Fast Company

Barnes & Noble Follows the Leader (Amazon) With $9.95 E-book Pricing

When Barnes & Noble scooped up e-book seller Fictionwise.com--owner of eReader.com and eBookwise.com--back in March, the company said the purchase was part of an overall digital strategy that would culminate with the launch of its own e-book seller later this year. While B&N didn't elaborate further on its digital strategy, part of it came to light this week when eReader changed its pricing to match the price of books for Amazon's Kindle e-reader.

amazon-kindle-dx-4Previously, there was no standing pricing for the books in the eReader store; the prices were as variable as those at a brick-and-mortar retailer. Now, all new e-books sold on the site will be $9.95 or less (and no book will be more than $12.95). Amazon already offers its e-books, old and new, bestseller or obscure, at a single $9.99 price point, making them cheaper than the average hardcover at a bookstore.

As Fast Company contributing writer Adam L. Penenberg wrote in this month's cover story, Amazon is redefining the cost of a book in readers' minds, forcing other e-book sellers to follow suit and in turn forcing publishers to play ball. Publishers are still trying to get as money much as they can from e-book sales, and Amazon loses money on many of its $9.99 titles (paying publishers as much as $12 or $13 for some titles). B&N's new pricing indicates that Amazon is dictating to everyone else what an e-book should cost, much the way Apple defined the price point for digital music.

A behemoth like B&N can afford to jump into the game of losing money now to make money later, but smaller start-ups will have a hard time undercutting Amazon's pricing by cutting deals with publishers. Thus, B&N's concession to Amazon's pricing structure could mark the beginning of a brave new world in e-books, one ruled by the dictates of Amazon. Once readers have it in their heads that an e-book is worth ten bucks and no more, everyone from publishers to writers to competitors like B&N are going to have to bend to that price. It would seem that paradigm shift is already underway.

[via InformationWeek, eReader]

Related Stories:
The Evolution of Amazon
The Fast Company 50 - 2009: #9 Amazon
Is Amazon the New Wal-Mart?

Add New Comment

1 Comments

  • Karen Wester Newton

    Am I reaading this correctly? Are you saying all the ebooks in the Kindle store are $9.95? That is totally not true. The usual price for a fiction book that is only available (in print) in hardback is $9.95. Books that are in paperback vary but are usually about 10-20% cheaper on Kindle than they are in print. Nonfiction can be anything. A lot of classics (i.e., out of copyright books) are free and some publishers run promotions where books are $1 or $2 for a limited time.

    Publishers may hate the $9.95 price, but ebook buyers hate paying more than that for an ebook that they can't sell or give away when they are done reading it. I think that's what B&N has realized.