Why do e-books have to cost so much?

Ever wondered why an e-book costs as much as it does? After all, its just a file isn’t it? Michael Hyatt, CEO of Thomas Nelson Publishers, the largest Christian publishing company in the world and the 7th largest trade book publishing company in the U.S., has an interesting perspective.

We assume that the bulk of a book’s cost is in the manufacturing process. Not so: “physical manufacturing and distribution expenses cost less than you think. Some people assume that these two items represent the bulk of a book’s costs. They don’t. Together, they account for about 12% of a physical book’s retail price. So eliminating these costs doesn’t do much to reduce the overall cost structure.”

Add to that digital preparation (there are currently six different formats), quality assurance and digital distribution (to more than 20 separate accounts) and the margins on e-books end up about the same as for their print brethren.

So what do you think? Do e-books cost too much?



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01 February 2011

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