The Grand Conversation on ebooks: Keith Stevenson

Keith Stevenson is the publisher at coeur de lion publishing, producer/ presenter of the Terra Incognita Speculative Fiction podcast, and a (very slow) speculative fiction writer. As a publisher, he’s responsible for critically-acclaimed efforts such as the novellanthology X6, Terry Dowling’s Rynemonn, and C0ck. He served for a few years as editor of Aurealis, the magazine of Aussie SF, and he is the current judging coordinator for the Aurealis Awards.

Keith is also a pretty switched-on guy,  he knows the ins and outs of Australian publishing like the back of his hand, and he intends to dabble with ebooks later this year. This is his take on the vagaries of ebook pricing Down Under:

“Do you know what you’re paying for, and are you happy about that?”

Books are very cool. Ebooks are cool, too, but they are not pbooks (a term I’ll use from now on to differentiate ebooks from books made out of dead trees). Ebooks are very different from pbooks and that difference goes a lot deeper than some people realise. And you can pay quite different prices for the various formats. This is such a new market, no-one’s really nailed down what value to attach to what format and how that value should be reflected in the cost to the consumer. Authors, publishers, and retailers all have their own ideas, and it’s a topic I want to look at a little deeper. So what are the options for you in 2011 if you want to read a book?

You can buy a pbook, which you can read anywhere, although if it’s big, it might be a pain to carry around. You can lend it to a friend, sell it on ebay, sell or swap it at a second hand bookstore, it looks nice on your bookshelf, and it can be useful for propping up that wobbly desk leg.

Or you can buy an ebook. It’s available in a variety of flavours (file formats), some of which are easier to read on more than one device than others. Ebooks can come with or without Digital Rights Management (DRM), which is anti-copying software. You’ll find ebooks you buy from small publishers or direct from authors probably won’t have DRM, firstly because that technology is quite expensive and small presses can’t afford it, but also because, in quite a number of cases, the small press or author doesn’t support the philosophy of DRM (but that’s a whole other conversation). The ebooks with DRM mean that you don’t actually buy the ebook, you buy a license to read the ebook on a particular device or devices. That means you can’t lend it to a friend (although Kindle and others are implementing a limited kind of ebook lending), and you can’t sell it. Ebooks don’t look good on the bookshelf and I’d advise against using your ereader to prop up shaky furniture. Of course, if you are at all computer savvy, you will be able to work out how to strip the DRM-ware off the book file so you can lend, copy, and otherwise propagate it any way you like. This is, of course, illegal.

Now emerging is the webbook, which is another digital reading experience altogether. In Australia, this format has been pioneered by the website, who have teamed up with Readings to make a webbook store. With webbooks, there’s no file to download. You can only read a webbook on a web-enabled device. If your ereader doesn’t have wifi, you’re stuffed. What you’re buying isn’t a book or a license to read – it’s permission to view the book on a webpage. If the website is down, you’re in a wifi blackspot, or the company goes out of business, your book is gone. This is probably the most tenuous sort of ownership you could possibly imagine in the book-buying arena.

I’ve done a bit of research into what these different types of reading will cost to see if there’s a cost/ value correlation.

Example 1
For this example I chose the Swedish author John Ajvide Lindqvist’s debut horror novel Let the Right One In, which was made into a Swedish movie of the same name and a successful Hollywood adaptation called Let Me In.

I can buy this pbook post free from the Book Depository for AU$13.41. Or if I want to buy closer to home, the pbook costs AU$23.95 ($17.95 + $6 postage) from Angus and Robertson.

If I was in America, or had a Kindle that was registered in America, I could get this as a Kindle ebook file for AU$10.06. I could read it on my Kindle or any other device I have that runs the Kindle app, which currently includes iPad, iPod touch, iPhone, Mac, PC, BlackBerry, and Android-based devices. If the publisher has ‘switched on’ the loan button, I could loan it to a friend’s Kindle for two weeks. I wouldn’t be able to read it on any device that didn’t run the Kindle app or read Kindle files.

Due to territorial copyright, I can’t buy the US Kindle file, but I can still buy the ebook file locally (e.g. through the Borders website). This will cost me AU$19.95. Borders has a deal with Kobo, so you can read the file on your Kobo ereader, as well as on your desktop or smartphone using the Kobo app. It’s probably DRMed, so I wouldn’t be able to read it on, for example, a Kindle because I wouldn’t be able to convert it to the Kindle format unless I did something illegal.

I can buy it in ‘webbook’ format on Again, this costs me AU$19.95. I can only read it on web-enabled devices (such as a later generation ereader, iPad, iPod touch, iPhone, Mac, PC, BlackBerry and Android-based devices). I can’t lend it to a friend. It’s also important to note that this type of book probably has the highest type of DRM: because there is no ‘file’, there’s no way to hack it.

This example shows me that there doesn’t seem to be an easy correlation between the type of reading experience you choose (pbook, ebook, or webbook), the constraints that choice imposes on your reading experience, and the price you pay for it. I deliberately chose Let The Right One In because it was one of the few webbooks available on the new site that I could compare across the board. So let’s take out of the equation for the next example.

Example 2
Still sticking with Sweden, I chose the mega-bestseller The Girl With The Dragon Tattoo by Stieg Larsson.

The pbook costs AU$13.41 from the Book Depository, or if you want to buy Australian, you can get it at Big W for AU$15.48. The Kindle edition is AU$5.20 (Kindle azw file). The Borders edition is AU$8.95 (epub file).

I think you’ll agree the Kindle edition is dirt cheap – and probably says a lot about Amazon’s deep discounting and volume sales. But at least there’s a general correlation that ebooks are cheaper than pbooks. However, it’s not clear how publishers or retailers are arriving at the prices they charge.

I don’t work for a major publisher, so I don’t know how their retail and wholesale prices are structured, but it might help our investigations to look at a few actual figures from my publishing company coeur de lion to view the problem from the other end.

X6 retails for AU$34.95. I give the retailer a 60% discount on the ex-GST price (this is fairly standard although bigger chains demand deeper discounts). That means I get a total of AU$19.06 for each book. From that, I have to pay something to the authors. We don’t have a royalty deal, just a fee, which amounts to $8.50 per book. Printing costs $7.70 per book, and postage will add another $2. That leaves me with a ‘profit’ of $1 a book, and I haven’t even counted my time in editing, promoting, selling etc. Lucky we’re not in it for the money! Of course, I get certain tax concessions due to running a business, and I make more on the sale of each book at a convention or via the website, so it’s not all doom and gloom.

But if X6 was an ebook, I wouldn’t have any printing or postage costs. And by the look of things at the moment, I’d be free to fix my price at whatever I think the market will bear, but – as we’ve seen – that market isn’t very consistent. I don’t want to rip customers off, but I don’t want to rip myself or the authors off either. So the big question for me – and for you, the consumer – is: how much would you be willing to pay for an X6 ebook that would represent ‘value for money’? You’ve seen the differing prices in the examples. I know other publishers have bigger overheads than me, but they also have economies of scale. Is there a correlation between what the pbook, ebook, or webbook cost them to produce and what they are charging for it? And apart from production costs, what else do you think you should be paying for? What else enters into the cost/ value equation for the consumer?

Do you think a file with DRM should have an ‘inconvenience’ discount? Should a webbook be even cheaper in that light? Do you think ebooks should cost the same as pbooks? Do you want to pay more to buy Australian? If you knew how much the author was getting would that make a difference? When is the price too much?

Right now, the publishers and retailers are setting the price for these different formats, and they can’t agree. Some seem really overpriced to me when compared to other formats. There will always be opportunists in any market, of course, but with the internet, consumers have the best chance ever of using their buying power to regularise the market and set a price on things that reflect the value they believe those things possess. So I – and probably every other ebook producer/ seller – want to know: what do you value in the various formats and how does that translate to a ‘fair’ price?

Update: As I write this, it looks like ebook pricing practices in the UK are coming under the spotlight bigtime with a formal investigation being launched by the Office of Fair Trading.

Keith Stevenson’s ‘pbooks’ are available from coeur de lion publishing. Keith’s latest is X6, and he is soon to release the space opera anthology Anywhere But Earth.

If you prefer audio stories, you can listen to them at Keith’s podcast Terra Incognita Speculative Fiction.

The Grand Conversation on ebooks will run here at until February 28. If you’d like to contribute a guest blog post, email me at



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  3. Elfwreck says:

    Wow, you’re the first publisher I’ve ever seen who’s willing to say that print+distribution costs more than 15-20% of the paper list price. (The verbal gymnastics that usually follow, to explain why ebooks should cost as much or more than paperbacks once those are available, are always fascinating.)

    For me, the important features of a book include my ability to share it with friends; if I can’t do that, my top price point is much lower. And because of the almost nonexistent marginal cost of ebooks, I’m willing to insist on lower prices, with the assumption that the publisher can make profit by selling enough volume. Currently, my max price for fiction ebooks is US$6, and I won’t buy anything with DRM. (I won’t even deal with free DRM’d ebooks; I read on different platforms & devices and I’m not willing to deal with the hassle.)

    That means, of course, that I skip over a lot of popular books. But there’s so much available–Baen’s science fiction,, the carefully-formatted public domain texts at Mobileread, and the endless unsorted mass at Smashwords–I never run out of books to read.

  4. Nancy Beck says:

    Interesting post. I found the link for it off of Coeur de Lion Publshing and through a blogger friend prior to that.

    Anyway, I live in the States, and I’ve been following the whole indie publishing/ebook thing with a lot of interest.

    One question I would ask in the ebooks you chose: Was there a reason why you didn’t pick an indie pubber, such as M. P. Mallory? I don’t know, maybe such indie stuff hasn’t taken hold in Australia in a big way (at least not yet)?

    As for DRM, the consensus I get from reading various websites and blogs is that DRM is a bad idea. Yes, there’s piracy, but there always will be those people who will try to do that sort of stuff (not that I’m in favor of it, BTW, because I’m not). But what DRM does, IMHO, is it penalizes honest people who wouldn’t ever think to pirate ebooks (or wouldn’t know how anyway).

    If you can, take a look through some of the more unknown authors out there. You might be presently surprised. (Besides, you can sample before buying.) Most are offering their novels/novellas/shorts for between US 99 cents and US 2.99 (don’t know what the exchange rate is), but they’re pretty cheap. I’ve picked up two ebooks from unknowns and will probably get more.

    FYI, before I close out this long-winded post ;-), I think ebooks should cost less than pbooks because costs are less. IMHO, the only reason ebooks from major publishers cost more is because, well, they have costs that most self pubbers don’t have, such as rents (NYC ain’t cheap, heh), employee salaries, etc., so they feel they have to charge waaaaaay more.

    For more interesting reading on this, consider J. A. Konrath’s blogJ.A. Konrath’s blog and Dean Wesley Smith website for further discussions on the indie scene.

  5. […] friend has passed on a post from an Australian publisher which does a different breakdown on the numbers, with higher publishing costs – however, I […]