Are you looking forward to getting an Amazon Kindle e-reader this Christmas?

by Dale Wright

Amazon launched new models to the UK market in October this year. A cheaper Kindle without a keyboard was introduced in the hope that more of us could afford to pick up a Kindle as a gift for a loved one.

kindl 79 Are you looking forward to getting an Amazon Kindle e reader this Christmas?

The new UK Kindle

Between January and June this year, British readers spent £12.7 million on e-book downloads, and the figure is only set to grow next year. Amazon, which originally launched as a bookstore, now sells more electronic books than physical books.

However, many people who own Kindles complain that e-books are too expensive. Many cost almost as much as their paper versions, and some are actually more expensive than buying the real book online and having it delivered.

Apple introduced a pricing policy forcing publishers to give the sellers of their digital books 30%, and this policy is now being used by most of the industry, much to the annoyance of Amazon who would like to give much bigger discounts. Unlike real books, digital books are also subject to VAT at 20%, pushing prices up further.

Analysts say that the policy of fixing commission at 30% was designed to prevent Amazon taking over the digital book market; Amazon can afford to lose money in order to attract customers, and it’s likely they could wipe out many other retailers if they were permitted to discount downloads heavily. But regulators are concerned that digital books are not cheap enough for us to buy as a result of the policy Apple introduced. Unlike paperbacks and hardbacks, there is nothing to manufacture, store or physically transport when we buy e-books, and there are no postage charges either.

The US Department of Justice and the European Commission are now looking into the price we pay for e-books on devices like the Amazon Kindle and the iPad 2. They are concerned that the practice of giving a fixed commission is, in effect, fixing prices. Changing the rules could mean good news for Kindle owners, but bad news for small bookshops who would not be able to compete on price.

Do you think e-books are too expensive?