Digital Penguins and history e-books

Penguin this week announced that they would be making certain of their titles available in e-book form. You can read more here.

Basically Penguin are simultaneously releasing a couple of novels in traditional print format (you know bookshops and stuff) and also as e-books. They also have plans to make their back catalogue available for download.

However, I think Penguin have missed a trick here. They plan to sell the e-books and print books at the same price. Not only is this wrong because the reader will be reluctant to pay the same for an e-book as a 'normal' book, knowing their is no print cost. But Penguin could sell the e-book at a lower price and still make more profit and here's how.

I talked here about the idea of history publishers using e-books.

For me the perfect publisher would offer a combination of approaches:

1. Traditional books: 'Real' books sold either via bookshops, amazon or the publisher's website.

2. E-book versions: These are digital versions of the 'Traditional' book made available for download at a reduced cost.

The success of this approach hinges on cost.

I spoke to a good friend who runs an excellent small print publisher, producing high quality books for a limited market. It's not Penguin but it was as close as I could get! He suggested a print cost of about £1 for a 160 page book with B&W photographs. However, this price was based on a 3000 book print run and therefore needs an initial outlay of £3000. As for pre-production costs he was less able to give an exact figure suggesting each book is very different. However, having worked as an editor I know a price of £1000 per a novel sized book is not to far from the mark. Add to this design costs, copy editing and other smaller jobs and you are soon at a figure of £2000. 

OK. This means for a 3000 book print run we could be looking at a total cost of £5000 pound. So about £1.65 per book.

Now, the price we sell to the shop will be about 60% of the cover price. So for a £7 book we will be selling for about £4 - giving us a figure of £12000 turnover per print run, but a profit of £7000. However, for a small press it could take up to three years to clear this stock.

So what if you were to produce an e-book version of this book? Well, the picture looks quite rosy. The chances are you have sent the file to the printers in a pdf format, so transforming this to download product is fairly easy. You may need to employ a web designer but this is a fixed cost and will be ignored for his argument.

The calculation comes down to download figures. The e-book would need to be cheaper but your costs would be based on the number of downloads. Let's say you sell a quarter of the books online that you do through traditional outlets. This would give you a sale of 250 books. Now the cost of these book is zero, since the hard copy version is paying for the pre-production, this means these sales are pure profit. So, if you sold them at half price - £3.50, it would produce an additional profit of £875. Not bad!

I think the main argument against his approach is that the 250 e-book sales would impact on the traditional books sales. Maybe. No one really knows for sure. The current thinking is that a person who downloads a book is probably a different person from that who would buy it in the shop. However, the profit on the sale of traditional book is £2.35, the profit on an e-book is £3.50!

So in my view Penguins approach is slightly wrong.

E-book versions of novels great!

E-books of back catalogue great!

Full price to download - boo! 

Comments

[Gavin Robinson]

I think web comics could be a useful comparison here. Comics like Achewood and Scary Go Round are given away free on the web, but people still buy the printed books. Maybe other kinds of publications could go the same way, but one implication might be that authors and publishers will have to try harder to make people who have already read the text think "this is such a good book, I really want to own a copy of it" rather than relying on people who haven't read it thinking "I'll buy this to see what it's like".

[Tony Bowerman]

Interesting topic, Gary. Thinking it through, perhaps we can draw an analogy between the relationship of an e-book to a conventional printed book, and that between a conventional softback and the hardback version. For particular types of book, some readers still prefer to pay a little more for the hardback - which has exactly the same content as the cheaper softback but is a more aesthetically pleasing product.

And maybe that's one of the keys to the relationship between the various respective formats - quality, feel and an aesthetic 'weight'. A good book is a good product; one that has a flawless sum of high production values, superlative design, a cracking cover, nice quality paper, and so on.

It's an irony, particularly for struggling authors, but what if the actual content matters less in that initial moment - when the customer either picks up and buys the book, or simply puts it back on the shelf - than the look and feel of the book as a 'product'?

Maybe the overall 'product' is more important to a lot of potential buyers than the 'pile 'em high and sell 'em cheap' merchants give it credit for?

Hmm? So what makes for a great 'product' in terms of boosting sales through it sheer attractiveness? Well, two recent sets of books spring to mind. The first are the adult books by Tove Jansson, the Finnish Moomintrolls' author, published by Sort of Books; and the others are a set of six small mountain walks books whose publishers name escapes me at the moment. But in each case it's great design that makes all the difference.

And in the world of e-books, that curious aesthetic is far less obvious.

Perhaps it's all about tangibility ...

[Gary Smailes]

Gavin - My view is that certain people will buy a print book and only a print book. Others will be happy with a pdf. The point is that it comes down to choice. By not having a pdf option then the publisher is limiting his choice.

Tony - I think the paperback/softback argument is a good one. However, many people will buy the hardback because it is out first and they can't wait. The e-book argument is about the choice the reader has. You are also correct that it changes the dynamics of publishing - but it must be a good thing that content could become king.

[Jordan 5]

A lot will come out over time but the truth has been out there for a long time as well but that doesn't give you what you want so this dance just goes on and on.