they should be cheaper, I'm trying to point out that e-books have interesting costs associated with them that could lead to good profits even at a $10 price point.

The argument I understand is that booksellers pay various fees and buy in bulk, and the publishers don't want to lose that revenue, and the booksellers don't want to go out of business. So some publishers are looking for a distro system that goes to more than one outlet, so that they can control the terms, rather than Amazon.