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amazonAmazon has gone public with new details about its high-profile standoff with book publisher Hachette, confirming that the e-commerce giant is trying to lock in a standard price of $9.99 for e-books — and making the case that the lower price is actually better for everyone involved, including the publisher.

kindleapp300300“Many e-books are being released at $14.99 and even $19.99,” the company says in a new post in the Kindle forums. “That is unjustifiably high for an e-book. With an e-book, there’s no printing, no over-printing, no need to forecast, no returns, no lost sales due to out-of-stock, no warehousing costs, no transportation costs, and there is no secondary market — e-books cannot be resold as used books. E-books can be and should be less expensive.”

Here’s how Amazon says the economics work out.

“It’s also important to understand that e-books are highly price-elastic. This means that when the price goes up, customers buy much less. We’ve quantified the price elasticity of e-books from repeated measurements across many titles. For every copy an e-book would sell at $14.99, it would sell 1.74 copies if priced at $9.99. So, for example, if customers would buy 100,000 copies of a particular e-book at $14.99, then customers would buy 174,000 copies of that same e-book at $9.99. Total revenue at $14.99 would be $1,499,000. Total revenue at $9.99 is $1,738,000.”

Of that revenue, the company says it would have 35% go to the author, 35% to the publisher and 30% to Amazon — not the 50% take that some reports have claimed.

We’ve contacted Hachette seeking comment on Amazon’s post. The publisher’s negotiations with Amazon have been at a standoff for months over this issue, causing high-profile authors to speak out against Amazon as the company has delayed shipments and pre-orders of key Hachette titles.

Amazon’s final point in its post addresses the issue of fairness for authors: “One more note on our proposal for how the total revenue should be shared. While we believe 35% should go to the author and 35% to Hachette, the way this would actually work is that we would send 70% of the total revenue to Hachette, and they would decide how much to share with the author. We believe Hachette is sharing too small a portion with the author today, but ultimately that is not our call.”

Read Amazon’s full post here.

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