Book Industry to join Music/News Chorus of Woe in 2010

SAI notes that more Kindle e-Books were sold on Amazon on Xmas day than real books:

On Christmas, the company sold more Kindle books than physical books.

Yes, this is obviously the result of everyone who got a Kindle for Christmas (lots of folks) firing it up and ordering a bunch of eBooks on a day in which most physical-book readers weren't shopping. But it's still important and impressive.

The Kindle's economics are still lousy for Amazon: The company loses money on new releases and makes only a modest amount on older titles, thus losing an estimated $1 per Kindle book.

Actually, whats more amazing is that punters will pay those prices for them, but, to paraphrase PT Barnum, there's an early adopter born every minute.... The bit I find amusing though is that the economics of an e-Book are lousy for Amazon - following the above link leads to this analysis:

Amazon accounts for about half of US e-reader sales currently and is losing money selling e-books. Here is how:

- Book publishers are standing their ground on wholesales prices – selling books at about $12 to distributors regardless of if it is a print copy or digital copy.
- Amazon sells them for $9.99, losing about $2 per sale.

Clearly companies like Amazon have to start selling e-books at print retail prices or book publishers will have to lower their wholesale prices. We think it will be the latter.

Given that, like CD's and Newsprint, a large % of the cost of a paper book is physical production and distribution, its amazing that publishers have managed to keep those prices up.

Like CD's and Newsprint, this is not sustainable longer term however, there is a limit to the suck...er, I mean early adopters. Not only that, but publishers already de-risk book sales by the remaindering system (unsold books are not charged for and are sent back at publishers' expense) and Amazon de-risks physical delivery by making the user pay extra.

I suspect in a year or so we will hear the loud wails of book publishers joining the music and news choir's refrain that the Internet is ruining their livelihood, when its clear that a lot of the reasons are self-inflicted. But its not as if they haven't had ample warning, after all music publishing hit this issuel in about 2005.