Rovio Recognizes That Massive, Massive Volume At Cheap Prices Beats Low Sales At Inflated Prices

from the unrealistic-ebook-pricing-is-nothing-more-than-a-paywall dept

Maybe it takes a "digital native" like an app developer to instantly "get" digital publishing. Asking those who've spent most of the ebook era actively fighting the new medium is frustrating for both sides of the conversation.

Rovio, the Finnish developer behind the omnipresent "Angry Birds" game, is releasing its first ebook/app, based on the print version that debuted last year. Mike Cane has a brief but excellent rundown on what Rovio's doing right, and where other publishers are continuing to fall short.

Cane starts by quoting from PaidContent's article on the ebook release, which points out a couple of important aspects of Rovio's offering:

[T]he app is "not just a book," said Peter Vesterbacka, Angry Birds CMO. "We took the content from the book, 41 egg recipes, but didn't want to just take the book, make a PDF and sell it to people. We actually made it a lot more interactive."

"Bad Piggies' Best Egg Recipes" is on sale for an introductory price of $0.99 or €0.79 in the iTunes Store and includes step-by-step photo instructions, an egg timer and photos of the finished dishes. Users can also upload their own pictures of the recipes they make.

First off, the app/ebook is not just a quick and cheap "port" being thrown into iTunes to grab some quick digital dimes. Secondly, the price is well under what most publishers would be willing to charge for a comparable ebook.

Why is this such a frikkin big deal?

[T]hey are selling an app-book for one-tenth of the print version's discount price. ($9.99) One-tenth!

That's a much steeper discount than most publishers would be willing to take, especially on a potential cash cow like this. Sure, one could argue that it's just an app spinoff, or that Rovio made plenty of money with its games, or that there's no "real writing" involved, or any number of tangents in an effort to minimize Rovio's deep discounting. One could even argue that Rovio is leaving money on the table or, as an outsider, just doesn't "get" publishing and price points.

Here's what Rovio has to say about the price point:

"We're not looking thousands or tens of thousands of downloads," he [Peter Vesterbacka, Angry Birds CMO] continued, "we're looking for millions of downloads of this book…We're going for massive, massive volume."

Oh, those crazy Finns and their madcap ideas! Volume! It's as if Rovio believes that it can distribute an infinite good at an extremely low price and still make some very good money. Insanity! Mike Cane points out the sheer incongruity of the situation:

He gets it. None of the Big Six of publishing — or the Little Sixes of it — do.

What if the Big Six started massively discounting their frontlist titles, going for that volume instead of trying to bleed each reader for the most they could squeeze out of them? They'd be able to transition their businesses to e faster and make lots more money in the process — and also help to thwart piracy!

Yeah. What if? Unfortunately, that's still largely open to speculation as none of the publishers seem willing to try it out. Even in the wake of a DOJ investigation into price fixing, prices have tended to move up rather than down (or remain unchanged) as publishers burn through remaining discounts. Even after various self-published authors have demonstrated the ability to make a living selling thousands of cheap ebooks rather than dozens of expensive ones, the tendency is to price ebooks in the same neighborhood as their physical counterparts.

Mike suggests deeply discounting the frontline titles and making more money through volume. But even if publishers aren't ready to take their current bestsellers down that road, what's stopping them from knocking the price of their back catalogs down to an impulse purchase level? Making the back catalog a bargain bin could turn casual fans into completists and give readers a reason to dip their digital toes into unfamiliar waters.

But, if nothing else, Rovio's pricing strategy has to, at the very least, highlight how many publishers are overvaluing their digital offerings, as if charging unrealistic prices will somehow prevent "devaluation." In reality, these higher prices simply show the huge gap between what the publishers desire and what the customers actually want.

Filed Under: angry birds, apps, ebooks, peter vesterbacka, prices, volume
Companies: rovio