Friday, March 25, 2011

Strange Goings-on in the Publishing Industry

The publishing world is all aflutter this week, thanks to two contradictory and coincidentally timed occurrences.

On the one hand, NYT bestselling thriller writer Barry Eisler announced that he was walking away from a half-million dollar, two-book deal (that’s $250,000 a book) with St. Martin’s Press in order to self-publish in e-book format only. (I'd like to note without being catty that this contract represented a considerable step down from his previous contract with Random House.) Seems SMP wouldn’t concede to Eisler’s demands for a higher percentage of e-book royalties; Eisler got mad and walked.

Eisler has a long (emphasis on long) post about why he did this on his blog here . He makes a lot of good points about the publishing industry—my personal favorite being that the industry is outsourcing much of its work, such as weeding through the slush pile (a task now performed by agents since most publishers refuse to accept unagented submissions) and promotion (we all know how much authors are expected to do their own self-promotion these days) while retaining the same share of profits. (Can I add copy writing to the list of out-sourced tasks?) And I do think it’s disgusting that authors get less than 15% in real terms of e-book sales. Since the cover price of e-books is lower than that of hardcovers, the rise in e-books is seriously hurting authors’ take home pay.

However, I’m not one of those (many, many) authors jumping up and down, applauding Eisler’s move and saying, “Oh, this is such a good model; let’s all dump our publishers and self-publish e-books for $2.99.” According to Eisler, authors who stand up for print publishing—which he derogatorily labels “legacy publishing”—are suffering from a form of Stockholm Syndrome. Personally, I think Eisler left several factors out of his calculation. First of all, he foresees the sales of his books continuing at the same pace ad infinitum. In my experience, this just doesn’t happen. There is a huge burst of sales when a book is first released, then the sales trickle off month by month. By my reckoning, he would need to sell something like 400 e-books a day for 300 days before breaking even. In order to achieve these sales, he will be lowering the price of his e-books, which of course he can do since he’ll be getting 70% of the price rather than only 14%. It’s been proven that e-books with lower prices get higher sales. However, if everyone lowers their price, that benefit will evaporate. And then "legacy published" authors will be left with 15% of that much lower price, which will work out to considerably less than 50 cents a book. Thanks a lot, Barry.

Secondly, not everyone has an e-reader. Not everyone wants an e-reader. Barry Eisler fans without readers will either have to go through a cumbersome POD rigmarole, or look for new authors. Which do you think is more likely?

Thirdly, while publishers don’t do as much promotion as we’d like them to, lead titles (like Eisler's) do get promoted. For one thing, publishers pay coop to put those books in the front of stores and in the newsagents in airports. I’ve heard that airport bookstores are getting unhappy because businessmen will walk into their stores, browse the newly released hardcovers, then walk away and download the e-book. Much easier than flying with a big hardcover. But if an author's new release isn't in Hudson’s News, those businessmen are going to pick up the newest release by some author who has stuck with the “legacy publishers.”

There are other factors at play here: I can’t see Hollywood or foreign publishers combing the ranks of self-published writers looking for their next blockbuster. Eisler, of course, already has foreign publishers, who will not doubt continue to print his books. Interesting he’s still willing to work with overseas “legacy publishers.” Of course, he needs them to pay for the translators. (You can read Eisler’s rant about the cover his French publisher gave one of his books here. Now, I’ve complained about covers in the past, but this is just, well, wow.)

Ironically, the day after Eisler’s bombshell hit the news, Amanda Hocking, who recently created shockwaves by making over a million dollars on her self-published e-book young adult vampire series, signed a reported two million dollar contract (four books, roughly $500,000 each), with—double irony—St. Martin’s Press. Amanda, the guru of self-publishing in e-book format, evidently believes the “legacy publishers” still have something to offer her. You can read Amanda’s take on the controversy here.

Update: Historical romance author Connie Brockway is also "going rogue" and is leaving Avon for the world of self-publishing. You can read her take on the subject here.


RevMelinda said...

Interesting post, Candice--I saw a piece today on romance writer Connie Brockway doing the same thing:

Interestingly, Brockway cites creative freedom as an important factor in this decision (or perhaps it's more of an important byproduct?). She says "Of course, this was more than a business decision. Strictly as a writer, I’m squealing with joy at the notion of being completely free to write the stories I most want to read. And, I sincerely believe, that my readers most want to read."

I'm not a publishing whiz or anything, but I've wondered for years why more authors don't self-publish. Perhaps we've reached a technological and emotional tipping point now, with a enough people having e-readers to make this worthwhile?

cs harris said...

Melinda, I did not know that. Thanks for the link. It is interesting that she cites creative freedom. Perhaps I've been lucky, but despite the fact that my stories have always bucked guidelines (especially my romances), I've never felt my creative freedom constrained. I'm considering putting the one romance to which I now have the rights up as an e-book, but the friends I know who have done this have had sales of less than 100! (As Amanda herself notes in her post.)

Steve Malley said...

It was indeed a strange week! :)

There thing I've noticed since I put stuff up on Kindle is that my sales are the opposite of mainstream release: Instead of a big burst at the beginning trailing off to nothing, my sales are building momentum. Every month I sell more than the month before.

Now, I'm not one of those who thinks this momentum just builds and builds and builds-- there's bound to be some kind of a bell curve there, or maybe a sales chart like a stock graph with heaps of ups and downs.

But it does go on forever.

Personally, I don't think publishers are going away. Or not exactly. They may be doing everything possible to drive themselves to extinction, but sitting on giant piles of money and intellectual property can compensate for a whole lot of stupid.

My greatest hope is that a large and vibrant self-publishing movement will bring publishers to heel, force them to correct their bad old ways...

cs harris said...

That's interesting, Steve; I suppose it's word of mouth kicking in. How much of a pain was it to put those books up--seriously?

Anonymous said...

On the general topic of e-books, I read the last Sebastian book on my Kindle (and loved it :D) but I noticed a surprising amount of typos. I think my favorite was one where it was supposed to be "Me?" but it came out "e?". There were also some spacing issues where there were supposed to be gaps within a paragraph. Are publishers still working out the kinks of e-books? I would've thought it'd be the same electronic copy that would go into print.

Charles Gramlich said...

Shows what a strange world we are living in now. Everything seems open and weird.

cs harris said...

Shelley, Oh, dear; I'd no idea they weren't using the digital copy. Where are these typos coming from? How bizarre. I hope this doesn't mean I'm going to have to start reading Kindle galleys, too.

Charles, the situation is serious in flux, isn't it?

Anonymous said...

Hi Candy:

I hope you publish any of the backlist titles to which you have the rights (I am particularly waiting for An Night in Eden - I love that book).

Typos in e-copy, geographic restrictions (I cannot buy Where Serpents Sleep as an ebook in Canada), Agency pricing and unfair royalties to authors are all examples of how the big publishers are trying to sabotage ebooks to the detriment of their authors. I don't think that the $2.99 ebook price is going to be the norm for a new full-length book (Eisler's current $2.99 e-offering is a short story). For backlist titles, this may be a fair price as many of the necessary costs were already incurred when the book was originally published. That price may also be good as an introductory price for new self-published authors. Ultimately, I think the price for a new full-length book is going to settle in somewhat higher.

As Brockway said in her commentary, the fact is that, many midlist authors are just not getting their contracts renewed unless they are prepared to meet the big publishers narrow criteria of what is acceptable. Self-publishing (and publishing with small independent e-publishers) allows these stories to be told.

Anonymous said...

That should be A Night in Eden - bad fingers :-).

cs harris said...

Anon, I think Eisler is right when he says that publishers are trying to put the brakes on e-books in order to protect their paper sales. Ironically, a big motivating factor is that the NYT does not count e-books in with hardcover sales, so publishers are also trying to maximize their author's chances of hitting that all-important list. One of these days the NYT will have to include e-books with whatever format the book is currently issued in--right now, the separate e-book list is weird; the e-book plus print list favors paperbacks.

And Brockway does have a point on freedom. I've been lucky with two of my editors, but I know the romance industry in particular has become ridiculously narrow. I quit reading romances long ago, and I know I'm not the only one.

Pax Deux said...

I have two e-reading devices (kindle and ipad), which I acquired for work and travel purposes. But nothing beats a book, at least for those of us who grew up reading them.

As a reader, I also wonder about how will I judge self published books. Will I be able to skim through some pages, or will I be restricted to a synopsis? How will I hear from these authors, if their books do not make it to Amazon or my local B&N (I'm not even counting independents).

Lots to think about.

Jane said...

I think that ebooks are around seven percent of total book sales. I prefer to read a hard copy book. There's just something about holding the book in your hand. Also, I think that printed books go up in value, some quite significantly, as a specific book become a scarce commodity. I can't see that happening with a file that's downloaded to a device.

cs harris said...

Pax Deux, I think you've nailed two of the biggest problems with self-published e-books. Right now, publishers act as "gate keepers" weeding out the awful. Yes, they also weed out some wonderful books that just don't fit anyplace, but they do serve as a quality control. The second problem is, How does anyone ever hear about these books? Self-promotion is very time consuming.

Jane, I much prefer paper books myself--in fact, I like big hardcovers. But e-books are an increasingly large part of sales. They're between 20-25 % of my sales, although I'm told my sales are unusually heavy in e-books for some reason.

Barbara Caridad Ferrer said...

I think the thing that's not being discussed a whole lot yet, is that favorable royalty rate through Amazon-- I have to wonder how long before Bezos changes the rules (as he is wont to do) and that 70% begins inching down. Mind you, it has a long way to go before it hits 14%, but still, it's something to consider.

It's all crazymaking and enough to make a person throw their hands up and declare themselves done with the whole thing.

vp said...

As with the ongoing print vs. ebook conversations amongst readers, I do not think that this issue has to be an either/or situation. I think it makes sense for authors to look for ways to take advantage of the new markets. In many ways, publishers have held the upper hand in the writer/publisher relationship for too long, and this might be an opportunity for writers to take some control. I also think that the creative control issue is a real one. I find that many of the independent authors that I have discovered through my kindle reading are doing some very interesting things and I'm enjoying discovering new writers. That said, I think there is still a place for traditional publishing houses. My hope would be that they would realize that working off an ancient and crumbling business model is not the way to survive. Publishing as an industry needs to try to quit choking ebook sales and embrace the new technologies. I am surprised that they learned nothing from the music industry debacle. As with any business, they must evolve or face extinction.

I do know that since I started reading on the kindle, I am buying twice as many books annually. This year, I may triple the amount. I attribute this to ease of use, convenience and the lower cost of ebooks. I still buy print books and I expect I always will, but for the amount of genre reading I do, ebooks have made perfect sense.

I would encourage writers who own any ebook rights to their backlist to publish them. I am constantly on the look out for older titles and I love the idea of the writer getting a larger share of the profits. Candice, I would be thrilled to buy any of your backlist on ebook. I have managed to obtain old paperback copies of most of your work at used books stores, but since those copies are falling apart, I'd gladly buy them in e book format.

Steve Malley said...

Hi Candy,

Sorry it took so long to get back. To answer your question, formatting my first one (Crossroad Blues) took me about twenty hours. Second time through (Poison Door) I was able to get the same job done in about six hours.

Of course, if had your name recognition I'd probably hire the jobs out. I know you can get professional formatting and cover design for under $600. You'd be able to keep writing while they did the heavy lifting, *and* you'd have final approval of your cover.

Hope you don't mind, I'm mentioning you in my next blog post- maybe tonight. :)

cs harris said...

Barbara, I think Amazon taking 30% off the top is just beyond disgusting. And you're right--what's to stop them from increasing their piece of the pie in the future?

vp, You are so right: some publishing houses are deliberately trying to put the brakes on e-book sales, mainly to protect their authors' standing on the NYT list, which doesn't lump e-book sales in with paper sales for the hardcover or mm lists (they have separate e-book lists. I only have the rights back to one of my romances, but I am looking into putting it up as an e-book. I'm also trying to get the rights back on some of the others. To my astonishment (and, frankly, chagrin), Ballantine has recently made several of them available again in mass market--my mystery Midnight Confessions being one.

Steve, Thanks for the answer. If it took you 20 hours, it would take me longer, especially since I don't have an e-reader and would be utterly clueless. But to be frank, I'm not sure I'd recoup $600. At the same time, I don't feel competent to do my own cover. (Did I tell you how much I love that Poison Door cover? I think it's your best so far.)

Susan/DC said...

I'm quite conflicted on this whole issue. As a reader I love going to a bookstore and browsing, and I refuse to buy a book (unless it's by one of my very few autobuy authors, like Candy) without reading at least a chapter. Without that, I don't know if I like the author's voice or if it has one of the hot buttons that make me put a book back on the shelf immediately. I like traveling and leaving behind books for others to read. I appreciate the handselling that the staff in a bookstore can do. I appreciate supporting jobs in my neighborhood. And I love reading a physical book. Since my local Borders closed, I've bought far fewer books for exactly these reasons.

OTOH, if more and more authors only publish e-books and if more of the authors I like publish digital versions of their backlists, I might be forced to buy an e-reader. Not a Kindle but perhaps a color Nook or an iPad.

cs harris said...

Susan, I like to read the first few pages and a scattered few from the middle, too, before I'll buy a new author (I've discovered many writers polish the first chapter extensively but skimp on the rest). I'm one of those weird people who actually prefers hardcovers. But I know so many people who tell me they're buying more books now that they have an e-reader. I suspect we're only just beginning to see the effects of this on the industry.