Wednesday, July 21, 2010

Amazon Vs. Canada and the Introduction of E-book Commerce

Sadly, my favourite place to buy books, the bargain books section at McNally Robinson, has been significantly downsized. This is hardly surprising, I suppose, following the news that McNally Robinson declared bankruptcy and closed two of its four Canadian locations at the end of last year.

Yet, defying all odds, American book retailers are apparently doing better during the recession as has moved to enter the Canadian market.

All this is occurring at a time when consumers are starting to move toward electronic books, lured by shiny e-readers and handy apps for the i-phone. Canada's largest book retailer, Indigo has entered the arena with its new Kobo ebook reader which retails for about $50 less than Sony's entry model. But this comes as the market is entering a price war that some predictions say will bring the price of e-readers down below $100 by the end of the year.

Personally, I don't think I will be lured away to the e-format until the prices reflect the actual value of the product. Seriously, shouldn't e-books be cheaper than books of the old dead tree variety?

Conventional books start in electronic format on an author's computer. Then trees are cut down, shipped to a mill, pulped, pressed, trimmed, shipped to a printing press, printed on, cut up again, bound and covered, shipped to distribution hubs, shipped to stores, and finally take up shelf space until (best case scenario) someone buys them. And that's just my simplified version of the process.

Conversely, e-books live entirely in cyberspace. Distributors only need one copy on a server in order to sell millions.

So why do e-books cost as much, if not more, than paper books? Why are we charged hardcover prices when there isn't even a paperback being placed in our hands? Didn't we already buy an expensive reader?

I'm guessing it's the same kind of scam as ATM fees, cell phone charges, and other vapourware that rich people use so that they don't have to live like the rest of us mortals.

And then there is the worry that even though money has changed hands, ownership has not.

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