On one level, it's really the same principle for print books. How much is a printed book worth? Pretty much everything manufactured is subject to the same law when it comes to pricing: something is worth what people will pay for it. If they won't pay enough for the manufacturer to make money, then the thing won't get made. But what about when the “manufacturer” is an artist or a writer? A lot of writers and artists will create their work no matter whether anyone buys it. Artists who make their living (or enhance their living) from their art, however, want to be paid for their work. And obviously, some books are “worth” more than others because people will pay more for a book by their favorite author than for one by an unknown writer.
With books, complications come in because the artist/writer relies on a publisher to “ manufacture” the books. Publishers decide how to create the book (hardcover, trade paperback, mass market paperback, or ebook) and how much to charge for it. Of course, with printed books, the price the publisher sets is not even close to iron-clad. If a bookstore or an online retailer wants to discount it, they can, and Amazon certainly does that a lot.
Because of agency pricing, the price the manufacturer sets for an ebook is iron-clad. And to some extent, a lot of the angst of ebook pricing is publishers being hoist with their own petards. If you price books by format for decades, you really should not be surprised that people expect a non-physical format book to be cheaper than even a mass market paperback.
And since there are easy and cheap ebook self-publishing platforms, unknown writers (and in some cases, unprepared writers) can self-publish ebooks and set prices themselves. This is what has given rise to the popularity of the 99¢ ebook. These books are so cheap, some folks buy them without worrying that they might never finish them. The situation reminds me of my maternal grandmother, who loved a bargain so much, she once came home with a pair of ugly pink sandals in a size no one in the family wore; she bought them because they were only a dollar.
Another unique aspect to ebooks versus print books is piracy. In spite of the fact that publisher now poo-poo the cost of creating printed books, there is very little incentive to create pirated copies of printed books and sell them on street corners for less than a bookstore would. Aside from the risk of getting busted, it would be hard to turn out a decent-looking book for less than a bookstore charges unless you own your own press and bindery. But with ebooks, creating pirated copies is cheap and easy, whether there is an ebook version available to copy or not. The specter of piracy is what haunts publishers these days. Right now they're focused on fighting it with take-down notices and law suites rather than cheaper prices for their legal wares, but that could change in the future. The podcast contains an interesting comment to the effect that dirt cheap ebooks may well be the future for backlist books. It would be harder for pirates to compete.
Personally, I think publishers need to start thinking about ways to make technology work for them— not by creating more DRM but by making ebook pricing more fluid. When the price isn't printed on the cover, it's very easy to change it. Publishers should be experimenting a bit more with what sells best for their authors, over time, not just when the book comes out in hardcover or in paperback.
So, to find out what you think (at least those of you with LJ accounts), I've created a short poll on ebook pricing. Feel free to weigh in with a comment, too!
For a book that is new & for sale in hardcover, what would you pay?
For a book that is not new & has been released as en ebook after being out of print