One of the other main reasons ebooks costs so much is because they are sold in proprietary formats. Yes, some costs associated with producing, distributing, an

One of the other main reasons ebooks costs so much is because they are sold in proprietary formats. Yes, some costs associated with producing, distributing, and selling physical books are diminished, but at the same time, publishers now have to pay to convert their text to each retailer's ebook format -- both a set fee and per-copy-sold fee. Publishers are forced to pay-to-play (essentially) in Amazon's store, or B&N's store, or whatnot, so that their books are available in their formats, a cost that is then folded into the production of the ebook. So yes, some costs go down, others go up. On a side note, the agency pricing model actually is better for most authors/illustrators as well, not just their publisher. Physical book, the author gets a set royalty (anywhere between 5-15%) based on the retail price. Ebook, the author gets 25% of net receipts. The breakdown there is: $10 physical book at 10% royalty: $1 per book to the author (out of ~$5 to the publisher) $10 ebook at 25% net: $1.75 per book to the author (out of ~$7 to publisher) It's a move toward more fair compensation for the content creators.