Publishers of a printed textbook in your student’s backpack are getting A MILLION TIMES MORE MONEY for that book than a digital publisher would for delivering the same content to your student’s mobile. This fact is clear from an analysis of the MacMillan vs. Amazon dust-up this week. Charlie Martin writes: “This weekend kerfuffle is really the death throws of a business model.” He says bet on Amazon. His article includes this big picture analysis of what is happening to print — of which textbook publishers are a major component:
The key is the mainstream publishers’ worry that e-books will cannibalize the sales of physical books. Mainstream book publishers, along with mainstream music publishers and the legacy media newspapers, are actually primarily manufacturers. The costs of the content, in royalties to the authors, are only about 10 percent of the cover price of the book, and less than that for the record. It’s the costs of setting type or mastering, printing the books or pressing the disks, shipping, cataloging, and selling them that dominates the costs of publishing.
Now, along come e-books and readers, like the Kindle and the iPad. Suddenly the whole business of publishing has changed. You can sell a physical book or an e-book — but each copy of the e-book costs literally one one-millionth as much to produce.