The Changing Face of Consumerism XII: Applied Economics and the Kindle Generation

Sometimes it’s better just to keep your mouth shut. I know this. I may be opinionated, but there’s a time and a place to express those opinions. More often than not, 9:05am in the office is neither the time nor the place. But sometimes I just can’t help myself.

It was just another day at the office, same as any other. I was trying to do something productive, because despite my abhorrence of ‘the system’ and working for ‘the man’, I appreciate that I’m being paid (albeit not nearly enough) not only for my time, but to use that time fruitfully (when IT permit) and besides, I’m one of those people who prefers to actually make busy rather than feign being busy. Perhaps I’d feel differently if I felt any affinity with the goons who occupy the desks within conversationable proximity to mine, but endless drivel about ‘Corro’ and ‘I’m a Celebrity’ fills me with a compulsion to burrow myself into a small dark corner, meaning that more often than not, I’ll bung a CD in the player or find an album on-line to stream, plug my phones in and create my own virtual cocoon in which to work. But sometimes I find it’s impossible to shut out the babble, and equally impossible to keep my trap shut.

Such was the scenario the other day. Three or four people seated behind me had been discussing books. Books I wasn’t bothered about. By which I mean, I’m not big on thrillers, and am wholly indifferent to the works of multi-million selling thriller author James Patterson. I was able to let the debate over whether or not his name was Patterson or Pattinson drift by, although I was pleased when one of the debaters thought to look him up on-line, and was also thus able to confirm the title of one of his books, courtesy of Amazon.

And so the subject moved to the topic of the Kindle.

“I love having my Kindle,” pronounced the middle-aged woman in the centre of the conversation, who’d been recounting how she’d hooked her husband on a certain author’s books by buying him one once. “But Kindle books are so expensive!”

“I know, I’d have thought they’d have been about a quid or something,” replied the colleague to her left, a tubby guy with a beard and spectacles in his mid to late twenties.

It’s a common complaint. If you read reader reviews of books on Amazon, there’ll invariably be a number harping on about the price of the Kindle edition – especially with new publications – to the extent that some titles attract dozens of one-star reviews without a single mention of the writing, the plot, the characters or any other aspect of thee contents of the book itself. Many of the reviewers aren’t even in a position to comment on the book, having posted their review in a fit of pique at the rip-off price being asked for the text with remarks like ‘I refused to buy it at that price’ and ‘I’ve ordered the paperback instead, but will have to wait several days for it to arrive in the post. And I’ve had to pay shipping on top!’

In today’s culture of immediacy and instant gratification, no-one wants to wait. And no-one wants clutter, either, hence the popularity of the Kindle. As the people behind me noted, it’s possible to store several hundred books, which would otherwise require many feet of shelves, on a single, portable device. But no-one seems to think it reasonable that they should pay for this convenience: they want it now, and they want it cheap, or better still, for free. But of course, that isn’t how capitalism works. Exploitation may be a significant feature of consumerism, with both consumer and producer being exploited for the benefit of the capitalists who hold the real power, but there has to be as degree of give and take, and if there’s no profit to be made from a end product, there’s simply no point in producing it, however useful it may be. But by the same token, the more useful or desirable a commodity, the higher its value in the marketplace. Whether that value is real or perceived is largely down to supply and demand, the market and marketing. It appears the perceived value of an e-book is comparatively low.

And so they whinged on in this fashion for a couple of minutes or so, bemoaning the fact that Kindle e-books are overpriced considering the fact there are no production costs involved.

As someone who has experience of publishing, both as an author and a publisher – albeit on a small scale – I felt qualified to wade in on this debate. Not that these individuals would have been aware of this: I tend to keep myself to myself, and not to talk about my writing or publishing activity in the workplace. Nevertheless, on this occasion, I found it impossible to let it go, and the fact my involvement in the publishing industry is on a small scale means it’s something that’s particularly close to my heart: it’s something that’s real and tangible, whereas with large-scale publishing – as with any large organisation – the realities become more abstracted as the process becomes increasingly distant. As with the music industry, Joe Public only conceives of the colossus: the multi-billion dollar international labels and the major-name chart acts. It’s understandable, of course, but the big names – and the big money associated with them – only account for a fraction of the whole. The common misconception is that everyone who has a book published is coining it in, because they hear about the immense earnings of the likes of J. K. Rowling and E. L. James. The majority of people don’t seem to realise that there are countless books that aren’t on the bestseller list, that aren’t published by Penguin or Bloomsbury. These are the people who buy one or two books a year, or possibly three when they raided a 3-for-2 offer at Waterstones or WHS or maybe their local supermarket. These are the people who, in the days before Kindle, would make sure the one, two or three books they purchased were at least 400 pages long because a 400-page book represents better value for money than a 250-page book that costs roughly the same. They’re the people who read series books because they know the characters and are comfortable with them, but are reluctant to try anything else because they don’t know what to expect: they might not like it. Better to play safe and go with what you know than risk disappointment and wasting money.

I don’t actually believe that all artists (by which I mean musicians writers, film-makers, dancers, whatever) should be able to make a living from what they do, even if such a scenario was feasible. There simply isn’t room for every artist, aspiring or otherwise, to achieve such widespread recognition as to sustain a living wage from their work, and there are many who simply aren’t worthy or, to be blunt, good enough. But I do believe that all artists should be fairly paid for what they do, just as any other form of labour should receive reasonable recompense.

If Kindle e-books really did all cost in the region of £1, you can guarantee that the ones who would see the biggest reduction in their cut of the profit (and there’s scant profit to be made on anything costing a pound) would be the writers. It hardly seems fair that the person responsible for the creation of the product should be paid less because some consumers choose to purchase a different format. The end product may be different, but the input itself remains the same. Would an office worker – the likes of the individuals idling away large portions of their working days debating the ways in which they spend their disposable income and leisure time – consider it acceptable to be paid less for dealing with emails instead of printed letters? Of course not: in fact, I suspect the opposite would be true, and that they would probably consider it reasonable to expect to be paid more, because the reduced overheads associated with e-comms over conventional paper and envelope snail-mail would logically enhance company profits – why shouldn’t they benefit? And this made for the starting point of my interjection into the conversation.

“The writers have still got to be paid,” I began. “On a paperback, they get pence in royalties…”

Naturally, the precise amount varies between books, publishers and authors, and the range is immense, and the actual royalty will depend on whether or not the book sells at its RRP or at a discounted price. But, for simplicity’s sake, it’s not unreasonable to work on the basis of the author’s royalty for a paperback being it’s around the 8% (although anywhere between 5% and 10% would be considered ‘average’), for hardback around 12%, and for e-books in the region of 20%. If a paperback retails at £7.99, you’re looking at 63p per copy going to the author (before tax). It takes a many multiples of 63p to equal a living wage. Given that it’s reported that 95% of all books published achieve sales of 100 or fewer, you can hardly consider writing a surefire route to riches, and when you also take into account the number of hours it takes to write a novel…

“Of course the writer’s have got to be paid,” agreed the woman, peering over her reading glasses. “But there’s no printing cost with a book on Kindle…”

I realised I needed to keep it brief and simple. And so I elected to pass on the details of the debate, hoping against hope that my sowing the seed may at least give them a prompt that would set these everyday consumers on a track of consideration.

I decided not to explain that obviously, the bigger the publisher, the more people are involved in the process. But against that, higher volumes of sales mean it’s easier to reduce unit costs… although it usually takes a bigger marketing budget to achieve those sales volumes. I also let pass the idea of there being a correspondence between market forces and cost in capitalist culture, namely that there’s a clear logic to charging the most people are willing to pay for a commodity. If a significant portion of any given target market are willing to pay, say, £10 for something, but consider £15 too expensive, why would anyone in the business of business, i.e. making a profit, charge only £5 for it?

The fact she’d already told her colleagues, “I buy loads more now I’ve got my Kindle. I keep finding stuff and thinking ‘What’s that?’” was evidence enough that however unreasonable she considers the price of e-books, the cost isn’t high enough to be prohibitive – and so the equation of balancing cost against demand and convenience works. This woman clearly isn’t alone, and as much as anything, I suspect the convenience is the real key here. The Kindle appeals to the demand everything, demand it yesterday if not sooner consumer society we live in and that the Internet has facilitated. Our needs haven’t changed all that radically, but our expectations have. Consequently, our demands have changed in line with those expectations. This then becomes a self-propagating cycle, and like a junky who experiences diminishing returns with every hit as their habit becomes more complete, so the consumer appetite grows evermore insatiable, needing more and faster. Yet each time the demand is met, so expectations grow, and as those expectations come to be met, so demand grows.

“That’s true,” I countered, “but the print cost actually only accounts for some of the actual cost of publishing a book. With an e-book, you’ve still got the bulk of the other costs involved in the publication process, like paying proof readers, like cover art, promotion… and you have to reformat a text for Kindle. Plus you’re paying for the convenience of the format, of having it instantly. Besides, given how little authors do earn on each book sold, if there is scope for paying a bit more, then that can only be a good thing.”

The woman looked at me boredly, then replied, “Yes, I know and understand all that, but I still would have thought they’d be cheaper. You know, like around a pound or so.”



A Kindle. Publish a book formatted for this, charge over the odds and make a mint. It works for me! Pass the Bolly, will you?