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Books Businesses Government The Almighty Buck

The Price of Amazon 298

Posted by Soulskill
from the not-quite-enough-for-free-shipping dept.
An anonymous reader writes "As physical book stores continue to struggle and disappear, the NY Times puts the changing book industry into perspective as a cost of the existence of Amazon. Further, it's a cost that hasn't been fully paid, as other effects of Amazon's ascendancy have yet to be felt. Quoting: 'One consequence of this shift is that soon no one will know what a book's "real" price is. Price will be determined by demand and perhaps by whim. The first seeds of this can be seen in the Justice Department's suit against the leading publishers, who felt that Amazon was pricing their e-books so low that it threatened their viability. The government accused the publishers of colluding to raise prices in an anti-consumer move. Amazon was not a party to the case, but it emerged the big winner.' Economists, publishers, and readers no longer have confidence that a book will cost the same amount this week as it did the last."
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The Price of Amazon

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  • And? (Score:5, Insightful)

    by Black Parrot (19622) on Sunday July 07, 2013 @02:15AM (#44207555)

    Just Amazon? Just books?

    • by auric_dude (610172) on Sunday July 07, 2013 @02:52AM (#44207661)
      Oscar Wilde might have once said "A man who knows the price of everything and the value of nothing."
    • by hedwards (940851)

      That was my thought, I don't buy any books from Amazon because they don't offer them in a format that's readable on my Nook. They're the main party that's trying to push their .MOBI crap on people.

      This is natural, the price of a book was always largely arbitrary. The book store itself would get to double the price that they paid for the book, and there were some tangible costs, but most of it was arbitrary based upon how much money they needed to make back their investment and earn some profit.

      The only thin

      • by lessthan (977374)

        I don't buy any books from Amazon because they don't offer them in a format that's readable on my Nook.

        That is kind of an odd way to look at the situation. I have a iPad and I can read Amazon books on the free Kindle app and I can read B&N books on the free Nook app. Not the most convenient setup (plus I have a bone to pick with both for a lack of organization options. The Kindle app won't even provide a rating field so I can know if I liked the book or hated it!), but the tech is obviously there. Wou

      • by mattack2 (1165421)

        I don't buy any books from Amazon because they don't offer them in a format that's readable on my Nook.

        I won't buy anything from Pepsi because they won't sell me Coke! WAAAAH.

  • NEWS FLASH (Score:5, Funny)

    by Anonymous Coward on Sunday July 07, 2013 @02:17AM (#44207559)

    This just in: the market isn't the same as it was 50 years ago! Some scientists are saying we need to observe our market differently. Panic ensues.

    • Re:NEWS FLASH (Score:5, Insightful)

      by fche (36607) on Sunday July 07, 2013 @09:54AM (#44209135)

      Leave it to the NY Times to pen something so illiterate: "no one will know what a book's "real" price is. Price will be determined by demand and perhaps by whim."

      The "real price" of something is exactly determined by each transaction where it is sold. This is the realest price you can get. A MSRP printed on the book is not "real".

      • by Grishnakh (216268)

        A MSRP printed on the book is not "real".

        Wrong: go to any Barnes & Noble store, and buy a book. Look at the MSRP on the book, and compare that to the price you paid at the register. They're the same.

        See, for traditional brick-and-mortar booksellers like B&N, the MSRP has long been the "real price". They just charge whatever the publisher writes on there. Amazon was the first large place to change that, and the b&m sellers are sitting around wondering why people don't buy books there any mor

        • by fche (36607)

          "Look at the MSRP on the book, and compare that to the price you paid at the register. They're the same."

          That merely happens to make them equal in those circumstances. They are not definitionally the same.

  • one word ... (Score:5, Insightful)

    by meekg (30651) on Sunday July 07, 2013 @02:24AM (#44207569) Homepage

    ... Selection.

    Amazon beats any bookstore at finding older books.
    Brick and mortar stores are all about displaying 20 copies of the latest shit best-seller, sitting side by side, on the front shelves. No thanks.

    • Re: (Score:2, Insightful)

      by tepples (727027)
      Things you can get from a brick-and-mortar bookstore but not from Amazon include near-universal "Look Inside" and same day delivery.
      • Re:one word ... (Score:5, Insightful)

        by AuMatar (183847) on Sunday July 07, 2013 @02:36AM (#44207609)

        Unless you have a kindle, in which case you have same day delivery. And with prime you can borrow a lot of books for free.

        • I have a Kindle, you insensitive clod...

          I can tell you that there are a hell of a lot of titles that are not available as eBooks - especially older ones. Not to mention that you haven't lived until you find a few where the Kindle version costs more than the paper edition. I mean WTF?

          I hate Amazon. I just hate them less than everyone else. Which appears to be the new standard in business success metrics.

      • by ranton (36917)

        I generally buy non-fiction books; usually to learn something new or get a new viewpoint on a topic I am already familiar with. In both cases I find that online reviews are far more helpful than thumbing through a book at the book store. If I don't know much about the topic, how will I know the quality of the book's contents? And if I am looking for a new viewpoint, I am unlikely to give the book an honest chance with a short skim. Online reviews and short snippets that I find with Amazon's "Look Inside" ar

    • Re:one word ... (Score:5, Informative)

      by Anonymous Coward on Sunday July 07, 2013 @02:28AM (#44207589)

      If you want old books, Project Gutenberg [gutenberg.org] might be worth your time.

    • by ozydingo (922211)
      I don't think I'd have a problem with the book stores you're describing succumbing to their obsolescence. I'd really like the book store I go to, however, to stay in business, as I do enjoy browsing the selection they offer. Just pointing out the diversity of options as far as such stores go, I'm sure you already realize the fallacy of generalizing so broadly.
  • by Citizen of Earth (569446) on Sunday July 07, 2013 @02:25AM (#44207575)
    ... for the buggywhip makers.
    • by Anonymous Coward
    • by mrmeval (662166) <mrmeval@NOSPam.gmail.com> on Sunday July 07, 2013 @03:03AM (#44207697) Journal

      Slashdot spewing nytimes paid pablum? Will pro-government shills be next?

    • by rolfwind (528248)

      Well, I can at least buy a car from many different manufacturers, from a variety of dealerships, and resell the damn thing if I feel like it.

      These electronic books, I'm lost. What do I own? Where's the the secondhand market? If I want to buy the 16 year old book, Harry Potter and the Sorceror's Stone, a secondhand paperback from amazon is $0.01 plus shipping (media mail should be cheap). If I want to buy it on a kindle, $8.

      So, what exactly is the consumer winning beyond some bookshelf space?

      • by thoth (7907)

        These electronic books, I'm lost. What do I own? Where's the the secondhand market? If I want to buy the 16 year old book, Harry Potter and the Sorceror's Stone, a secondhand paperback from amazon is $0.01 plus shipping (media mail should be cheap).

        Man this is hilarious! In the same paragraph you complain about there not being a secondhand market for ebooks, you also point out 16 year old physical books are $0.01. Um, that's not a secondhand market either, at those prices (or for the amount of value the physical retains over the years), a whopping penny, you are better off recycling them. If you literally get rid of a physical book immediately after reading it, you'd be better off using a library.

  • by Anonymous Coward

    What use is a physical book store when I do not want to buy physical books?

    And it's not just physical books and bookstores. I have no local computer shop that carries even 0.01% of the inventory that Amazon and Newegg possess, and the stuff they do have is just purchased from Amazon or Newegg and marked up 30%.

    Amazon is just better than shopping locally. Better in terms of selection, price, and availability. Best of all I don't even have to leave my house. Books are delivered instantly to my Kindle and ther

    • by Anonymous Coward on Sunday July 07, 2013 @04:15AM (#44207819)

      Brick and mortar stores are doing just fine killing themselves on the electronics front.

      Just a couple weeks ago i wanted a usb cable. Nothing fancy... a to b. 3 foot.

      I wanted it now. So i hit all the stores as i was out that day. they either didn't have it. or in the case of staples... it was $34. thirty four fucking dollars for a 3 foot piece of cable. (not even a monster cable)

      After a loud 'FUCK THAT'. I went and got it from newegg. took 2 days total. price. $3 Thats even with state sales tax since newegg has a place in my state.
      And places like staples are actually wondering why nobody goes there anymore... they really can't figure it out.

      Fail on price? Check. Fail on stock? Check. Fail on service? Check. Fail on convience? Check.

      If these phsyical stores wan't to stay open. They're going to have to step up to the plate in a big way on one of those points... But so far... nope. nobody has.

      And bookstores are the same. Plus they get to compete with ebooks too. Can i bring my reader to their store and walk out with an ebook loaded? Nope. Fail.

      • Re: (Score:3, Interesting)

        by SiliconSeraph (996818)
        I've worked at a electronics store that shall not be named in my more formative years. The employee price on USB cable was 10% above cost, so about a buck. The cost to customers? Literally $15-20 per cable. And that, by the industry standard, was relatively reasonable. It was an up sell item on computer systems.
        • by GrumpySteen (1250194) on Sunday July 07, 2013 @09:42AM (#44209057)

          It was an up sell item on computer systems.

          This is the real reason for the ridiculous pricing of cables. Stores don't sell a lot of cables and customers who are only buying a cable are rare, so competing on cable pricing doesn't make any sense.

          They jack up the prices on cables because they know that they can often sell them to customers who are buying computers, televisions or other expensive products that the store does have to compete on pricing with. The profit margin on the expensive item will be fairly low, so they want a variety of high profit margin add-ons like cables and extended warranties that they can push the customer to buy.

      • by stinerman (812158)

        Same here.

        The dog chewed a laptop cable. It was cheaper to have Amazon overnight a new one than it was to buy it at the local Best Buy. $20 cheaper. The brick & mortar stores that deal in electronics thrive on the folks who simply don't have enough information to make an informed decision. As soon as they get wise, they order online.

  • Breaking news (Score:5, Interesting)

    by WWJohnBrowningDo (2792397) on Sunday July 07, 2013 @02:32AM (#44207595)

    Economists, publishers, and readers no longer have confidence that a book will cost the same amount this week as it did the last.

    Breaking news: prices of goods change based on supply and demand. Film at 11.

    • Film at 11.

      Well, you got that part right.

      (Please don't go on about supply and demand at us, when the supply is effectively infinite.)

  • by phantomfive (622387) on Sunday July 07, 2013 @02:37AM (#44207613) Journal
    I read the summary three times, but I'm still not sure how it relates to reality. For example, this sentence:

    'One consequence of this shift is that soon no one will know what a book's "real" price is. Price will be determined by demand and perhaps by whim.

    How is that a consequence? Haven't books always been priced based on demand and whim? They don't think the price of a $200 textbook is primarily in the print materials, do they?

    • I read the summary three times, but I'm still not sure how it relates to reality.

      Sadly, neither the summary or the article makes the situation clear.

      How is that a consequence? Haven't books always been priced based on demand and whim? They don't think the price of a $200 textbook is primarily in the print materials, do they?

      No, in print books have pretty much never been priced on demand or whim. For an individual book, the price remains the same for all customers at a brick and mortar store. Amazo

      • by stenvar (2789879)

        You know, there are other online bookstores besides Amazon. If the price differences matter to you, shop there.

      • Re: (Score:3, Informative)

        by perryizgr8 (1370173)

        and this sort of personalized pricing is not happening on amazon. it might start happening some time in the future, but right now everybody sees the same price for an item. they may increase or decrease the price suddenly/rapidly, but the change applies to everyone.

    • Re: (Score:2, Interesting)

      by stenvar (2789879)

      Prices of books have in many places been set by price controls and monopolistic practices. Of course, the consequences have been a massive government handout for publishers and making books less available to people who weren't rich. This is particularly true in Europe. Even in a monopoly, prices are set by demand, but they are generally set much higher than in a competitive market.

      It's nice to see this system undermined by technology and progress. There is now hope that the cozy and corrupt relationship bet

    • by AmiMoJo (196126) *

      What TFS means is that books will be priced differently for each individual. If the online shop thinks you will pay more then me for a given book they will try to charge you extra, something that physical shops can't do.

      Amazon isn't the only company that does it. I remember a few years back there was a story about iPhone users being charged more by certain websites.

      • by Rich0 (548339) on Sunday July 07, 2013 @08:28AM (#44208633) Homepage

        What TFS means is that books will be priced differently for each individual. If the online shop thinks you will pay more then me for a given book they will try to charge you extra, something that physical shops can't do.

        This is something physical shops have been doing for AGES, though not as much recently with commodity items.

        What's the price of that new car? Sure, ANYBODY can get it for the sticker price, if they're insane. Everybody can also get it for less, and just how much less depends on their negotiating skills and those of the salesman. If you look desperate, expect to pay more.

        The same is true in the US medical industry. Look desperate, and you can expect to pay more (don't worry, I'll give you a "discount" since you're paying cash...). I love it when people talk about how much they save by not having insurance, as if the insurance companies pay list price (healthcare list prices are almost as inflated as RIAA math).

        The only real difference with something like Amazon is the level of automation - they can give you an experience that looks like Walmart, but in reality is more like Jimmy's Used Cars.

  • The marginal cost of 'manufacturing' and hence the long term price for any piece of information is $0.

  • by Anonymous Coward

    A Financial Times photographer visits an Amazon fulfillment center in England. [fastcodesign.com] This is what your one-click purchases are doing to people.

  • I thought the whole point was that when books are in demand, prices increase, and as things fall out of favour, price decreases? Why should a book that few people want cost as much next week as it did this week? Compete, make a book people want to read, people will pay for it.
    • The problem they are discussing, as pointed out by other people, is that when you look up a book on Amazon that is related to books you have already purchased, it is priced higher than when someone who has never purchased books related to that subject or genre looks it up (even if both of you look for the book at the same time).
  • by stenvar (2789879) on Sunday July 07, 2013 @02:53AM (#44207669)

    One consequence of this shift is that soon no one will know what a book’s “real” price is. Price will be determined by demand and perhaps by whim.

    Price is supposed to be set by demand. And if it is set wrong on a whim, people don't buy it.

    “Discounting, and especially inconsistent or shifting discounting, really messes with a publisher’s ability to price a book fairly and accurately to its cost,” he added.

    If by "fairly" you mean that bloated, overpriced, arrogant publishing houses with excessive internal costs can't force their customers to pay inflated prices anymore, then yes, they can't price "fairly" anymore.

    As far as I'm concerned, the revolution in the book market isn't done until every single big 20th century publisher is out of businesses, and most authors sell and market their books themselves through convenient and inexpensive online services.

    • I think the point of the article is about: Do people want the changes that are happening to the main street to continue?

      From a purely consumer standpoint, sure, cheaper is better. And as long as there's no development of monopolies or other devious practices, that's fine for consumers.

      But. Stores closing down in your town leads to decrepit town centres; decaying cities aren't nice and have other, unpleasant consequences. Massive corporate tax avoidance (partly why Amazon has such great prices in the UK?)

      • by stenvar (2789879)

        Stores closing down doesn't lead to "decrepit town centres", it leads to new stores moving into the now free stores: coffee shops, maker spaces, skateboard vendors, who knows. That's a good thing.

        And if there really were no demand or need for "town centres" other than to keep obsolete businesses there, then we should demolish them and get rid of them. Why should people who have no need of "town centres" continue to pay high taxes to maintain them? And make no mistake: high density living is expensive once y

    • As far as I'm concerned, the revolution in the book market isn't done until every single big 20th century publisher is out of businesses, and most authors sell and market their books themselves through convenient and inexpensive online services.

      ...and it's impossible to know if a "book" is total shite, hyped by phony reviews. The cost of a book will be not an hour's wage, but multiple hours trial and error.

      Yeah, can't wait.

  • One consequence of this shift is that soon no one will know what a book's "real" price is. Price will be determined by demand ...

    That is the "real" price. Basic economics [answers.com]. Any other price than one set by demand is artificial (as in "price-fixing"). If prices are dropping due to the advent of Amazon, there are a number of possible causes: Decreasing marginal cost of creating each book (especially since the marginal cost of an e-book is probably less than a few millionths of a cent), supply increasing faster

  • "Economists, publishers, and readers no longer have confidence that a book will cost the same amount this week as it did the last."

    Not sure I see the problem here. Books are like any other good. They're "true" market value is only as high as the target market is willing to pay. This is going to shift frequently. Sometimes up, sometimes down. Quality and available will play the same role with books, as with anything else.

  • The other amazing thing in this is Amazon is not very profitable. They have been reporting losses, not gain.

    When expenses exceed income, shareholders have a loss negative earnings per share

    Amazon has been declining, and yet the analysts have awarded them this amazingly high valuation, as if they were the next Microsoft or the next Walmart.

    Guess what though... revenue doesn't mean squat, if your expenses are higher than what you make, and you therefore aren't able to convert that revenue

    • by loufoque (1400831)

      Being profitable means spending money on taxes. It's more interesting to put spend on the extra money on R&D.

      • by mysidia (191772)

        That's not what the trend in their financials shows is happening though. Cash from operating activities has been decreasing, free cash flow declined dramatically over the past year, they are borrowing an enormous amount of money -- getting more and more money by taking out more and more debt.

        And they wind up with a negative EPS and declining margins, which essentially means that they are moving towards a trend of destroying shareholder value.

        They are not dying, but the picture shows essentially

  • Wait a minute (Score:5, Insightful)

    by 93 Escort Wagon (326346) on Sunday July 07, 2013 @03:52AM (#44207777)

    Let me get this straight. Based on the "struggle" and "disappear" links in the summary, I guess we're supposed to feel sorry for Barnes & Noble as well as Borders. Is that correct?

    It wasn't all that long ago people lamented how these mega-stores - specifically Barnes & Noble and Borders - were killing all the little independent book shops. Their response was they delivered what the consumer wanted at lower prices. Well, it looks like the shoe is on the other foot now! I actually felt bad about the independent book sellers (a few of whom have managed to adapt and do good business)... but not these guys. If they can't compete in the modern marketplace, that's their problem.

  • I live in Finland, where Amazon does not have a "local" presence and I've sometimes ordered stuff from UK, Germany and US Amazon. You'd think that international shipping would kill the idea, but you would be very mistaken regarding how bad the local retailers (and sometimes even local online stores) are.

    I recently purchased a Mac Mini and wanted a DP-miniDP cable to connect it to my monitor. I looked the cable up in various finnish retail and online stores. Not a single retail store I visited had it, not ev

  • If you are talking about the content, i.e, the information in a book, there has NEVER been a 'real cost of the book'. It has always been, like for any information resource, dictated by how valuable the information is to a certain set of people. What value a publisher sells the book is determined by the highest price the publisher think he can sell the book at. A little thing called the 'free market' principle that seems to be lost on TFA.

    If you are talking about the physical object (paper, binding etc.) , y

  • A Kindle book is a rental that you pay buyer prices for. In many cases, Kindle books are more expensive than paper books, sometimes ridiculously so. Yet, you cannot do any of the things with a Kindle book than you can with a regular book: you cannot lend to as many people as you'd like; you cannot keep a personal backup copy; you cannot resell it; you cannot read it on anything other than a Kindle.

    The story for Amazon MP3s is nearly as bad, with one saving grace: they give you a physical copy of the file,

    • you cannot lend to as many people as you'd like

      How often do you actually do that?

      you cannot keep a personal backup copy

      But someone else does that for you. And with Calibre, you can do it yourself.

      you cannot resell it

      But you usually get it for less than the cost of the physical book, so you already took the price break of selling it later, up front.

      you cannot read it on anything other than a Kindle.

      Except a phone or a tablet or a computer.

      And here are some things you can do with a Kindle eBook that you can't do with a physical book:

      Own 4700 of them without taking up any shelf space or having to move heavy boxes.
      Take 4700 of them with you on vacation.
      Carry 4700

  • I worked as a book store manager in the early to mid 90s. I handled ordering, read heavily in industry and business news, and had friends all over our large city in the book trade, as well as friends and relatives in publishing, From that experience I can tell you this: most everyone back then saw the writing on the wall when Barnes & Noble and such came into being. They were Amazon before Amazon. These companies were getting better prices for books than small chains and independent sellers. We simply c
  • Defending tuf (Score:5, Insightful)

    by Tony Isaac (1301187) on Sunday July 07, 2013 @10:34AM (#44209331) Homepage

    There is no "real" price. Prices are determined by what sellers can get for a product, and what people will pay.

    This isn't even about "real" prices. The big publishing houses have for years inflated prices because they could. Now an upstart comes along and starts to eat into their profits, and the old school publishers aren't happy about it. Of course not!

    The book publishing industry is now following the same path that the music industry started following when iTunes disrupted their little racket back in 2001. The book industry has been ripe for change for years. It's nice to see it finally happening. Now if we could just see the same thing start happening to textbooks!

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