EU Targets Apple In Ebook Investigation 99
nk497 writes "The European Commission is investigating Apple and five publishers regarding ebook pricing, after raiding ebook firms earlier this year. 'The Commission will in particular investigate whether these publishing groups and Apple have engaged in illegal agreements or practices that would have the object or the effect of restricting competition,' the watchdog said."
duh (Score:2)
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Not sure if there is a name for: "we all buy the book from the same publisher and they charge all of us the same price, so we happen to sell it at the same price to the consumer. Why? Because we happen to have the same percentage commission rate." ... Maybe there is a german word for that.
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Incorrect. These particular publishers will not do business with anyone who does not sell at the *exact* price they set. No sales or discounts allowed.
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Re:duh (Score:4, Informative)
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That's one thing that's annoyed me about digital purchases, the prices seem to stay higher for a longer period of time. With a book you want to sell it. Every week that you don't sell it you've wasted shelf space. Publishers are wasting storage space holding these books and will eventually remainder them. But online... well there's no inventory pressure on you to drop prices. Same with games; in a month you'll see the price of a game drop already if it's in stores, probably a big drop after holidays,
Re:duh (Score:5, Informative)
Actually, in Germany book sellers are required by law to sell books at the same price (at least those from German publishers). And for that, there is indeed a word: "Buchpreisbindung".
However the sellers are quite creative at it: You may sell damaged books at lower prices, and therefore you quite often find "damaged" books where the only "damage" is the text "Mängelexemplar" ("flawed exemplar") on them.
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This was also the case in the UK when the Net Book Agreement [wikipedia.org] was in force in the early 90's.
For a while, everyone played ball, the smaller retailers were able to stay in business because nobody could undercut them, and a book cost the same price no matter where you bought it. Two larger booksellers (Dillons and Waterstones) then started to exploit a loophole by either punching a hole in the cover, or marking the edge of the pages with a pen. Then they could sell books at a discount as they were "damaged goo
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Actually, in Germany book sellers are required by law to sell books at the same price (at least those from German publishers).
Of course they don't have to do that for foreign books, that's why English language books are far cheap..., no wait, they actually cost at least 3 times the UK price printed on them.
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But this isn't what happens in the book industry. The next time you purchase a physical book, look around and you will find that the publisher has printed the price on it. Publishers don't sell the books for the same price to all retailers, who all then use the same profit margin to come up with a price point. The publishers instead tell retailers what they can sell the books for. No other consumer market works this way.
What it looks like the EU is complaining about is ebook publishers making agreements wit
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The publishers instead tell retailers what they can sell the books for.
So perhaps you can explain why the book store I walked past yesterday had a sign in the window saying '30% off all hardbacks'? Or, indeed, why I almost never see a book on Amazon for sale at the 'retail price' without a discount?
This publisher-set pricing is exclusive to e-books, not to paper books.
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The biggest difference here is illustrated by Amazon: they are a physical book retailer, but an ebook publisher. Book publishers always set the prices they charge to their customers - the retailers. But for ebooks the publisher is used to selling directly to you. Apple's idea that the ebooks sales process needs middlemen is the oddball part of all this.
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Thats called a "sugested retail price". Comic books do it too. The store can sell it at any price they want, though. However, if the store wants one of those contracts where the publisher will take books back if unsold, they may demand the sugested retail price be used unless otherwise authorized for liquidation purposes.
Next time you go to a Borders.... oh wait... next time you go to a B&B, you may see they put a their own price sticker over the printed price. They mostly repsect the print price, tho
Re:the word is "Marketplace" (Score:4, Informative)
Amazon ALLOWED?! Wow, way to rewrite history there. Amazon actually went so far as to pull Macmillan books from their store in protest but knuckled under the pressure. Their middle finger at the publishers has been to make sure anyone purchasing from them sees that the price is set by the publisher and NOT by Amazon.
Read this -> http://blog.macmillanspeaks.com/a-message-from-macmillan-ceo-john-sargent/ [macmillanspeaks.com]
Amazon did NOT go quietly on this and went so far as to pull quite a few books from their digital shelves trying to NOT be forced into this but the leverage the publishers held was simply too great. This lawsuit is what should have happened all over the place right then and there, that it's only happening now years later and in the EU is a shame. Why is it that lately the EU seems to be the only place where common sense appears to be spoken?
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Not sure if there is a name for: "we all buy the book from the same publisher and they charge all of us the same price, so we happen to sell it at the same price to the consumer. Why? Because we happen to have the same percentage commission rate." ... Maybe there is a german word for that.
Kollusion?
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You'd call it the Net Book Agreement.
http://en.wikipedia.org/wiki/Net_Book_Agreement [wikipedia.org]
It operated from 1900 through to the 1990s in Britain. During this time high street had book sellers of all sizes, from the big chains to the small independents. Since it's demise, independents have trouble competing with the chains, and most have gone to the wall. Now some of the big chains of booksellers are going to the wall because of supermarkets and Amazon. Give it another 10 years and there will be nowhere on the high
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My mum buys her groceries online. Gets them delivered.
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How does that work? Is this just for non-perishable goods? Canned stuff, etc?
If not...I'd have trouble with that. I mean, when I shop I need to be there to pick up and feel and physically examine the produce...to make sure I get the biggest and freshest for my money. I like to look at my meat, beef in particular and try to get the one with the best marbling.
I also tend to look at expiration dates, like on dairy...and get the one with the longest expir
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How does that work? Is this just for non-perishable goods? Canned stuff, etc?
People wouldn't use it if it was as bad as you fear. Many people in the UK, particularly the elderly, get their groceries delivered these days. Including my mother. She's never had an issue with perishables in over five years. The produce is not selected from what's in the store, they take it from their warehouse area.
Keep spreading your childish FUD though!
Well you second-hand experience from your... (Score:2)
Well your second-hand experience from your mother is exactly the opposite of mine.
Over about 10 years:
I've tried Tesco and Sainsbury- I got fed up with them because they kept substituting items I didn't want for items I did. And because they expect you to hang around for 2 hour delivery slots.
I then switched to Ocado (Waitrose), who offer 1 hour delivery slots and usually arrive right at the start of the period. But after a year I stopped using them as well.
The reason: their "fresh" food onlyever has a shel
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No ability to find books by browsing
I regularly browse through e-books on Amazon, though I wish they'd let you read more than 10% (or is it 20%?) of the book.
no ability to lend your friends books
Amazon, at least, supports limited lending so long as the publisher allows it.
having your books remotely deleted on publisher whim...
As far as I'm aware, Amazon only ever deleted books that the publisher did not have the rights to sell. It kind of sucks, but there's no good solution to that problem.
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Business as usual.
For companies in an oligopoly basically offering identical products, there are 3 basic ways they can make more money than they do now:
1. The big box retailer strategy: Lower their price, and hope that the extra volume more than makes up for the reduced margin.
2. The airline strategy: Raise their price, and hope that their competitors follow suit.
3. The cell phone strategy: Lower prices on a loss leader to gain customers, lock them in without them noticing, then raise prices and fees and th
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Lock them in without them noticing? When's the last time you signed a contract without noticing? If ever, you have bigger problems to worry about (not to mention said contract is also invalid). The problem isn't that consumers don't notice, it's that they don't care.
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There are a couple of ways of doing this:
- Include a clause that allows you to change the terms at any time without notifying customers or providing any sort of consideration. If you look for it, you'll find it buried in the fine print of all sorts of consumer contracts. Yes, this is a stupid contract to be signing, but many people don't read the fine print or don't realize what that clause means if they see it. The courts have sometimes ruled those contracts invalid, but for most people it's more expensive
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Include a clause that allows you to change the terms at any time without notifying customers or providing any sort of consideration. If you look for it, you'll find it buried in the fine print of all sorts of consumer contracts. Yes, this is a stupid contract to be signing, but many people don't read the fine print or don't realize what that clause means if they see it. The courts have sometimes ruled those contracts invalid, but for most people it's more expensive to sue than it is to just pay up.
You can c
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Most people don't realize that they're paying a very high monthly fee for that cool new smartphone.
Some of my friends cringe when I say my smartphone cost 500€. It's only natural, since they paid 100-200€ for an equivalent device.
What they fail to understand is that while they're locked into expensive contracts, I'm paying around 10€ per month (8€ internet + admittedly few calls and SMS) on my prepaid card without any sort of obligations.
It's the same way that printer manufacturers reali
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Like I said, the problem isn't that people aren't aware what they're getting in to, it's that they don't care (enough to look into alternatives). Through their actions, people are saying that they care more about convenience (the convenience of the readily available option) than cost. It's not like we live in the dark ages where this information isn't readily available to anyone who cares enough to look.
Hardware too (Score:2)
Apples and Apples comparison (Score:2)
That's how most companies operate (suggested retail price), however that's just the products of one company, not like the book market where there are several publishers.
Apple competes with HP and many others. Amazon suddenly can't compete with Apple, Kobo or others on books because the publishers don't want to!
This is the publishers doing, never mind Apple.
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That's how most companies operate (suggested retail price), however that's just the products of one company, not like the book market where there are several publishers.
Apple competes with HP and many others. Amazon suddenly can't compete with Apple, Kobo or others on books because the publishers don't want to!
This is the publishers doing, never mind Apple.
This is mostly true, and there's really no question that the publishers are the "Bad guys" here, except Apple probably included a clause which basically said "fine we'll go for the agency model, but in return you have to guarantee that you're not going to undercut us later" (apple is known to have made deals like this in other fora) So, basically, Apple conspired with the five publishers in their scheme to price-fix the e-book market, something the other booksellers such as Amazon and B&N had been unwi
Whuh? (Score:1, Redundant)
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Welcome to capitalism, by the way. Hope you enjoy your stay. We'll bill your credit card on departure.
Lets not just include Apple (Score:1)
What about Amazon? Or the other big E-book retailers? How often to e-books go on sale? Discounting? Ever see an e-book for 50% off? Not very often I bet. Consider that an e-book costs mere cents to create and able to offer an unlimited supply surely they should have variable prices.
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The point is that these publishers are dictating the price to Amazon and any other ebook distributors. In order to sell these ebooks, those distributors must sell at the price set by the publisher and are not allowed to give any sort of discount.
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I've been reading ebooks since 2002. I can tell you that the Agency pricing model (that sets the book price at the distributor level) has hurt competition. I used to buy my books from fictionwise.com. They were a great company with a loyalty program that kept me buying several books every month. Now I buy from Amazon. Why? Because fictionwise can no longer carry Agency books, since loyalty programs are verboten. Fictionwise sold books in quite a few formats, so I could buy from them without getting stuck in
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Well except they want DRM and that's where the platforms all differ. I use Kindle and Caliber, I may buy a Nook soon but it won't ever see a DRM book. I stopped buying from Amazon when their prices shot through the roof as publishers began dictating prices. What I used to find for $9 and often less is now much more and often more expensive than hard copy. That's crap and I welcome this suit as well as the efforts of Amazon to eat the publisher's lunch by publishing themselves. They have to if they want to s
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Every day: http://amazon.com/kindledailydeal [amazon.com]
Re:Lets not just include Apple (Score:5, Informative)
Paul Thurrott's column [winsupersite.com] on this speaks to that question, and describes the logic of the antitrust investigation pretty succinctly:
Before Apple's entry, publishers set the wholesale price of books, but retailers could determine the final selling price. But Apple changed that, allowing publishers for the first time to determine the final price at which eBooks were sold to consumers. As a result, the average selling price of new eBooks jumped from $9.99 to $14.99.
The EC will try to determine if the firms colluded to fix prices and restrict competition. Both charges should be easily proven.
As I reported in February 2010, while Apple was negotiating with the major publishers, at least one of them, Macmillan, demanded that Amazon raise prices on its Kindle books to match Apple's prices. Amazon, now as then, owns the dominant eBook platform, called Kindle. And Macmillan threatened to pull its books from the Kindle unless Amazon went along with the price hike. After temporarily pulling Macmillan's titles from its store, Amazon capitulated and raised prices as demanded.
"We have to capitulate and accept Macmillan's terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books," Amazon wrote to customers at the time.
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"We have to capitulate and accept Macmillan's terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books," Amazon wrote to customers at the time.
That's exactly the same legal argument that didn't work for Psystar in the US. Maybe such reasoning will have better results in the EU.
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generally producers that are shown to set that price in collusion with their competitiors are guilty of forming a cartel. IANAL but it appears that telling Amazon to raise their prices means Macmillan was choosing to set a price based on what its competitor set (ie the price on Apple's store).
They could have told Apple to reduce their prices and they'd probably be guilty just the same, the idea is that they set the price according to the market - not artificially set the prices outside the consumer marketpl
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But Apple and Amazon didn't collude.
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Actually Macmillan gave them a choice - they could continue with their existing deal but would find large swaths of their books no longer available to Amazon. They said as much -> http://blog.macmillanspeaks.com/a-message-from-macmillan-ceo-john-sargent/ [macmillanspeaks.com]
Their blog is fascinating as it truly shows just how far their head is up their ass IMO.
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Amazon aren't one of the companies being investigated. I guess they are the ones who reported it to the EU and being the first to report it means you get off any fines that are levied.
Meanwhile in the USofA (Score:2)
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Paul Thurrott's column [winsupersite.com] on this speaks to that question, and describes the logic of the antitrust investigation pretty succinctly:
Before Apple's entry, publishers set the wholesale price of books, but retailers could determine the final selling price. But Apple changed that, allowing publishers for the first time to determine the final price at which eBooks were sold to consumers. As a result, the average selling price of new eBooks jumped from $9.99 to $14.99.
The EC will try to determine if the firms colluded to fix prices and restrict competition. Both charges should be easily proven.
As I reported in February 2010, while Apple was negotiating with the major publishers, at least one of them, Macmillan, demanded that Amazon raise prices on its Kindle books to match Apple's prices. Amazon, now as then, owns the dominant eBook platform, called Kindle. And Macmillan threatened to pull its books from the Kindle unless Amazon went along with the price hike. After temporarily pulling Macmillan's titles from its store, Amazon capitulated and raised prices as demanded.
"We have to capitulate and accept Macmillan's terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books," Amazon wrote to customers at the time.
So instead of Amazon now the publisher has the (price-setting) monopoly on where to get their ebooks. I can see why Amazon doesn't like that.
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Consider that an e-book costs mere cents to create
This just in: products have more to their cost than just the cost of replication and materials. I'm pretty sure the author(s), editors, typesetters, etc. that have a hand in the creation of the work want to get paid, too, no?
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Maybe they didn't include Amazon and B&N because that is an european commission, and those distributors don't operate at Europe.
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While B&N doesn't operate in Europe, Amazon most certainly does - in fact the Kindle is absolutely everywhere this Christmas, here in France.
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Amazon certainly does: http://www.amazon.eu/ [amazon.eu]
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Have you not ever noticed the blurb next to the Amazon price that notes the price is set by the PUBLISHER and not Amazon? Amazon is no longer able to set their own prices, fought this, and lost the fight right after the iPad came out. The result being that blurb to let their customers know who's fucking them - apparently you've not been paying attention....
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Amazon was the one setting their own price to the books. The publishers (supported by Apple) demanded (at the time that the iPad came to the game) Amazon to only sell their books at a fixed retail price.
The Agency Model is a racket! (Score:4, Informative)
This is bad for the consumer since it means that market forces have less sway and there is little to distinguish one store from another. You will not find ebooks on sale and there is no point in "shopping around" since the price is the same everywhere.
If similar agreements were in place for other products, it would cause lawsuits. Imagine if all of the oil products sold by Shell or BP were given fixed prices. Media companies would love to have their own profit-guaranteed cartel and will push for illegal agreements to defend their aging business model.
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In effect, the Agency Model is illegal price fixing by doing a "de facto" price floor at an unreasonable level, a practice banned by US and European Union antitrust laws. I would not be surprised that as a settlement, the price of new e-books will have a price floor of around US$12 per e-book, not the US$15 to US$16 it is now.
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This is another example of why free-market is bullshit. Leave these big players uncontrolled and they will screw everybody over.
You think publishing, which relies entirely on a GOVERNMENT-GRANTED MONOPOLY to operate, is somehow an indictment of the free market?
BTW, there are about a bazillion e-books on Amazon for $0.99 if you don't want to pay $19.99 for one from a big publisher.
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They were involved in price fixing, which essentially is only illegal because there is government regulation. Without regulation this would happen much more often and on larger scale.
Let's try that again.
Publishers only exist because of copyright. Copyright is a government-granted monopoly.
Now explain how publishers would price-fix if copyright did not exist.
When a monopoly exists, it's usually for one of two reasons:
1. Bigger is cheaper. No smaller company can compete because the big company is more efficient and can sell their product for less than any competitor. This is good, because it means customers are paying less.
2. Government is preventing competition. This is bad, because it
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Of course it is!
Just like healthcare in the US is heavily regulated and relies on various government monopolies (medical associations, patents...) is an indictment of the free market. It can only be solved with an even greater monopoly by making it a universal national system or a national monopoly.
You don't know anything do you? /s
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For sure! Whenever the problem is "too much government", it's always clear that the solution is "even more government". Maybe the problems of national healthcare systems could be solved by some sort of international healthcare system! If we just keep trying long enough, we'll surely elect the worlds first non-corrupt politician, and everything will be rainbows and unicorn giggles.
Ebooks are Great (Score:5, Insightful)
Ebooks are slowly changing the way authors sell their books. No longer do you need a publisher to sell you book. Self-publishing is not only a possibility now, but it is also a reality. The only thing you can get from a publisher now is up front fees and marketing. But with the web, you can do much of that yourself.
Step 1. Create a company to help authors promote books
Step 2: ????
Step 3: Profit
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I think that, rather than self-publish, the big opportunity is for small/indie publishers. I've read a few self-published ebooks and I would say that they tend to lack the kind of polish that a good editor can supply. In that sense, I think having a publisher, or at least paying for an editor's services, is essential to the success of these endeavors.
Small publishers have the chance to help create a new model:
1. No more big advances. Instead, offer a larger piece of the royalty pie.
2. Push the quality envel
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Yes, all you get from a publisher is up-front fees and marketing. And professional editing. And layout and typesetting.
And the way you say 'marketing' makes it sound like an easy thing. There are a quarter of a million books published every year in North America alone. Writing the first rough draft isn't the hard part. Writing the much better eighth draft is harder. Then getting anyone to read the damn thing, much less pay for it, is hardest.
No one is getting rich in the book industry. No one. Not the publi
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You are correct. The reason why it hasn't happened before is that self publishing was hard 10 years ago. It was even hard 2 years ago. You needed money to pay for everything. Now you only need a way to support yourself until you can get the book written. Once there, you can self promote with websites, blogs, twitter, facebook, so on and so forth. Once authors realize this, the book industry can be profitable more profitable because you are no longer beholden to share holders. An author can now pay an
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Look at Rebecca Blacks Friday song. She has made a shit ton of money from one single all because of the crowd sourcing effects of YouTube... Look at open source projects.
A shit-ton of money? Seriously? Grand total, before taxes and any cuts she needs to make to management or to pay costs, the song generated between $25,000-$50,000. As a one-hit fluke that's awesome, but a career it does not make. Randomly being the one video in a million that happens to catch on for a moment is not exactly a strategy you can build a life around. Google "Rebecca black sales" if you want to see the numbers.
Can you name two dozen OSS projects that are even paying their contributors living wage
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Have you ever read an unedited manuscript?
There is a writer in Russia who goes through traditional publishing route (both paper and e-books), but puts manuscripts of his works-in-progress online, free for everyone to read. The last thing that he makes available for free is the final version of the manuscript before it goes off to the editor. Sure, you can read them, and even enjoy them, but when you compare them to what is actually published, you quickly understand what is it the publishers actually do, and
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It's Andrew Cruz [samlib.ru]. And, yes, it is in Russian.
The benefit he gains from it is that there are enough fans who rush to read the manuscripts even in their raw form, and effectively serve as additional pre-screening before proper editing. For his books, it can matter because he's a prepper, and his books tend to be pretty heavy on description of weapons and other survivalist equipment. Regular editors generally don't know enough on the topic to correct any factual mistakes he might made, but the fans do.
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Tell me again why an eBook needs anything more than A) an author B) an editor (editors can do layout) C) distributor? Well, granted, some books may need illustrations and some people may fuss about making an un-needed "cover".
Typesetters though? For an eBook? REALLY? Because, I honestly thought that every single text editor out there allows you to, you know, change your own font and font size/style. Even Notepad.
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'Changing the font and size' is about the least part of what a typesetter/layout person does. And it's a job that is particularly important for digital media where consciously choosing how things are displayed makes a massive difference to the readability. What font gets used? How large are the indents and how will the book treat text-wrapping for long lines? How are chapters and other headings handled? Are there quotations or other types of inset text?
God help you if you are doing something actually compli
I realized this (Score:2)
There is no _reasonable_ explanation as to why a physical book should be cheaper than 1s and 0s.
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There is no _reasonable_ explanation as to why a physical book should be cheaper than 1s and 0s.
Sure there is. The cost the physical ink an paper is maybe 15% of the cost of publishing a book, so you're starting from about the sam eplace price-wise. (Charlie Stross has a great write up on this, at length http://www.antipope.org/charlie/blog-static/2010/04/common-misconceptions-about-pu-1.html [antipope.org] ) Retailers will discount physical books to shift inventory off shelves, something irrelevent to ebooks. Of course, you'd think the publisher would want to discount the ebooks to help build a buzz for a boo
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Printing and shipping dead tree books is not that expensive. Setting up a data centre and all the associated payment and fulfilment stuff to run an e-book store doesn't come free. Us slashdotters do like to be paid for our efforts.
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My thought was more towards inherent costs, and artificial supply/demand. Physicals carry not only costs to print, bind, but to distribute. Shipping 12 crates of books should cost more than uploading an e-book to a source.
This is the most common misperception about publishing. Read his first couple of essays for a thorough cost breakdown, if you doubt it. The total "physical cost": printing, binding, shipping, etc, is only 10-15% of the cost of publishing a typical book (at least, a novel, nonfiction is different). 85%-90% of the cost is paying the author, the various proofreaders, the typesetters (yes, ebooks also have typesetters), the marketing spend, and on and on.
Something which _should_ have less overhead, _should_ cost less. Even 2$ less would convince me to not buy in print. And again, that _should_ give more money to authors, although I doubt it does.
Except that's where you're off - there isn't much less
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Ebook price comparison search engine (Score:1)
Slightly OT, but as many reading this probably care about ebook prices: Try the legal search engine in the open source Calibre [calibre-ebook.com]. Besides being arguably the best library management software available it's got a comparison search (called Get Books in the toolbar) which is the most comprehensive I've seen. It'll provide hits from a lot of different stores, but you can configure which ones. Or, if you're comfortable with liberating your legally bought books from their DRM shackles, I heard of this guy called App
The Brits went through this, too (Score:1)
http://en.wikipedia.org/wiki/Net_Book_Agreement [wikipedia.org]
But how does one 'deface' an e-book? Remove the DRM?