The Wall Street Journal recently noted that the many people receiving e-readers as gifts at the end of 2011 would find that “the price gap between the print and e-versions of some top sellers has now narrowed to within a few dollars.”
Many big publishers have adopted the agency-pricing model (where publishers set the price of the ebook, not the retailer) in rebellion against Amazon’s $9.99 pricing strategy for ebooks. Publishers were scared that Amazon could gain control of pricing and then continue to drive ebook prices down, eventually paying less to publishers and decreasing their profits. As a result, many publishers are now pricing the ebook version of a new book only slightly lower than the price of the print version. For example, Walter Isaacson’s best-selling biography of Steve Jobs sells for $14.99 in the ebook version and $17.40 in the hardcover edition.
Interestingly, some experts are claiming that by increasing ebook prices, publishers have slowed the ebook market growth. However, it appears that this may not be true.
One market research firm, Yankee Group, found that, on the whole, ebook prices are falling. They report that “the average price of a consumer digital book had fallen to $8.19 by the end of 2011 from $9.23 in 2009.” This firm also forecasts that the average ebook prices will drop to $7 from the current $9 over the 2012 year.
Whether ebook prices rise or fall, I highly doubt that higher ebook prices will slow the growth of digital reading significantly. After all, digital reading is not just about price. It is about a new way to easily store and read books. eBook sales have grown and are still growing. The Yankee Group expects ebook sales to be 4 times higher by 2013 then they were in 2010.
If these conflicting reports leave you wondering what the best price for the digital version of your next title should be, take heart. There is no new hard and fast rule for pricing ebooks. I believe the old rule is still valid. Price your book within the price range of its competing titles. Pricing it significantly lower or higher than similar titles will curtail your sales.