Retail vs digital books cost comparison
March 5th, 2010 | By Ovi Demetrian Jr | Posted in DistributionPublishingSales
In a recent New York Times article, the author tries to make sense of the math for the cost of a traditional book versus an ebook after the recent $13-15 price tag set for ebooks. Based on their numbers, I’ve attempted to compare how the old retail model compares to the new ebook model in a couple of simplified graphs:
Retail Bookseller
Average cost: $26 (Hardcover)
Digital Bookseller
Average cost: $13
Publisher
Bookseller
Printer
In the Retail model, on a $26 hardcover book an author would get $3.90 (15%), the publisher would get $6.80 (30%), the bookseller would get $13 (50%) and the printing and shipping would cost around $1.30 (5%). In the Digital model, the retail bookstore is essentially eleminated along with the printing and physical shipping costs and in their place are online shops like Amazon.com. In this model, the author gets $3.25 (25%), their publisher $5.85 (50%) and the online shops $3.90 (30%). These are rough numbers, but they give us a good idea of how costs breakdown.
Ultimately, the biggest difference in cost is for the customer which will greatly incentivise digital sales in the years to come as the technology for reading ebooks becomes more accessible. And while the amount made by authors appears to be about the same, a lower cost to the customer means more sales longterm and more going to the author. The biggest thing to take out of this is that the author’s piece of the pie has increased and as the market continues to evolve there’s opportunity for it to increase even more!
Ovi Demetrian Jr is the founder and interface designer for Indie Aisle. He loves books of fiction along with comics and has delusions of writing his own stories someday.