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Summary:

Amazon is offering consumers a free digital copy when they buy a CD. It makes perfect sense to do the same for books — alas, it’s not going to happen. Here’s why.

Sad dog

Amazon caused a stir this morning when it announced a two-for-one policy that will give a free digital album to anyone who buys a CD. The policy applies to past purchases — even if you bought the CD 10 years ago — which touched off a flurry of speculation that Amazon might do the same for books.

In this perfect world, Amazon would add free Kindle copies for every book people have ordered through the website, giving loyal customers a digital version of their home library. Alas, the chance of this happening is about as good as 50 Shades of Grey winning the Pulitzer prize.

In a Mashable piece, Lauren Indvik claims the reason is two-fold. First, Amazon has sold far more books than it has CD’s, meaning the cost of providing matching digital versions is likely prohibitive. And second, Amazon doesn’t have a big strategic incentive to do so. Unlike music, where it lags behind Apple and Google, the company is already dominant in digital book retailing and doesn’t need to fight for market share. While the company will do anything it can do to preserve its advantage in books, the more pressing task for Amazon is to keep muscling in on cloud-based music and entertainment services.

This makes sense but to these two reasons, we can add a few more. One is that CD’s are nearly obsolete while books are not — meaning book publishers are unlikely to risk undermining their pricing power through digital bundles. Likewise, unlike books, consumers can easily “rip” CD’s, meaning the music studios are not giving up all that much in the Amazon deal

There is also the question of relationships. While music studios can look to Amazon as an ally and a source of leverage against Apple, many book publishers regard the retail behemoth as a ruthless bully who stomps on them at all turns. The two sides are unlikely to cuddle up for a print-digital partnership. Finally, the nature of book rights mean Amazon would have to get copyright clearance from many individual authors unlike music where studios routinely license whole catalogues.

The bottom line is that consumers may love the idea of a digital library of what they have paid for already — but it’s not going to happen.

(Image by MISHELLA via Shutterstock)

  1. Mindbendingpuzzles Friday, January 11, 2013

    Amazon won’t do this but what about the book publishers themselves? I would be a lot more tempted to start buying paper copies of books again if I knew they came with a pack in code for the eBook. It could even be a way for publishers to undermine the dominance of Amazon in the eBook market if they used a non proprietary format for three pack in eBook.

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    1. The only publisher I know of that includes digital copies with paper is Baen, but of course, they were the front runner in ebooks in many ways. If you look, you’ll be able to find copies of certain Baen books with a CD in them, containing not only ebooks but lots of other goodies.

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    2. As someone who works for a publishing house, there are a couple reasons as to why you probably won’t (Baen being the exception) see e-books paired with physical books. 1) They are normally relegated to different workflows (it makes no sense) and are considered separate products. 2) Publishers are increasingly trying to move into the e-book realm and therefore don’t really want customers to get print books. Granted a publisher will NEVER complain if you choose to buy a print book, but it makes little financial sense to support a physical book (which has a high delivery cost) with a competing product, the e-book (which has a high production cost, but almost nil delivery). Obviously there are outliers, but what I’ve described above is the general policies followed by most major publishing houses.

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      1. But by that same logic, couldn’t offering companion ebooks to physical be a great strategy to increase market awareness and adoption of ebooks? It could even be a limited time thing, say 6-12 months.

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  2. This article strikes me as odd. All the hardcover books (mostly King) I purchased in 2010 – 2011 are also available on my Kindle….

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  3. I said it yesterday and I’ll say it again today, in this situation I have zero moral dilemma with using bittorrent or other sources to acquire digital copies of books I already own.

    I refuse to buy the book a second time just to get it digitally, particularly when the books sell for pennies at half price book stores.

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  4. I have a Kindle Fire HD and I love this thing. It was easy to understand and I love the interface. Here’s the one I have on Amazon http://amzn.to/UBAU84. If you’re looking for a tablet you should check it out, I think it’s very underrated.

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  5. I wonder whether a true incentive to lure p-book buyers into having digital editions of their past purchases is to be able to monetize data produced by users as they read, search, highlight, and annotate. You can´t do any metrics on p-books while being read, thus print becomes a hurdle for modern marketing technique.

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    1. ergeqrgregr – FANTASTIC point. I became a true ebook convert (at least for non-fiction) when I discovered the amazing value and convenience of highlighting key pieces, chapters, etc. This should be a tribe building gold mine for publishers, if they could access and properly understand this data.

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  6. Paul Lukehart Friday, March 22, 2013

    Amazon has a patent on a system for doing AutoRip for books (based on purchase records), but for many of the reasons mentioned above, it hasn’t happened yet. It will, though, as the industry turns–bundling is already a feature of media (see what’s going on with Ultraviolet, etc), so the natural progression is to books.

    Alex alluded to it, but the margin structure is completely different for print vs digital books. For print, the publisher gets about 50% of retail price, and only a portion of that is really licensing fees–maybe 15%. For digital, the publisher gets about 70% of whatever it sets the price at, and there are no printing or freight costs. Think about that– a $20 book in print nets the publisher $3 in licensing, but a $10 e-book might then net $4 after costs.This makes ebook cannibalization a major concern…

    as I’ve discovered since working on this. Last fall (actually before Autorip!) I started a company with a friend to try and address this, and we’re working on a mobile-based service. Looking to make it e-reader platform agnostic, and we’ll be launching a beta soon. If you’re interested, check out http://lightlibrary.net/ . Thanks!

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