Friday, September 4, 2009

Would A US$50 eBook Reader Be A Disaster?

Study: Everyone Wants a Kindle–For $50

New Forrester Report: The eReader Price Squeeze
What we found was that the price points for how most consumers value eReaders is shockingly low--for most segments, between $50 and $99.

Emphasis added by me.

I've been down this road once before: Wednesday, October 8, 2008, Sony Reader PRS-700: Part Three:
When it came to Jim Malcolm, Sony's Director of Corporate Marketing for Mobile Lifestyle Products, I brought up the hardware pricing issue.

He saw this poll result:



I've wailed for lower prices. As recently as this week, so has Dear Author.

This is basically what Malcolm told me. The poll results are from those who are tech-savvy early adopters. They already know the price of things and so, of course, would love eBook reading devices to even be as low as five for $20.00. Malcolm claims that Sony's own research shows that hardware price is actually not a factor. Can I argue with their expertise and proprietary, professional research?

Yes. I know. I'm stubborn. Or I'm just an absolute eejit when it comes to real-world marketing, but I can't but help to point once again to the example of Henry Ford and the Model T. Plus, there are the more recent examples of the Commodore-64 and the Asus EeePC.

Since then, that poll has added votes:



But wait, as the bad TV ads say, there's more:



If half the people who own these devices are buying nothing, then there are at least three things happening here:

1) Piracy is rampant. That depends. So far, the only popular eBook format that has not been cracked is Sony's own BBeB. Most people say it's because the market is too small to attract the pirates. Most of the pirated material I've stumbled on has been either plain text or PDF -- not file formats for the Kindle, the Sony Reader, or other such devices. So I doubt piracy.

2) People are reading only free eBooks. Really? I doubt this too. Why spend money on an expensive single-purpose device to read free?

3) There is no market for eBooks people must buy. And yet there's the Kindle Store, the Sony eBookstore, Smashwords, et al. Yet none of them have actually published sales figures. And when writers have, the amounts of money mentioned have been equal to less than a one-month rent payment in New York City. Plus: that earned amount is not sustained over the long run. Is there no real market -- yet?

Would a US$50 or even US$99 eBook reading device explode the market?

That's possible ... but the ramifications of that would not be good for many.

Right now, people are paying at least US$200 for an iPhone (a little more for an iPod Touch) -- and there is resistance to paying for software!

See: iPhone piracy - the cold hard figures.

That app retailed for an impulse-buy price of just US$1.99!



And yet people were stealing it right and left.

So what would happen when someone buys an eBook device for only US$50 or $US99?

Do you think people are going to look at an eBook priced at US$9.99 as being reasonable?

Hell no!

"Wait a minute. If I buy just five (or ten) eBooks, I've paid as much for them as for this hardware. The hell with that!!!111"

This does not bode well for the future. At least in the United States. Elsewhere, such a low price for an eBook reader would be a boon. See: In the footsteps of Carnegie.

And speaking of Carnegie, we don't exactly live in a society where people express the sentiment he once did:
When I was a working-boy in Pittsburgh, Colonel Anderson of Allegheny – a name I can never speak without feelings of devotional gratitude – opened his little library of four hundred books to boys. Every Saturday afternoon he was in attendance at his house to exchange books. No one but he who has felt it can ever know the intense longing with which the arrival of Saturday was awaited, that a new book might be had.

Has anyone ever witnessed a line to a public library to rival, say, one to buy an iPhone?

No, don't bring up Harry Potter and bookstores. That's an event. The lines disappeared after that event.

Learning is not a one-off event. Yet public library patronage increases only during tough economic times. Like now.

So where does this leave us?

1) A public that is generally indifferent to book buying

2) A public that if given an inexpensive eBook reader would likely resist current eBook prices

3) The continued devaluation of the eBook

None of this is good for things as they are currently arranged.

10 comments:

MaThurrell said...

If all this is true, do you think eBook readers will ever hit mass market? If they don't, will it be because of the price or actual interest?

Great post as usual!
-Maria
vook.com

Mike Cane said...

The question of a mass market is an entirely different post. Yeesh.

Randolph said...

On one hand I'd love to see an inexpensive reader. I think they're too expensive as it is.

On the other hand, the expectation of many readers to see free ebooks is a potential killer.

I make my living on my writing and over ninety percent of my sales are to eBook buyers. eBook buyers who are happy to have my books delivered that way and they don't complain about price, they just want me to write faster. A good feeling.

I do provide some free content: an eBook, a living eBook Anthology and a collected Horror eSerial, but if I were to suddenly stop charging, as these advocates for free eBooks suggest, I wouldn't be able to write full time. My readers might see one book a year instead of three or more.

If that's what a cheaper eBook reader leads to, a further indulgence in this misguided sense of entitlement that seems to be growing with the digital age, then keep the prices up, just a little.

kittent said...

I'm just curious as to what you think should happen.I'd probably buy a $50 ebook reader because a)i'm a geek and b)I read ebooks on my Acer Aspire now, which is fine for in bed, but not so good for a 15 minute bus ride. (It's easier to pull a paperback out of my lunch bag.) I lusted after a co-worker's Sony...but not enough to spend that much money.

I'll read free books, but if it's something I want/need I'll buy it.

Mike Cane said...

>>>I'm just curious as to what you think should happen.

Dumb eBooks Must Die, Smart eBooks Must Live

Joe said...

eBook piracy is indeed rampant. A quick search of Demonoid will reveal thousands of copyrighted works in Sony's LRF format (or so I've heard).
On a side note, phones & tablets are not he future of ebooks - reading on an LCD sucks - bad. Dedicated readers work because of the e-ink displays, LCDs can't match the readability or low power consumption.

rjnagle said...

Maybe I'm unusual, but I bought my ebook reader for the specific purpose of buying things which are unavailable in print. That includes (mainly) public domain and creative commmons works. So it does not surprise me to hear that many haven't bought ebooks yet. After owning several devices for the last 3 years, I am happy to report that last month I bought my first ebook.

Cliff Burns said...

Stirring the waters again, Mike, thatta boy.

I put the question to people in my LibraryThing group, asking what price they'd be willing to pay for an e-Reader and the overwhelming majority said they'd only consider it if the Readers were less that $100 and e-books far less than they are now. These are book-lovers, the core audience for publishers. Would cheap Readers radically affect the publishing world? Maybe...I'm not afraid to find out since for the past six months my site has been inundated by hundreds of E-Reader users who are downloading and reading my novels and short stories in reams, eager for anything to plug into their expensive gadgets...

Mike Cane said...

>>>eBook piracy is indeed rampant. A quick search of Demonoid will reveal thousands of copyrighted works in Sony's LRF format (or so I've heard).

@Joe: LRF is a hacked format, not the for-pay Sony BBeB. It could be those titles were format-shifted from others. I haven't checked myself.

>>>Maybe I'm unusual, but I bought my ebook reader for the specific purpose of buying things which are unavailable in print.

>>>On a side note, phones & tablets are not he future of ebooks - reading on an LCD sucks - bad.

@rjnagle 1) You are the first person I have ever had admit something like that. 2) The population of Stanza on iPhone and iPod Touch towers over the combined population of all eInk devices.

>>>and e-books far less than they are now.

@Cliff: Do the math, Cliff. If you bought a car, would you also pay for gas at the per-gallon cost of one-fifth the car's price? As a writer, I admit I fear the day of fifty-cent and one-dollar eBooks.

Cliff Burns said...

...whereas I just want to get my work into Readers' hands, as many as I possibly can. Money, making a living, has never been an object. Creating ground-breaking, innovative work, drawing intelligent, erudite Readers. Ah, Readers. I'm positively GREEDY for Readers. Because I firmly believe if the Readers come, that's what creates the buzz and the buzz, of course, is what takes you that next step up the ladder...where there is the possibility of MANY, MANY MORE Readers. And that's what I'm thinking about as I post another story or novel on my blog, letting people read it for absolutely nothin'. Encouraging them, in fact...

It beats the ol' submission game and dealing with agents and editors with the brains of lobotomized hamsters.

Readers...gotta have more Readers...