“While Amazon might be able to find a market for $9.99 books on the Kindle, the iPhone-iPod Touch world is a very different place. Very few people are willing to pay that kind of money for any sort of application, let alone an e-book.”
With the lower cost of production and distribution, you might expect publishers to pass some of the savings from e-books on to the readers, but the trend seems to be a strategy of maintaining prices and simply expanding the profit margin, and you can’t really blame a company for looking at it that way, as long as readers are still buying.
There are two considerations that come to mind here. The first is that if readers won’t pay the increased prices, then the market will correct itself and the price of goods will drop to reflect the lower cost of production. The other is that the majority of these increased margins are likely going to the publishing houses, not the authors (similar to the relationship between record labels and musical artists). This means that there is an opportunity for independent authors to self-publish and cut out the middleman.
This possibility has existed before, and e-books have been distributed online for on-screen viewing, but the mainstream market’s push to popularize the portable e-book devices, similar to the explosion of MP3 players (notably, the iPod), has opened up a new market for self-published e-book authors to tap into, who are already primed for the delivery method.
Moreover, the idea that users pay more for content when they have a convenient way of viewing it means that more e-book readers may signal higher prices for the e-books themselves. For consumers, the questions still remain: How much would you pay for an e-book and does the platform you read it on make a difference?