After a Roller-Coaster Ride, Ebook Prices Have Stabilized Somewhat in 2013

Expert publishing blog opinions are solely those of the blogger and not necessarily endorsed by DBW.

Since the summer, ebook price have been on a roller-coaster ride, lurching up and down due to competition between retailers, holiday promotions and, most notably, new contracts between major publishers and ebook retailers precipitated by U.S. Department of Justice actions.

Below is the average price of an ebook that appears on the Digital Book World Ebook Best-Seller List — the top-25 ebooks sold in any given week*. Take a look:

ebook best-seller avg price 1

In the past several months, however, the average price for a best-selling ebook seems to have stabilized somewhat at around $8.00. While the prices have jumped around somewhat, there is a clear trend:

ebook best-seller avg price 2

Ebook prices rose in the late summer, fell from the fall through the early winter and have stabilized. But why? We have a few theories. Let’s overlay some events, first:

ebook best-seller avg price 3

There are two important trends to consider here when thinking about ebook pricing:

— Discounting of titles from the largest U.S. publishers.
— Holiday season: for ebook discounts and for new device ownership.

Our theories on why ebook prices took the ride they did over these past few months:

1. Ebook prices rose throughout the fall as publishers that still could directly control the prices of their new releases tried to squeeze every last dollar out of relatively high ebook prices. A few hit titles helped keep prices relatively high in aggregate.

2. Prices started to fall as the holiday season approached because of two reasons: First, publishers saw profit in discounting and generating more sales; second, by early Dec., three of the six largest publishers were now being discounted by retailers, meaning that many of the most popular titles were now being sold at the lowest prices the retailers could afford. It wasn’t just HarperCollins anymore.

3. Prices continued to fall following the holidays as millions of people received new e-readers and tablets and wanted to download the popular favorites from earlier in the year and previous years that were now being sold under $10. Most notably for our purposes, The Hunger Games trilogy had a big surge over this period and the three titles were being sold for $5.00, $5.99 and $5.99, respectively. Other old favorites crept onto our list, too.

4. Prices have since stabilized at a low level as retailers and publishers jockey for position among consumers who generally like and want lower ebook prices. We are now seeing some of the largest publishers experiment with discounting even newer titles. This past week, the average price of a best-selling ebook dipped below $8.00, driven mostly by $2.99 and $1.99 big-six titles.

For more on this, continue to follow along with our best-seller list every week.

All data here is provided by Iobyte Solutions

* I should say here that if you take a different sample, say, the top-100 best-selling ebooks or the top-five, you will get a different graph than the one I presented below. Further, if you look at ALL ebooks, you’ll get a different graph. I take the top-25 because it’s most of the books that people are buying. If the No. 1 ebook in a given week is selling at $9.99, then that’s what a larger number of consumers are paying for their book than the No. 17 ebook selling at $5.99. Another flaw in this is not weighting each of the positions. It would be better, for instance, to know exactly how many copies of each title are sold, multiply that by the price, add up the final dollar amount for the top-25 and then divide by total number of titles sold. That would give us a better idea of what people are spending overall. For now, what I’ve done above is, I think, the among best we can do when thinking about what the average consumer is paying for an ebook today. I’m happy to hear comments, feedback, etc.!