Publisher Credits Low Production Costs To High Ebook Profitability

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Simon & Schuster reported a large increase in ebook sales during the first quarter of the year, according to this Publishers Weekly article.

Aside from giving specific figures on how much ebook sales have increased, the article also mentions something interesting. I’ve never heard one of the large publishing houses say this (emphasis mine):

“We got out of the gate faster than usual,” said S&S CEO Carolyn Reidy led by sales of e-books that doubled in the quarter and accounted for 17% of revenue with digital audio adding the other one percent (about $28 million). The steep increase in profits was attributed to lower shipping, production and returns costs as well as the “painful” belt-tightening that S&S has implemented over the last 18 months plus the higher sales, Reidy said.

In other words, they are admitting that because ebooks have low production costs, and low shipping and non-existant return costs, ebooks are very profitable.

Publishers have maintained in the past that because of marketing costs and even production costs, ebooks are still very expensive, justifying a higher selling price.

Are they finally seeing the fruits of the ebook revolution?

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