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Amazon Digital Markup: 129,000%

andrewhy.de

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Re: Amazon Digital Markup: 129,000%

#51

Post by RobAtticus »

freerobby wrote: post #40
RobAtticus wrote: post #36

Earlier quoted context omitted.

They charge him $.15/MB to delivery the book[1]. Cell carriers charge you ~$15/200MB = $.075/MB for data. Certainly a markup, and it gets better as more people use WiFi, but not 129000%. [1] https://kdp.amazon.com/self-publishing/help?topicId=A29FL26O...

But remember, they're charging that $0.15/MB even for people who don't own a 3G-capable Kindle. In those cases it really is roughly a 120,000% markup over an already profitable service.

And those cell users can download the book multiple times at no additional cost, in perpetuity. So sometimes they may be taking a loss. It's really not all that simple, and I think calling it a 120,000% markup is dubious at best.

Re: Amazon Digital Markup: 129,000%

#54

Post by jchavannes »

I don't like the AWS pricing either (or at least how it's communicated). I have considered AWS but no matter how much time I spend looking at their pricing, I can't figure out how much I should expect to be charged each month.

I agree the tone of the article is a little over-victimized though.

Re: Amazon Digital Markup: 129,000%

#55

Post by res0nat0r »

mycroftiv wrote: post #48
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.

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…

Hosting a static file in S3 you have to point people to manually find and download themselves is much cheaper because you don't have the built in captive audience, WhisperNet and everything else which comes with the Kindle ecosystem, so comparing the two only via a flat dollar cost is naive.

Re: Amazon Digital Markup: 129,000%

#56

Post by cs702 »

notatoad wrote: post #39
cs702 wrote: post #3

I strongly suspect Amazon is offering well-known, "must have" authors a much better deal -- possibly even losing money on sales of some of their books -- and making it up by giving a raw deal to less-well-known, independents like Andrew Hyde, the author of this blog post. Does anyone here know if this is indeed the case?

The well known must have authors don't self-publish directly on amazon, they have publishers who handle all that sort of negotiation for them. And part of that negotiation surely includes talking amazon down on the delivery fees. However, authors who publish heir work through a publisher also don't make 55% royalty, so the author of this blog post is still better off than he would have been.

notatoad: I didn't write or even imply that well-known authors self-publish.

FWIW, I have heard from a second-hand source that one well-known author is receiving net royalties from Kindle sales that are greater than the Kindle price of his books. I don't know if this is really true, but it rings true; hence my question to the HN community.

Re: Amazon Digital Markup: 129,000%

#57

Post by MBCook »

recoiledsnake wrote: post #46
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.

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.

But isn't that factored into the 30% cut they take before the delivery charges?

I love my Kindle and I really like Amazon, but this is the first I've heard of the delivery charge part. Considering that it's around 25% of the price of the book... it really does seem like a rip off on their part.

Re: Amazon Digital Markup: 129,000%

#58

Post by MBCook »

fennecfoxen wrote: post #32

Personally, I'd be more depressed by something that says "Amazon charges authors $2.58 to deliver an e-book ( after 30% cut)" than some big fancy number like that 129,000%. It's more meaningful.

I agree. "Amazon's takes 55% of my ebook sales" or "Amazon's hidden 25% ebook fee" would have meant quite a bit more.

Re: Amazon Digital Markup: 129,000%

#59

Post by redditmigrant »

res0nat0r wrote: post #55
mycroftiv wrote: post #48

Earlier quoted context omitted.

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…

Hosting a static file in S3 you have to point people to manually find and download themselves is much cheaper because you don't have the built in captive audience, WhisperNet and everything else which comes with the Kindle ecosystem, so comparing the two only via a flat dollar cost is naive.

You are completely missing the point. They do charge a commission. The problematic part here is that this $2.58 is called "delivery fee". Im sure all the ecosystem costs a lot of money, and they are free to charge whatever they think the ecosystem is worth, but calling it "Delivery fee" seems disingenuous.

Re: Amazon Digital Markup: 129,000%

#60

Post by droithomme »

OK, so for a $10 book, Amazon collects 30% for themselves, which is $3.

For a 19MB download delivered via 3G to a Kindle, Sprint, the wireless carrier, charges .15/MB, or $2.85/19MB. This is paid to Sprint, not Amazon.com. The article errors by comparing this fee to the cost for server bandwidth using S3 to come up with his markup value, but S3 bandwidth covers the internet only and does not include fees involved with passing through any sort of cellular network.

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