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Amazon Digital Markup: 129,000%

andrewhy.de

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Re: Amazon Digital Markup: 129,000%

#41

Post by Arkeus »

ImprovedSilence wrote: post #37
res0nat0r wrote: post #33

Earlier quoted context omitted.

> charging several dollars for a "delivery fee" of a digital book is OBVIOUS BS! Do you think that the largest file sharing service (S3) and the largest public cloud computing infrastructure (EC2) in the world just operate for free? Digital delivery fees help pay for the millions in hardware, software, infrastructure and maintenance costs for these services, which Kindle uses extensively.

Fair point, but don't you think It'd be nice if they advertised the price for said fee, or at least provided a chart for fees/mb? It seems like it is a "hidden cost", not outlined in detail, leaving the client in the dark, which appears to be the problem here.

While I think his claims of high delivery charges are fair, I don't think it's right to call it hidden. When pricing your book in Amazon's self publishing (I am assuming here he went through KDP), it calculates in real time the delivery charge and estimated royalty based on the price you input. There is also a blurb on the right side of the same page explaining the delivery charge, and how it applies to the 70% royalty plan (and now there is no delivery charge for 35% royalty).

Re: Amazon Digital Markup: 129,000%

#42

Post by ChuckMcM »

andrewhyde wrote: post #21
ChuckMcM wrote: post #14

This is confusing. Here is someone with a FANTASTIC first outing of a book and he's whinging about it? The author raises $8K on Kickstarter, sells his book for $10, and is complaining that the 'gorilla' is taking a bigger percentage of the take? Using his numbers: of 73%/11%/12%/1% his money was $1117/$231/$333/$20 respectively. So he made three times as much money selling through Amazon as he did on the next closest…

Having a great time with the book, sorry if I came off as whining. A few notes. A high % of the KS money went into rewards (books printed averaged $20 shipped). I did make 3x though Amazon, but if I had gone through gumroad, I would have done double the revenue. Biggest tl;dr complaint is that as an avid reader of about a book a week I had no idea that authors paid both 30% of the total price plus the delivery fee. T…

Awesome book btw, careful with this though:

"I did make 3x though Amazon, but if I had gone through gumroad, I would have done double the revenue."

Not nearly as many people know about Gumroad or use it, so for any given marketplace, some percentage of the buyers in that marketplace are potential customers but they are stubbornly proportional. If Gumroad has 10% of the customers that Amazon has and you get 2x the revenue per book sold, you will only see an increase proportional to 10% of the sales at Amazon. As a worked example

219 Amazon customers $5.10 per book -> $1117 in revenue 22 Gumroad customers $9.25 per book -> $209 in revenue

It's the area under the curve that is important. In a traditional publishing arrangement you would give a bigger 'discount' to a big seller (say Barnes and Noble) vs a boutique seller like 'World Books'. One has 10,000 stores, the other 4 stores. Because while you get less per book, you sell more books and make more overall (price * volume, not just price).

So I seriously doubt you would even have matched the Amazon revenue, if you had gone through Gumroad and precluded Amazon.

So when you look at it you need to sum all of the sales, and all of the margins, and you will get your 'average selling price' or ASP. This will help you understand how much you can profitably 'invest' in putting together a book. As your reputation grows, if you garner an audience, then you can 'count' on more total revenue per book and take some of the guesswork out of the planning.

The other part of the equation is time, since it takes a while for people to get the book and recommend it, there can be several months of 'growth' before you really know what the market for your book is.

I totally understand that you were surprised had the additional charges that Amazon specified but didn't make clear (and that Apple does a better job of this I think is a good thing since they are the competition). Unfortunately PDF is a horrible book format as it pre-computes for a given render and that means that it looks like crap on readers that don't fit the mold. Epub is much better, as is mobi. For what its worth the last time I was looking through the Writers Guide (one of my daughters is looking to creative writing as a career) selling 1500 travel books if you weren't Michelen or Fodor's was a 'big' title, so selling 300 pretty much right off the bat is huge. I wish you great success!

Re: Amazon Digital Markup: 129,000%

#43

Post by res0nat0r »

ImprovedSilence wrote: post #37
res0nat0r wrote: post #33

Earlier quoted context omitted.

> charging several dollars for a "delivery fee" of a digital book is OBVIOUS BS! Do you think that the largest file sharing service (S3) and the largest public cloud computing infrastructure (EC2) in the world just operate for free? Digital delivery fees help pay for the millions in hardware, software, infrastructure and maintenance costs for these services, which Kindle uses extensively.

Fair point, but don't you think It'd be nice if they advertised the price for said fee, or at least provided a chart for fees/mb? It seems like it is a "hidden cost", not outlined in detail, leaving the client in the dark, which appears to be the problem here.

The terms are plainly outlined in this table right here, which I found after 10 seconds of Googling:

https://kdp.amazon.com/self-publishing/help?topicId=A29FL26O...

Re: Amazon Digital Markup: 129,000%

#44

Post by tylerneylon »

Some commenters say the post is wrong to complain when the author is making money through amazon's distribution, or when amazon takes a loss on selling kindles.

I disagree with both sentiments.

Main point: It does not cost amazon an average of $2.58 to deliver the author's pdf. Amazon is being dishonest by calling this a delivery cost. I consider it unethical to name a fee something that it is not.

"Be grateful for what you do get" is not a valid argument against dishonesty. If Amazon makes a business decision to take a loss on kindles, this also does not justify dishonesty.

Re: Amazon Digital Markup: 129,000%

#46

Post by recoiledsnake »

res0nat0r wrote: post #33
mycroftiv wrote: post #29

Earlier quoted context omitted.

He is making an entirely justified complaint that Amazon charges unreasonable fees. The idea that any and all corporate behavior is fine simply because "it says so in the contract" is ridiculous. You aren't actually paying attention to what the author wrote - he even specifically talked about how Amazon's Kindle platform provides a good experience for readers and has accounted for the majority of his sales. His post…

> charging several dollars for a "delivery fee" of a digital book is OBVIOUS BS! Do you think that the largest file sharing service (S3) and the largest public cloud computing infrastructure (EC2) in the world just operate for free? Digital delivery fees help pay for the millions in hardware, software, infrastructure and maintenance costs for these services, which Kindle uses extensively.

Also remember that Amazon either takes a loss or is barely above breakeven for the Kindle hardware including the Fire. It is like the game console model. Go independent and make money on the PC, but if you want access to the millions of willing buyers and predictable hardware requirements, you either charge your customers more or make it up in volume.

Re: Amazon Digital Markup: 129,000%

#48

Post by mycroftiv »

res0nat0r wrote: post #33
mycroftiv wrote: post #29

Earlier quoted context omitted.

He is making an entirely justified complaint that Amazon charges unreasonable fees. The idea that any and all corporate behavior is fine simply because "it says so in the contract" is ridiculous. You aren't actually paying attention to what the author wrote - he even specifically talked about how Amazon's Kindle platform provides a good experience for readers and has accounted for the majority of his sales. His post…

> charging several dollars for a "delivery fee" of a digital book is OBVIOUS BS! Do you think that the largest file sharing service (S3) and the largest public cloud computing infrastructure (EC2) in the world just operate for free? Digital delivery fees help pay for the millions in hardware, software, infrastructure and maintenance costs for these services, which Kindle uses extensively.

Did you read the blog post? The author specifically was comparing the cost of delivery via the Kindle service to using Amazon S3/EC2 to deliver the content. His specific comparison was that the price that he would pay to host and deliver the content using Amazon's own services, would be orders of magnitude smaller! In other words, the comparison you are making is the exact basis for his entirely justified claim that Amazon's delivery fee is complete ripoff.

Re: Amazon Digital Markup: 129,000%

#49

Post by pbreit »

Two misconceptions: 1) services are properly priced at what the market will bear, not the cost to deliver them. 2) Many Kindles get their content over a regular cellular network which the Kindle owner does not pay a monthly fee.

Re: Amazon Digital Markup: 129,000%

#50

Post by robryan »

pilom wrote: post #10
cperciva wrote: post #9

Earlier quoted context omitted.

The fact that you can get 2 GB of data for $30 doesn't mean that you can get 18 MB of data for $0.27. Most people paying $30 for a 2 GB data plan are using far less than 2 GB of data.

Very true, but the fact that the author is paying a distribution fee an order of magnitude more than the $.27 seems pretty fishy.

Doesn't amazon promise delivery to anywhere in the world? These high prices might be subsidising places with crazy high data rates.
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