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Will Pay-as-You-Read Allow Publishers to Charge More for Ebooks?

As readers come to understand that they are paying for quality, they may be willing to pay more.

By Edward Nawotka, Editor-in-Chief

paid contentToday’s feature, Killing the “Pay First, Read Later” E-bookselling Model” discusses Israel’s Total Boox, an untriguing new company that is offering a “pay-as-you-read” e-bookselling model. The system is logical — if you read 10% then you pay for 10%, if you read 100% you pay for 100%. Publishers are free to set their own prices, and Lorch thinks that this system may enable them to ultimately charge higher prices.

“I think that part of the downward trend on Amazon, of giving deep discounts is because of the uncertainty involved,” he says. “Buyers want to minimize risk; but that risk is eliminated on Total Boox. And if people only pay for what they read, then ultimately they may be willing to pay more.”

Could this indeed be true? Perhaps so.

One of the phenomena we’ve seen in pricing is the push toward zero, led in large part by the self-publishing community. The strong sales of inexpensive titles has demonstrated one thing: consumers are willing to take a chance on a book if it’s cheap. And if that book disappoints, it’s no big deal — especially when it compares with having paid $9.99 for a book. Anecdotally, e-booksellers have reported that returns on these cheap titles are far less likely than they are on higher priced books (you did know you can actually return an ebook to most ebook retailers, albeit with some effort involved?).

But what if the books were better, and the urgency to read it higher, leading to a greater degree of satisfaction? Could this not, in particular, inspire more confidence in readers, particularly if the risk of paying outright for a poor book was already minimized?

Ultimately, this may very well translate into higher prices, as readers better understand that they are paying for quality — instead of what we have now, which is little more than a promise all too frequently unfulfilled.

Yes we’ve already seen some experimentation in this area among those authors who give their digital editions away for free online with the expectation that the reading experience will generate publicity and inspire purchases of print books. But that is a marketing exercise being driven on a personal level by many; it’s not a model that works as a long-term solution for the industry.

Total Boox model has many potential long-term implications. It may change the format in which writers present their work — think more short chapters, with cliff-hanger endings, a la The DaVinci Code. It may force publishers become even more selective in the titles they opt to publish, as readers seek out a “flight to quality” for these higher priced books. But in the long-term, the greatest impact it may ultimately have is marginalizing the print book business even further as print books are turned — for a significant percentage of readers — into an object of posterity, the proverbial souvenir.

Agree? Disagree? Let us know what you think in the comments.

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3 Comments

  1. Posted February 19, 2013 at 4:28 am | Permalink

    I left a comment to the article proper where I argue that a major beneficial fallout of this business model – which makes a lot of economic sense – is that it will force writers (and their editors and publishers) to curate more their books, from first page to last.

    That readers will be willing to pay more for proven quality? Definitely.

    That this will contribute to the total displacement of printed books by e-books? No, I don’t think so. This may happen for genre literature – the kind of “throw-away fiction”, i.e. the paperbacks one used to buy in airports and supermarkets. But it won’t happen for serious non-fiction and not even for serious literature. There is something in published books that an e-book experience is unable to duplicate: the ability to flip through pages, back and forth, the possibility offered to treat the book as your personal object, either to embellish your living room or to scribble in private comments in the margins, with nobody having the ability to look over your shoulder…

  2. Posted February 19, 2013 at 4:57 am | Permalink

    This model can lead to a situation that the writers receive payment even before they finish writing a book. When more and more readers are following a successful title, the writer can simply carry on writing, which will result in much more revenue to the writer and Total Boox.

  3. Posted February 19, 2013 at 5:39 am | Permalink

    The exchange of cash for value lies at the heart of every successful brand-based business transaction. Consequently, we can observe from this initiative, the onus is on the delivery of high perceived value in order to leverage full price (or a higher price).

    Yet, the initiative also implies the reverse: the ability to read and trash before a high financial outlay could suggest that quality need not be high and that financial success is therefore random. In this way, this model still permits publishing indolence: let the market decide. It could be argued therefore that a focus on “churn it out” is financially weak and corporately suicidal.

    It could also be considered that indolence may today be at the heart of commercial function in publishing – be it poor quality commissioning or even a lack of understanding of the emotion of brand. If consumers cannot understand perceived value then underperformance will be a certain consequence.

    The dichotomy today seems to be between self-publishers (who know little about brand but take a chance on luck) and publishers (who ought to understand their brands so that they can deliver consistent quality but who still chance to luck because of the need to deliver cashflow).

    How do publishers recapture their conceit as the arbiters of taste? By being assertive in their vision, promise and emotional engagement. Profit, after all, is the net result of perceived consumer reward. But will shareholders permit smaller companies doing things well rather than larger companies doing things poorly?

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