What Are We Paying For?

Everything is going digital, and by that I mean that pretty soon we won't be able to buy any physical objects at all. All our "belongings" will exist only in some form of electronic storage. I have a problem with this, as I may have mentioned.

But even if you're absolutely gung-ho about iPods, even if you think that "book" should begin with an 'e,' even if you never want to own another object in the physical world again, you should be aware of something. It has to do with economics, so if you're frightened by money, maybe you should leave the room, or at least brace yourself for impact. Don't say I didn't warn you in an extremely condescending manner.

Things you buy cost money, right? And whether you like it or not, most of that money doesn't go toward the creator of the item. This is particularly true in the case of books, music, computer software, and other things which (surprise) have made the switch to an all-digital format.

The money you pay for a book, in particular, mostly goes to pay for the fact that the book must be printed. Sure, there's advertising and author royalties (we hope) and salaries for executives, but without the printing process, that book wouldn't cost anywhere near as much. It's not just the paper and glue and ink: it's money to pay the printers, it's money to ship the finished books all over, it's money to buy warehouses to store the books, and it's even money to print books which won't be sold because if you have to print huge numbers, it's very hard to judge how many books you need to print and therefore to be on the safe side most publishers print too many.

Now, consider on the other hand an e-book. The author still gets paid peanuts (possibly less), the publisher still has to pay its executives (and other people not having to do with the printing process like editors), and advertising is still going to take a chunk of change. But since there's no printing, it doesn't cost the publisher a dime. They can "print" exactly as many as they sell.

Now I know there are a fair number of legends out there about the actual price of making a CD; I've heard everything from ridiculous to... well, ridiculous for other reasons. But regardless of what it actually costs to produce the CD, the case, and liner notes, you still have to ship those CDs, plus all the problems of storage and making too many that are endemic to books. That's why CDs cost so much, and why record stores go out of business; all that cost is passed on to the store, which to turn a profit must pass the cost on to the consumer. When you buy an MP3, even if you overlook the fact that digital media have drawbacks all their own, it doesn't cost the company as much.

So why do you pay as much or more for the ephemeral version of something? Again, I don't agree with digital format on principle, for various reasons. But it really makes no sense to me to pay more, or at least enable to company to make more money, for something which limits your use. If you want to read an e-book off of the computer, you either have to print it (which passes the printing costs on to you and certainly doesn't look as nice as a book) or you have to buy some expensive portable thing.

So are you comfortable with subsidizing publishers? Because you're just making it easier for them when you buy digital.