Did you read the blog post? The author specifically was comparing the cost of delivery via the Kindle service to using Amazon S3/EC2 to deliver the content. His specific comparison was that the price that he would pay to host and deliver the content using Amazon's own services, would be orders of magnitude smaller! In other words, the comparison you are making is the exact basis for his entirely justified claim that Amazon's delivery fee is complete ripoff.
Hosting a static file in S3 you have to point people to manually find and download themselves is much cheaper because you don't have the built in captive audience, WhisperNet and everything else which comes with the Kindle ecosystem, so comparing the two only via a flat dollar cost is naive.
It's ridiculous to include the cost of the entire "Kindle ecosystem" with a fee called "delivery fee" - as other posts have mentioned, this is what commission is for. WhisperNet is another story - this is legitimately a part of the delivery - however, it's just 3G service that they leased from AT&T, and to assume it costs them even close to $2.58 per delivery is just ignorant. If I downloaded an 18MB e-mail attachment over 3g on my phone, essentially the same thing, I would be absolutely livid if I was charged $2.58.
Amazon's "delivery fee" is 15 cents/megabyte. By comparison, AT&T's most expensive pay-as-you-go data plan is $15 for 250MB, or 6 c/MB, less than half the price. Their cheapest plan is 1 cent/MB.
Amazon is known for having very reasonable data storage/transfer fees in their other services, so it's very clear to me that they're just taking a huge margin here.
What they're doing is charging one fee based on price and an additional fee based on file size. This separates the incentives for the publisher, which makes sense.
It's also worth noting that his book is large compared to your average novel. He clocks in around 17.6 megabytes, whereas even a giant novel like Game Of Thrones is only 3.3 megabytes. Hunger Games is a paltry 0.5 megabytes.
Probably Amazon is charging more to offset the cost of their unlimited free 3G usage. Before I had a 3G phone, I purchased a 3G Kindle partially to take advantage of this incredible offer. With a 3G Kindle in the US I could freely browse the web anywhere with no limit.
> If I downloaded an 18MB e-mail attachment over 3g on my phone, essentially the same thing, I would be absolutely livid if I was charged $2.58.
Then be very careful you never accidentally do that when on international roaming (which 3G Kindles do have). You could easily end up being charged $250. And no, that is not an exaggeration (there have been much worse cases).
Amazon probably isn't paying 15 cents/megabyte in the US. But they're probably paying significantly more outside the US. They've figured out the average cost per megabyte and probably added on a few cents. This way the author is getting charged something in the neighborhood of $2.70 to deliver each book rather than being charged $0.50 for some and $15 for others depending on where the purchaser happens to be. Also keep in mind that Amazon lets you download purchases again at a later time via 3G, so they're probably factoring variable delivery costs based on the number of times people are normally downloading the books.
Amazon also has a pretty good track record at lowering costs when their costs go down (at least when looking at AWS), so it wouldn't surprise me to see the delivery fees dropping over time as they negotiate better deals with AT&T or if they start working directly with other mobile operators in other countries.
> Amazon is known for having very reasonable data storage/transfer fees in their other services, so it's very clear to me that they're just taking a huge margin here.
Exactly. They are trying to run a for-profit business. The T&C for data charges is clearly laid out in a simple table I found within 30 seconds of Googling. I'm not sure where the expectation of charity comes from that they shouldn't be making a profit, you don't have to use Amazon or Kindle if you don't want to. Do you think the new Macbook Pro costs Apple $2200 to make?
So... are we morally barred from complaining, or is it merely to be considered gauche?
(This reminds me of the people whose entire conception of "Free Speech" is "I can say anything and if you criticize that's an infringement of my rights.")
Complaining that a business is charging too much money for its product is silly, if everyone is willing to pay that price. The central insight here is that there is no morally correct price for something, there is only the market price. Goods and services don't have "correct" prices, there is only what people will pay.
If you are willing to pay, saying they are charging too much is just wishful thinking.
You are completely missing the point. They do charge a commission. The problematic part here is that this $2.58 is called "delivery fee". Im sure all the ecosystem costs a lot of money, and they are free to charge whatever they think the ecosystem is worth, but calling it "Delivery fee" seems disingenuous.
I don't believe it is disingenuous at all. It could have been lumped in with the other charges, but they are explicity stating this is how much it costs you as the publisher if you wish to use their infrastructure to publish your content digitally.
I think it is disingenuous to assume that $2.58 is some number pulled out of the air to rip the author off. The current meme right now is to assume all digital content delivery is essentially 'free', but this is untrue.
Someone else said AT&T is the whispernet provider. AT&T's smallest data plan is $15 per 250MB (overages are the same rate). The author says they are being charged $2.58 per 18.1MB, which is $35.63 for 250MB.
So Amazon is charging 237% of the ridiculous rate AT&T uses to try to force people to upgrade to a higher plan.
And that's despite the cost that most Kindle users (I'm guessing over 90%) get their books through their computer or WiFi, and don't accrue any cellular charges.
Plus... this is Amazon. I'm pretty sure that given the amount of data Kindles may use they would have been able to get a better deal out of AT&T than your average individual consumer.
And again, this is all on top of the 30% they take that should already cover all of this.
Do yourself a favor and don't investigate the actual cost of things you buy on a regular basis, because you will be absolutely livid when you find out some of the margins being made off of you.
