Paper used to transmit information in the form of books, magazines, science or news introduces friction.
Digital transmission reduces the friction.
We already understand this.
We understand we can reduce the friction by removing as much of the paper as possible.
But when you remove friction, you remove associated costs.
And when associated costs go down, so does the price to the end consumer of the information.
The battle being waged today is that traditional publishers haven’t yet figured out how far away from “free” they need to stay, and still have the perception that what they hold (the information) as having value.
$2 for an ebook can make the information inside be perceived as having no more value than this short blog post.
An author charging $2 shows us he doesn’t value his work.
A publisher charging us $2 indicates a deep discount.
$50 for an ebook makes us (the consumer) question the audacity of the publisher.
When an author self-publishes an ebook, whether the price is free, $2 or $50, we know the money (the majority of it) is going directly to the author.
An author having the audacity to charge $50 for an ebook signals to the consumer “Hey, this is worth it, it’s something special, and I feel you need to pay a significant sum of money to me to access this information.”
When a publisher charges $50 for the same ebook we (the consumers) think “Why are they price gouging us? How much is the author really getting on this sale? 50 cents? A buck?”
Who charges us, and how much, is the signal of whether something holds value.
But also whether we are being over-charged for the product.