Nathan Bransford, Author


Monday, March 7, 2011

Amanda Hocking and the 99-Cent Kindle Millionaires

As Amanda Hocking said herself, "I don't understand why the internet suddenly picked up on me this past week, but it definitely did."

And how.

The writing world is abuzz about Amanda Hocking, the 26-year-old self-published author who sold over 450,000 copies of her e-books in January alone, mostly priced between 99 cents and $2.99. She's now a millionaire. The writing world has been abuzz for a while about J.A. Konrath, who has very publicly blogged about the significant amount of money he has made selling inexpensive e-books.

Many people in the last week have sent me links about these authors, wondering...

What exactly is going on here? How in the heck are these self-published authors making so much money? Is this the future? And does this mean the end of the publishing industry as we know it?

The News That's Fit to Print

Before we delve into what this means for the world of books, I feel like it's important to take a deep breath and splash some cold water on our faces.

The reality: This is still a print world and probably will be for at least the next several years. Even as some publishers report e-book sales jumping to between 25% and 35% in January, the significant majority of sales are still in print. As I wrote in my recent post about record stores, over a decade after the rise of the mp3 the majority of revenue in music is still in CDs.

So let's not get out of hand (yet) about the scale of this e-book self-publishing revolution, if it is indeed one. Yes, this is real money we're talking about. Yes, these authors deserve all the credit in the world. And yes, these authors are also making money in print as well.

But we're still a ways away from self-published Kindle bestsellers making Dan Brown, James Patterson, Stephenie Meyer, J.K. Rowling kind of money, the old-fashioned way, through paper books in bookstores. It's not as exciting a story to remember that traditionally published franchise James Patterson made $70 million between June '09 and June '10, but it's still worth keeping in perspective.

Let's also not forget that Hocking, Konrath and a couple of others are the tip of a very large iceberg of self-published authors, the overwhelming majority of whom are selling the merest handful of copies. As Hocking herself writes:
I guess what I'm saying is that just because I sell a million books self-publishing, it doesn't mean everybody will. In fact, more people will sell less than 100 copies of their books self-publishing than will sell 10,000 books. I don't mean that to be mean, and just because a book doesn't sell well doesn't mean it's a bad book. It's just the nature of the business.
Yes, it's new, it's a big deal, it's seriously awesome for Hocking, who seems like a super nice and humble person. But let's not also lose our perspective about the scale of the shift taking place. The book world is changing in a big way, but it still ain't done changed just yet.

The War Between the Worlds

So. Now that we are all sober and erudite, let me shock us back to life with this statement: Hocking and Konrath and others like them represent an existential threat to traditional publishers.

To understand why, we're going to need to take a look at how much it costs to make a print book vs. an e-book.

There is a perception out there, repeated endlessly around the Internet, that e-books should cost almost nothing. Electrons are (basically) free, so why should an e-book cost $11.99?

The reality, which I shall bold, italicize, and underline for some emphasis: Paper doesn't really cost very much.

Let's start with your basic $24.99 hardcover, the most profitable format. Of that cost, only approximately $1.50 goes toward the paper, printing, and distribution and all the stuff that publishers save with e-books. Repeat: $1.50 out of $24.99. E-books just don't save publishers gobs of money.

Let's look at a back-of-a-napkin breakdown of a print book vs. an e-book (all numbers approximate):
$24.99 hardcover:
$12.50 to the bookstore (roughly 50% retail price)
$2.50 to $3.75 to the author (between 10-15% of the retail price)
$1.50 for paper, shipping, distribution (again, approximately. UPDATE this would be for a high-print-run book, HarperStudio cited $2.00 as average)
=
Around $8.00 to the publisher, which is split between overhead (rent, paying editors, copyeditors, etc.), marketing, other costs, and hopefully some profit assuming enough copies are sold.

$9.99 e-book (agency model):
$3.00 to the bookseller (30% of the retail price)
$1.75 to the author (25% of the publisher's share)
=
Around $5.24 to the publisher, split between overhead, other costs, and hopefully some profit

You can see why publishers aren't exactly leaping onto the cheap e-book bandwagon when there are hardcover sales to be had. They make a lot less money per copy sold. They're worried about cheap e-books eroding their more profitable print sales. Electrons aren't saving them much money.

Print is still where it's at for them, and they're not crazy to behave accordingly.

For now.

Here Come the Insurgents

That $8.00 vs. $5.24 per-unit print vs. e-book consideration? Overhead? "Other" costs?

Hocking and Konrath don't care.

They don't have overhead, unless you count rent, an Internet connection, the services they contract out, and a laptop. They're not paying for an army of editors, assistants, lawyers, marketing teams, sales teams, and executives. They're not beholden to shareholders.

They write books, they figure out the editing and cover design on their own, they blog to try and spread some buzz, and word of mouth does the rest. They can afford to sell their books at a low price.

And because they cut out the middle man (and because publishers' e-book royalties are low), self-published authors make more from self-publishing a $2.99 e-book (70%, or $2.10) than a traditionally published author makes from a $9.99 e-book (25% of the publisher's share, or $1.75).

You read that right. More money to the author per copy at $2.99 than a traditionally published e-book at $9.99. Many self-published authors are laughing their way to the bank on that one.

If you aren't going to be published in print in a big way and you have an entrepreneurial spirit, what's the point of going with a traditional publisher? Why not undercut the competition and make more money?

The Perception of Value Problem

And yet...

Despite the glaring e-book royalty situation and some notable authors opting for self-publishing (such as Seth Godin), there has not yet been a mass exodus to self-publishing. Most of the biggest bestselling authors are sticking with traditional publishers. Not only is print still where the bulk of the audience is, publishers still provide an indispensable array of services that many authors (such as yours truly) simply don't have time to handle on their own.

But there's a problem that publishers are up against as we move inexorably into the e-book era: Perception of value. 

Publishers can explain their costs and how e-books don't save them much money until they're blue in the face, but on a gut level many people simply don't believe an e-book should cost $12.99. It feels too expensive. A lot of people will simply not buy one or even go and pirate a copy because they feel like they're being ripped off.

Why could that be? Yes, you can't put your hands on an e-book or resell it, but people willingly plop down $12.99 to go to a movie and you can't put your hands on that or resell it either. Why have books suddenly become exorbitant at $12.99? Why is that too much to pay?

Well, it's partly because $12.99 is competing against the upstart $2.99 Kindle bestsellers and some other lunatics named Charles Dickens and Herman Melville and Jane Austen, who are giving away their books for free!! (Which, ahem, may be because they're long dead and in the public domain).

And therein lies a big challenge for publishers.

The Price of "Good Enough"

So.

On the one hand you have publishers who are clinging onto the print world as long as possible and literally can't afford for prices to erode. They're counting on their quality control, their marketing, and their curation of what they feel are the top books in order to charge consumers a premium and hopefully instill a perception of value that new e-books "should" cost between $10.99-$14.99.

And on the other hand you have the self-published upstarts, who are willing and able to undercut publishers' e-book prices all the way down to 99 cents or even free.

Will publishers be able to maintain their prices or will they have to come down? And if they have to come down, how far will they have to go?

As always, the answer will be determined by consumers and their individual choices.

Stephenie Meyer's Twilight for $8.99 or Amanda Hocking's Switched for $0.99?
Harlan Coben's Live Wire for $14.99 or J.A Konrath's Shaken for $2.99?

Different people will make different choices, and I don't presume to know how that will play out (and for the record, I haven't read any of the prominent self-published authors).

Some consumers are more than willing to pay a premium for their favorite authors. I'm reading Into the Wild by Jon Krakauer right now, and it's so unbelievably incredible that no matter what I paid for the e-book it wasn't enough.

For other consumers, no book is ten times better than the other and they aren't willing to pay a premium. Many consumers just aren't that worried about the writing quality (as perceived/judged by the publishing industry), don't need the publishing industry deciding what to read for them, and just want a good story.

When the world moves toward e-books and print distribution is no longer where it's at, publishers are going to have a fight on their hands justifying the cost of their services to authors at their current e-book royalty rates.

They'll have a second fight on their hands as they try to adapt to a world where there are good books for sale for just 99 cents or less.

What do you think about the new Kindle millionaires, and what do you think it means for the future of books?






241 comments:

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Fawn Neun said...

I've met Joe Konrath, he's saavy and works his butt off. He's also incredibly prolific. None of these hurt his ability to make a profit.

But even with the support of a publisher, the onus on the author to promote is pretty heavy. Writing, editing, designing, distribution AND promotion - well, that's an overwhelming amount of work.

Self-pubbing is fabulous for backlist. And Amazon is supposed to be coming up with a new program for digital shorts. Once they're published elsewhere (or even if they aren't), that's going to be a great market for people who love shorts.

Rita said...

According to the Kindle information sheet, authors receive only 35% of revenue. What does the author of the article know that mere mortals do not?

J. T. Shea said...

Looks like I haven't reached the Long Tail's End after all. Maybe it's back home in Kansas, Toto.

BTW, it's been St. Patrick's Day for an hour and half here in Ireland. Best wishes to all!

Wodke Hawkinson said...

I'm very glad self-publishing is such a viable option now. Will soon be putting out two books of short stories. If that goes well, then the novels come out!

Will Granger said...

I have to admit, it is interesting watching the traditional establishment of agents and publishers struggle with this. It is undeniable that self publishing is a legitimate way of selling books.
With agents being the current gatekeepers, who wouldn't at least try the self publishing ebook route? This is a new opportunity, especially for those who can't crack the code on how to properly write a query letter and attract an agent, which seems to be the most important element in getting published. After all, most agent rejection letters say something like "Your book may be right for someone else...", so why not try it yourself? It only takes a little time.

Chris Redding said...

I applaud all who have chosen a path to publication.
But.
Those who go the traditional route (and there is nothing wrong with making that choice) realize that you will not have legions of PR people touting your book around. Your book will be in the store a total of 30 days before the cover is stripped and the book is sent back to the publisher You may get your cover in a group ad. What you will get is reviews and distribution.

Anonymous said...

I thought that self publishing was not the way to go, but more people than you realise are making a good living from it. There's a writer on Kindle called Guy Burtenshaw and h made over $4,000,000 on the first part of a series he has published called Ring of Tabor. I haven't read it myself, but I'll probably be adding to his fortune by getting a copy just to see what all the fuss was about.

Anonymous said...

According to here http://www.novelr.com/2011/02/27/rich-indie-writer, only about 30 to 40 people in the WORLD are making more than $20,000 a year (still barely enough to live on) as self-published authors. Not worth getting your hopes up.

Anonymous said...

I understand HBIC's point, I agree to some extent, though, I think the game is changing now. But I wanted to say that Hocking did submit her work to publishers first and had many rejection letters. She spent time promoting her work which is what a publisher expects anyway. She isn't the first person I've heard of who found a publishing deal after going the e-book route. But, the level of success that she has reached is rare and yes we should be realistic and sensible.

Kimberly Kinrade said...

I hear a lot about ebook self pub vs. print book traditional pub. I'm wondering about the self-pub who also offer print books?

Usually around $8.99 or so, many (most?) self-published authors also offer at least paperback print books for sale. (Createspace currently does not have a hardback option, but Lightning Source does...so even that is an option for P.O.D. (Print on Demand) self published authors)

Traditional brick and mortar bookstores were on the decline even before all of this self-publishing hoopla.

The fact is, most bookstores don't have a tremendous selection in many genres. You can get what you want on Amazon or B&N.com for less $ and with a pretty fast delivery rate. (or instant if you do opt for e-book.)I've tried going to my favorite bookstores to find a new read and left empty handed or with a book that wasn't very good. Online I can read a sample chapter, see reviews, and make a decision. This is for both traditionally published and self-published book. It seems that shopping in an actual bookstore for an actual book is just not as useful these days.

Also, I've read that people are more likely to buy ebooks in certain genres (like romance) and paper books in non-fiction especially. So those statistics are not universally true for all genres. There's actually a pretty big discrepancy depending on what sort of book you are talking about.

Finally, the big money makers in traditional publishing that you spoke of all made their name before the economy and publishing climate shifted so dramatically. Is there still room in traditional publishing for this kind of success, given what people can afford to spend and what publishing companies can spend on marketing, advances, etc?

I look forward to hearing your thoughts.

BeWrite Books said...

I disagree with the author's time line on the future of print, especially as emphasis turns to online sales of hardback and paperback and brick-and-mortar stores die like flies. But that's mere opinion. Let's look at some facts.

Amazon is a retail outfit that provides a sales outlet at a cost per sale. Seldom does it act as a 'publisher'.

That 70% author and publisher share is not a 'royalty', it is actually a representation of a simple sales commission of 30% ... in disguise.

Below $2.99 RRP and on all ebook sales outside the US, Canada and UK, Amazon takes a whopping 70% sales commission cut(as does the Sony store on all ebook sales regardless of recommended cover price and geographical location of a sale).

For this, the stores offer nothing more than a sliver of space in a massively overcrowded shop window.

Best wishes. Neil Marr. Ed. BeWrite Books.

- -Alex McGrath said...

I've set the e-book version of my novel "All the Same Songs" at $4.99, and in my mind, that seems pretty fair. You can't even buy a half gallon of ice cream for $5 unless you have a coupon.

99 cents or around there seems too low to me.. I mean it is a whole book..

I love the analogy of going to see a movie, and have often thought of that myself. You pay 10+ dollars to see it, and then it's over and you can't have it anymore without buying the DVD. You can't even pause or rewind or use the subtitles in the theater haha. I think the movie theaters will always have that particular fun vibe of "I'm going out somewhere" to help them though.

Anonymous said...

Perhaps it has been discussed elsewhere; if so, forgive this post. The easiest explanations are two-fold. First, a 99 cent eBook is zero risk -- on Amazon, it can be returned and refunded in full. Any gambler would grab at those odds (bet ten times and only pay when you win). Second, teenage boys are the major market segment for eBook readers (per NPR last week)and an eBook reader does not have a cover. (All right, you're with me now.) THEY CAN READ anything without being conspicuous. Now look at the top sellers and see if they make sense.

Jesse said...

This whole discussion has been quite interesting, to say the least. I am going to argue the figures for producing a book as being unrealistically low. In dealing with printing companies, that might be close to what it costs to produce a MMPB but not anywhere close to a hard cover--or those print companies (no, not Kinko's, thank you; legit print companies of books) have been over inflating their prices. And I don't buy that at all. With all the overhead involved, that number is at the very least triple of what those pub reps have tried to sell you. Sorry, don't buy it.

Personally, I'd rather not have the gatekeeper involved. Sorry again, but we all know that a HUGE percentage of all of the books written are going to get shot down because of timing, current trends, and on occasion because someone was having a bad hair day. As you've said repeatedly, you can't predict what's going to sell and what isn't. I'd much rather my readers make that choice and to be honest, when I go looking at books/ebooks (yeah, I'm one of those greedy types, I love 'em both), I don't listen to critics, I read the reviews posted on the books. I make my decision based on reader reviews. I don't need a gatekeeper for that, either.

As to quality? I've seen quite a few ebooks released by the Big Six that were not well edited, contained misspellings, incorrect punctuation, strange and intrusive line/page breaks, and that passes for quality? Someone made note of "bad writing" being available for "IndiePubs." Right, like we've never seen bad writing in legacy publishing either. Shall we name a book and go digging for the reviews? How many of those got raves and how many were trashed. Stephen King's early career springs to mind.

Again, I say let the gatekeepers learn how to adapt and let the readers make the choice. It's about damn time that we took control of our own careers, took back the control of our own product, and get it out there to be read. There are too many damn good writers out there that are being shown the curb for every reason under the sun but that the author has no talent.

Yeah, I'd love a trad contract, but that's not a guarantee of a budget or a marketing team behind me. Didn't you just post that authors are now doing the majority of their own promo? Once upon a time, the publisher scheduled the book signings, sent out the promo materials, booked talk shows, sent out review copies, etc. Guess who's been doing it of late....

I choose to go my own way. I choose to be an Indie Published writer and I'm damned proud of that fact. I choose it for the integrity of my product and because I'm tired of someone else telling me my destiny. I choose my own. And if I have to do all the work anyway, what the hell do I need that Legacy/Trad publisher for anyway? I'll take the reader reviews and if my book sucks, then I'll take it on the chest and learn how to write better. For me, there's no indecision. I am what I am, an Indie Published author!

JRK said...

Hi,

I just wanted to let everyone know my experience with publishing houses- it's not just about the quality of the writing, but the timing, the marketing and the sales teams who have to go into book stores and convince them to put your book on shelves.

I sent my first novel "The Day of a Thousand Surfing Buddhas" to New Holland Press. I had the luck that it fell onto the desk of a passionate old style commissioning editor who called me within days of posting it- dream story so far.

She championed it but New Holland Press had just signed a contract with another author for an adventure story set in China- they could not have 2 books competing in the same stable.

So,they post-poned/said no.
Meanwhile I pitched another idea to the same publishing editor who was enthusiastic, got me to write 5 chapters and then the global financial crisis hit. It was the salesman who blocked the print of this second book as they could not imagine selling it into a bookshop in a shrinking economy.

Some great advice this commissioning editor gave me was to go into a bookstore and look at the covers and titles up the front that make you want to pick them up- no matter how good your work is, if a publishing company is going to invest their money, they need to know it will be attractive to key positions and sell.

Interestingly, no other literary agent or publishing company read my book as they simple weren't taking new authors.

So, recently I put "The Day of a Thousand Surfing Buddhas" onto Kindle.

The thing is, it's not just about money, it's about being read, isn't it?

justinerkelly.wordpress.org

Lynne said...

Fantastic post. Clear & educational. Thank you Nathan!

As an author still going through the traditional channels, it really gave me a new perspective on e-rights & and the reality of e-books. Thanks for the link to this post from your Friday roundup.

And BTW, agree with you on INTO THE WILD. All JK's books are brilliant.

Diana Hurwitz said...

Love or hate Amazon, they built their own launch pad (on-line store), rocket (POD & E-Book), guiding system(algorithm)and are mining for fuel(SP authors and their own imprints). As in everything, it's survival of the ingenious. The bookstore demise is aided by the realities of predatory business practices, a shrinking customer base due to the aging of boomers,lower birth rates, job loss, and competition for entertainment dollars. Books are no longer a rarity. The newer generations aren't as interested in collecting things. They are born with an electronic device in their hand and we have become a culture that favors the disposable. I've read thousands of books over the past forty years. Not all of them were good or worth the money. I remember my favorite authors' names. I remember the few stories that touched me in a permanent way. I don't remember how I obtained the book or who the editor, agent or pulishing house were. I remember the story. That is the only thing we authors truly have control over. Stories have the power to touch lives,change minds, comfort and amuse no matter how they are told or sold.

Business English teacher said...

I RECENTLY READ AN EBOOK BY ANNA PIEKARCZYK: MY DAD MY FISRT LOVE REALLY HEART-WARMING BOOK BASED ON TRUE STORY SOLD ON AMAZON

Brian said...

I like the idea of having my name on a hard cover featured in a Barnes & Noble, but the question is... How does a writer get through the damn door in the first place? It's not easy to get past that slush pile, as they call it. Traditional publishing is somewhat snotty (for lack of better words), or should I say: picky and choosy? Of course, they have to be. How many books can one store hold?

Still, eBooks are fascinating. Cracking into the traditional publishing system seems to be a full time job in and of itself (whether you are submitting to a publisher directly or submitting to agents).

THE OLD WAY

Send a query letter and wait three months for a reply? No thank you...

Send a query letter to an agent who then requests your manuscript and then signs you - hopefully - after that, which would be about nine months to a year from the initil query? No thank you...

And finally, if the book does get published, add another year to the above timeline? No thank you...

THE NEW WAY

Write the book (got that covered), edit (that's covered too), publish (no problem) and then market online (yep, can do that too).

Sorry Harper Collins... I think you've got a little problem on your hands!

Self-publishing eBooks has given writers and readers alike the power to control book publishing. Yes, paper books are still charming (I love bookstores), but so are eBooks. Why not self-publish and flex your 'online marketing muscle' and be on your way much sooner?

I'll take better royalties, my online marketing savvy and see traditional publishers and agents on the other side... If they ever get there!

LOL

Dan Petitpas said...

Well, one of the things people don't point out is that the high price of books (I mean, $8.99 for a paperback? $24.99 for a hardcover?) is the main cause of declining book revenues. When I was a kid, I remember seeing people buying stacks of books when they were cheap and not worry if a few were clunkers in the bunch. But now, books are so expensive that people agonize over what, if any, book to buy. Cheaper books mean more writers can make a living at writing. It's no accident that when publishers kept raising their prices, they kept cutting their midlist authors. Higher prices mean less books sold, so publishing just keep cutting their authors and staff. E-books have the potential to turn that around to the advantage of writers once again.

Diane Cox said...

Well, this is kinda late, and yes I sorta resent 'spending' words that should be in my second book, but I think the very fact that every writers' conference drills into you that you can't support yourself writing means that people will self publish. They want to get their books out and they want to eat! I'm still trying to get my very well written book out after two years and I'm ready to try the Hocking way. It's also a lot easier to promote online than in person when you have to work to support your craft.

Rashad Pharaon said...

This may have been covered by another post already, given that I haven't read all 221 responses, but I believe ebooks would do better for unpublished or mid-list authors with more than one completed novel. Amanda Hocking had nine available her first year. Yes, nine. Not one. Now that is some serious e-shelf space; so if you only have one book, my suggestion is to keeping writing.

IanThomasYoung said...

Much has been said about the inferior quality of the majority of ebooks but I have seen gob-smackingly poor writing and editing in print books even by established authors. So, I'm willing to give ebook authors a little slack in this regard. At the end of the day, I just want a good story and can handle a minimum of misspelling or misused commas. But please, authors, at least get your homonyms right; confusing 'there', 'their' and 'there' even turns off this forgiving reader.

Scott said...

Has anyone tried being an affiliate publisher? i don't know how many know this business model, but in internet marketing you know those people who make money online - just type in how to make money online and you'll see all of these products and ebooks(not novels) being sold. And you know how they do it they offer 50% commisions sometime 75% to 3rd partys who sell these ebooks on their behalf. now these $3 ebooks would have to be repriced to like say $10, $7 to the affiliate and the rest to you. And who and what are these affiliate marketers?? they're people who can send up to 1000s even millions of eyeballs to view your ebooks lets say one affiliate sells 1000 ebooks a month every month? how much would you make? say someone sends 100,000 people a month to your ebook and 10% buy? it happens, some of these affiliate marketers make $15,000 to $30,000 a month online some of the very best make millions a year and i know it's big in affiliate marketing to sell products off amazon, sell physical iteams and if this takes off your soon find an army of affiliate trying to sell your books and if they see your ebook trending in kindle say you sell 500 ebooks a month they will promote the heck out of your ebook by youtube,facebook, blogs,website, articles and pdfs documents online. now before i end this i want to say 95% of all affiliate markeers fail that HOW saturated it is online which is great for writers. as soon as these people smell money they will be all over you like a rash this i belive this will happen sooner or later anyway most likely by some faceless employee at google or amazon this will change self publishing. Most writer's don't know how to market on line but these people are experts trust me i've had a good look at how they do things and they're good at sending loads of targeted buyers your way, just look at clickbank it full of offers for affiliates to market.

Shona said...

Phew! Nathan, I went completely BLIND trying to read the 200+comments on this excellent post! This effectively demonstrated for me the biggest challenge of self-publishing today: FILTERING. How do you separate the wheat from the chaff? If I get so overwhelmed trying to pick out the gems of wisdom from comments on a blog, how am I expected to pick out a good book from this landfill of self-publishing? Face it, it's little more than a garbage dump. Maybe one way of adding validity to self publishing is by going the agent-curated self publishing route as promoted by Argo Navis Author Services (from Perseus Books) It seems to be a hybrid platform. There is an interview by literary agent April Eberhardt on the Writeitsideways blog. I am curious to find out if the Argo Navis option (which is only available to agented writers) will act as an effective filter to self publishing. Is this the new wave of the future?

Shona said...

Phew! Nathan, I went completely BLIND trying to read the 200+comments on this excellent post! This effectively demonstrated for me the biggest challenge of self-publishing today: FILTERING. How do you separate the wheat from the chaff? If I get so overwhelmed trying to pick out the gems of wisdom from comments on a blog, how am I expected to pick out a good book from this landfill of self-publishing? Face it, it's little more than a garbage dump. Maybe one way of adding validity to self publishing is by going the agent-curated self publishing route as promoted by Argo Navis Author Services (from Perseus Books) It seems to be a hybrid platform. There is an interview by literary agent April Eberhardt on the Writeitsideways blog. I am curious to find out if the Argo Navis option (which is only available to agented writers) will act as an effective filter to self publishing. Is this the new wave of the future?

Linda Johnson said...

I've read one of Amanda's books and several of John Locke's books. More power to them!!!! They are smiling all the way to the bank! http://mhlnk.com/96123952

Richard Due said...

I'm afraid the portion of your arguement based on the $8.00 paper profit figure holds no water.

No publisher has ever sold a book at full hardcover price through the life of its print run. Not even the Potter books.

For beginners, Amazon, and many others, start selling their hardcover books at 40-60% off—right out of the gate!

Then, there are the remainders, which are sold on giant pallets to places like Books-a-Million, for around $1 a book, sometimes less.

And what about the books publishers failed to push into bestsellerhood, books with print runs so massive that not even the remainder houses can soak them up. Those represent a negative number. Don't forget to average those into your $24.99!

No. I'm afraid the idea of publishers making $8.00 per paper book is, at best, very silly. Personally, I would be surprised if they made, on average for all their titles as a whole, much more than $3 a book.

But that $5.24 figure you have on the ebook. Now, that looks spot on.k

Nathan Bransford said...

Richard-

Those discounts off of the retail print price come out of the bookseller's take, not the publisher's.

Tima Maria said...

I can see the validity of both sides of the argument here, although as a writer - as yet unpublished - I too would like to go the route of traditional publisher. Unfortunately, no matter how good a book and the story line, the majority of literary agents don't want to know you if you're an unpublished author and the same can be said for the majority of publishers - even if you're the runner-up in a nationwide literary competition, which I am. Check my blog - http://bloodgifted.blogspot.com - for my take on this issue.

Carsten Aretz said...

I think the problem is, is that everybody's an expert. Just shut up and right. Keep your day job and do your writing on the side. What ruining the industry isn't the kind of publishing, it's overly critical individuals. If someone sucks at writing and makes millions then find out how he/she did it and mirror that. Amanda Hocking wrote a post on her blog about how she promoted her book. Read it. Google it. It's there for your reading. Obviously there are a lot of people who adore Amanda and the other author you mentioned. Writers should not pan other writers because they aren't deemed to be as good as the mainstream writers. People need to stop being snobs, open their eyes to the bigger picture, write something, and self-publish via kindle for cheap. And do the same for their ebooks.

Carsten Aretz said...

By the way, I meant, shut up and write, not, shut up and "right"... LOL!

Anonymous said...

I refuse to pay over $7 for an ebook unless it's Stephen King or JK Rowling. Yes, that's right. Unless they're already scandalously rich, I don't give a damn, but really. That's the bottom line. I know how much it costs to make an ebook and I know how much the author really gets. It's friggin' ridiculous.

As a reader, I don't care about "perception of value." I'm a former marketer (who actually worked marketing for a bookstore chain). I know "feel good" lingo when I hear it just like I knew it when our main marketing guy told us not to worry about Amazon, they'd be dead in 5 years!

That was 15 years ago.

What I've seen in a lot of these agent blogs and publisher blogs is a bunch of people trying to remain relevant by doing what they've always done instead of working with the winds of change.

The bookstore chain I worked for did the same thing. Guess what? They no longer exist.

As for "perception of value," I have about as much luck finding a well written self-pubbed ebook as I do a trad published one. Honestly, it's a gamble each and every time. I have my tried and true: Nick Hornby usually comes through for me, as do some others, but how many freakin' times have I splurged for a $12 ebook that made the "best of" list or was recommended by a friend only to find it as hackneyed as some of the shittier .99 books.

No more. I'm done. If the synopsis sounds good and the cover looks decent (yes, I do judge covers), I'm a go. There's about as much chance I'll like it as some of the shit that the trads put out. You know. Like Twilight. Or 50 Shades of friggin' Gray. Or Cassandra Clare.

Seriously, the traditional publishers aren't much better at weeding out the crap than we are.

Anonymous said...

I have two books I plan to self publish. Before I decided on this route, I did some research.

I wanted to know whether ebooks were any good. I found out about %50 of the ones I purchased were. Here's my purchasing process:

1) Is the cover good? (If so, I go to step 2)

2) Does it have mostly positive reviews? (If so, I go to step 3)

3) Did I enjoy reading the preview on Amazon? (If so, I purchase the book)

Self published books that can meet this standard are good about 50% of the time. When they are not good, I usually know before I more than 50 pages in.

I think there are a lot of readers who take the same approach and who realized that you don't have to buy a book from a "publisher" to find a good book.

At the end of the day, you have to do a few things as a self published writer:

1) Make sure your cover looks good.
2) Make an honest attempt to send copies of the book out so that they can be reviewed. (There are various online groups that will read and review your book for free).
3) Make sure it's good enough not to get bad reviews!
4) Pray :)

Jason said...

I don't mind paying 8-12 for a brand new novel being published but I do have issues when a book is selling as a mass market paperback for $8, used copied $1-2, and the ebook is over $10. This is a total rip off! Publishing costs have been paid for, the books has been out a long time, yet publishers still think to gouge us consumers with these ebook prices. If the book is in mass market format, then prices need to be under 5. They'll prob end up selling more anyway and earning more in the long run.

Anonymous said...

I'm a self published author, even though i've had a 5 out of 5 stars on my novel and an excellent review it doesn't mean a damned thing. If you think you're going to make a sh*t ton of money in self publishing one or many novels? Give your head a shake, it will not happen period. I've done marketing until i was blue in the face and still got absolutely dick all from amazon ekindle. It's just another crap shoot, you got a better chance getting struck by lightning on a clear sunny day.

Rauzet said...

I think self publishing is just a stepping stool for many great up-coming Authors. No more being turned down by publishing companies. I published Kindle Your Aspirations just a couple of weeks ago and it has been downloaded 6,000 times! I would encourage guys to try it out!

Kathy said...

I have a B.A. in journalism, worked for newspapers and magazines for years, won awards for my writing, editing and design, and even owned a print shop.

Because of my background, I feel that I'm fairly qualified to write a book -- and have written books -- but haven't bothered to try to get anything published because I don't have a literary agent and from what I've learned, couldn't get an agent until I've already had a book published.

Would self-publishing a book -- or many books -- qualify when trying to get a literary agent? Or would an agent look only at sales?

I have the same question as Breadline Books: How do these self-published e-book authors go about marketing their books? Writing is a solitary activity, and most writers I know have very little time for socializing, so don't have a wide circle of friends.

How does one market to strangers?

One more thing that makes me crazy, as I'm sure it does most of you, is the fact that there are so many poorly written e-books. Unless every reader is unfamiliar with correct spelling and grammar, not to mention punctuation and capitalization (I could go on, but I'm sure you know what I mean), I can't see why they would be interested in purchasing an e-book.

The few I've partially read have been riddled with so many spelling, word usage and punctuation errors that I simply had to stop reading.

I always have a pen or pencil with me when reading books and magazines in order to make corrections, which was unnecessary until about 15 years ago. As for newspapers, I have become accustomed to all the errors, and so rarely read them.

Has anyone done an informal survey to determine what topics readers of e-books are most interested in? That could be useful to help those of us considering self-publishing.

Anonymous said...

I think self publishing gets around the controlling of the population's words into oblivion by Publishing houses.
The world can say what it wants without having to GET PERMISSION from a group that controls the world's opinion and knowledge base.
TRUTHS CAN COME OUT ABOUT ....REAL...HISTORY NOT CRAFTED HISTORY.
In the past the winners wrote history. Now SELF PUBLISHERS can SPEAK UP about the real truths that politics, religions, social groups, communities, universities, etc. keep hidden and not allowed to be published.
As a friend of mine recently told me, she had her father's writings about when he was a prisoner of war. The writings and his experiences she had urged him to publish. His response was HISTORY HAS ALREADY BEEN WRITTEN (by politicians and their minions) His stories of what actually happened were so different of what was published in Newspapers and history books. History will and can be changed again. THE TRUTH WILL COME OUT!
Also for those that want to speak up or write viewpoints that allow MEN to be strong again right BESIDE strong women CAN SAY AND WRITE WHAT THEY WANT AGAIN, AND THOSE THAT WANT TO READ THEIR WORDS CAN FIND A PLACE TO OBTAIN STRONG MEN'S VIEWPOINTS.
Stories with themes that allow women to be women without forcing the star or heroine to be a prostitute OR WHORE. Real lives without guiding our culture into stories of parties for Rainbow clubs where a guy collects a rainbow of THE MOST lipstick colors in the evening. These stories get kids to follow, resulting in a high amount of Herpes of the face and throats of teens, both male and female (such as in Rockwall, Texas and several towns around there, some years ago.)
Movies and books with orgy parties have resulted in Orgy parties sweeping even the Medium and small towns, which have resulted in a plague of Bird Mites (No See Ums)that have mutated, and spread now through the human population, (A WORLD WIDE EPIDEMIC) which are almost impossible to get rid of.
People follow what they read and see in movies and on TV. Movies are from books and TV writers, and as they are running out of something good to say and write for movies and TV, they put THE CONTROLLED OPINIONS OF PUBLISHERS BOOKS into scripts for movies and TV.
Children and Teens, as well as Young adults follow and act and dress as they are TAUGHT through the available MEDIA THAT WE SHOVE OUR LITTLE SWEETIES IN FRONT OF AS BABY SITTERS SO WE CAN COOK, CLEAN, OR JUST GO ON ...OUR...INTERNETS
We see the degrading of women, the crushing down mentally of our young men, and a destruction of our society.
IT WILL BE REFRESHING TO SEE AND READ NEW BOOKS WITH ...REAL...LIFE and not always the going on a date and HAVING to have sex TO PAY for the evening or see someone killed.

Anonymous said...

It sounds like many are trying to find a pattern that just doesn't exist. You can't stereotype a traditional published author or a self published author. There are successes and failures on both ends. Just do what you love and the rest will follow. Don't get bogged down in the charts and graphs trying to figure out how to make a quick million writing books.

Singlem said...

As a published Kindle author myself, I found this post very interesting.

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