Short article in Wired a few weeks back about Kindle users protesting prices higher than $9.99 for digital books. It's as if users are valuing the books as just pure digital bits. When you buy books at a bookstore, you have some visual justification for why some books are more expensive than others. The book may be thicker, with more pages, or with glossy heavy stock paper with beautiful photographs, or an expensive leather binding. The varying form factor for books has allowed that industry to get away with much more pricing variation than, say, the music industry, where most CDs and LPs are shaped exactly the same, or the theatrical exhibition industry, where going to the movies costs the same regardless of what movie you're seeing and how much it cost to make (on an absolute basis, the cost variance for producing one movie versus another is much larger than in books and music). To the viewer, many elements of the moviegoing experience are the same regardless of which movie you're seeing: they are about the same length, shown in theaters that are shaped, for the most part, the same, with screens of roughly comparable size. That along with years of uniform pricing have pretty much ensured that the only theaters that can get away with varied pricing are ones offering a unique experience (e.g. a price premium for the massive curved screens of IMAX, or a price discount for the really old movies offered at second-run theaters).

With books for the Kindle, you have few visual cues to distinguish the value of one book from the other. And so it's understandable that users might be inclined to think every digital book should cost the same. In one sense, they're right, as the digital cost of storing one book versus another will not vary by much at all.

What is missing, of course, is the understanding of all that has gone into the production and marketing of that work, or a linkage between the quality of the book and the price. The uniform price that Apple placed on songs in the iTunes music store at launch ($0.99 per track) removed price variance as an element of the shopping decision, for better or worse. That is now a mental anchor, and any deviation seems, well, deviant.

As a retailer, Amazon and Apple have roughly the same costs for whichever digital book or song they sell, so I can understand their interest in standardizing the pricing and encouraging impulse buying with the simplified decision structure. I can also understand why a publisher or music label would prefer pricing variance, to better account for their costs in acquiring and marketing the different books in question.

As for my Kindle 2 , I have owned and used it just about long enough that I am ready to share an overall assessment soon (quick summary is that it's solid but with lots of room for improvement), but not long enough to avoid the disappointment of hearing Amazon announce the Kindle DX today. I've barely had my Kindle 2 for 3 months, and already a replacement has been announced?

I can understand and accept product obsolescence and early adopter risk in technology, in fact I'm well-versed in it what with iPods and iPhones and digital SLRs and laptops getting replaced by newer, higher-performance models every half year to a year, but the Kindle 2 barely started shipping 3 months ago. I feel like Kindle 2 buyers should have either received a heads up that the Kindle DX would be coming or that we should be offered an option for trading in our Kindle 2 for the DX. The Kindle DX seems a bit pricey to me at $489, not a slamdunk purchase, but one of my biggest issues with the current Kindle 2 is its screen size, and I would have liked to have known the DX was coming at this price point back when I was making my Kindle-buying decision back in February.

Amazon rarely disappoints me, but today it did.

amazon, economics, kindle, pricing