Why We’re Not About To Get Cheaper Books

Why We’re Not About To Get Cheaper Books
Proposed changes to laws surround book copyright in Australia are controversial, but even leaving aside their potential impact on local writers, it’s not at all clear that major savings will occur.

The release this week of a report from the Productivity Commission recommending that parallel import restrictions (PIRs) on books be removed has fired up fierce arguments. Parallel import rules mean that it’s not legal to import copies of books from overseas if copies are produced locally within 30 days of overseas publication. Changing them would mean that large chains could “parallel import” books from overseas and potentially sell them at a cheaper price than the ones produced by local publishers.

The pro-case — cheaper books for consumers — is pretty easy to make. The anti-case is essentially that the changes will substantially reduce the profitability of local publishers, making it harder for them to support and nurture local authors.

What’s interesting, though, is that the Productivity Commission report itself doesn’t provide much direct evidence that eliminating territorial copyright will result in prices dropping. This is its carefully qualified statement:

The Commission concludes that the PIRs place upward pressure on book prices and that, at times, the price effect is likely to be substantial.

In other words, no-one actually seems to know whether prices really will fall. Author Nick Earls makes the point well in an opinion piece for the ABC:

The fact is that some books are cheaper in Australia, some are more expensive and some cost around the same as elsewhere, and prices vary from book to book, time to time, retailer to retailer and with changes in the exchange rate. Either side in this argument can cherry pick individual books – and times with exchange rates that favour their case – and wave them in the air in order to make their point, but it doesn’t prove a point about an entire industry.

In the case of bestsellers, a change in the rules might well mean that you’ll be able to pick up a bargain-priced copy. But as a quick visit to Big W or K-Mart will attest, you can already do that now in most cases. For rarer titles, it might well be possible to get them cheaper online from overseas, but that’s not forbidden under the current rules either if there’s no locally-published version available.

In any event, despite the ongoing arguments, nothing will change in a hurry. The Productivity Commission has recommended a three-year notice period before changing the rules, so even assuming its ideas are taken up, it will be 2012 before any of us can measure the difference.

Lifehacker’s weekly Loaded column looks at better ways to manage (and stop worrying about) your money.


  • What’s to stop consumers currently ordering from the likes of Amazon.com, eBay, etc. anyway? Admittedly you get more of an overhead per-book on individual items compared with a book shop being able to import cheaper from overseas, but IMVLUOIA (In My Very Limited Understanding Of It All) it would probably reduce the number of dodgy overseas importers setting up websites pretending to be local online book stores and offering less than decent customer service and refund possibilities.

  • “For rarer titles, it might well be possible to get them cheaper online from overseas, but that’s not forbidden under the current rules either if there’s no locally-published version available.”

    It’s quite often cheaper to get them online. Sites like http://www.booko.com.au are great for finding where (here or OS) it’s cheaper to get a specific title.

    And I don’t think it’s illegal to import books /even if they are published locally/. Certainly individuals can do that (just like we can for DVDs), but it’s the retailers/resellers who can’t do the parallel importing.

    A lot of the time, I’ll order a book from Amazon and even with the exorbitant shipping cost it will be cheaper and quicker than getting it locally from Borders/Dymocks.

  • All the arguments aside as to the ‘why’ and ‘what-ifs’ — the simple hard cold facts are the books cost so much more in Australia (and not just Australian books) that most people buy them elsewhere (e.g., Amazon) or don’t buy them at all. I am regularly aghast to go to a local bookstore to find a book costing not 25% or 50% more than overseas but sometimes 300% more! There is no plausible explanation for this beyond the fact that we are getting ripped off blind and it has to stop. The local industry is shooting themselves in the foot by making books so expensive here that no one buys them. If they were competitively priced to overseas suppliers the business would increase in Australia. This is basic Economics 101! Stop crying ‘WOLF!’ and step into the real world!

  • I can accept that your average Australian might want to subsidise local culture (I don’t), but can’t it be done more directly. I don’t like how the price of all books are increased to subsidise the small number of Australian books produced. Maybe Australian titles should receive a direct subsidy, regardless of where they are actually produced?

  • What a dumb post. Lifehacker claims the productivity commission has not provided evidence prices will fall.

    As Glenn points out, the situation in NZ is clear evidence.

    But Lifehacker has not provided evidence that prices will not fall.

    Prices will fall under the logic of commonsense and simple economics. The new laws open up a previously contained supply channel from overseas publishers.

    Nick Earl does not make the point well at all. No one is cherry picking – new books are commodities. They are like and like and thus easy to compare.

    The only valid point Lifehacker makes is that the roll out will be over 3 years. THis has little to do with the main ‘argument’ of the post. How much research went into this? Like 3 minutes of googling?

    • I’ll ignore the insults and point out that there are very few specific figures in the PC report (and a clear acknowledgement that the situation varies widely depending on the category of titles being considered), which makes its conclusions open to debate. In the debate leading up to publication, there were lots of examples of exactly the kind of “cherry picking” Earls discusses (this book is cheaper, therefore all books will be cheaper non-logic). And commonsense (an overused term) suggests that prices aren’t necessarily going to fall when major, locally published titles are already sold at below retail value as a loss leader in chain stores.

  • I have worked in bookselling, book stores have moderate overheads — this will help them sell more books with the much greater variety and pricing they can offer customers.

    the argument that some books here are cheap is entirely misleading — retailers currently make 30-40% on full RRP books published locally, much more with imported titles, while the royalties, commissions 1-5% go to the producers/authors, the other 55-76% goes to the publisher. overseas publishers do much larger print runs and the economies of scale are enormous, so they can afford to sell for 25-50% of the Australian publishers.

    the ‘cheap’ books referred to are known as ‘dogs’ in the industry, they are older, unsaleable editions that aren’t moving and are offloaded to department stores and discount booksellers, who sell them for as little as tenth of the original price — this is no different to clothing ‘wholesale outlets’ that sell last season’s stock / seconds / returns. you cannot compare them with new release, full retail priced titles. also, BigW / Target may sell cheaper than the bookstores but only ~5%, still giving them a healthy 35% margin.

    online sellers (such as amazon or bookdepository.co.uk) often trade in these same ‘dogs’ or leverage bulk-purchasing to get bigger discounts from the publisher, which they happily pass onto the customer given their lower overheads (nearly everyone in the industry buys direct from the publisher except for rare/out-of-print items).

    bottom line here — everyone in Oz should benefit from this arrangement, aside from a handful of people in the local publishing business, who will be competing directly with their larger overseas partners. if retailers greedily swallow all the savings from this deal, they face a slow death — losing all of their business to their online competitors.

    the union was arguing $80M could be lost, but compare that with the commissions own estimates: ~$750M/per annum in savings to the retailer/consumer!

  • Hi all, Have just discovered this thread hence the tardiness. I’m writing as freshly minted first time author based in Sydney. Today my ‘complimentary’ copies arrived in the post, excitement plus …
    That was until I looked at the publisher’s local website and discovered the cover price in Australia is almost $180 hardback. Let’s be clear, we’re talking about a 300 pager here, not a tome.
    The US price is $84, steep enough but it does imply a reasonably priced paperback version. After picking myself up off the floor, I checked out the British site where the price in pounds is relative to the exchange rate.
    My contract was with the NY office, for greater reach among other things. Who benefits here? Certainly not the author, nor potential readers and nor the local market.
    It’d be kind of nice to sell a copy or two but it seems perverse that no one I know could afford to buy their copy locally – I certainly couldn’t!

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