Amazon Digital Markup: 129,000% • Hacker News Board

Re: Amazon Digital Markup: 129,000%

#111

Post by djt » Tue, Jun 12, 2012, 6:04 AM UTC

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…

from my personal experience I have never used Gumroad before, so if it was $9.95 from Amazon and $9.95 from Gumroad then i would have bought from Amazon. I think you may have made the same profit but your readership would have been much lower if you hadn't used Amazon, which is an important consideration if you want extra exposure.

Re: Amazon Digital Markup: 129,000%

#112

Post by danmaz74 » Tue, Jun 12, 2012, 6:08 AM UTC

stickfigure wrote: post #109

Consumer here. What I don't like about this absurd per-megabyte price is that it discourages authors from including quality pictures in their books. This finally explains why the Kindle version of some books I've bought were garbage. In particular, I was enormously disappointed with Lonely Planet books - the maps are poor quality and split out among several pages so it's almost impossible to find anything. It was a t…

Completely agree on this. Moreover, the price of a Kindle book is often HIGHER than for the printed version, which is outrageous, especially because of the poor quality of the layout of many kindle books layouts.

Re: Amazon Digital Markup: 129,000%

#113

Post by xxpor » Tue, Jun 12, 2012, 6:31 AM UTC

damian2000 wrote: post #95

xxpor wrote: post #77

Earlier quoted context omitted.

What if you have a US kindle in say, the deserts of Australia? It's going to cost a LOT more than $.27. I mean a LOT.

Wrong - most deserts of Australia don't have any 3G access. But anywhere in Australia with 3G access (i.e. populated areas) all have the same data tariff, which is comparable to the US price.

>But anywhere in Australia with 3G access (i.e. populated areas) all have the same data tariff, which is comparable to the US price

How do you know the details of AT&T's roaming agreements with Australian carriers?

I know you don't, because your statement is 1000% incorrect.

Re: Amazon Digital Markup: 129,000%

#114

Post by yohui » Tue, Jun 12, 2012, 6:38 AM UTC

emmett wrote: post #110

derleth wrote: post #89

Earlier quoted context omitted.

> They are trying to run a for-profit business. So... are we morally barred from complaining, or is it merely to be considered gauche? (This reminds me of the people whose entire conception of "Free Speech" is "I can say anything and if you criticize that's an infringement of my rights.")

Complaining that a business is charging too much money for its product is silly, if everyone is willing to pay that price. The central insight here is that there is no morally correct price for something, there is only the market price. Goods and services don't have "correct" prices, there is only what people will pay. If you are willing to pay, saying they are charging too much is just wishful thinking.

But if the masses are made aware of the potential for a better deal, might not their willingness to accept such a price decrease?

In a more competitive, transparent market, I would think others could exploit such dissatisfaction.

Re: Amazon Digital Markup: 129,000%

#115

Post by PKop » Tue, Jun 12, 2012, 6:46 AM UTC

masklinn wrote: post #106

coderdude wrote: post #20

Earlier quoted context omitted.

"What is the marketplace doing to earn this percentage of my sales?" seems to be a common question asked by sellers. The last thing on their minds it would seem is the fact that the marketplace is selling their item for them and providing the infrastructure so that they don't have to handle all that PITA interaction. This is especially true of Amazon. You get a lot of value by selling on their marketplace. The high n…

That's what the 30% markup is for...

Exactly. His surprise seems surprising. That the company with the clear majority in the e-book market would charge more for the service of being published within that market does not seem like earth shattering news.

Re: Amazon Digital Markup: 129,000%

#116

Post by ricree » Tue, Jun 12, 2012, 7:25 AM UTC

cheatercheater wrote: post #107

Mathematician here. Anyone care to clarify how he came up with 129,000%? That is, one-hundred twenty-nine thousand percent? I'm not good with numbers. Thanks in advance.

He's comparing the stated delivery fee to Amazon's S3 costs for outgoing data, which he says costs $0.01 per 5 books.

Re: Amazon Digital Markup: 129,000%

#117

Post by tallanvor » Tue, Jun 12, 2012, 7:57 AM UTC

dandelany wrote: post #80

res0nat0r wrote: post #55

Earlier quoted context omitted.

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.

It's ridiculous to include the cost of the entire "Kindle ecosystem" with a fee called "delivery fee" - as other posts have mentioned, this is what commission is for. WhisperNet is another story - this is legitimately a part of the delivery - however, it's just 3G service that they leased from AT&T, and to assume it costs them even close to $2.58 per delivery is just ignorant. If I downloaded an 18MB e-mail attachmen…

Amazon probably isn't paying 15 cents/megabyte in the US. But they're probably paying significantly more outside the US. They've figured out the average cost per megabyte and probably added on a few cents. This way the author is getting charged something in the neighborhood of $2.70 to deliver each book rather than being charged $0.50 for some and $15 for others depending on where the purchaser happens to be. Also keep in mind that Amazon lets you download purchases again at a later time via 3G, so they're probably factoring variable delivery costs based on the number of times people are normally downloading the books.

Amazon also has a pretty good track record at lowering costs when their costs go down (at least when looking at AWS), so it wouldn't surprise me to see the delivery fees dropping over time as they negotiate better deals with AT&T or if they start working directly with other mobile operators in other countries.

Re: Amazon Digital Markup: 129,000%

#118

Post by shalmanese » Tue, Jun 12, 2012, 8:01 AM UTC

Why not make it $10 on Amazon and $9.50 on all the other services. That way, people who are indifferent will go for the service that nets you the highest margin while people who prefer kindle won't care that much about the price differential.

Personally, I'm pretty much indifferent to iBooks vs Kindle since both are just apps on my iPad. If they're both $10, I choose Kindle simply because it's a bigger brand name. If there's even a tiny price differential, I'll choose the iBooks.

Re: Amazon Digital Markup: 129,000%

#119

Post by jrockway » Tue, Jun 12, 2012, 8:04 AM UTC

It's not 129,000% markup. You're paying for outgoing bandwidth (at S3 prices) and you're paying for the Kindle's incoming bandwidth, which could be over an internationally-roaming 3G network. Yes, it's dumb that Amazon charges authors and not themselves, but would you prefer they take 40% instead of a fixed $2?

Re: Amazon Digital Markup: 129,000%

#120

Post by brazzy » Tue, Jun 12, 2012, 8:14 AM UTC

lostsock wrote: post #96

droithomme wrote: post #60

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 wit…

I am confused as to why the author of the book paying for the download of the end user in the first place? If the end user decides to download it via 3G it should either come out of their existing data allowance or be billed to their phone bill... ... or alternatively they can download it over Wifi and neither the end user, Amazon or the author should pay for it?

What you're missing is that the kindles' 3G is not paid for by the user. It's free and comes with international roaming, something that carriers tend to charge an arm and a leg for.