Writing Is An Art, Publishing Is The Business
With mainstream publishers, writers and music artists get 10% to 15% with an advance against sales on the front-end. Naturally, they want higher prices at retail as it returns more money to their pocket; but, most of all, they want to get their creative works in as many hands as possible.
In the ebook business, as it is in the music industry, the retailers are in the middle. They want a salable product with enough margin to make a profit. The retailers are now large organizations; Barnes and Noble and Amazon are two of the largest.
Without a doubt, these institutions have an interest in selling their products at attractive prices. Also, both these major retailers sell their own branded ebook readers; Amazon's Kindle and Barnes and Noble's nook. These e-readers, as well as other readers by electronics manufacturers, are the razors to the ebooks razor blades.
Enter The Kindle
Over two years ago, Amazon released the Kindle 1 (November 19, 2007), which ignited the ebook market. Prior to the Kindle, you could buy ebooks for PDAs (Personal Digital Assistant: Palm, Sony, Comppaq and so forth) and there were a few online retailers, such as Fictionwise (now owned by Barnes and Noble), but, until the Kindle, this was a niche industry.
While new hardcover books sell for $25.00 and up, Amazon sells the same book, in a Kindle ebook format, for $9.99. When Apple showed off their planned iPad device, Macmillan, a large book publisher, forced a play with Amazon to raise the ebook pricing. Their strategy was to stop selling through Amazon, unless both parties could agree on pricing. Amazon was forced to capitulate (the full details are still unknown) to not lose a major publisher in their book list.
The Bottom Line
What does this all mean to people like you and me, the consumer? At this time we're but pawns in this game. Until all of the publishers decide their marketing strategies, it's business as usual at the bookstores, both physical and online.