That's probably a worthwhile subject for a future post... For this post, I'd rather think out loud about altering the pricing models for e-reading devices and e-content.
I won't buy a Kindle edition of a book that's more than $9.99. Why? Besides the fact that I'm a cheapskate, I guess I'm still bitter about paying almost $300 for an original Kindle, so I expect to "make it up" with cheaper content. I wonder how many others like me are out there.
I'd say quite a few. Look at the Kindle book bestseller list. Even though there are plenty of Kindle editions priced above $9.99 they rarely make the bestseller list. In fact, as I type these words 14 of the top 25 have a price of $0.00, one is $0.01 and the rest are at or below $9.99. I only found three books in the top 100 priced above $9.99. Three.
Why can't a device vendor go with more of a cell phone model, where the low price of the device is subsidized by the longer-term commitment to buying content? How many Kindles do you suppose Amazon could sell if they priced it at $99, or $49? The device costs more than that to make, not to mention the cellular charges they pay Sprint, so why would Amazon price device so low? Hoping that they "make it up in volume" won't help...they'll just lose that much more money in total.
But what if all the ebook editions Amazon sells for the Kindle weren't $9.99 but something much closer to the print book's price on Amazon? So a $30 book at 33% off would be $20 for the Kindle edition (as opposed to $9.99 currently), pretty much the same as what you'd pay for the print version. Now there's a bigger margin left over for Amazon to keep part of (to cover the loss on the sale of the device), share some with the publisher/author and even pay Sprint. And oh, btw, we'd put an end to the model where some publishers are delaying the e-version so as not to cannibalize the print version's sales. Publishers would be indifferent, if not prefer the e-version since there's no cost for manufacturing, inventory or returns. Hallelujah!
Additionally, in order to qualify for that low price on the device, the customer would have to commit to a minimum volume of econtent purchases over the next 2 years. Opt out early and pay a penalty. It's sounding more and more like a cell phone plan, isn't it?
What's not to like about this model? The first vendor to adopt it would likely sell a boatload of devices, maybe more than they could manufacture. It would also protect the value of the intellectual property. Amazon's $9.99 price on Kindle editions is really cheapening the value of the content. I used to think it was OK because you can't share an ebook with a friend, but B&N is about to address that problem with the Nook (sort of). I still think we publishers need to figure out how to add value to ebooks and not just live by quickie p-to-e-conversions, but that was the subject of at least one earlier post.
What do you think? Is this in the cards? Will a hardware vendor go this route? I sure hope so.