> They are rarely cheaper than physical books and I often find them to be even more expensive!

ebooks are easier to store, easier to back up, and easier to access where and when you want than paper books, and can support functions (search, etc.) that paper books don't. There's a good case that -- outside of the downsides of DRM for those books that are burden by it -- ebooks are just plain better than paper books in many ways. So its not really unreasonable that they'd be more expensive (books generally don't have direct substitutes, and the ebook and physical version of the same book don't come from competing entities, so the tendency for a perfectly competitive market to drive prices down to production costs is mitigated -- OTOH, the forces driving prices up to marginal utility are present just fine.)