&quot;Customers are not stupid, they understand that e-books are a lot cheaper to produce&#x2F;distribute than a physical book, and they should be priced accordingly.&quot;<p>If customers &quot;understand&quot; this, they mostly understand incorrectly. While it may make intuitive sense that printing and distributing a book should make up a lot of its cost, that&#x27;s not actually true. I haven&#x27;t looked at the details for a few years but this is something I wrote a while back on the topic: <a href="http:&#x2F;&#x2F;www.cnet.com&#x2F;news&#x2F;why-e-books-arent-cheaper&#x2F;" rel="nofollow">http:&#x2F;&#x2F;www.cnet.com&#x2F;news&#x2F;why-e-books-arent-cheaper&#x2F;</a><p>(To summarize that post, printing plus the take of wholesalers who handle distribution is only about $5 for a hardcover.)