>>>It sometimes seems to me that publishers would rather sell 100 ebooks at $14 ($1,400) than 500 ebooks at $9 ($4,500).

In a day where I’ve been screaming myself blue on Twitter about publishing, THANK YOU for that SANE and REAL-WORLD-BASED observation.

Today, I shut down Tweetdeck.  Just wasn’t working for me.

One thing that Sargent said today was that he thought that consumers would ultimately determine ebook pricing, but it was not useful for Amazon to be setting an artificial price of $9.99. That’s hard to disagree with- Amazon should be good at setting pricing beneficial to Amazon, but in the traditional model, Amazon and publishers do not have aligned interest in the pricing.

In my blog post, I focused on the library issue.

I enjoyed the library angle in your post (available at http://bit.ly/aggDSq).

I don’t buy Sargeant’s claimed high ground on e-book prices, though.  If Macmillan (and others) really cared about price and Amazon’s strong position, they could try opening up Kindle’s closed format.  That never came up.

Trade publishers are comfortable with simple answers, like format locks without keys, but they don’t want to confront the impact of limited use on price.  Why would I pay $14 for a book I can’t lend, I can’t give away and I can’t resell?

What I don’t see mentioned that often is the probability of saturation. If I see a great cell phone on sale for a great price, I’m still not going to buy it because I already have a cell phone.

When you ask people why they don’t read more books, they don’t tell you it’s because books cost too much; they say they don’t have enough time. I don’t subscribe to Harper’s, for example, not because of the cost, but because I can barely make a dent in the magazines I already subscribe to: the New Yorker and New York Review of Books. A sub to Harper’s is really cheap—a great deal—but even $25 is too much to pay for something I know I’m never going to read.

For a while, you may see a ebook sales bump at a lower price point because it seems like a bargain compared to print prices and people will buy stuff they don’t actually want that much if it seems to be “on sale.” But at a certain point, they WILL stop buying piles of ebooks because they aren’t reading the ones they already have. At that point, you’re stuck with that lower price as the only thing you can get for the fewer copies you’re able to sell to the people who really do want it.

You make a good point, that reading competes with many other demands for both leisurely and personal use of time.  Modeling that is tricky, but the scenario you describe does not seem far-fetched.

That said, I’m not arguing in favor of lower e-book prices.  I’m arguing here that publishers should pay more attention to the perceived value of e-books, which I think plays a larger role in determining price than supply-chain decisions.

One of the things that affects perceived value is the ability to lend or give away the book (something that generally you can’t do in the Kindle universe).  If an “e-book glut” is coming, books would stil be worth more if the buyer had the sense that, whether or not she got to read the book, it could be given or re-sold to someone else.

In this post and a couple of others, I’ve struggled with the idea that constraining Amazon with an agency pricing model “solves” the price problem.  If publishers really want higher prices for books, they have to look at the purchase, consumption and re-use ecosystem, not just the price that Amazon charges for a one-time use.