One of my favourite bloggers, Declan Burke, writes about the real cost of writing. I think it’s a smart read for anyone thinking about writing as a career!

The rates for freelance journalism have changed over the last decade, not always upward, so it can be hard to put an hourly figure on earnings. These days I can write a feature in two hours and earn €200 very rare, but my hourly rate, when I’m being honest with myself and factor in the daily commute, is usually closer to €20.   Now let’s extrapolate, and apply that hourly rate to writing fiction. At two hours per day, five days per week, 48 weeks per year, at a rate of €20 per hour, that amounts to €9,600 per year ‘spent’ on writing fiction. Multiply that by the ten years I’ve been writing seriously, we’re looking at the guts of €100,000, or €33,000 per book published. And that’s presuming that I’ll have a book published in 2011, which is a pretty big presumption; if I don’t, we’re looking at each book I’ve published costing me €50,000. Meanwhile, the largest advance I’ve ever received is €10,500, a figure that’s roughly ten times what an author scrabbling around at my level is likely to receive if he or she is lucky enough to see a book land on a shelf.

via Crime Always Pays: Word Junkies; Or, The True Cost Of Writing.

Borders is not looking like it can pull through this, in fact it looks like it is in its final stages of life as a company.  Some of its stores might survive as either a smaller chain or part of a new entity, but the chain as a power is all but finished.

The lessens for booksellers and publishers in Ireland and the UK (which has already suffered the loss of Borders) is that the Bricks & Mortar supply chain that we rely on so much is not invulnerable and can and will fail in the years ahead.

“It would have a significant, concrete and immediate impact on sales,” said one publishing executive who requested anonymity as the person’s business relationship with Borders is confidential. “We would just sell fewer books period.”

Traditional book outlets such as Barnes & Noble (BKS.N) and Borders account for about 49 percent of book sales in the U.S. according to Albert N. Greco, professor of marketing at Fordham University who follows trends in publishing and retail.

While people can go to other retail outlets such as Wal-Mart, there are typically fewer selections.

Wal-Mart, for instance, carries around 1,400 to 1,700 titles, said Greco, while Borders’ superstores stock well over 100,000 books.

“If the chain went out of business it could be a serious blow… the whole value chain could be adversely impacted,” Greco said.

via Analysis: Book publishers may suffer in world without Borders | Reuters.

Declan Burke, a favourite of mine and a fellow I’ve had coffee with before, has an interesting post about reviews that come alone some time AFTER publication and the value of these non-traditional media:

Leaving aside my fascination with the web’s potential for generating coverage of writers who might not otherwise get a fair shake, not to mention the opportunity it provides to by-pass traditional publishing and go straight to the reader, it’s always nice to know that someone is reading your stories, and nicer still when you know that you haven’t wasted their precious reading time, and particularly nice when a reader goes to all the trouble up writing a review and uploading it. These are not things I take lightly.

It’s one thing, and a marvellous thing in itself, to be reviewed in the traditional media outlets, but the fact remains that said reviews are written by people who have received a copy of your book for free, and are being paid to write the review. But, and at the risk of being overly sentimental, there’s something a little bit special about a review from a reader who has paid good money to read your story, and then, off their own bat, and with no reward for it, puts in the time and effort to write a review and post it to the web. Above all else it’s a practical example of that much abused phrase ‘the kindness of strangers’, and I deeply appreciate it, and always will.

via Crime Always Pays: The Kindness Of Strangers: Web 2.0 And Readers’ Reviews.

This is a fascinating development. I suspect a short lived one, at least for now, a factor of the initial enthusiasm of new ereader owners rather than the way the list will remain for the rest of the tear, however, a space to watch and a sign that ereaders and ebooks change change the industry quite rapidly:

Millions of gift-wrapped iPads, Kindles, Nooks and other digital reading devices resulted in an unprecedented surge in sales of e-books last week.USA TODAYs Best-Selling Books list, to be published Thursday, will show digitals new popularity: E-book versions of the top six books outsold the print versions last week. And of the top 50, 19 had higher e-book than print sales.Its the first time the top-50 list has had more than two titles in which the e-version outsold print.

via Week after holidays, e-book sales outdo print – USATODAY.com.

photo credit: alancleaver_2000

About This Series
Things Publishers Fear is an occasional series about the realities of publishing in the modern era. For the record, survival is not guaranteed, nor is it always deserved.

Authors

I wrote the bulk of this article across on my personal blog, but it warrants a full exploration here on Green Lamp Media. You might wonder why publishers could fear authors, the life blood of their business? Let me explain the reasons.

Currently the bulk of authors are in a fairly powerless position relative to publishers. Publishers have money, access and publishing slots. Publishers finance the editorial and production work that goes into a book and have the relationships that ensure distribution, advertising and shelf space. This has been changing rapidly over the last few years.

One way it has been changing is self-inflicted, publishers shedding costs by shedding editors (and, some would argue, quality as they do it). But the other more visible way it is changing is in economic terms as the cost of making a text widely available drops very close to zero via effective digital publishing.

[pullquote]Why should you sell a paper publisher your digital rights when there is no need?[/pullquote]

In 2006 when I was only starting to think clearly about digital change (and had only been writing a blog for some 4 months) I wrote a post called Authors Will Drive Change, it was part of a short series of articles on what was changing the publishing industry.

The point is that publishing is no longer just about books and even more it is no longer about waiting for a publisher to decide your work is good enough for print. Options abound and as more and more writers realise that they will take advantage of it.

E-books will push this change even more. There is no reason why authors’ royalties should be the same on e-books as they are for paper books and in many ways there is no reason why the authors cannot sell e-books themselves rather than through a publisher. Why should you sell a paper publisher your digital rights when there is no need?

What I didn’t address back then and what has become clearer now, is how established authors will also drive change and in doing so, make a much bigger impact. After all, if ebooks begin to account for 20-30% of the market (or more) and of that major authors generate the lions share of sales then their departure from your lists will make a huge dent in revenues.

But even authors with moderate (still impressive but not BLOCKBUSTER) sales can see the benefit of direct sales and cutting the publisher out. The most recent example of this is JA Konrath who writes The Newbies Guide To Publishing blog. He has been posting for some time now about his rather impressive success in selling books via Amazon’s Kindle device:

In short, this market is perfect for a one-person operation.

I’d certainly entertain an offer from a large publisher, if they wanted to buy rights for one of my books. But I’m not going to go out looking for the opportunity. Especially since I’ll make more money in the long run if I keep my rights.

I could even make more money in the short run.

According to my recent royalty statement, my horror novel AFRAID sold about 54,000 copies in all formats, earning me around $27k.

If I released a Jack Kilborn ebook on my own, and it sold like my current ebooks are selling, I’d make $20k in a year.

It’s doubtful I’ll make $17K next year on AFRAID, since it’s no longer getting coop on bookstore shelves. But I’m sure I’d make $20k, or more, on a self-pubbed ebook.

So in two years I can make more money on my own on a self-pubbed ebook than a book released by a major publisher in hardcover, trade paper, paperback, and ebook formats, supported by a tour and advertising.

Unless it’s a big offer, I can’t imagine selling rights to my work ever again…

And There Is More
The IDPF released the figures for February ebook sales. They are pretty stunning. I’ve written elsewhere about my skepticism regarding ebooks and the industry’s obsession with price and a single format, but when one sees figures like this, it is almost understandable that they get excited and distracted by them.

Mike Shatzkin writes about what this seemingly rapid shift towards digital means for the print side of the business and it is an interesting perspective:

If by the end of 2012, 25% of sales for a new book are digital, then about half of new book sales will be made through online purchases if we count the print book sales made through online retailers (mostly Amazon.)

Online print sales can be served through inventory generated on demand. So, if these estimates are right, we are less than three years away from a publisher (or author) being able to reach half the market for a book without inventory risk!

Having half the market reachable without print-run risk or inventory storage; having half the customers connecting with their reading through online paths that make them at least theoretically identifiable; and having a quarter of those customers reading through a medium that enables interactivity will make all the changes we’ve seen so far in trade publishing appear trivial. And if the very perspicacious Carolyn Reidy, her unnamed counterpart, and I are right, that disruption is going to take place before many books now under contract reach their publication date.

Personally I caution about moving from current trends towards future results. I’m unsure if the sales will continue at their current level never mind continue to explode in such an impressive fashion. However, even if we allow that Mike and the trends are half right and we see say 33% or 40% of the market reachable via no-risk required methods by 2012, then the savvy authors like JA Konrath will see little reason to work with a publisher at all. Why, if they don’t require the finance that is one of a publishers strongest assets, would they?
[pullquote]as the market becomes more digitally biased, the greater the risk that lead and mid-list authors see first the advantage of retaining their own digital rights[/pullquote]
This is not to say that publishers don’t offer more than finance, they do and in abundance, but for some authors, the skill set that publishers offer is affordable and at a more reasonable cut than they currently allow publishers to keep.

In my view, as the market becomes more digitally biased, the greater the risk that lead and mid-list authors see first the advantage of retaining their own digital rights, then later the advantage of retaining all rights and exploiting them for themselves.

The future, for all that it offers great promise to authors and thus they WILL drive change, may not offer such great promise for publishers and certainly not as they currently exist and hence why publishers fear Authors!

photo credit: Max Braun

About This Series
Things Publishers Fear is an occasional series about the realities of publishing in the modern era. For the record, survival is not guaranteed, nor is it always deserved.

Google

Where to start with the fear of Google. The 12 million scanned books. Yes that will do for now!

It is not just that publishers are rightly pissed at the fact of Google’s actions (and the gall they have shown in continuing with them throughout the process of first suing and then reaching a complex and variously hated/despised/grudgingly accepted settlement) they fear the implications of Google’s actions.

Fearing the fact

When I say the fact I mean that Google has, at the very least, stretched the idea of fair use to the limit and in doing so created a tool of great value. A searchable database of all the works they can. Nothing will now put the genie BACK in the bottle. The database exists the power of publishers as possessors of that POTENTIAL database is gone, broken forever by the reality of Google Books. Search there and you’ll see its amazing capacities even if only partly, and in a hampered way, realised.

You may not think that this is important but it has created a database that publishers do not:

a) control
b) understand and
c) know how to profit from

If publishers had been involved in the creation of such a database they might have built in any number of changes, made any number of demands and would in any case have had different interests from each other, so much so that they probably would never have made this a reality (and why should they if does not benefit them?). But now they are presented with a fait accompli and one that, even with a settlement, leaves them disadvantaged and with a database that hardly favours them.

Maybe these things are their just deserts, perhaps you feel they have created this situation by failing to move with the times and invest in technology and rights databases, but this series is designed to take the publishers viewpoint and from that perspective, those three things are very worrisome indeed and justify some fear, regardless of the historical reasons for their existence.

Fearing the potential

Any sensible publisher, though, reserves their real fear for the potential of Google and its database. Google are very well placed to benefit from every digital trend you can envisage. The massive textual database they have built compliments this in innumerable ways. Mobile results can be enriched with tourist info from books, history texts and restaurant reviews, not to mention news stories from newspaper and magazine publishers (as if any content producer will escape). What is more so much of the database will contain books that singly have little of value but as a whole collection and cross-referenced are worth considerable sums (public domain works, government publications and the like).

The database brings the reality of competition with EVERY SINGLE BOOK EVER PUBLISHED into sharp focus for publishers as new books face increased real challenges from books published 10, 20, 300 years ago and in every conceivable context, on a phone, laptop, desk computer, iPad, iPod, wi-fi enable device, anything that connects to the cloud and has a screen (not to mention an increase in POD). So if the web enabled a flood of amateur (and let’s face it not always terribly good) content, Google’s books database enables a flood of real professional content that rings true with quality and which at a time when being published was harder than it is now has the stamp of publishers approval. This onslaught threatens directly the lifeblood of all publishing, the new book trade, in ways that all publishers rightly fear.

The potential of Google Books is that by supplying information from a vast accessible anywhere database you reduce the overall demand for new or fresh paid content. What’s even more frightening is that Google is a private company and access to that enormous database will be, for all intents and purposes, at their whim.

How do you like them apples? Well, as a publisher, I don’t like them much, but as William James said: “acceptance of what has happened is the first step to overcoming the consequences of any misfortune.”

About This Series
Things Publishers Fear is an occasional series about the realities of publishing in the modern era. For the record, survival is not guaranteed, nor is it always deserved.

photo credit: dsearls

No 1 ~ AMAZON

Despite the seeming victory of Macmillan in its battle to force Amazon to accept the new “agency model” publishers have a sensible fear of Amazon. Like all businesses that sell their goods to consumers through intermediaries, publishers are forced to subject themselves and their products to the requests and “suggestions” of the retailer.

Amazon controls a large portion of the online consumer connection to books. They may not be the best at this, but they are surely the biggest. They have been on top of pretty much every trend in publishing for some time:

They have exceptional efficiencies in terms of distribution and sales (both in terms of ebooks and print books), the kind of efficiencies that publishers could never equal. Operations, operations, operations. If you can ship faster and cheaper you have an advantage over your rivals. What publisher could afford to build out a Whispernet for ebook delivery?

They are organised by category and could easily spin out niche based sales sites (and could afford to pay for content to go with that and attract attention) if they chose. If this doesn’t concern you ask yourself if Tor.com is viable if Amazon spins out a sales site with masses of author or for hire content built around the Sci-fi & Fantasy genres?

They have a powerful presence in Print on Demand and Self Publishing. You think that’s not that amazing witness the small scale gold rush that has been emerging over the last six months as established publishers see future profit and less authorial and consumer concern in Self Publishing. Mick Rooney has an interesting Guest column addressing some of these points over at Irish Publishing News.

With the launch in 2009 of Amazon Encore, Amazon is officially and finally a publisher. That Encore is currently modest hardly matters, they could easily scale that effort very rapidly if they chose and because it need not support the massive legacy costs that the bigger publishers need to, they require much more modest sales results per title and much less working capital per title. Oh and in 2010 they have already announced 9 titles all of which will be out by April 2010. I expect to see many more before the year is out.

So while a victory on the ebook pricing model seems like a step forward for publishers in may ways it represents a funny one. The “Agency Model” actually means Amazon will now profit from each sale whereas up until now, for new releases, it was losing money. So Amazon stands to make more money per unit of a new release sold, but less for backlist titles and non-new releases. But it moves the goal posts by removing the key selling point for the Kindle, the $9.99 new release price point.

This makes it much less attractive for Amazon to deal with publishers rather than cutting them out of the equation and dealing directly with authors or even with agents. After all, they were using ebooks to sell high priced devices and even if they make more money per ebook sold it won’t compensate them for selling fewer units of the Kindle. The battle for publishers now is to retain control of that crucial relationship, the author-publisher relationship. Having already surrendered the publisher-reader relationship and knowing how difficult it will be to regain traction in that arena, to allow Amazon to insert itself between the author and the publisher would be fatal.

So, from their perspective, publishers’ fears of amazon are rational and justified. Amazon threatens to disintermediate the publishing industry using the talent the industry has nurtured and the content the industry has edited, developed, marketed and grown. That hardly seems fair does it? But then “Deserve got nuthin’ to do with it.” – Snoop