James Kendrick over at JKontheRun had an interesting opinion piece yesterday on ebook pricing. He believes competition is keeping prices low, and therefore dedicated ebook readers are a poor value proposition since they lock you into a content store, which may lead to less competition and in turn price inflation.
I read his piece with some misgivings. I know that James has many years of experience in mobile tech, and he’s been writing about his ebook experiences for a long time as well. But in my opinion he’s missing a few important points, and I fear that he’s fallen prey to a few ebook myths which need to be addressed.
Specifically, in James’ piece he says:
While the three major e-book sellers have obviously gravitated towards the $9.99 price for new releases, in the future if a consumer owns a reader that is tied into one store then there is no guarantee the price will be competitive. A lot of reader makers are embracing ePUB format for books, and that’s a good thing, but that’s only half the battle for new releases. These books will almost certainly be infested with a DRM scheme, and just because a given reader can handle the ePUB format it will still stick the owner with whatever DRM system it supports. That will likely tie a given reader to a particular store. And as you can see, prices may vary.
Let’s start with the myths.
Myth one is that ePUB DRM varies from store to store. As a general rule of thumb, if something supports ADE (Adobe Digital Editions, the DRM of ePUB), it can read books from any ePUB store, such as Sony, Kobo, , or even Overdrive library books. Buying a Sony Reader does not tie you solely to the Sony Store, nor a nook into B&N. It may make it easier, but it’s not the only way. The only exception to the ePUB=universal across all DRM-capable readers is books from the Barnes and Noble store, because they use a different form of DRM. However, both B&N and Adobe have promised there will be an update making this DRM system available as an ePUB upgrade to other ebook readers in 2010.
Myth two is that you have to shop around at each store to find the best price. You can actually hit up the AddALL ebook search engine and comparison shop at the click of a button! Also, while shopping around can save you a dollar or two, there are some stores that offer benefits from purchasing through them, from the coupons offered in-store at B&N to micropay rebates at Fictionwise.
The rest is a matter of opinion. I don’t see the ebook market yielding to higher prices; customers would revolt. And it would require there being ONE supplier of ebooks, which is highly unlikely. Even in the music industry, where Apple is number one in digital downloads, there are still strong competitors, from Amazon to eMusic. There’s no reason to see ebooks as different. Even if Amazon holds their own as the mindshare/marketshare leader, there are at least two major bookstore competitors with more open file options: B&N and Kobo Books. There’s never going to be one device for every person; again, to use the music analogy, just because the iPod is the dominant player doesn’t mean no one else makes mp3 players anymore.
Content in ebooks is more flexible than many people realize. It may not be as dead easy as flip on your wireless and start shopping, but you can look beyond the store that came with your reader and find content from other sources. And arguing that competition will dry up and cause prices to inflate is, to me, a strawman argument. In the (admittedly short) history of digital media, prices have deflated, not inflated. Plus, would the publishers be crying, whining, and pitching a fit over $9.99 pricing if they had even the slightest hope that would increase?