The Uber-Index
How Magazines & Newspaper Publishers are Training Me

Payment Models

Money2 I thought the micropayment model was dead.  Back in the '90's and early 2000's it was simply too much of a hassle to pull out my credit card for any one- or two-dollar transactions.  Then came iTunes.

Now I'm amazed how quickly I'll make a 99-cent purchase.  Part of the reason is the seamless way iTunes is integrated into the overall iPhone/iPad ecosystem.  Apple has created a model where payment is too temptingly simple.  Amazon may have patented one-click payment but Apple is perfecting it.  A quick check of my recent AMEX statement shows I paid Apple more last month (for mostly sub-$5, including a large number of 99-cent, transactions!) than I paid Amazon.  That wasn't the case 6 months ago.

There's still a huge difference between grabbing a free app and paying for one, even if it's only 99 cents.  I'm still pretty stingy here and I want to feel confident I wasn't snookered into paying for something that's not even worth a dollar.

The problem in the book publishing world is that we haven't found a good content model for the sub-$5 purchase.  Customers don't want to buy chapters, so don't kid yourself about that model.  And sure, you can do the quick-and-dirty print-to-e conversion and sell it for a fraction of the print price, but that's not much of a future.

We need to create more product entry points that appeal to the masses with low initial prices that offer a great value proposition as well as upsell opportunities for additional irresistible content and/or services.

What can we learn from other experiments in the app world?:

  • First, don't assume the quick-and-dirty p-to-e conversion model is more viable just because the iPad offers a large, full-color screen.  I still refuse to pay $4.99 for a single iPad issue of Time, for example.  (You'd think the magazine folks would realize that's no way to attract new customers.  What about the free trial subscription to let me see what's special and get me hooked?)
  • Second, and perhaps most importantly, think about rich content, not just quick-and-dirty conversions (see my earlier highly relevant posts here and here).  A chemistry textbook publisher creates this while a visionary creates this.  The former is a yawner while the latter, even as a fairly high-priced iPad app lures me in because it's so tempting to explore and discover with it.  Question: How many customers would describe your e-products with words like "tempting", "explore" or "discover"?
  • Third, think about subscriptions, not just one-time payments.
  • Fourth, think about selling the network, not just an individual product.
  • And finally, don't ignore the advertising and sponsorship worlds.  Yes, I know many people say they won't stand for in-book advertising.  That's fine.  Offer two different versions, including the higher-priced one for those folks who won't tolerate the ads.



Harlequin series romances often sell for less than $5 (once the typical Target new book discount has kicked in). Ditto westerns. They'd also make great subscription material.

Maybe the next move is to look at shorter long-novella/short-novel works. Many fantasy and romance authors package two or more novellas into a single book to justify the price of a trade paperback ($6 or more); those stories (sometimes filler novellas to tide over fans between series entries) would also be perfect for the sub-$5 price point.

Book Calendar

It costs $6 for an ebook from Baen that has already been released in paperback. It would be justified to sell ebooks that have already been released in paperback at the $6 range. This is an example with the book Live Free or Die-- $26 for the hardcover, $7.99 for the paperback, $6.00 for the web subscription. Classics if they were reformatted could be in $3-4 range about the same cost as a Dover paperback edition. The formatting and editing leaves something to be desired with some of the free classics.

Francis Hamit

My best selling e-book is "Buying Retail" an 11,000 word detective story originally published in The Red Rock Review in 1996, before all this started. It's priced at 49 cents and sell best in the Sony Reader format. My novella "Sunday in the Park With George" is on Amazon Shorts a service which seems to have died of neglect. It doesn't sell much because everyone thinks Amazon Shorts is dead. I need to get it on other services. It's 24,000 words or more than 80 pages.

E-books are a good place , in fact, the only place, an intermediate length like that can be published.

As for full length books, if I have a print edition, I'm doubtful that I want to demolish my own market by also making an e-book edition available. The costs of formatting and preparation are also a negative sell.

Mathew Anderson

Thanks for the informative article. I am very excited about the positive impact of iPad on learning and especially distance learning / elearning. The perceived coolness of devices as iPad and the image of apple will encourage students to take up learning in a more fashionable way. The effectiveness of the delivery just like you pointed out with the comparison of the book and the ipad app is amazing. Keep up the good work.

Stacey Hamilton

Very interesting post. I agree totally with your point about creating rich content, and that is something that all publishers should be focused on these days. But I wonder if your comment that "customers don't want to buy chapters" is painted a bit broadly. Certain content sold by the chapter--software books, for instance, a topic I know well as an editor at SAS Press--might be marketable if the authors write with a chapter delivery method in mind. Great post, and love your blog!

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