The Shatzkin Files


Comparing self-publishing to being published is tricky and most of the data you need to do it right is not available


I have a certain pride of discovery in super-successful indie author Hugh Howey. It was nearly two years ago that I learned about him on a trip to LA to organize a conference that didn’t happen. The Hollywood grapevine told me about his novel-of-assembled-novellas, Wool, which was a sudden major self-publishing bestseller and that he had a movie deal. I got in touch with him and his agent, Kristin Nelson, and learned that he was making $50,000 a month in royalties, and had a host of foreign deals as well as the movie deal. Meanwhile, the publishing establishment couldn’t come up with an offer that would sensibly entice him to give up his indie revenues. I read his book and loved it and then had many interesting exchanges with Hugh and Kristin, which resulted in them appearing on the Digital Book World program in 2013, 13 months ago.

He’s a terrific guy who has achieved a phenomenal success and maximized it in a very clever way. But I think he’s a much better author and self-promoter than he is a business analyst.

At the beginning of the year, Howey offered his advice for publishers which reminded me of an old saw of my Dad’s, which was “when I was a kid, everybody wished their father owned a candy store.” Hugh’s advice for publishers is to eliminate things that annoy him (non-compete clauses, length-of-copyright licenses, New York City offices) and to lower prices, give away ebooks with hardcover purchases, and pay authors monthly.

Now, none of these things is necessarily a bad idea, and some of them will almost certainly come to pass, at least for some authors in some contracts. And I remember when Wiley moved from 3rd Avenue to Hoboken that they figured they got a competitive advantage of permanently lower rent at very little sacrifice of efficiency. But none of them are things a publisher would do just for the hell of it; they’d have to see a competitive advantage or a competitive necessity. The piece he wrote advising the publishers (which he addressed to HarperCollins but which he meant to be generic) didn’t even attempt to prove that these changes were either commercially advantageous or necessary.

But giving this advice to HarperCollins or any other big publisher is not dangerous to anybody’s health. Unfortunately, Hugh’s latest business inspiration — a call to arms suggesting to independent authors that they should just eschew traditional publishing or demand it pay them like indie publishing — is potentially much more toxic to consume. (The agenda here is unclear. Is Hugh most interested in getting more authors self-publishing or in organizing authors to demand better terms from publishers? It’s hard to tell, but there is an agenda, it would seem.)

The long story short is that Howey analyzed a bunch of Amazon rank data (apparently a single day’s worth, 1/28-29/2014, which has so many obvious problems associated with it that all by itself it raises questions about what of value can be gleaned) and from that extrapolated some breathtaking (and breathless) conclusions that go way beyond what the data could possibly tell anybody. The analysis purports to compare how authors do self-publishing versus how they’d do with a publisher and comes to the conclusions that they make more per copy on average self-publishing and maybe even sell more and make better books to boot. (For much more and better analysis of the data biases, I’d check Dana Beth Weinberg’s post on this subject. Her objections and my objections have very little overlap.)

My problem with the whole exercise is that there is a long list of relevant facts not included in the data and therefore ignored in the subsequent analysis:

1. Author revenue from print sales.
2. Getting an advance before publication versus having costs before publication.
3. Unearned advances and their impact on author earnings.
4. Getting paid for doing the work of publishing which goes beyond authoring.
5. Current indie successes where the author name or even the book itself was “made” by traditional publishers.
6. Rights deals.
7. How well Amazon data “maps” to what happens elsewhere. Is it really projectable?
8. The apparent reality: flow of authors is self- to traditionally-published, not the other way around.
9. Publishers can raise royalty rates (or lower prices) when it becomes compelling to do so.

Each of these could be a big or small part of the story, but every one is relevant.

1. Author revenue from print sales. Authors not only make a lot of money on print sales, but print in stores (as opposed to printed copies available through Amazon) is also a marketing element. This all still matters. In a comment on Howey’s site, one author estimates her Amazon sales as anywhere from 10% to 30% of her total sales. Obviously, for some other authors it is a lot more than that, maybe north of 70% of their sales. Which kind of author are you? And if you’re the kind selling mostly on Amazon, is that an inherent characteristic of your appeal or a deficiency in your non-Amazon distribution?

2. Getting an advance before publication versus having costs before publication. Although Howey cites one author who turned down an advance to self-publish, those stories appear to be few and far between. I was really struck by one such author announcing nearly two years ago that he was doing this, but, in the end, that author took a publishing deal — not a self-publishing deal — from Amazon. And the size of the advance is also a consideration that Howey’s analysis doesn’t touch on. It can’t, because that data — however relevant — isn’t available. (But then, can you draw valid conclusions without it?)

 3. Unearned advances and their impact on author earnings. Unearned advances are a substantial part of author compensation. I know of one Big Five house that calculates that they pay more than 40% of their revenue to authors and another which says that number is in the high 30s. That’s not all digital, some of that is print with manufacturing and warehousing and shipping costs associated with the revenue. How can you compare how authors are compensated if you don’t calculate the benefits to authors, meaning the resulting higher percentage of the revenue they’ve taken, of unearned advances? That relevant data is also not available.

4. Getting paid for doing the work of publishing which goes beyond authoring. Frankly, the biggest omission to me is the eliding of the costs — in time and money — of doing the work the house does for an author. Howey mentions that editors and cover designers can be hired. That’s true, and good and competent ones too. But is a good writer necessarily a wise chooser of an editor or of a cover design? How much does it cost if you don’t get the right one the first time? (We know publishers aren’t perfect at these jobs either, but they’re bound to be better most of the time than somebody who hasn’t ever done it before.) And is that how you want to spend your time? Authoring is a job but doing the work of self-publishing is also a job. And it entails real risk. Advising a writer to self-publish without considering these things is like telling somebody who’s a good cook that they might as well just open a restaurant.

5. Current indie successes where the author name or even the book itself was “made” by traditional publishers. Another factor any author self-publishing has to consider is the likelihood of success, which is much greater if the books are backlist (have some fame in the marketplace) or even if just the author has been previously published. Successes like Howey’s, from a total standing start with no prior writing track record, are quite different from others who have reclaimed their backlists and used them as a platform to build a self-publishing career. Now, that data could be obtained. Wouldn’t you like to know how many of the “indie authors” at various income levels were cashing in on what was originally publisher-sponsored IP and how many started from scratch? (It’s more challenging, of course, to assemble the data by the author rather than by the book.) But I sure think it would be necessary to understand before drawing conclusions about who should self-publish.

6. Rights deals. Howey himself has benefited from having a stellar agent who has made foreign and movie rights deals for him across the globe. (She even made a print-only deal for Wool with S&S.) Yes, you can (if you’re lucky) do this like Howey did: finding an agent to represent his self-published material. But that’s another thing to find and manage that comes with the deal (and the advance check you get to cash) if you do a deal with a traditional publisher (although, admittedly, you would probably have had to find the agent in the first place, and self-publishing could be a way to do that.) Nonetheless, you get more rights-selling firepower on your side if you’re with a publisher.

7. How well Amazon data “maps” to what happens elsewhere. Is it really projectable? A massive flaw in the analysis is the biased nature of the data. Amazon’s sales profile is not the same as the market as a whole. (One day of data isn’t a projectable sample either.) One agent pointed out to me that they are weak at selling mass-market fiction, for example, and that their ebook sales tend to the fresh and new, so they don’t get a bump when a mass-market paperback comes out. But we can be pretty sure that Amazon sells ebooks more successfully than the market as a whole, because Kindle has the biggest installed base and Amazon has the most book customers. This bias of sample is compounded by the focus on genre fiction. No matter how big a percentage of those niches is served by Amazon, it is important to remember that it is where they are relatively strongest in relation to the big publishers. If we were comparing literary fiction or biographies — both of which have lots of worthy authors too — the chances are the cost of an Amazon-only distribution strategy, or an ebook-only distribution strategy, would be far higher. And the chances of success would be far lower.

8. The apparent reality: flow of authors is self- to traditionally-published, not the other way around. But I think part of the motivation for this piece was frustration in the indie author community at the fact that many of the best ones get signed up by traditional houses, who view indie publishing as a farm system, and very few established authors will actually turn down an advance to go indie. They’ll reclaim their backlist and self-publish it, or do a short ebook on a subject that is timely and can’t wait for print or be made longer. But there has been very little evidence that I am aware of that publishers are having wholesale difficulties getting authors to come aboard with them on a traditional deal.

9. Publishers can raise royalty rates (or lower prices) when it becomes compelling to do so. Which brings us to the final point that I think is relevant and ignored. As Howey and others have pointed out, the early days of ebook publishing appear to have been good for publisher margins. They can afford to give authors more. (In fact, I encouraged them to do that before their accounts come after them for the extra margin in a post nearly three years old.) But they’re not going to give it out of some spirit of generosity or because Hugh Howey (or Mike Shatzkin) thinks it would be a good idea. They’ll give it when it is a competitive necessity to do so.

So my advice about Hugh Howey’s advice is simple. Totally ignore it if you’re not a genre fiction author; there’s precious little evidence or thinking in it that applies to you. And if you are a genre author, be very clear about the extra work and extra risk you take on in order to get some extra margin. Both will be required for sure whether the extra margin materializes or not.

Self-publishing is definitely an incredible boon to commercial writers and they should all understand how it works. Increasingly, literary agencies see it as their job to provide that knowledge.. It is almost certainly a good idea to self-publish for many writers who have reclaimed a backlist that has consumer equity. It is a perfectly sensible way to launch a career, either before going after the commercial establishment or as a part of the strategy to engage with them. (Editors in the big houses are well aware of the self-publishing successes; it’s a new farm system.) If an author has access to markets, it can be a better way to get short or very timely material to them faster. But to say it has its advantages and applications is a far cry from saying that it is a preferable path for a large number of authors who could get publishing deals.

I can’t “prove” this so I won’t try, but it bears further emphasis that it still looks like the number of authors who start as self-published and then get “discovered” by the establishment and switch over is still larger than the number of authors who say “keep your stinking advance” and turn down a deal to do the publishing themselves. None of the parties involved is stupid — not the traditionally-published authors, nor the self-published authors, nor the hybrids — not even the publishers. And they might not be evil, either. As for self-interested debaters, they exist on all sides.

PS: I HATE long comments. If you disagree with me and want to use my space to make your case, please be concise. (And frankly, although I also prefer you to be concise if you agree with me, I’m made less cranky when I get long-winded support.)

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  • Jack W Perry

    Thanks for this informative and rational response. Your piece thoughtfully pointed out some of the realities of the marketplace and the flaws in the assumptions of Howey’s “analysis.”

    Also, didn’t Howey sign a print and digital deal with Random House UK? So, he must have seen value in aligning with a corporate publisher. Good for him. He definitely defines the “hybrid-author” and has a foot in both worlds.

    • http://idealog.com/blog Mike Shatzkin

      My understanding is that he not only signed a print-and-digital deal at RHUK, but also that they provided editing support that he incorporated into his own edition. (But I might be wrong on that.) Yes, Hugh’s a hybrid author, really. You’d almost have to be if you want global coverage.

      Mike

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  • Hugh Howey

    Great write-up, Mike. I would say I agree with 86% of it.

    However the sliders are moved, there are a couple things about our data set that should raise eyebrows:

    1) The distribution and preponderance of self-published authors is real and can be verified by browsing the bestseller lists on Amazon.

    2) The fact that e-books absolutely dominate the overall mixed-format bestseller lists (to the tune of nearly 90%).

    And giving up print is not giving up 70%, as our report today shows. It’s giving up 12% of that 70%. Bookstores and publishers lose a lot, but authors don’t give up much at all. In exchange, they get 70% on their digital.

    That is: Traditionally published authors are giving up more in digital losses than self-published authors are giving up in print losses. And that disparity will only grow.

    It could be that I’m getting lucky over and over, but my reasoning here isn’t post-hoc. It isn’t because of my success. In 2009, I published my first book with a small press. And then I saw what was coming with self-publishing. I put the contract for book #2 in a drawer and took charge of my writing career. I even bought the rights back to my first book. You can find me saying the same things 4 years ago that I am saying today. Things like: “Agents will one day prowl the bestseller lists for indie talent,” which industry experts laughed at me for suggesting. And then it happened. Things like: “Authors will one day turn down mega deals because they can do better on their own.” Ludicrous when I said it. All came to pass.

    I assume I’m getting lucky over and over. I don’t have decades of expertise or even a college degree. Just an open mind and wide eyes. But those two qualities have served me pretty well. And I’m perfectly happy with every one of my conclusions in that report being wrong, but someone has to explain the distribution both of indie authors and e-books. Because that distribution paints a VERY different picture than ANYTHING any industry expert has ever suggested about today’s book market.

    • http://idealog.com/blog Mike Shatzkin

      Hugh, I’d have much less of a quarrel with your methodology and your advocacy if you targeted your advice to genre fiction writers who are capable of churning out many titles a year. And it would be nice if you respected the fact that you’re looking at numerators without denominators. Doing an (incomplete) analysis of how (some of) the top 0.5% of titles do tells me (and everybody else) *nothing *about how many tried and failed and how much it cost them to try and fail. And I really don’t accept your apparent contention that the number of authors turning down advances to self-publish is anything but a very minor trickle, which I believe is dwarfed by those who self-publish and then sign. (You aren’t alone in having seen self-publishing as a farm system for the majors some time ago. I’d strongly advise you to double down on that understanding and cool it a bit with the near-universal advocacy.) But if you agree with 86% of what I say, or even 76%, I’d love to see it reflected in your future posts. I hope I’m clear, particularly in the postscript, that I in no way disdain self-publishing. But I think my “just because you can cook doesn’t mean you can run a restaurant” analogy holds and it doesn’t in any way seem reflected in what you say.

      Mike

      • Hugh Howey

        Hmm. According to the data we pulled, these genre writers are making more money on fewer books, so I don’t think the “churning” is the answer.

        And I enjoy all things publishing. I like geeking out over this stuff. And I don’t have any problem being wrong. I’m not offended when people disagree. So I’ll probably keep right on pontificating and advocating. I like it.

        And of the two studies, mine and the one at DBW, mine is far less-wrong. It isn’t even close. At least I’m looking at the top 1% of both groups, and not comparing 1% to 100%. Mistakes that elementary result in a huge loss in credibility. There’s a huge swath of successful authors that will have a hard time taking anything DBW releases seriously. Not without some kind of retraction and admission that the sampling and analysis were way off.

        As we’ve both admitted to each other before, time will tell. Until then, let’s keep having fun bouncing ideas and opinions around and not take it any more seriously than it needs to be taken. There are no experts here. The ground is shifting too fast for that sort of hubris.

        Cheers,
        Hugh

      • http://idealog.com/blog Mike Shatzkin

        Hugh, I’m sorry, but I really think your whole methodology is fatally flawed, even before we get to the details where we disagree. I absolutely agree that self-publishing suitable for many situations. And it is possible that a genre author might be able to glean some value from your analysis. But it is worthless for any other kind and we are a LONG way from the time when MOST authors — even genre authors — will be better off self-publishing than being published. As a path to a good agent and good deals, it’s totally legitimate. But you keep insisting Amazon is the universe, and it isn’t. Sometimes it is 80% of the universe and sometimes it is 10%. In other words, you’ve done a FABULOUS job analyzing the weather in Omaha but I think you should stop telling people you can predict the weather in Boston as a result. And this isn’t a “time will tell” argument. Things change with time. I’m talking about right now in the world we live in today. And I say so not having been surprised by a single one of your data points. Amazon is a curated world, not a random one. It might be news to some that there are a lot of ebook-onlies on the Amazon combined bestseller list, but not to people who are paying attention. I wrote a long time ago that we needed to reconsider what bestseller lists mean because of price variations (which wasn’t necessary when we did hardover, trade pb, and mass markets.) If bestsellers were arrayed by CUSTOMER SPEND, we’d see a very different picture. Self-publishing is a much smaller part of the total picture than the unit sales bestseller lists at the place that sells them best COULD lead one to believe, particularly if one has something they WANT to believe.

        Mike

      • Elliot1234

        But it is worthless for any other kind and we are a LONG way from the time when MOST authors — even genre authors — will be better off self-publishing than being published.

        Can you provide data to demonstrate that?

      • http://idealog.com/blog Mike Shatzkin

        No. Let’s go back to the top. The point to this piece is that the data you’d need to prove that isn’t available. I’m arguing that you can’t prove it, one way or the other. What I’m expressing is my opinion.

        Mike

      • Elliot1234

        It may be an opinion, but opinions carry ideas. Im challenging the idea.

        So how do we know we are a LONG way from the time when MOST authors — even genre authors — will be better off self-publishing than being published.?

      • http://idealog.com/blog Mike Shatzkin

        Because you’ll see the evidence of a change in the negotiating position by publishers changing their deals to get and keep the authors they want. And probably we’ll see the development of a big-publisher-controlled intermediate tier with a different deal, shifting the risk-reward ratio and maybe even the work ratio. To a certain extent, that’s already beginning to happen.

        Mike

      • Elliot1234

        Interesting speculation about the future. But I suppose we would have to consider all the other things that can change in the future. Otherwise, the idea suffers from the same weakness you cite Howey for.

      • http://idealog.com/blog Mike Shatzkin

        Not exactly — even nearly — the same thing. But if the analogy strikes you as precise, I won’t try to change your mind.

        Mike

      • Elliot1234

        Well, you make an assertion, base it on two factors that may change, and ignore all other factors that may change in the future. At the same time, you criticize Howey for basing his assertions on limited data and ignoring nine factors you list. I agree you won’t change my mind, and I probably won’t change yours. But there are lots of other minds reading all this.

      • http://idealog.com/blog Mike Shatzkin

        Let’s just leave it as “I don’t follow your logic”. You can draw any conclusions from that you like, as can the other minds reading this exchange.

        Mike

      • Elliot1234

        For the other minds, the logic is simple. Howey made an assertion and Shatzkin told people to ignore it because he did not consider nine other factors. Then Shatzkin made an assertion without considering many other factors. Which assertions should be ignored? You decide.

      • http://idealog.com/blog Mike Shatzkin

        I will not attempt to challenge your logic, which requires your characterization rather than any real summary of the substance. I think people should judge me by my words, not by your summary, but I’ve gone around this track enough to suit myself even if perhaps not enough to suit you. And it is all here for people who want to wade through it.

        Mike

      • Elliot1234

        I suppose they could judge you by the same standards you judge Howey.

      • http://idealog.com/blog Mike Shatzkin

        I don’t know what that means. I like Hugh Howey. I think he’s a terrific writer, a dogged and smart entrepreneur, and a lousy busy analyst. He’s got me beat on at least two out of three. I don’t feel insulted or defeated if somebody disagrees with me.

        Mike

      • Elliot1234

        I know what it means. It means you criticized Howey because he failed to consider nine factors you identified, So, if we apply your standards to you, we can see you made an assertion, based it on two speculations, and didn’t consider many other factors. I’d have to say your assertions are lousy. They are just based on your speculations. Howey based his on real data. Should we pay more attention to your assertions than his? If so, why? (What does insult have to do with any of this?)

      • http://idealog.com/blog Mike Shatzkin

        Elliot. I can deal with nasty and I can deal with stupid. But I can’t deal with both. This conversation is at a end.

        Mike

      • Elliot1234

        OK. You don’t know why we should pay more attention to your assertions than to Howey’s?

      • http://idealog.com/blog Mike Shatzkin

        Howey says he agrees with 86% of what I said. I will stipulate that Hugh Howey knows a lot more about both writing and self-publishing a book than I do. I would hope he’d agree that it is likely I know a lot more about the publishing business than he does, and vouch for the fact that I don’t shy away from things that are new.

        But we’re verging back to the stupid. You can take me or leave me. There is both plenty of written evidence and plenty of people to ask to form an opinion. You’re entitled to yours. And everybody else is entitled to theirs. I’m not running for office or campaigning to build an organization.
        Mike

      • Elliot1234

        So we should pay more attention to your assertions because you say you know more? You are not demonstrating that by making assertions based on speculation about the future.

      • http://idealog.com/blog Mike Shatzkin

        I just saw the same diner I saw four comments ago. I knew we were going around in circles. I really don’t have the patience for it anymore. I’m sorry I couldn’t satisfactorily answer your questions. But you seem to want to know more about me. I’m sure there is somebody out there who can give you an informed opinion about what my speculation is worth.

        Mike

      • http://idealog.com/blog Mike Shatzkin

        Elliot, I re-read yours and I’ll walk mine back.

        You weren’t nasty.

        But you’re asking a ridiculous question. I said Hugh Howey urged a position with data that was inadequate to the purpose and I explained why. Our positions aren’t mirror-images because I am NOT urging a position. I am not trying to tell authors what their earnings really are one way or another, he is. I am not drawing conclusions from a ridiculously limited data set, he is.

        Pardon my frustration with being pressed to explain that an analogy is not analogous. But it isn’t. At all.

        Mike

      • Elliot1234

        Well, you are telling authors, But it is worthless for any other kind and we are a LONG way from the time when MOST authors — even genre authors — will be better off self-publishing than being published. That is pretty firm position. And you back it up with speculation about two factors in the future, ignoring all other factors in the future. That is inadequate backup for the purpose, especially when you criticize Howey for ignoring other factors.

      • http://idealog.com/blog Mike Shatzkin

        Well, that’s for you to judge. You can decide whether you think I know what I’m talking about. And so can anybody else. And that really is the end of this line of conversation. It’s really boring. From here on I use the delete button.

        Mike

      • http://alexandralynwood.com/ Alexandra Lynwood

        Mike,

        That fails to take into account the concept of business failure. Businesses most often fail when they don’t see the need to adapt, are unwilling to change, or don’t notice that industry moved on without them.

        You’re assuming publishers would adapt if the market demanded it, and yes that would be the sensible thing to do. However, real life shows us that sometimes businesses just don’t. Having worked in corporate insolvency in a previous (boring) life I can assure you that business can end up entrenched in their own narrow viewpoint and fail to adjust to the new needs or desires of their clients/customers. Looking at the situation from that perspective I can’t help but wonder if we’re watching that inflexibility right now.

        To turn that comment around allow me to post this scenario:

        “Because you’ll see the evidence of a change in the negotiating position by publishers changing their deals to get and keep the authors they want.”

        Could instead be:

        “Publishers aren’t changing their deals to get and keep the authors they want because they haven’t yet seen the need to.”

        When you don’t see a need it doesn’t necessarily mean the need doesn’t exist – it’s also possible they just don’t see the need because they’re stuck with poor data, methodologies or management.

      • http://idealog.com/blog Mike Shatzkin

        Alexandra, I don’t think publishers will fail to “see the need” if their problem is that authors they want to sign won’t go for their deal. Even if you assume abject stupidity (which I don’t, but you apparently do), that should be clear if they face it.

        Mike

      • http://alexandralynwood.com/ Alexandra Lynwood

        I didn’t say anything about abject stupidity nor do I assume it. That’s putting way too many words into my mouth! Having worked with failed behemoths I can assure you that the situation is rarely that cut and dried.

        I’m merely suggesting that sometimes industries get stuck in their own world and don’t – or can’t – see what is happening around them. Even when they do it doesn’t necessarily mean they can produce appropriate strategies or responses to the situation. If they could they would not have failed.

      • http://idealog.com/blog Mike Shatzkin

        But, Alexandra, this isn’t about what’s not in their world. It is about what is at the *center *of their world. Pardon me for a characterization you didn’t intend, but I think it is implied if not explicit. I’m not sure who but an idiot wouldn’t notice it if they couldn’t sign authors up to their publishing house anymore.

        And I certainly think some publishers are going to fail, or get absorbed. It might be 15 years since I first wrote that there would be consolidation among big trade houses because bookstores would start to fail. There’s no doubt in my mind that we won’t have five big trade houses 10 years from now. But that doesn’t mean the one or two or three we have won’t have a new set of offers for authors. I expect they will.

        Mike

      • http://alexandralynwood.com/ Alexandra Lynwood

        That I can agree with. I too think we’ll be seeing even more mergers with a few failures along the way.

        The ones that will survive will be the ones who adapted. The adaptation is likely to take on several forms but I think at the heart of it better terms for authors will need to be a key approach.

        My generation and the one following me are much more adapt at utilizing technology, and we’ve grown up with tools that allow us to express ourselves without the need for a middle man. The question that people are inevitably going to ask is: what benefit is there in signing with you?

      • http://idealog.com/blog Mike Shatzkin

        Alexandra, I believe there is a lot for publishers to provide authors through scale, regardless of how much the authors know about technology. About *that*, time will tell.

        Mike

      • Spela Lavtar

        From what Mr. Zacharius wrote, I would say that it’s quite evident, that as long as writers are submitting their manuscripts to publishers, publishers (or at least Mr. Zacharius) doesn’t see a need to address that question.

      • http://idealog.com/blog Mike Shatzkin

        Partly that’s because publishers deal in a world of professionals — agents — who KNOW the answers and whose job it is to spell it out for their clients. But mostly because very few publishers feel a shortage of things to publish.

        Mike

      • Spela Lavtar

        This sound something like a politician would say, when he/she is avoiding answering a direct question. There’s a bunch of answers on Alexandra’s and Jesse’s question and yet, none of them actually answers it.
        “Partly that’s because publishers deal in a world of professionals — agents — who KNOW the answers and whose job it is to spell it out for their clients.” is dancing around the subject, nothing more, because it seems that you can’t give writers a compelling answer. And there’s also “But mostly because very few publishers feel a shortage of things to publish.” That’s just what I said.

        Oh, yes, an agent, even an editor, who PERSONALLY KNOWS the author asking that question, would be able to answer that question, but the answer
        would only be relevant to that particular author, not to authors in general.

      • http://idealog.com/blog Mike Shatzkin

        I guess “what a politician would say” is another way of saying “not what I want to hear” or “screw you”.

        Look, it’s a business. People generally do business with people they generally do business with. That’s true in all businesses, not just publishing. People who succeed in the business generally have mastery of something that allows them to make a contribution *and *an ability to navigate the particular business. Sometimes talent alone is enough; almost always it isn’t.

        And publishers don’t explain the business of publishing to authors. It just isn’t how it works. And if you find a publisher who wants to explain it to you, you’ll know you’ve found somebody very atypical. I think you’re much more likely to get the understanding you want (if you really want one, and I must admit I’m really not sure) from an agent, *if *you’re a commercial-enough writer to interest one in spending the time.

        Mike

      • Spela Lavtar

        It was an observation, not a “not what I want to hear” or “screw you.” I’m not following what’s happening in publishing
        industry (and read your blog and comments) to hear what I want to
        hear, but to see how other participants see the industry and to learn about different angles. And sometimes, like
        today, I share my observations, and that I do without expecting that others would agree with me.

      • http://idealog.com/blog Mike Shatzkin

        Okey dokey.

        Mike

      • Jolene Guinther Navarro

        Thanks for a clear and well written article. This takes me back to the mom at home vs the mom with a career debate. In order to validate my choice I have to prove your choice is bad, even evil.

      • http://idealog.com/blog Mike Shatzkin

        I like the analogy. Thanks.

        It is always tiresome when people turn a discussion about something into an exercise in self-righteousness.
        Mike

      • http://www.beautebook.com/ BEAUTeBOOK

        Great article Mike, yours is the best analysis I have read until now, because it is the most complete. I would like to add that when you choose to self-publish, not only you are in charge of editing and of cover design, but on marketing and promoting the book, which requires time and skills that not everybody has. Also traditional publishers have a marketing budget that benefits authors by fostering its sales, and as you said, you need to consider print income to compare authors earnings. I love self-publishing and what it meant to the industry, but I agree with you that they are two different paths, and whether which one is best depends on each author.

      • http://idealog.com/blog Mike Shatzkin

        I like praise as much as the next guy and I thank you for yours.

        Mike

      • Steven Zacharius

        I’m sorry….what question didn’t I answer…I must have missed it.

      • Steven Zacharius

        There have been many publishers reporting better earnings this year so I still think we’re doing things the right way for our business. It might change down the road, but for now; things are still going well.

      • http://alexandralynwood.com/ Alexandra Lynwood

        Thanks for the response and sorry for the delayed reply (Valentine’s Day!).

        And that’s great but then the question arises why better deals are not on the table for authors. I’m not presuming to know the details of every deal placed on the table by Kensington compared to other large publishers, but one only needs to listen to the author community for two minutes to realize just how angry, upset and hurt they are.

        How long is the current model of low author royalties sustainable within the traditional press industry?

        If this was ten years ago people could point to their profits and say hey it’s all good. Now and going forwards however, not so much. Technology has changed the picture drastically and writers see a way to cut you guys out. Presumably you’re seeing increased profits on digital like the others are reporting – what happens when more authors jump the digital bandwagon and strike out for themselves?

        As I said below before you entered the conversation, Steven: what benefit is there in signing with you? That’s a question that’s going to become more and more common as people educate themselves on this topic.

        I don’t think it’s a question of ‘might change’, I think it’s a certainty that different strategies will have to be adopted in the future. Not necessarily a bad thing – businesses that adapt tend to survive.

      • Steven Zacharius

        I think the answer should really come from an author who has been traditionally published for several years and has seen their career build as well as their advances continue to escalate. We publish over 400 books per year and the overwhelming majority of authors have been with us a long time, many over 20 or more years. From me it sounds like hype because all you hear on most blogs are from authors who were debut authors with us. All publishers provide services that established authors apparently value or they wouldn’t stick with publishers. There has been no exodus of authors from publishers. We have more submissions than we could ever publish. Speak to authors who are successfully traditionally published at writers conferences rather than just hearing the same story being told over and over here. Don’t hear it from me.

      • http://alexandralynwood.com/ Alexandra Lynwood

        With all due respect that isn’t an answer to the fundamental question I am posing. Given all the information that is freely available to up and coming writers, why would they take you (or another publisher) up on a traditional deal?

        The numbers aren’t in their favor, exposure appears to be lackluster in many cases, and poor decision making has contributed to books tanking. These aren’t my words, these are just some of the complaints that have been made by traditionally published authors in recent weeks.

        Hype suggests that some people are highly enamored of something, so clearly there’s something about self-publishing that is resonating within the writer community. On the flip side of that we’re seeing very few traditionally published authors come out waving proud flags in favor of the traditional industry.

        Why isn’t traditional publishing being hyped also in light of the authors that have “traditionally published for several years and has seen their career build as well as their advances continue to escalate”?

        Have some stepped forward? Yes.

        Do they tend to be megastars like Patterson and Turow? Yes.

        Chances of everyone else becoming a megastar? Unlikely.

        Let’s face it though, discussing the outliers in either situation isn’t that helpful. It’s like saying that many self-publishers fail to make sales. Yes, but many people fail to ever traditionally publish at all.

        The true focus should be on the midlist who appear to be having a much more viable career doing things for themselves. What is it that traditional publishing can offer them other than a brief glance when they’re clearly showing that there is a great deal of money to be made on their works? This is a section of the market that David Maass referred to as “the money-losing burden” just a few days ago. Somewhere there is a disconnect in thinking.

      • http://idealog.com/blog Mike Shatzkin

        And, also with all due respect, this is a silly question to pose as a hypothetical. Steve has already said that they get plenty of submissions, they have no shortage of writers, and that on top of the new submissions they have writers that have been with them happily for years. AND they’re doing well financially, so there would be no apparent urgency to change. You’ve made a hypothetical case explaining why authors just won’t pay attention to publishers and agree to take their deals. Only problem is: that’s not a situation recognizable to any publisher with a decent operation and a checkbook. You’re worked up about a problem that from the standpoint of people running their businesses every day actually doesn’t exist.

        Mike

      • http://alexandralynwood.com/ Alexandra Lynwood

        I’m not in the slightest bit worked up, Mike, simply posing a genuine question nicely to Steve that’s being asked by other writers on other boards in a much more aggressive and less receptive manner.

      • Jesse Pearle

        “Given all the information that is freely available to up and coming writers, why would they take you (or another publisher) up on a traditional deal?”

        As an “up and coming writer” this is the question that really needs to be answered, and it hasn’t yet. I don’t care that there are old authors still hanging around who have been content for the last two decades. That tells me nothing about what traditional publishing can do for me (or other authors like me) today.

        Given the vast disparity in revenue between self publishing and traditional publishing, if all I need to do is pay for an editor and cover designer (which is a one-time expense and in no way translates to an ongoing percentage of revenue into someone else’s pocket), then why shouldn’t I just do it myself?

        Not that you’d have me anyway, but assume you would just for a moment.

        What do you (or your counterparts) have to offer that I can’t do for myself in today’s industry?

      • http://idealog.com/blog Mike Shatzkin

        I suggest you ask that question of an agent! It’s their job to give you this kind of education and good business advice.

        Mike

      • Steven Zacharius

        I have no qualms about an author self-publishing their book. More power to them if they think they can make more money doing so and many here have indicated that they have. But if you want to build a career in writing and get greater exposure you need a print component to your distribution. You also need more visibility and reviews from established reviewers.

        I have no idea why traditional authors aren’t speaking out. Probably because they don’t find a need for a blog to hang out together. They see each other at writer’s conferences all the time, at Book Expo, etc…

        But you bring up a good point. Most people don’t get selected by publishers so indie publishing is a great venue for them. Publishers are gatekeepers as are agents. We are filters as to what gets published in many cases. The editor has to like the story and the writing, versus a writer just putting up the book for sale in many cases or paying a freelance editor to edit their work.

        New writers choose a publisher for their own reasons. That’s why I said you should speak to them instead of hearing it from someone in the business. You have the same 50 people or so in all the blogs on indie publishing and you’re all preaching to yourselves…..convincing each other how successful indie publishing really is. They make lists to show how many writers made of x amount of dollars but they don’t talk about the other 10,000 that made fifty cents selling their books. You don’t hear from the bulk of the indie writers. You hear about rankings. Do you hear much about foreign rights being sold? Talk to established traditionally published writers for yourself and see what they say. There are loads of them out there.

      • http://alexandralynwood.com/ Alexandra Lynwood

        Steve, I do think it’s interesting discussing this with you and the fact that you’re at least willing to engage with the community is a great starting point. Hopefully there’s a middle ground somewhere between the disparate viewpoints because I think we all love books at the end of the day. With that said:

        “But if you want to build a career in writing and get greater exposure you need a print component to your distribution.”

        According to the data that Hugh Howey is releasing that isn’t true. Did you see an increase in your profits due to genre print, or was it due to genre digital releases? I’m guessing it was the latter. I don’t think for one minute that print is going to explode into a frenzy or even maintain it’s market position as digital becomes the new normal. So why would I be interested in nominal print distribution?

        “I have no idea why traditional authors aren’t speaking out. Probably because they don’t find a need for a blog to hang out together.”

        But traditional print authors have been speaking out. They’ve just not been extolling the virtues of traditional publication. If there is such a benefit to traditional publication then you guys have a major PR problem on your hands because people aren’t discussing it.

        “You have the same 50 people or so in all the blogs on indie publishing and you’re all preaching to yourselves…..convincing each other how successful indie publishing really is.”

        I’m not sure how productive this conversation can, or ever will be, if you seriously think that only 50 people on the entire internet are discussing these issues.

        “Do you hear much about foreign rights being sold?”

        It’s becoming more common to hear about this, yes. Again I think it’s going to become more frequent as people figure this stuff out.

      • Steven Zacharius

        I haven’t seen very many successfully published major authors here talking about traditional publishing one way or the other. I do stand by my comment that there are a handful of successful indie authors talking here on the blogs. I keep saying there are tens of thousands of indie authors that are only selling five books a year and you won’t hear from them ever. I don’t hear much about foreign rights being sold here and if they are I have no idea if the rate are comparable to what a traditional subsidiary rights agent would get for them.I don’t think we have a major PR problem on our hand. Every week at our editorial meeting there are more books brought up for potential acquisition than we could ever hope to publish. And I should add that many of them are from people who have self published as well.

      • Lyn South

        Perhaps ask the question of author Allison Winn Scotch. Previously traditionally published, she self-published her current book, The Theory of Opposites, for which the movie rights were just purchased by Jennifer Garner.

      • http://idealog.com/blog Mike Shatzkin

        Which, I suppose, is supposed to “prove” that self-publishing your book makes it more likely to get a movie deal?

        Sort of a non sequitor…

        Mike

      • Lyn South

        Not what I said at all, Mike. Please don’t put words in my mouth. I simply provided an example (as requested by Mr. Zacharius) of a traditional turned indie author and the sale of subsidiary rights (in this case, film rights) for their indie published book. By the way, Ms. Winn-Scotch has been on the NY Times Best Seller list. She left traditional publishing for many of the reasons that Mr. Konrath and Mr. Hewey have cited.

        It would be nice to have a civilized conversation without being taken out of context, thank you.

      • http://idealog.com/blog Mike Shatzkin

        Apologies for taking you out of context. One of the hazards of replying through the Disqus email system.

        But, on the substance, publishers never had much to do with selling movie rights (they’re very often excluded from publishing contracts). In fact, I’m waiting for when Hollywood figures out that movie scripts could be turned into a line of novels. That day’s coming.

        Mike

      • Steven Zacharius

        That is wonderful for her. But also keep in mind that loads of movies are optioned and never made into films. If it does; that’s an amazing thing for her.

      • Jesse Pearle

        “the overwhelming majority of authors have been with us a long time, many over 20 or more years”

        Do you think perhaps those authors have just become too comfortable to make a fuss? I’ve been in my current (day) job for fifteen years just because it’s easier to stay than to try to find something better. I could no doubt make more money elsewhere, but it’s too big a hassle to move, to learn a new procedure, interact with new people. It’s just safe to stay where I am. Job security and all…

        I also can’t help but wonder what happens when those 20-year authors kick off? Who’s going to replace them when new authors are learning to be more self-sufficient?

      • Steven Zacharius

        Almost 100% of these authors have agents who are hopefully looking after their careers. I don’t think agents would be complacent if they didn’t their authors were getting a good deal. As I said we acquire new authors all the time, two last week alone plus another 20 for our digital imprint Lyrical Press. These authors could self publish if they wanted but they obviously see value in being with a publisher. There are many digital first houses including Entangled which Jackie Barbosa said she liked. There’s Samhain, Ellora’s Cave, Carina, Impulse…..some from traditional publishers. Obviously we’re still offering services that many authors find valuable.

      • Jesse Pearle

        “These authors could self publish if they wanted but they obviously see value in being with a publisher. There are many digital first houses”

        I still wonder if those authors did their homework? I didn’t before I signed with a digital first press like the ones you listed. I was just happy to get a contract.

        I’m still very fresh and wet behind the ears, you could say, but my first impression now is that perhaps I should have waited and self-published my novel instead. I am reserving judgment until my personal experience with traditional publishing plays out, but that doesn’t preclude me from asking questions now.

        What value is it that those authors see? Is it financial security? Is it about transferring responsibility for certain aspects of the process? (The tedious stuff like editing, ebook formatting, marketing.)

        I’m not trying to pick on you, I promise. I read and reposted your guest blog on writersinthestorm last fall. It was informative and incited lots of questions that I never really asked.

        But if I want to make the most of my investment in my own writing, it really seems silly right now to sign with a traditional publisher. Forgetting that I did already, I’m looking at that more as an experiment, to be honest. I expect my indie-publishing project to net far more in a year than my traditional publishing project does (I’m talking net revenue in my pocket). But I won’t know the real answer to that question until next February :)

        “Obviously we’re still offering services that many authors find valuable.”

        The question remains, what services do your authors still find valuable that an indie author couldn’t do for him/herself?

      • Steven Zacharius

        How about getting the book into print at a full price where most of the sales still take place? What’s your marketing ability on kdp? Lower the price and hope it sells. You’re going to have 100,000 other books at lower prices to get lost with. How about getting reviews from well known reviewers like publishers weekly or library journal or the NYT?

      • Jinni

        I must have been absent the day the New York Times started reviewing genre fiction en masse.

      • Steven Zacharius

        Gee, a sarcastic comment. I didn’t mention the words genre romance. I assumed there were more than genre romance indie authors. How about thriller writers and writers of quality fiction? Surely there must be some indies out there writing other than category fiction.

      • Steven Zacharius

        And how about answering the question I posed as to when publishers lower their prices to match indie discounted prices? How will you compete against known names for the same price?

      • http://idealog.com/blog Mike Shatzkin

        Your post is confusing. You say you signed with a digital-first publisher, but then you talk about a “traditional” one. They aren’t the same.

        Every opportunity needs to be evaluated on its own merits. It isn’t “indie versus traditional” or “self- versus a publisheer”. It depends on the offer. It depends on your appetite for work and your appetite for risk. It depends on how much clout the person acquiring your book has at the house.
        For writers, it mostly depends on having a good and competent agent to guide you.

        Mike

      • Jesse Pearle

        “Your post is confusing. You say you signed with a digital-first publisher, but then you talk about a “traditional” one. They aren’t the same.”

        They are the same to an author. I think that’s the perspective you and Steve seem to be missing. What does it look like from the other side of the fence? Step into our shoes for a few moments.

        I want to see my book published. If I don’t do my homework I’ll accept the first crappy contract that comes my way. Then I’m stuck with it for the next XX years… longer if I’ve written a series.

        Except I want more than to just see that glossy cover on a bookshelf. I want revenue. I want a career of this. I want to quit my tedious day job so bad my teeth ache. What’s the best avenue for me? It definitely isn’t sitting around waiting for rejections when I could just dip into my nest egg, pay an editor and cover designer, and publish it myself.

        Plenty of authors are probably more patient than I am and will likely fuel the slush piles of traditional publishing for awhile yet. At least until they catch wind of this discussion and realize they don’t have to wait if they have the constitution for it.

        Bottom line, what’s in it all for me? I am brand-new to the discussion. I don’t have fifty years of old dogma to filter through when I see new information. My eyes are fresh and to my fresh eyes I don’t see a whole lot of value in the old establishment. I see infinite value in the new one.

        So I’m understandably skeptical about everything agents and publishers have to offer, but I still want to understand why my gut tells me to leave that behind and carve my own path.

        I don’t want to speak for all new authors out there, but if they’re paying attention, they’re probably having the same questions and concerns. The fact that I have yet to receive an answer to my question is telling.

        Steve answered it in a round-about way. Print is what traditional publishers offer. “What’s your marketing ability on KDP?” Well, I plan to do more work than just let it sit there and hope Amazon does the work for me.

        If a new author is resourceful enough, they don’t need a publisher to find success. Established authors are a different story, sure, but as the industry evolves, the people clinging to old methods will disappear.

        Who matters most in the end? The sellers or the producers?

      • http://idealog.com/blog Mike Shatzkin

        OK. I don’t think we speak the same language.

        Mike

      • Steven Zacharius

        Many of the major publishing houses have digital first lines, including Kensington. We have eKensington and Lyrical Press. There’s Avon Impulse, eHarlequin, Carina Press and more. These digital first imprints are very similar in nature to Samhain and Ellora’s Cave or some of the smaller digital first publishers. Entangled works on a different model than most digital first houses I believe which pays editors and others a percentage of the receipts of the book. The sellers and producers both matter.

      • Jackie Barbosa

        I still wonder if those authors did their homework?

        Since my name came up above, I feel I have to point out that most of the digital imprints Steve referenced pay much better than 25% of net on digital sales. Entangled pays 35% of list, which currently works out to 50% of net. I can’t really think of anything that would entice me, as an author in a heavily digital genre like romance, to sign a contract that offered only 25% of net for digital. I mean, yes, a very large advance might give me pause, but I ran the numbers on this posted on my blog at http://bit.ly/1oEwlZp (had to take out parens for the link to work; my bad!) and I’m not sure I could be won over for less than $50,000 unless I was certain I could get my rights back at 7 years.

      • http://idealog.com/blog Mike Shatzkin

        That’s the right approach. There’s a right price for everything. And if a publisher thought that they could grow your audience enough, paying you $50,000 against their normal royalty rates would be well within the budgets of many.

        Mike

      • Jackie Barbosa

        $50,000 sounds like a lot of money, but the 25% of net royalty rate that underlies the earn-out is a huge disadvantage the the author. What I’m not sure you (or publishers or even some agents) really appreciate is how relatively EASY it is to earn out a $50,000 amount in 7 years IF the royalty rate is fair. These aren’t the print days where you had 4-6 months on bookstore shelves to earn back the majority of your advance. The digital long tail is effectively forever, and publishers can easily retain rights to your book well past the seven-year mark simply by discounting your book for a few weeks to achieve the sales number threshold.

        You really have to look at any advance you receive as possibly the ONLY money you are going to earn from this book for the next 35 years UNLESS you can get a revision to your reversion clause that lets you get your rights back at year 7 without conditions. Otherwise, there is a very good chance that you are leasing rights to your book to the publisher for a full 35 years, and if you do earn out, you are also accepting 25% of net for all sales after earn-out, which could be decades. That’s a pretty tough pill, IMO, and really shifts a big chunk of the long-term risk to authors.

      • http://idealog.com/blog Mike Shatzkin

        First of all, don’t plan for what appears now to be sustainable sales to last forever. Even five years, let alone 35 years.

        i assumed you personally chose the number $50,000 based on what you felt exceeded the net present value of all the royalties you’d earn on a title.
        You also have to factor in whatever belief you have (apparently not much) that having a publisher will help you build your personal brand, which you continue to own for every book you do into the future. If you think you can do it just as well on your own, I think you should at least ask yourself the question of what you could *get out of *a pubilsher’s efforts be being an author skilled at extracting that value. Some authors (and agents) are better at it than others.

        Mike

      • Jackie Barbosa

        First of all, don’t plan for what appears now to be sustainable sales to last forever. Even five years, let alone 35 years.

        My model assumes diminishing sales figures over that 35 years, but considers the “worst-case scenario”, which is that you continue to sell 250-500 books per year, which is the reversion threshold in many boilerplates I’ve seen lately. I have a novella that’s been out since December of 2007. It’s from a digital small press and, frankly, it’s wildly overpriced for its length. It has consistently sold 100 copies a year for at least three years. If it were priced more in line with the market, I suspect it would easily sell several times that number.

        The point I’m making here is that publishers have the power through pricing changes to retain the rights to any book they want, pretty much indefinitely. So while I think $50,000 might be enough to entice me, it’s still not a slam-dunk. It would depend an awful lot on how many immediate uses I had for that $50,000. (Right now, I have an incipient use in the form of a teenager who’ll be starting college in a little more than a year :).)

        So, move fast, publishers! I can be had for the low, low price of $50K. (Totally, 100% joking!)

      • http://idealog.com/blog Mike Shatzkin

        Jackie, at some point your model needs to take into account both getting the money *sooner *and getting the money *for sure*. Sounds like it is pretty sophisticated but if you haven’t worked that in, I think you should. Of course, you need the offer to make it anything but academic.

        Mike

      • Steven Zacharius

        Is this price to high in relation to what indie authors are selling their books for or too high in relation to what publishing houses are selling books for?

      • http://idealog.com/blog Mike Shatzkin

        Whatever that large number of authors does, they aren’t likely to suddenly abandon their publisher en masse!

        Mike

      • Anthea Lawson

        A certain agent (at least one, probably more) is known among indie circles for watching bestseller lists like a hawk and scooping up the new authors who are trending upward, signing them to traditional deals before they even get their first indie check. At least two dozen, if not more, indie-first authors have been acquired in the last year via this method. So you may be right, there are a lot of new authors being signed from Amazon’s bestseller lists. But.

        These starry-eyed newbies will not stay starry-eyed for long (I know, I was one of them once, entering tradpub with all kinds of rose-colored expectations that proved utterly, utterly false.) They might be locked into contracts now, but for the ones who do NOT become mega-bestsellers, they will begin to understand what it was they gave up.

        We are still at the beginning of a major seismic shift. And tons of experienced, savvy authors are leaving tradpub to go indie. There’s a talent drain, Mike, and it’s starting to show. (In things like Harlequin editors “reaching out” to local RWA chapters with offers to judge contest, appear as speakers, give advice and workshops – all unheard of a few years ago.)

        So, yes, we can agree to disagree, but these are just the pre-shocks of a major quake, in my opinion. :)

      • http://idealog.com/blog Mike Shatzkin

        I don’t disagree with what you said. The industry is in the process of getting smaller and the non-industry is in the process of getting bigger. Amazon needs it to stay that way. If you add up all the sales by the indie authors in the top 7000, compare them to the total, and imagine that component getting a lot larger, you’ll be seeing a much smaller industry reflected there too.

        Mike

      • ET (Liz) Crowe

        I have also noted this phenomenon and consider it part of the increasing genre-fication of fiction generally, thanks to E.L. James and her runaway, shocking success.

      • Steven Zacharius

        Every publisher looks at the Amazon rankings and tries to determine if there’s an up and coming star. I don’t know that there have been all that many examples of indie authors that were later contracted by publishers and were built to major author status. The fact of the matter is that most indie books still sell at highly discounted prices and that’s why them climb the Amazon charts. People are willing to take a chance on a book that ranges from $ .99 to even $3.99….but once the publisher acquires the book with an advance and then has manufacturing costs and overhead expenses, the publisher can no longer afford to do the book at that price. We’ll see if original indie authors continue to build once acquired by a publisher.

      • http://www.zerogravity.com.au/ Jonny

        Surely a publisher wouldn’t acquire a book they didn’t believe in, regardless of how quickly it was rising the charts. So if it didn’t continue to be successful regardless of price would it not be the fault of the publisher?

        You’re suggesting that you don’t believe such books would continue to build once acquired by a publisher.

        Do you mean to suggest that an indie author with enough success to be acquired by a publisher is better off without a publisher?

        I think that adequately answers the question being asked.

      • Steven Zacharius

        If Kensington were buying a book that was already selling well from an indie author; and we were going to publish it in print…that’s one part of our offer. But that’s not where we plan on making the money. We buy that author and give them an advance based on our being able to hopefully build that author further in digital and print for many more books to come.

      • http://josephratliff.com/ JosephRatliff

        I think the problem with your “just because you can cook doesn’t mean you can run a restaurant” analogy is the definition of what is “a restaurant” is changing dramatically.

        “A restaurant” no longer has to be a traditional publishing company. Now, “cooks” can run their own restaurant, and they are OK with the risk that restaurant might fail.

        The channels of distribution are changing Mike, “the major leagues” is being redefined dramatically, but you already know that.

      • http://idealog.com/blog Mike Shatzkin

        Well, yeah, Joseph, if you want to say that what was a restaurant is now a hot dog stand on the side of the road, you’re right that more people can get into the game. But it ain’t a restaurant. There’s no denying, or attempting to deny, that the opportunities for authors have opened up in a big way because of digital self-publishing. And that people can make a living on it. That doesn’t excuse misleading comparisons between what authors make from publishers and what they make doing it on their own, nor does it excuse eliding how hard or easy it is for them to do it themselves.
        Mike

      • http://josephratliff.com/ JosephRatliff

        Two things…

        1. Assuming people cannot run a full-fledged restaurant, and not a hot dog stand, because they just might have the savvy to do so right out of the box (without the help of some elite institution)… is a bad assumption to make. Potential authors are smarter than the “establishment” gives them credit for, and it’s proven again and again by the stories being told (more to come as well).

        2. As for eliding how “hard or easy” it is to do it themselves… these aren’t kindergarten students we’re talking about either. They are adults, using information to make choices, and just as the “establishment” is trying to provide their biased interpretation of the data (missing out on 70% print comes to mind), so Hugh has provided a biased interpretation that gives the other side of the story.

        As an intelligent adult, I can interpret both sides (and consider both sides) of the argument.

      • http://idealog.com/blog Mike Shatzkin

        Joseph, if you can show me *one thing *in the Howey “call to arms” that started this conversation that spells out in any way what work or risk is involved in doing it yourself, you’d have an argument. But you can’t. It wasn’t there. That, and all the key factors he left out, is what started this string. Nothing else.

        Mike

      • http://josephratliff.com/ JosephRatliff

        I suppose you might be right, in that respect… I did say it was biased though. ;) He does mention the risks you speak of on his blog though, maybe not the way the “establishment” wants to hear them exactly, but they are there.

        I’m re-reading it now.

      • http://idealog.com/blog Mike Shatzkin

        Right. NONE of the nine things I mentioned — all of which are relevant to *any *attempt to compare the paths to commercial success for authors — were in his post. And he was advocating a position. I am NOt advocating a position. I have spelled out specific circumstances in which it makes real sense to me to self-publish. I have advised people who have come to me to self-publish. Somehow the self-publishing community (as expressed in this comment string) wants to turn this into some sort of Manichean debate. It isn’t black and white. It is MANY MANY MANY shades of gray, even *within *the paradigms of self-publishing and being published. As the much- (and stupidly-) maligned Writers Digest-DBW study spelled out, more and more authors are “hybrids”. They do both. In fact, Hugh Howey does both if you look at him globally!

        Mike

  • Dave Bricker

    Mike, I write a popular blog about self-publishing and generally advocate for that approach—but I don’t believe there’s one right way to publish; different authors have different goals, audiences, and chances for success on their own. I thought your article was measured and accurate. People on all frequencies of the publishing spectrum who rally for an “us vs. them” mentality have missed the boat in favor of standing around on the docks of self-validation.

    Smart writers do their homework, learn about the publishing business, understand the benefits and liabilities of various options, and pursue the path that best fits their needs, styles, definitions of success, and (of course) their books. Recommending the merits of one approach over another based on generalized and incomplete data won’t do much to aid anyone’s informed decision-making. Thanks for taking the time to write your analysis of Howey’s assertions. Your insights are appreciated.

    • http://idealog.com/blog Mike Shatzkin

      And your comments are appreciated. I think it is a *very *important development — too often ignored — that the literary agencies of any size are *all *putting self-publishing capabilities on their payrolls. You have to be a fool or a very zealous partisan to see this as a one-size-fits-all kind of problem.

      Mike

    • Steven Zacharius

      I think we need to come to a common understanding that when most of the people here are talking about indie publishing they are really only talking about publishing with ebooks. There’s a lot more out there than just ebooks.

  • John Andrews

    Money is only one of the world’s big drivers. It competes with liberty, fun and non-material (spiritual) satisfactions. These factors can favour self-publishing, as can the desire to publish quickly. Where did I read that the world may come to have more publishers than readers?

    • http://idealog.com/blog Mike Shatzkin

      I think I heard the same quote lately…but, John: all of the appeals in Hugh Howey’s piece were around what makes better economics. That’s what I was responding to, not all of the many other motivations that could influence a decision to self-publish (and I agree there are many other factors to think about it many cases.)

      Mike

      • John Andrews

        That’s true, and I agree that both publishing routes are ‘right’ for certain purposes. But if I was going to get $50,000/month from ONE of the two routes, I would rather it was from self-publishing. Authors are individualistic folk. I guess many of them feel like this – and that these feelings will influence the business of publishing.

      • http://idealog.com/blog Mike Shatzkin

        I wouldn’t disagree with your apparent contention that authors would characteristically be suited to an indie strategy. Maybe that’s further evidence that it doesn’t make commercial sense for most of those who get offered an advance, because we haven’t yet reached a point where they are routinely turned down.

        Mike

      • John Andrews

        Though Jeffrey Archer does it, but I can’t see many authors turning down advances. They feel like compliments. But authors dislike rejections and this is another reason for choosing to self-publish and for ‘I did it my way’ to be sung at their funerals.

      • http://idealog.com/blog Mike Shatzkin

        Well, yeah. But so far it is simply idiosyncratic behavior, not a commercial trend.

        Mike

      • Steven Zacharius

        Again the amount of people making $50,000 from self publishing is greatly discussed and we never hear from the tens of thousands of other indie authors who aren’t selling ten copies a year.

    • Deborah Smith Author

      Here’s my report from deep inside the world of genre fiction authors: Most make very little money, whether trad published or self-published. Few will ever make much money. Most of the books published are dreck and will quickly be forgotten, period. Publishers look for the cream of the crop, and there is not much cream out there. I judge contests and see hundreds of queries of a year. Lots of well-intentioned, well-edited, cookie-cutter novels that are completely interchangeable. When I find a rare author with the combo of a fresh voice and a fresh plot and a type of story that the current demographic of readers I can reach through my sales platforms want to buy, I celebrate. All those authors are desperate to sell their books to anyone who will listen.

      • http://idealog.com/blog Mike Shatzkin

        I think that’s an honest picture of reality. Thanks.

        Mike

      • chris

        238 angry comments… and not one person resorted to saying ‘Fuck’.

        This site is getting way too highbrow for me, Shatzkin. I request a post about the adult publishing industry next. include lots of pictures to support ‘hard’ data collection.

        Thanks.

        Fuck.

      • http://idealog.com/blog Mike Shatzkin

        Thanks for the note of levity, Chris. The seriousness of this mostly-meaningless debate makes me seriously question whether I want to write a post on this subject OR abandon my notion of answering most comments.

        Mike

  • http://www.doctorsyntax.net/ Peter Ginna

    Mike, I think everything you say here is right on target, especially with respect to advances. When one factors in the percentage of an advance that is unearned, for most authors the effective royalty rate is much higher than the contracted rate, whether in print or e.
    I would also say that based on what I have seen I would be extremely wary of extrapolating from a small (and, especially, a chronologically limited) data set of Amazon rankings to any kind of unit sales figures. I wish I could remember where I saw the piece (New Yorker?) but a few years ago one writer demonstrated how volatile Amazon rankings can be even within a 24-hour period, zooming wildly up and down based on a very small number of sales.
    Like you, I have great admiration for Hugh Howey and I think self-publishing is a great strategy for many authors. But much more challenging for one who’s not a genre fiction author, as you say. No author should feel traditional publishing is the only way to go, but all should be aware of how challenging the self-pub route can be.

    • http://idealog.com/blog Mike Shatzkin

      Agreed on all counts. The use of a single-day’s data as a base for projecting a year’s sales is a particularly egregious error of logic and the laws of probability.

      Mike

      • William Ockham

        No, you are just wrong about that. It would be wrong for projecting the earnings a particular book based on its position on that day, but likely to be excellent for projecting the shape of the market.

      • http://idealog.com/blog Mike Shatzkin

        All you have to do is follow the weekly reports of bestsellers from DBW, which uses a similar rank-into-sales-number methodology, to see that the representation of big pubs and smalls changes, sometimes dramatically, week to week. And that’s with aggregated data. It changes a LOT MORE day to day (smaller samples cause bigger fluctuations.) So you get a twofer: you can be wrong on the titles AND wrong on the shape of the market.

        Mike

      • William Ockham

        I do follow those DBW lists and your comments just reinforce my opinion that you have a fundamental misunderstanding of the data and what it reflects.

        The published methodology of the DBW list is deliberately not reflective of the true market according to the response of the guy who developed it to a question I asked him.

        Your assertions probably seem like common sense to you, but there are many aspects of statistical analysis that are counterintuitive. Look up Simpson’s paradox. I can’t teach you the fundamentals of statistics in a brief comment, so I will just say that I am doing my analysis of their data and will come to my own conclusions.

      • http://idealog.com/blog Mike Shatzkin

        That’s fine. You come to your conclusions and I’ll come to mine. The attempted methodology of the two — to interpret rank into actual sales numbers — is the same. The details are probably different. I know Lubart. He knows a thing or two about statistics and probability. You claim to as well. I don’t know what Howey knows; I just know what his data can’t reflect because it isn’t there.

        Mike

      • http://idealog.com/blog Mike Shatzkin

        In fact, Howey could make what he’s doing more accurate by orders of magnitude if he took 30 days of sales rather than 1. It would also give him a lot more titles and even a bit of a long tail effect (because so many titles would only appear one day). There would still be HUGE holes in the data, but that step alone would certainly make it more accurate. You do realize, of course, that the ratio of bigs to smalls could be drastically different the day before or the day after Howey’s data. I don’t want to cast any aspersions, but when you think about it, it’s a bit weird that they used one day’s data. Did they *cherry pick *the day? I don’t know…but a bigger sample would make me feel a lot better. And multiplying that by 365 to make some comparisons. Yowza!

        Mike

  • Pingback: Viral Report on Self Published Earnings Crashed This Server - Page 2

  • Kate Barsotti

    Thanks, this is useful, especially for those of us writing for kids (even in genres). I am not convinced I could duplicate Howey’s success for the middle grade set. I might try it for YA if I had the right story and I were willing to commit many hours interacting with readers and fans.

    • http://idealog.com/blog Mike Shatzkin

      If you’ve already got a publisher, you’ll still benefit from doing the digital marketing with your readers and fans. That’s another thing missing from the analysis. Whatever an author can do on behalf of a self-published book, they can do on behalf of one that has a publisher too!

      Mike

      • Kate Barsotti

        Agreed, but it’s a delicate business. COPPA rules are pretty strict, so that means I have to figure out how to reach parents, teachers, librarians, etc. It’s not ideal. Part of literacy is making one’s own reading choices, at least it was for me. Will adults hand over the subversive books, the deeper books, and ones that may be just a bit too hard and make a kid work? Or will they make safe choices, fiction that purports to be educational and wholesome (horrors)?

      • Nick_Stephenson

        except for price changes, which is essential for advertising avenues like Bookbub, Kindle Nation Daily, BookBlast, etc, etc. Or cover changes. Or free promotions.

      • http://idealog.com/blog Mike Shatzkin

        Publishers do *lots *of price changes.

        Mike

      • Nick_Stephenson

        absolutely – but the flexibility of price changes isn’t there. For example, I know what price will yield the most revenue at what sales rank (eg, following a big promotion), so I can change that price at the drop of a hat. Publishers aren’t set up to do that right now. I wouldn’t, for example, be able to run monthly advertising promotions at lower prices with a publisher without convincing the marketing team it was a good idea. And are publishers really going to commit to $500 or more a month on sites like Bookbub? If that sort of thing was written into a contract, maybe, but how often does that happen?

      • http://idealog.com/blog Mike Shatzkin

        I don’t know how often it happens now, but it will happen more often in the future. I know that all the big publishers are developing digital marketing capabilities and lists of names and ways to interact at scale. Their contribution isn’t zero and a lot of what an author can do effectively doesn’t cost money. And I think BookBub type promos WILL be written into contracts by smart agents.

        Mike

      • Nick_Stephenson

        Which I think leads back to some of the points Hugh made in his “publishing CEO” articles – many authors would happily take lower (or zero) advances in exchange for better royalties and more transparent / specific marketing plans written into contracts – ones that will actually bring decent results. I think many authors would rejoice to see something like that as part of the deal.

      • http://idealog.com/blog Mike Shatzkin

        I’m 66 years old and I have been in the publishing business since I was 11. Based on all those years of observation, I refuse to believe that the size of the advance isn’t the most important thing to 9 out of 10 of the authors who do it for a living, if not 99 out of 100. Sure there are other trade-offs, but with a larger advance *automatically *comes a larger *commitment
        *from the publisher, whether it is spelled out or not. If you have other objectives besides making money, trading off the advance might make sense. But if you want to make the most amount of money, you want the biggest possible advance.

        Mike

      • Nick_Stephenson

        again, what’s the average advance these days? I think Jackie Barbosa, above, spelled it out pretty well.

      • http://idealog.com/blog Mike Shatzkin

        In the agented world, the average advance is considerably higher than Jackie’s. Her publishers are setting a very low bar for her to do better on her own. No agent can afford to negotiate contracts for 15% of $2500 per book and none of them do.

        In other words, the “establishment” is a lot bigger than this conversation seems to imagine that it is.

        Mike

      • Nick_Stephenson

        and what proportion of authors does that “agented world” cover? can you tell us what the average author advance, across the board, for all authors, actually is? That would certainly help put some context on the data – bearing in mind, a lot of publishers offer digital-only deals with zero advances, can you really be sure that average is as high as you think?

      • http://idealog.com/blog Mike Shatzkin

        Nick, I’m not making that argument. And I didn’t say that an author declining a $2500 advance was making a mistake. But I think a certain amount of perspective is in order about how much of the total *book business *all the self-publishing success that the network and echo chamber it creates amounts to. It was those comparisons which were the initial headlines that got us talking about all this in the first place. We’ve had a little bait and switch.

        Mike

      • Nick_Stephenson

        But that IS the perspective authors are coming from – do I take $XXX advance and lower royalties, or do I take no advance and earn 70% – that’s one of the biggies. And that’s not even taking into account authors who have no offers on the table.

        This set of data goes a long way toward showing what’s possible, and goes a long way to helping us answer that question by showing us a snapshot of what total revenue is going where on a given day. If that $XXX advance turns out to be $5,000 or less, then it’s pretty much a no-brainer as it stands today.

        If, like you said, many authors don’t earn out their advances, then that only makes the picture look worse, doesn’t it?

        I think those particular authors would rather forgo the $5,000 advance in lieu of $5,000 worth of effective advertising spend – everyone would end up better off.

      • http://idealog.com/blog Mike Shatzkin

        I think you’re saying an author would rather take NO money and a $5,000 ad spend than a $5,000 advance. We are clearly talking about an author who doesn’t do this to eat. If you don’t do it to eat, you would seem to me LESS likely to want to take on the investment of time and money required for self-publishing if you could get somebody to do it for you and pay you for the privilege.

        Mike

      • Nick_Stephenson

        So, if I’m desperate to eat, then $5,000 is fair? Is the choice between accepting a low advance or starving? Doesn’t that sound a little abusive? I don’t get that analogy, assuming, of course, that’s not what you meant…

        What I do understand is that I can spend $500 on a service like Bookbub and make back $2,000. So, yes, I’d much rather a publisher spent even half that money on advertising, leaving them enough profit to offer better royalty rates.

      • http://idealog.com/blog Mike Shatzkin

        No, what I mean is that there are people doing it for a living and there are people who are doing it for other reasons, ranging from pin money to personal satisfaction to whatever. I admit to the POV of people who do publishing, or authoring, for a living. That’s the intended audience here and it is my primary frame of reference.

        Mike

      • Nick_Stephenson

        And that’s where I’m coming from too – we’re talking revenue and profits here, right? This question has been asked countless times: what is it that publishers are offering that authors can’t get themselves, while keeping 70% of list price? The boilerplate answer to that seems to be “print” – so why aren’t we seeing more print-only deals, if paper really is 70% of the market?

        Publishers need to be able to answer those questions. And I don’t think they’re unfair, considering how much authors are signing over for the privilege.

      • http://idealog.com/blog Mike Shatzkin

        It’s not about answering questions. It’s about offering a clearly compelling proposition. Authors will do, and should do, what’s best for them. Authors who have built a following already and are suffering declining sales are, indeed, good candidates to switch to self-publishing. There are times it makes sense. But it sure ain’t close to *most *of the time yet. And it is almost *never *for a non-genre author who wants to make money.

        Mike

      • Elliot1234

        Propositions prompt questions. The answers matter.

      • Steven Zacharius

        Most publishers aren’t interested in print only deals because the level of author advances from authors with a successful history hasn’t declined. So with print sales leveling out the only way to keep paying a larger advance is for the publisher to hold onto digital rights. Hugh offered me his book with no advance an a 10% royalty but the book is already several years old and has sold huge amount of copies online and various price points. At this point how many copies would it sell in print? I have no idea. I can see on Bookscan how many copies of his books have been sold in print and they don’t compare to the number of digital copies because of the huge price discrepancy. And I’m not singling out Hugh here….this would be the same story for any author offering a publisher their book after it’s already been sold digitally at a discounted price.

      • Nick_Stephenson

        Absolutely, this is a great point. Print is a subsidiary right, a distant second to digital for most authors. That’s what we all suspected, and Hugh’s figures confirm it. It’s also refreshing to get a candid view from someone in your position, rather than the old “print is king” argument that I don’t think anyone really buys into any more.

        So, come on Steven, continue that candor and tell us: what can a traditional publisher offer that we can’t do ourselves? Step up to the plate, lay it on us.

        I’m dying to know the answer, I really am. And we all keep asking, because we really can’t figure it out by ourselves..

      • Steven Zacharius

        To say print is a subsidiary right is ludicrous. If you’re a debut author it might be but if you’re an author that’s established your print numbers can range anywhere from 25,000 to 1,000,000 copies in mass market. That’s not subsidiary income in my view. Open your eyes beyond $.99 digital books and look at the bulk of the business.
        If big publishers wanted to end indie competition all they would have to do is make their books priced at the same low prices as indie books. Who would the reader buy then? An unknown author or a well known author at the same price?

      • Nick_Stephenson

        What’s a typical print run for an author? What are the returns on that print run? What’s a typical advance? What percentage earn out? I’m not seeing any figures from you, and I assume you can take a stab at giving us some.

        And to answer your question, readers don’t choose between one author or the other. If the prices are reasonable, they buy both.

      • Steven Zacharius

        There’s no such a thing as typical with such a wide range of genres and formats. But how can you possibly say readers don’t choose between one author or another but buy both? If tom Clancy is 2.99 and a new indie author is 2.99 which do you think will be bought?

      • Nick_Stephenson

        If they like the look of both, they buy both. It’s not a choice of one over the other, readers like more than just one author and don’t need to limit themselves to “just one book” if the prices are reasonable.

      • Steven Zacharius

        If the books are priced similarly or even close; do you think they choose lee child or someone unknown ?

      • http://idealog.com/blog Mike Shatzkin

        You touch on a major point here, Steve, which I think the champions-of-the-masses are missing and have missed all along!

        The *worst thing *that ever happened to the indies was the upsetting of agency pricing. As long as the biggest publishers’ books were consistently $9.99 to $14.99, or maybe $6.99 when in paperback, there was a clear alley for the self-published to be discovered and purchased in the $2.99 and under price band. Now that all bets are off around what the retailers can do, which has forced the publishers (perhaps in their own interests in some ways, but sooner than they might have) to play with price experimentation, including sales (promoted on Bookbub) that take prices way down, it has made it harder — and will continue to make it harder — for the unknowns to use price as a means of discovery and competitive advantage.

        I don’t think we heard too many indie voices saying “*please keep Agency pricing” *even though it would have been in their own interests to do so. Maybe they were enlightened defenders of the consumer. Or maybe they really don’t think these business details through.

        Mike

      • Steven Zacharius

        Great point. When publishers had their prices on ebooks higher it was a different ballgame. With publishers making established authors discounted to promote a series it’s competing against the indies in a big way. I remember see the new Clancy book for 1.99 and Grisham’s Sycamore Row for the same. Can you imagine how many ebooks were sold at that price instead of someone buying a book from an indie author that same day or week.

      • Nick_Stephenson

        Both, more than likely. That’s the great thing about reasonably priced digital books.

      • http://idealog.com/blog Mike Shatzkin

        Kumbaya.

        Mike

      • Nick_Stephenson

        Indeed, nicely put.

      • http://idealog.com/blog Mike Shatzkin

        I guess I should admit — point out — that I intended to be ironic. I have a British friend who regularly tells me “Americans don’t do irony”. I had to say so. I wouldn’t want you — or others who might have the patience to read all this — to think I agree.

        Mike

      • Steven Zacharius

        Really, readers buy both? Don’t you believe that there is only so much discretionary income that people spend on books or that they have limited time to spend reading? I’ve seen how long it takes people to read books from the data we receive from companies like Scribd. Over 3/4 of the books sold thru the subscription service are taking longer than a month to read. How many books do you think the typical reader is buying per year?
        And I don’t know how many times you want me to say that there is no such typing as a typical advance. It depends if you have a track record or not and how your sell thru has been in the past. Every publisher can look up sales on Bookscan and see a history of print sales from almost 80% of the industry. But for generality….I’d say an average mass market print run is probably in the low 50% sell thru range while trade and hardcover are closer to 65%. I have no idea what percentage earn out. The bigger the advance, the less likelihood of it earning out. I do know that the amount of royalties that we pay out on a yearly basis has multiplied since ebooks came around.

      • Nick_Stephenson

        Hi Steven – apologies for the belated response, I thought this thread had finished! I can only answer from my own experience – my choices were to submit to agents, or self-publish (or both). I obviously make more money self-publishing than waiting through the submissions process, and, on the off chance I did get a contract, chances are good I’d end up making more money independently anyway (we’re talking about life + 70 years of higher royalties as an indie, so it would have to be a pretty big advance to make up for handing most of that over).

        This isn’t going to be true for everyone, but the whole point is that we are becoming better educated about the choices we have as authors.

        There is a (small) chance I might have gone on to be one of the top published earners, but that’s a big gamble to take and the numbers didn’t make sense. Theres an equally small chance I’ll go on to be one of the big indie authors, but there’s a much better chance I’ll earn more hanging around the midlist.

        I’m always open to offers though – If you think I might do better with a traditional contract, make me an offer!

        Hope you had a great vacation, glad to see you’re still taking the time to put yourself out there in the comments.

        Nick

      • http://idealog.com/blog Mike Shatzkin

        Nick, just stepping in here to say how nice it is from my perspective to see respectful disagreements that take place without anybody being disagreeable. I feel responsible for the environment in my comment space and some recent ones have straddled a line of nastiness and disrespect that has no place here. Thanks for the object lesson in how to state your case and hold your ground without snark that adds nothing to the value of anybody’s arguments.

      • Nick_Stephenson

        My pleasure – thanks for keeping the comments open

      • http://idealog.com/blog Mike Shatzkin

        We never close!

      • http://idealog.com/blog Mike Shatzkin

        I want to show here that the established publishers and I don’t see eye to eye on everything. I wrote a post quite some time ago (you can search the site and find it) about print as a subsidiary right. It isn’t the way things are, but it is the way things might eventually become. And there are very early signs of a dawn of that day. But that’s it.

        Mike

      • Steven Zacharius

        I don’t have any problem doing a print only deal as long as their is coordination between the author and publisher as to the pricing of the ebook and the release date. A publisher won’t compete with a 15.00 book if the author is putting it out at 2.99 at the same time. Of course the advance structure would have to totally change as well since no one would have any idea as to how successful the print book would be on its own. I don’t know if anybody has done a study yet of indie authors who have sold their books to traditional publishers. There have been some very public deals and when I look at the Bookscan numbers many of them didn’t justify the amount that was paid by the traditional publisher for the print rights; not even close.

      • http://idealog.com/blog Mike Shatzkin

        Steve, I think *this *might be *news. *

        Mike

      • Steven Zacharius

        I’m pretty sure we’ve already published several authors that were self-published before. Off the top of my head, we may have picked up the ebook rights with the deal, but it was way after the book had already been e-published by the author. Joe Konrath offered me a challenge to publish his book without an advance…but unless they’re going to be released at the same time with cooperation between the two, I don’t think a publisher would be interested in making an investment and then being undercut tremendously by the author themselves.

      • Steven Zacharius

        If someone wants to throw out the big names and the supposed amounts that these indie superstars have been paid, I’d be happy to look up Bookscan numbers. I’ve already looked them up for Wool for which a huge advance was paid.

      • Elliot1234

        Mike, what percentage of published fiction is authored by people who write for a living? What percentage of all fiction authors are you addressing?

      • Steven Zacharius

        I don’t believe bookbub accepts all books for promotions. They’d much rather have an author that’s going to sell a lot of copies than some new author that might sell 200.

      • http://idealog.com/blog Mike Shatzkin

        You’re right about Bookbub, Steve. They’re trying to pick what they think will work. They only do one or two books a day.

      • Jackie Barbosa

        We are clearly talking about an author who doesn’t do this to eat.

        I think it’s pretty clear from the data that the vast majority of authors don’t make their living from writing. Far more authors also have day jobs than the reverse.

      • Jackie Barbosa

        In 2008, declining an offer from a traditional publisher, even with a very small advance, wasn’t really an option. Things are different today. And aren’t we lucky!

      • Steven Zacharius

        Yes you are. So are publishers for that matter because with less print space available they can focus their attention on a smaller printed list. They can also start authors in a digital only line and see how they perform and then move them into their printed list and continue to hopefully build their career and sales.

      • Anthea Lawson

        Romance focused, though I know a SF author out there has done something similar for that genre: http://brendahiatt.com/show-me-the-money/

        Thing is, midlist genre fiction advances have gone way way down in the last couple years. And yet, genre fiction is where the money is in indie. Do the math. ;)

      • http://idealog.com/blog Mike Shatzkin

        I don’t quarrel with the fact that it makes sense in niches and I think this conversation demonstrates that there’s some arbitrage opportunity in mid-list genre fiction. What I quarreled with was gross overgeneralization that did not deliver targeted advice.

        Mike

      • Steven Zacharius

        Scifi is a very unique area. Advances have probably gone down…and we don’t publish in this area, because the demand from retailers is very low for these books…except for the big sellers. There’s less shelf space for books that don’t sell or turnover the inventory quickly enough for the retailer to want to bother carrying the book. Because of this there are only a couple of publishers that even publish sci-fi any longer to any serious extent.

      • Steven Zacharius

        Genre fiction….or romance, or women’s fiction….is where much of the big money is but that’s not mid-list fiction.

      • Steven Zacharius

        We’re back to the question of an average advance. I said earlier we don’t track our advances like that. Every deal is an individual contract. New authors start low and big authors are still very high and obviously most fall in-between.

      • Jackie Barbosa

        For the record, I was published by Kensington and $2,500 was the standard per book advance for debuts at that time, agented or not. I don’t know that that has changed much since then. In fact, I’d hazard a guess that the average for a Kensington “debut” author might be lower, since many of those authors are probably being signed to their no-advance digital line.

        Also, for the record, my agent was with the Djikstra Agency at the time. Not exactly small fish. A friend of mine, who signed for the same per book advance about a year later, was repped by Dystel and Goderich. And in my experience, most agents will happily negotiate deals for 15% of royalties for the life of contract, even if the advance is relatively small. Granted, a small advance may never yield a large payout, but some authors with small/no advances hit the big-time and bring in a ton of money. And any agent who refused to negotiate a money deal for a client who wanted that deal should be fired.

      • Steven Zacharius

        Jackie did we force you to take the advance or sign a deal with us? You and your agent decided it was a good deal at the time. Most debut digital lines, like Entangled that you mentioned before, don’t pay advances but they pay a higher percentage of royalties than normal. Our debut digital programs do the same. But you just said what I repeated above….you’re talking about an advance for a first time writer that the publisher is taking the risk on. And the typical advance for a first time author in print has gone up. But please don’t consider that amount of 2500 as a typical advance for an author that has a track record of good sales….nothing could be further from the truth.

      • Jackie Barbosa

        I’ve said multiple times I’m not sorry I took the deal. At the time, there just weren’t as many choices available as there are now. No, I wasn’t forced. I was THRILLED. Things didn’t work out as well as I’d have liked, but I consider that a lesson learned. (A lot of the reasons it didn’t work out as well as I’d have liked have nothing to do with either Kensington or me/my book. There were plenty of factors outside anyone’s control.)

        And of course I don’t think $2,500 is the typical advance for an author with a good track record of sales. Print advances for debuts have gone up since then, perhaps, but the number of debut authors who get offers that include advances and print distribution is also way down. (Fairly. Print distribution is down.)

        But who are you trying to convince that signing with a legacy publisher is a good idea? The authors with a good track record of sales who get big advances or the ones you’re “trying out” at low/no advances? I don’t think it’s the former. As you say above, they’re not leaving traditional publishing in droves. So it’s pretty clearly not them you’re aiming to convince.

        And honestly, if traditional publishing houses aren’t worried that they are losing authors/books to self-publishing, why do they care what Hugh Howey or anyone else has to say? Why expend so much effort to prove self-publishing evangelists wrong if there’s no threat?

        And I ask this question as anything BUT a self-publishing evangelist. I am 100% an evangelist for the publishing option that is best for suited to an individual author’s goals, needs, and talents. Period.

      • http://idealog.com/blog Mike Shatzkin

        I’ve reached exactly the opposite conclusion that you have, apparently. I think the Big Houses do a *lousy *job of promoting what they do to authors. I think they don’t because they don’t have to: they find the books they want to sign up and sign them up.

        This whole thing didn’t start with publishers, large or small, making a case. It started with an indie author making a case. And getting a lot of attention for a big headline that frankly suggested that indie publishing was a bigger part of the overall picture than it is. It got lots of attention; I thought it left out important components of the argument it was trying to make. No publisher, large or small, had anything to do with it. Steve has been interested enough to sprinkle his thoughts around, but there’s absolutely no other evidence here of *publishers *trying to persuade anybody of anything.

        They *should *be, but they aren’t.

        Mike

      • Steven Zacharius

        I don’t think we’ve really cut down much on the number of debut authors that we publish. I know last meeting we just signed up two more. I don’t know that any publishers are concerned what Hugh is saying….so far I only see me and Mike commenting on an interesting debate which is always enlightening. And Mike isn’t a publisher….so I don’t see any other publishers besides myself in here commenting, although I did see one comment from a small indie publishing company I believe.

      • http://idealog.com/blog Mike Shatzkin

        Yes, and thanks Steve, for adding your commentary to the blog. And especially thanks for being directed and concise.

        Mike

      • nedworking

        That’s really the question, isn’t it, Jackie. Why are Steven and Mike and accessories like Donald M. putting so much light and heat into this topic?

        If, as Steven said above, that all is “perfectly well” at publishing houses, and they’re making money hand over fist, why write one word about self-publishing? Doesn’t affect their bottom lines, does it? (per Steven, above in this thread)

      • http://idealog.com/blog Mike Shatzkin

        I am both having trouble following the discussion with so many responses having come in while I slept (the limitations of the Disqus comment system) but also having trouble working up an interest in answer where much of this has gone.

        But I can answer this one. I wrote the post because I saw a post by Hugh that I thought would get a lot of attention and was full of logical holes. I really have to laugh at my new role in life: defender of the establishment. I have a career criticizing the establishment that goes back before most of the commenters on this blog were *born*.

        The echo chamber of self-publishers is obviously very powerful if you’re in it. But when you see statements saying the print sales don’t matter, you realize that the echo chamber doesn’t know there is anything outside of it.
        Mike

      • nedworking

        You prove my point, Mike.

        People are wrong on the Internet every hour, every day, in every way.

        Unless it’s materially affecting your livelihood or the business you’re in, it’s not worth your time (or my time) to comment or correct.

        Your statements here are clearly giving light and heat to something that if it didn’t have a material impact wouldn’t be worth commenting on.

      • http://idealog.com/blog Mike Shatzkin

        I don’t know what you do for a living. A foundation of what I do is understanding (and sometimes forecasting) how the industry is changing. My blog is my way of distributing (and branding) those thoughts. When I see something that I think will get a lot of attention that I think I can add some light to, I try to do that. That’s where this started. Where it went has a much bigger emotional component fueling the discussion than a rational spirit of inquiry. And that *is *draining of energy.

        Mike

      • Steven Zacharius

        Ned, I spend time writing here because hopefully I will learn something new. I have to tell you that since starting blogging a few months ago I’ve received at least two dozen submissions directly to me from people who have been following these blogs. It looks like we’re finally going to sign up one of them that met our standards. So clearly there are people reading and writing here who would give anything to still be published by a traditional publisher even though they won’t come out and admit it here. As Mike said earlier, for 9 out of 10 people the advance is still the key issue.

      • nedworking

        Steve — I admire the heck out of the impulse to learn something new! Great engagement, with that motivation.

        Personally, I’m glad you’re receiving submissions. However, I doubt sincerely that anyone cares about the advance, if they actually understand the terms. Advances mean nothing: broad distribution and connection with the reading audience is everything to any writer. That’s why they sought you out: advances aren’t the key, they’re a nostalgic reminder of a different era of publishing, and it’s darn sweet of you to offer them, but I don’t think they really matter much.

        I’ll bet you even money that people who want to be published would prefer a direct “licensing rights fee” and a higher net percent of profits over an “advance.” I’m putting it in quotes, because as we know advances don’t always earn out, and it’s merely a sign of a publisher’s faith in a writer. Earnings may never happen for writers, especially for writers who aren’t forced to invest in their careers and marketing their work.

        So why not call it a licensing rights fee, paid as a one time cost, and give writers a higher % of net? (It’s a sincere question, and I’d love to hear your answer.)

        I’m glad to have you here…. and on other forums. Hope we all learn from each other.

      • Steven Zacharius

        I guarantee you that most authors that we deal with care primarily about the advance especially if the deal is done through an agent. The royalty rate is part of the discussion but most publishers have standard royalty rates where we start first time published writers. If they don’t like the publisher’s terms they can try and get a deal with another publisher or of course they can self publish. But I have to tell you most of the times when we offer a deal to a new author; the deal is accepted.

      • Steven Zacharius

        BTW our average advance for a new author hasn’t gone down because of people signing to the digital lines. The digital line still publishes a relatively small number of books and even some of those people get an advance depending if they’ve been published before. Did you get an advance on your deal with Entangled?

      • Steven Zacharius

        And as I mentioned an average advance would be a very difficult thing to quantify. Do you want a publisher to take their small advances along with the multi million dollar advances and divide by the number of the titles….or are you really asking about a typical advance for a first time author where the publisher is taking the risk of laying out an advance for a book that will be published at least a year or two down the road. It’s two totally different numbers.

      • Nick_Stephenson

        Either would do. What are those two numbers? What’s the median advance? Or mode? Any figure will do.

        Next, take that figure and divide by the number of years left in the copyright. How’s that advance looking now?

      • Steven Zacharius

        That is about the most inane argument I’ve ever heard. Are you going to leave about back list sales which are 25% of a publishers revenue and forget about those and any addl royalties the author may earn? Versus selling your book for $1.99 for a while until you have to give it away for almost free to keep any sales going at all?

      • Nick_Stephenson

        Not seeing any figures, Steven. I asked about advances, not money pusblishers earn. We’re talking AUTHORS income. Another reason authors are clamoring to get the rights to their backlist returned, so they can actually go out and sell them.

      • Steven Zacharius

        Publishers don’t calculate median advances. Each book is a separate contract. A debut author might start as low as 3000 for a mass title or 5000 for a trade. But the upper numbers are above a million. Any average would be meaningless. How many copies does a self published author sell after two years at $5.99?

      • Nick_Stephenson

        Why don’t they know how much they’re paying people? It’s pretty simple math and a fairly crucial business cost, I would have thought.

        But let’s say it’s $8,000 for genre fiction novels. How many authors are likely to earn royalties on top of that. 25%? For most, that’s all they’ll see. Ever.

        I can tell you the average self-published author sells a whole lot more than the 99% of authors waiting to hear back from agents.

      • Steven Zacharius

        Because when you’re paying thousands of royalties at a time it’s not a number of any significance to us. The importance is if we make a profit with each title. You can’t tell me the avg sp author makes more because kindle doesn’t publish sales only ranks which can be hugely misleading.

        Your assumption of genre is totally wrong. We have historical romance authors getting advances well in excess of $100,000. These are authors we’ve helped and those are the authors we want to attract to build. That’s why we offer two or three book contracts. We are now taking authors from our digital line and moving them into mass market. There’s one we published a few ebooks with us and earned 50,000 per book and is now getting an a $25,000 per book advance for her first print books. The low numbers people keep throwing around here are for authors early in their career that don’t have successful print or eBook track records yet.

      • Nick_Stephenson

        And that’s the point, isn’t it? The vast majority of authors don’t get those kind of big figures, most authors are not “established”. An even bigger number never even get a publishing contract in the first place.

        The only choice facing the huge majority of authors is, “shall I make zero dollars submitting to agents or a little money self-publishing?”

        Those few who DO have offers on the table are starting to turn them down, because they believe they can do better on their own.

        And there’s yet another army of traditionally published authors who are already signed, making poor money, who are desperate to get their rights back to self publish.

        The authors you’re talking about are a tiny fraction of the whole. That’s what Hugh’s study is trying to do – give that majority as much information as possible, so they can choose whether to submit and go down the traditional route, or go it alone. Nobody ever complains there’s too many career options.

        There’s a lot of hostility on both sides, but the truth is nobody wants to see publishers going out of business (well, most don’t). But the reality of the situation is that the book market only needs two groups of people to survive – authors and readers.

        Publishers are optional.

      • Steven Zacharius

        You’re reality of publishing is severely distorted. I don’t believe we’ve had a single author that we wanted to continue to publish who has left us for self publishing. It hasn’t even come up. You’re preaching to a group here with a definite bias that hasn’t been successful in traditional publishing.

      • Nick_Stephenson

        And you’re doing the same to a (much smaller) group who have been successful in traditional publishing, by whatever measure you’re using to define that success.

        More and more traditionally published authors are exploring independently publishing their work – I can’t imagine it’s not going to come up in conversation for very much longer.

      • Steven Zacharius

        I am not doing the same because I haven’t heard from any current traditionally published authors here yet. If more and more are exploring independent publishing then why haven’t publishers lost more authors? My definition of success might be different than others obviously. But I think if you go through a first contract which is at least two books and then manage to still be continually published by that publisher, something is going right for both of you.

      • Steven Zacharius

        There’s no hostility on the part of publishers. You don’t see any others in here even discussing the subject because it really has had very little influence on their business.

      • Nick_Stephenson

        Steven, I see 250+ comments discussing this on this site alone, hundreds more on other blogs. Including, I might add, the President and CEO of Kensington, who somehow feels the need to spend his weekend justifying his opinions.

      • Steven Zacharius

        A weekend in Florida on vacation :) But I always enjoy the dialog and I’ve learned things from many of the indie authors and I’ve also bought several of the books that they recommended I read about self-publishing. You can teach an old horse new tricks.

      • Nick_Stephenson

        Have a great vacation, Steven – I look forward to the ongoing dialogue. Hopefully other publishers will follow your lead.

      • http://idealog.com/blog Mike Shatzkin

        This is a pursuit of meaningless information. Anecdata. Wouldn’t help any author make a better decision when they have their particular choice on their next book.

        Mike

      • Deborah Smith Author

        Keep up the good argument, Mike. I have plenty of beefs with the major houses, having written for many of them over the course of the past 25 years, and I totally believe that publishing is an insanely run business now that I’m on the dark side as a publisher myself. But what astonishes me in all these arguments about self-pubs vs. trads is the pervasive and overwhelming ignorance — much of it wrapped in total confidence — on the part of self-pub advocates. I read a parade of staunch assertions about how publishers operate — but most of it is partially or completely wrong. Not just from a perspective of the specific business, but from ANY business standard. Please, please, folks, if you want to argue a point against trad publishers, at least educate yourselves about their business practices.

      • Steven Zacharius

        I like how the term “promotion” has now become lowering the price to under $1.99. Promotion used to mean marketing the book with advertising, whether in print or online. Anybody can lower the price of the book, publishers do it all the time…..and now we’re all concerned about devaluing content. What would happen if publishers made all ebooks 2.99, from all of their authors….do you still think that people would be buying indie authors that they never heard of?

      • Andrew

        Yes, they would. Because the only authors left at that price would be indies. Unless you think agents can convince authors that the 25% of net they’ll get from you at $2.99 is a better deal then the 70% they’ll be getting from amazon.

        That said, why not give it a whirl? Take some backlist books from some of your mid-list authors that haven’t sold well, lower the price to $2.99, and see what happens to those authors past and present book sales. Historical data says their sales on books new and old will rise, and thats not a bad thing, is it?

      • Steven Zacharius

        Actually Andrew we’re working on that right now. We’re looking at books that have run out of stock and then we’re going to drop the price on ebooks and see how they do. I’ll be happy to report if we see a big increase in sales; I hope we do.

      • Nick_Stephenson

        Price promotions are effective, that’s why authors use them. It’s a powerful tool that can reap large rewards, actual measurable results – how is this a bad thing?

        If publishers lowered all books to $2.99 people would buy more books. They would still buy mine at $4.99. They do today, even with thousands of books priced lower. Authors aren’t in competition with each other.

      • http://idealog.com/blog Mike Shatzkin

        Of course authors are in competition with each other!

        And of course books at lower prices steal sales from books at higher prices. That’s why people lower their prices.

        It does not follow that lowering the price to sell the most is the best commercial strategy. And it is particularly not true if the book can have any substantial print sale, which far more than half the books with the opportunity to get them actually do.

        Mike

      • Steven Zacharius

        Are you kidding me? Authors are absolutely in competition with each other and with other things that readers can spend time on…such as video games, movies, browsing the net, watching tv……

      • pixiedust8

        But isn’t not doing your own marketing that the main “selling point” of traditional publishing? If you’re doing all the same work marketing and making less of a percentage off that work, what is the benefit to the author? My own agent said that that one book per season in traditional publishing basically gets all the marketing dollars and the others get none. They used to get a little, but that’s changed.

      • http://idealog.com/blog Mike Shatzkin

        First of all, the same amount of marketing results in more sales through a publisher because of the leverage of much greater distribution.

        And the profile of marketing spending is changing. And the big publishers are learning best practices that can be applied at scale to do digital marketing in ways no author can do it on their own, including to growing proprietary lists. I know for sure the number of email addresses about which *something *is known and that can be targeted is numbered in the millions in at least two of the big houses, and I’d be surprised if it isn’t also true in the other three. These assets aren’t very obvious, but they can be very potent. And they’ll be more effective as publishers learn better how to use them.

        Mike

      • pixiedust8

        I’ve worked extensively in email marketing. It would depend a lot on the lists and how they were obtained–and honestly, emails are increasingly ignored.

        Also, in terms of reveneue, I’d be curious how more sales stack up against fewer sales but a larger percentage of the sale.

      • http://idealog.com/blog Mike Shatzkin

        Emails aren’t the only way to use email lists.

        And don’t assume the people doing digital marketing at big publishers have less experience than you do. Or less brains.

        Mike

      • pixiedust8

        I’m going to take the high road in this discussion, which is more than I can say for you. Good night!

      • Maia Sepp

        I’ve commented on this upthread, but I will add here that if publishers had as much brains/experience as you’re implying, they would not have been surpassed by an email-oriented start-up like Bookbub. They, at the very least, would not need to pay a 3rd party to promo their writers, which they definitely do.

        Publishers should have mastered the art of digital promotion/marketing years ago. And they haven’t. Not so brainy, that.

      • http://idealog.com/blog Mike Shatzkin

        Maia, I know all of the people that all of run the big houses. I don’t agree with them on a lot of things (and they all know that) and I have often predicted dire occurrences in their future (and they all know that), but I DO know — from FIFTY years of knowing the people running these businesses — that they are the smartest bunch of CEOs the industry has ever had. Perhaps you know them better than I do. Perhaps you are more discerning than I am. Perhaps you are so much smarter than I am that you can see intellectual deficiencies that aren’t apparent to me. But if you see a question and you think the answer is “they’re stupid”, my personal opinion — for what it is worth — is you’ve probably got the wrong answer.
        Mike

      • Maia Sepp

        Good God, I never said that they’re stupid; I said that this particular action was “not brainy”.

      • http://idealog.com/blog Mike Shatzkin

        You’re sorta right. You said “if they had as much brains/experience” as I was implying. I didn’t think it was too much of a leap to say you were calling them “stupid”. I certainly didn’t mean to mischaracterize your opinion, but I really don’t think I was that far off.

        Mike

      • Maia Sepp

        Well, you have and it is. History is full of smart people who’ve failed to adapt to changing technical, political, business, and societal changes.

        My background is in technology, so I’ve seen and worked with a lot of disruptive technologies in emerging sectors and I have a huge amount of experience working with people and organizations who didn’t or weren’t able to adapt. (I also have a fair bit in the digital/book sphere.) Some organizations are simply not able to adapt in a timely and agile fashion, for a variety of reasons, even if they’re made up of phenomenally smart people. CEOs, of course, are not the only ones who are key factors in the strength of an organization, although I’ve worked primarily in smaller start-ups and have had fairly good access to them.

        Additionally, I was applying brains/experience to a SPECIFIC action: digital marketing, so your clarification is also inaccurate, although I’ll grant that my intent is open to interpretation. Since you’ve decided to interpret it as an insult vs. a legitimate observation about where we find ourselves today WRT to the digital book sphere, I’m going to conclude that this a probably not a productive discussion.

      • http://idealog.com/blog Mike Shatzkin

        “Digital marketing” is not “*a” *specific action. Digital marketing is *many *things (which have been written about on this blog *many *times).

        If the conversation isn’t productive for you, I think you’d be wise not to continue it.

        Mike

      • nedworking

        Mike, I work in technology (Microsoft, Adobe, Intel). What Maia Sepp said is precisely right. Ever hear of the Innovator’s Dilemma? I don’t care how “smart” your publishing CEOs are, it’s a very hard hole to dig out of. Your response is lacking.

      • http://idealog.com/blog Mike Shatzkin

        Yes, I have heard of the Innovator’s Dilemma!

        We seem to be a long way from where we started. I criticized a piece that purported to use data to “prove” that authors would be better off eschewing publishers and working on their own. During the course of the dialogue about that, I speculated (pretty safely, I think) that many of the adjustments people are looking for in terms would come naturally out of negotiations if they were warranted. That doesn’t seem to me to require much in the way of vision. You can either sign up the books you need to run your business or you can’t.

        And I never suggested that *every* publisher would make the changes they’d need to make in time to survive. I just think it is a bit early to be doing victory dances about the death of the establishment and the rise of a new ruling class, which is, more or less, what the argument has turned into.
        Mike

      • Steven Zacharius

        Good business ideas come up all the time. Look at Facebook, it was rocket science…it was a good idea. BookBub was a good idea because it combined a value for readers from many different publishers. It’s like an ideal inexpensive book club…..you pick the inexpensive books that you want to read. Great idea, I wish I had thought of it.

      • Steven Zacharius

        Until fairly recently publishers were never willing to lower their prices to the levels seen on bookbub. We valued our content much higher that $.99 or $1.99. Then we started discounting books to these low prices to generate sales for a few days to get a new book moving up the list but everyone has to remember that free is not a viable business model for publishers. Indies might be able to sell their books at these low prices but publishers can’t do that forever. They have other costs to cover including the manufacturing of the printed book. I find it interesting how we value the content at a higher price than authors who indie publish. We think a book is worth more than $.99 or $1.99. And when Amazon and others are overflowing with cheap books it gets harder if not impossible to make your book standout from the crowd without extensive marketing support.

      • Steven Zacharius

        BookBub is successful because they are all opt-in names that are being mailed to. The reader has asked to be notified of bargain books in a certain genre. The publisher pays to have their books go to different size lists and most of the time, at least at my firm, it has proven to be a worthwhile investment on our part. It just goes to show that if you make the price of a book $1.99 you’re going to sell more copies but your total revenue is going to be substantially less.

      • Jackie Barbosa

        Big publishers are learning best practices that can be applied at scale to do digital marketing in ways no author can do it on their own, including to growing proprietary lists

        You mean like the email blast to 2,000 subscribers that a major publisher offered HM Ward as the lynchpin of their “knock-her-socks-off” marketing plan if she took their $1.5 million advance? When she has a mailing list of over 30,000?

        http://www.kboards.com/index.php/topic,178537.msg2516075.html#msg2516075

        Things that sound impressive in principle are often less so in practice.

      • http://idealog.com/blog Mike Shatzkin

        You’ve got a great story if a) she turned down the $1.5 million advance and b) she made more than that selling the book herself.

        Mike

      • Jackie Barbosa

        Did you read the linked post, Mike. It’s all right there, from the horse’s mouth.

        Unless you’re intimating that she’s lying…

      • http://idealog.com/blog Mike Shatzkin

        No, Jackie, I didn’t read the linked post (sorry, I just can’t..this isn’t how I make a living…) but if that’s the story, it’s a good one. But if she was getting a $1.5 million offer, she obviously already had a substantial base.

        Mike

      • Jackie Barbosa

        I’m not sure the $1.5 million is for a single deal. Her last offer was high 6 figures for a novel on-spec, sight unseen. She said she’d consider it if their marketing plan knocked her socks off. It didn’t and she didn’t sign.

        This is an author who is pulling down $100,000 a week from a single book several times a year. She hit the NYT 11 times in 2013. It’s pretty safe to guess that, during each of those 11 weeks, she made at least $100k, which means that JUST in those weeks she made $1.1 million. The other $400,000 wouldn’t be at all hard to come by.

      • http://idealog.com/blog Mike Shatzkin

        I don’t doubt a word of it. But there are unique non-replicable aspects to everybody’s story. As I have said repeatedly, while I don’t think much of Hugh’s business analysis, I think what he accomplished as an indie writer is mindblowing. He *didn’t * have a base that any publisher would pay six figures, let alone seven, for. He built it from scratch. I know others have managed to do it, but that strikes me as a a lot harder than exploiting an already known brand, which I agree will get easier to do (and will ultimately force, or entice, publishers to change both their marketing practices and their deals.)

        Mike

      • Jackie Barbosa

        Again, just for the record, Ward started from ground zero in self-publishing. Arguably, her success (11 times on the NYT bestseller list in a year, lest we forget) is just as mind-blowing as Howey’s, if not more so.

        Is her success replicable? Well, yes and no. What I mean by that is that the Ward/Howey/Hocking level of success in self-publishing comes to only a tiny proportion of authors. And it takes hard, hard work. Ward says she works 80 hours a week. Most authors probably can’t or don’t want to work that hard or that much. (I know I don’t!)

        But the thing is, that level of success (multiple trips to the NYT and earnings in excess of a million dollars) are just about equally as rare in traditional publishing. If you’re starting from ground zero, whether you’re published by the Big 5 or publishing yourself, your chances of getting into this elite territory are infinitesimal. Either way, publishing is seldom a road to instant riches. It takes time and a lot of work. There are some good reasons to choose the traditional route, but there are also good reasons to choose the self-publishing route (or a boutique publishers for that matter). But the factors that go into that decision probably shouldn’t include “How good are my odds of becoming the a millionaire?” Because frankly, the odds are lousy either way.

      • http://idealog.com/blog Mike Shatzkin

        I value this comment highly. It is true. It also spells out the reality that it can take working 80 hours a week to make it happen. There are also many who work 80 hours a week and for whom it does *not *happen. And the other data point relevant here is that Amanda Hocking decided, even after having achieved the success working her tail off, that it was better to take a publisher’s money and let *them *do that work. Her choice was entirely rational.

        Mike

      • Steven Zacharius

        But let’s not forget that Howey and Hocking have both ended up dealing with traditional publishing houses in the end.

      • http://idealog.com/blog Mike Shatzkin

        Howey’s deal with Simon & Schuster is print-only. He’s still most indie in the US, although he is published by publishers much more overseas. Hocking “switched” to having a publisher. At the time she said it was because she wanted to write, not deal with the business of publishing.

      • Daniel Knight

        Mike, I don’t understand why you wouldn’t want to read such a post – and each and every article about self-publishing. Isn’t reporting on publishing exactly your business. How can you be adequately informed if you cherry pick the information you decide to research.
        Earlier you said you won’t be reading the follow-ups to Hugh’s original report – even though his follow-ups include data you explicitly say was missing. Where is the logic in ignoring this?

      • http://idealog.com/blog Mike Shatzkin

        Actually, reporting on publishing is *not *my business. I don’t make a friggin *cent *reporting on publishing.

        There’s a lot to read. We all have to make choices. And I think people can decide if somebody’s choices disqualify them as worth reading themselves. I’m comfortable with that. I’m not striving for the largest possible audience. If you don’t want to be part of it, I’m sure you’ll find plenty of other worthwhile ways to spend your time.

        Mike

      • Steven Zacharius

        I’ve read most of the major articles and have commented on many of the indie sites. When I wrote my first blog that generated loads of comments it was that there is tremendous coverage of the exceptions in self-publishing but no comments about the other 10,000 authors that sell no copies. This author had a success story but there have been many self published authors who have ended up going the traditional route in the end when they came to terms that both parties felt were acceptable to each other.

      • nedworking

        Might want to read the post, Mike.

      • Steven Zacharius

        What about the additional marketing muscle of big publishers getting the prime space on the ebook retailer sites? How about the big publishers getting the chance to meet with Kindle editors to get books recommended?

      • Maia Sepp

        And they’ll (email lists) be more effective as publishers learn better how to use them.
        *
        Isn’t it incredible, then, that a 3rd party came along and perfected the art of using reader email lists, while publishers did no such thing? Instead of publishers mastering this type of marketing on behalf of their authors, instead *publishers* use Bookbub to push their authors.

        Considering that a publisher such as Random/Penguin is such a huge house with such a long history of expertise in the book industry, I find this impossible to explain, if they’re as forward-thinking as you claim. I have nothing against tradpub, but I think it’s quite obvious that they’ve been trounced by Bookbub. And I find that telling.

        (ed for clarity)

      • http://idealog.com/blog Mike Shatzkin

        Until you got to the end, I didn’t realize you must have meant that Bookbub “perfected” something that publishers don’t know anything about.

        I think I had a blog post 2-1/2 years ago about the 600,000 emails Tor had sent out that October supporting their books. Of that total (if I remember; you can look up the post), something like 250,000 were opened and something like 40,000 “took the action” requested (a click, or something.) You can be assured that all the numbers are bigger now and that the actions are more sophisticated.

        This is *not *new. Bookbub is, but email marketing isn’t. (And I am not disparaging Bookbub. Great that they’re there. But they are *not *alone.)
        Mike

      • Mojo

        I think they are, in terms of scale and reach, by a huge factor. If publishers were capable of moving the market the way Bookbub can, why would they give marketing dollars to Bookbub? The answer is that they wouldn’t.

        But it’s an interesting point. I’d love to see a tradpub writer talk about how their publisher’s digital marketing got them to Amazon’s top 100 list. I know how I did it, and I’m happy to share that data (as many indies are).

        If someone has seen a post by a tradpub writer who’s been the beneficiary of this type of digital push from their publishing house that doesn’t include Bookbub or any other 3rd party, can you please post a reply to me? I try to keep up on the industry, but I might have missed something.

        Cheers,
        Maia

      • http://idealog.com/blog Mike Shatzkin

        One of Bookbub’s value proposition is that it is *not *publisher-specific. It is “picking out” (actually “selling”, but they don’t emphasize that part) the *best deal of the day* every day. One publisher alone couldn’t sell that value proposition. That said, if Bookbub “succeeds”, they’ll get bought. Maybe a big publisher will buy them. Would that prove you’re right or that I am?

        Mike

      • Steven Zacharius

        There was nobody better at direct marketing than Harlequin. For decades their book clubs were enormous.

      • ReadWriteThinkPlease

        How have publishers been “surpassed” by BookBub?! As Mike Shatzkin points out, BookBub has a different value proposition to the consumer than a publisher pushed email: it is precisely BECAUSE it is THIRD PARTY that consumers value the information. BookBub “curates” its content (or gives the impression of curation, we all know it can be bought once a threshold of ratings/reviews is reached) so consumers “trust” the information.

        And please show me the hard data that proves BookBub results in more profit to the publishers than do their own lists. Or is your conclusion as scientifically suspect and as much of a whistle in the dark as Howey’s?

        When I receive an email from, say, HarperCollins informing me that Neil Gaiman has a new book (information I specifically signed up to receive): I act on it. Immediately. And I read the book. Immediately. Unlike the hundreds of bargain BookBub books that I may or may not get around to someday. And I know that I am not alone in this behavior.

      • http://idealog.com/blog Mike Shatzkin

        Thanks for this. I think it is a bit shocking how poorly understood are the existing digital marketing efforts at publishers. They’re extensive. They have *millions *of consumers they’re pinging regularly. Among many other things. We’re in very early days of digital marketing. Nobody’s “figured it out” yet. Amazon’s the best at it, probably, and they send me stupid emails all the time that they should have enough internal knowledge to do better.
        Mike

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  • Margaret Yang

    Can we talk about your headline for a moment? I think there’s a word missing. “Comparing self-publishing to being traditionally published” would read better. Without out the word “traditional” in there, it sounds as if being self-published and being published are mutually exclusive. Are they? As for the content of the headline itself: it is tricky and most of the data isn’t available, so…what? No one should do it? You do it all the time!

    • http://idealog.com/blog Mike Shatzkin

      Well, clearly, if I hire an editor here for my headlines, you should be a candidate. And you’re right that we do some creative speculation here on occasion, but if you read the post I wrote *about*, you will see that it purported to make some pretty precise calculations which were, first of all not possible, and secondly (although I didn’t get into this part of it in much detail) also sometimes just wrong.

      Mike

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  • Jackie Barbosa

    1. Author revenue from print sales.

    Howey’s done this as of today. You should check it out. I don’t think his numbers are 100% reliable, but the piece of the revenue pie that AUTHORS give up by going the self-published route is a lot smaller than you might think because authors get a relatively small chunk of that revenue. (I get 8% of list on my one traditionally published book. Whoopee.)

    2. Getting an advance before publication versus having costs before publication.

    You mean like the $2,500 advance I got for my three-novella anthology, followed by a full year where I got no additional money at all? Yeah, that was way more awesome than spending $1,000 to publish a single novella and making $16,000 the first year it was on sale. (I’m still waiting to break the $5,000 earnings mark on that anthology, by the way. Four years after publication.)

    3. Unearned advances and their impact on author earnings.

    The other side of that is not earning anything while you’re waiting for the book to earn out. I don’t live on last year’s royalties, yanno.

    4. Getting paid for doing the work of publishing which goes beyond authoring.

    This is a downside to self-publishing, no doubt about it. But you assume every author who can self-publish has an equal opportunity to get all this work done for him/her by a traditional publisher. The reality is, for every author who has that option, there are dozens who will never make a dime in traditional publishing because they’ll never get a contract. Why shouldn’t they invest in themselves and see what happens?

    5. Current indie successes where the author name or even the book itself was “made” by traditional publishers.

    Hm, this seems to be directly counter to your point 8. Are self-pubs becoming the new traditional publishing stars or are traditional publishing’s existing stars becoming the new self-publishing stars? You should choose one or the other and stick to it.

    6. Rights deals.

    Many self-published authors have agents who do this for them. Many traditionally published authors sell exclusive rights and their publishers never succeed in selling any rights in other territories. (Looks at self.)

    8. The apparent reality: flow of authors is self- to traditionally-published, not the other way around.

    I know of MULTIPLE authors who’ve walked away from advances in the past year to self-publish. I’d list them all if I thought they were all comfortable with being named here. I will, however, mention one because she’s been very public about her decision. Stephanie Laurens’ name ring a bell?

    9. Publishers can raise royalty rates (or lower prices) when it becomes compelling to do so.

    Which basically means authors should forego the much higher digital royalties they can get TODAY by self-publishing on the chance that publishers will improve their terms at some point in the future? Er, you see why that’s not enticing, right?

    • http://idealog.com/blog Mike Shatzkin

      First of all, if you’re making it work for you, then you should definitely go right ahead. Although I suspect if you REALLY make it work, you’ll find the advances you could get will become more tempting.

      But the posting today by Hugh about the author revenue is, to put it politely, irrelevant. He’s talking about the AMAZON-reported print sales. And we know for self-published books that means CreateSpace which also means no books in stores which also means no visibility. Please see my comments about studying the weather in one city to predict the weather in another.

      As for the flow of authors, maybe neither of us in a position to know. You seem to know a lot of authors who are turning down advances to self-publish. What I’m seeing is a lot of publishers and agents combing self-publishing to find recruits who aren’t that hard to bring on board.
      And OBVIOUSLY, an author who can’t get a deal should self-publish as a way to get their stuff out there. I’m only saying it isn’t preferable, not that it isn’t sensible when you have no other choice!

      And, as for your last comment, of course I am not suggesting that anybody should eschew doing what makes them more money today because publisher terms might change in the future. But I also think that people shouldn’t be sucked into believing irrelevant analysis encouraging them to make bad decisions.

      Mike

      • Jackie Barbosa

        He’s talking about the AMAZON-reported print sales.

        I’m looking at Hugh’s charts and they say “Bookscan Top 100 Bestselling Print Books (all brick and mortar plus all online stores combined).” Are you saying that’s not where the data came from?

      • Jackie Barbosa

        As for the flow of authors, maybe neither of us in a position to know.

        I’d agree, neither of us knows for sure. But for every author you can name who has been converted to the “traditional” side, I’m sure I could name someone who has deserted traditional in favor of self-publishing because print sales are down, therefore advances are down, and they just cannot stomach 25% of net on 75% of their total sales.

        It’s probably true that big name, bestselling trad authors aren’t running to self-publishing. They don’t have to. Their advances are great and print is still a sizable proportion of their revenue stream. But only a tiny percentage of all traditionally published authors are big name bestsellers. Most authors are nobody. And nobody doesn’t get big advances and huge print distribution. A lot of those nobodies have concluded they’d be better off publishing their own books and getting a larger share of the royalties on their digital sales and turned down advances to do it.

        Note that I’m not opposed to publishing with publishers. I have a two-book contract with Entangled Publishing (a boutique digital-first press) and I’m thrilled with them. They pay a fair royalty, have an awesome marketing team, and have fantastic editors. I’m happy to give up more of my royalties in exchange for such wonderful support.

      • http://idealog.com/blog Mike Shatzkin

        OK, Jackie, what you’re saying is making a lot of sense to me. Self-publishing is ALWAYS a better idea for an author who a) has some brand in the marketplace and b) knows something about the process of getting from a good manuscript to a good book. And, you’re right, there should be a growing population of authors being lost from the current system as it shrinks, as it has and will. Got it. Duly noted. I think that focusing the advice that way makes it make a lot more sense. And it has the benefit of suggesting a much more specific basket of tactics.

        Mike

      • ET (Liz) Crowe

        the “do what works for you and keep doing it” model certainly applies in my other life as marketing director/owner of another trendy industry: Craft Brewing. Some bottle, some can, some just serve in their pub some go regional some national some keep it state wide. I think it’s a matter of what you can afford to do and what will eventually have a positive RoI for your business.

      • Deborah Smith Author

        Disagree. As a former Big 6 author, now a small press publisher and hybrid author, there are many many reasons why authors are better off staying with trad publishers: print distribution, rights management, liability coverage, copyright management, and marketplace clout including marketing that can move mountains the average author cannot begin to budge. There are many anecdotes about good and bad experiences out there, but this false idea that trad publishers offer little appeal to most authors is simple that: false. I know plenty, PLENTY, of authors who are midlist genre fiction stalwarts and will never leave their publishing homes. They may self-publish special projects on the side (and often do, with presses such as mine,) but they value the stability and advantages of their big houses.

      • http://idealog.com/blog Mike Shatzkin

        Glad to hear from you!

        Mike

      • Steven Zacharius

        Finally a believer :)

      • Steven Zacharius

        Did you get an advance from Entangled? There are many digital houses that will pay a higher than 25% of net receipt royalty. Most author’s sales aren’t 75% digital and 25% print….maybe in entry level genre romance…but not with bigger authors and I’m not just talking about mega-bestsellers.

      • CW

        Mike, if you are talking about Hugh’s “What Authors Leave on the Table report” — that was Amazon’s DIGITAL sales versus all Bookscan recording PRINT SALES (all bookscan, regardless of outlet, platform, publisher). That would also include Amazon print sales reported via Bookscan. Maybe that doesn’t make it any more relevant to you, but your current foundation for saying it is irrelevant either contains a typo or is flawed.

      • http://idealog.com/blog Mike Shatzkin

        Sorry, you’re right, I didn’t look further at Hugh’s data to see he had pulled in Bookscan numbers (which are incomplete, but in a different way). The problem is that it still doesn’t tell him what he needs to know. The best-agented biggest published authors (who are in the top 0.5% that he has examined) don’t make statutory royalties. They get big advances that don’t earn out. So the data is still insufficient to make the comparison.

        Mike

      • Jackie Barbosa

        After having been “valued” down below, I hate to come in stomping my feet, but if those top 0.5% of authors aren’t earning out their advances, it’s a dead certainty that this isn’t because the publisher is losing money on those books. The reason they aren’t earning out is because the author can’t earn out at the royalty rates the publisher is paying, especially if a significant proportion of that author’s sales wind up being in digital instead of hardcover. Authors typically get 15-20% of list for hardcover print sales but only 12.5% of the list on digital sales. Since the list price on digital books is seldom more than half the hardcover edition, authors are losing big bucks on those sales–and those sales are growing. It’s tough to earn out a $1+ million per book advance at those rates, even if your book sells extremely well. But it’s also clear that the publisher isn’t losing money by paying that huge advance because they are earning so much more on each sale than the author is.

        By the way, this data comes straight from Harper Collins: http://bit.ly/MlEVOf

      • http://idealog.com/blog Mike Shatzkin

        Jackie, the royalties aren’t *intended *to earn out. They are intended to enable the publishers to effectively pay higher royalty rates without writing them into a contract. That’s the *point*!!!

        The “dirty little secret”, if you’re looking for one, is that this means that higher royalties *are *being accepted by publishers, but only for the authors who have agents sophisticated enough to know how the game is *really *played. It is part of why, on another part of this string, I was emphatic about the fact that authors will always choose the largest possible advance. Or that they should, in their own interests.

        Mike

      • Jackie Barbosa

        Oh, I know those royalties aren’t intended to earn out. But it’s not AGENTS who are getting those kinds of deals. It’s authors with the sales volume to command those kinds of deals. No agent, no matter his/her sophistication, could get me that kind of deal. The agent I have now could absolutely get me that kind of deal (and I would expect her to) if I had the kind of sales numbers a Sylvia Day does.

        And that’s, perhaps, the biggest irony in this discussion. From your perspective, it’s all about the value added by publishers and agents, who are somehow the ones “responsible” for authors who do well. I’d argue it’s quite the reverse. It’s the author that matters. In a fundamental sense, the publisher works FOR those authors, not the other way around. Or they should…

      • http://idealog.com/blog Mike Shatzkin

        We’re now officially going around in circles. If we agree that some deals aren’t intended to earn out, then let’s not apply contractual royalties to them as though that’s how the author is getting paid. It is true that the agent’s ability to get any particular deal for an author is dependent on *both *the author’s desirability to the publisher *and *the agent’s sophistication in leveraging that desire to what amounts to what is *effectively
        *a higher royalty rate, although that’s not the way it is portrayed or executed.

        Mike

      • Jackie Barbosa

        I don’t think we’re going around in circles, because I don’t believe that the majority of legacy-pubbed authors in Hugh’s sample are in that top 0.5% who are getting the big buck advances that never earn out. He’s looking at the top 7,000, not just the top 1,000. (And, by the way, I’ve BEEN in the Top 1,000 on Amazon, more than once, with both self-pub and house-pubbed books. We have already established, however, that I’m nowhere NEAR the top 0.5% of authors.) On any given day, a lot of legacy-pubbed authors who are in the top 7,000 on Amazon are midlisters, not mega bestsellers, and they probably aren’t getting the kinds of advances you’re talking about, so they aren’t getting the kinds of preferential “hidden” upscale in royalty rates your talking about.

        Now, I *do* think the data Hugh has gathered doesn’t say some of the things it purports to say. (Extrapolating annual earnings from a book’s position on the bestseller lists on a single day obviously doesn’t make a lot of sense, given the fluctuations we see from day to day.) But I really don’t think it’s fair to say that because the top 0.5% of authors get huge advances in lieu of higher royalties, the differences in those rates are meaningless to the average author when it comes to looking at potential earnings. Because the average author ISN’T in the top 0.5%, but might have a pretty decent shot at hitting the top 7,000 on Amazon (like I said, I’m nobody, and I’ve done it with at least 4 books).

      • http://idealog.com/blog Mike Shatzkin

        Yes, but Jackie, you’ve already said (admitted) that the income calculations for those self-pubbed authors are crazy because what happens in one day doesn’t happen every day. Just how much of a hole in a data’s validity does it take for you to say, “this analysis might not mean very much”? And a LOT more than the top 0.5% of authors published by big houses (which would be 1 out of 200) get advances that don’t earn out. I believe *most *advances do not earn out!

        Mike

      • Jackie Barbosa

        Income calculations for legacy-published authors are equally difficult to determine because so much of the data is hidden. And I’m not just talking about unearned advances. I’m talking about reserves against returns, basket accounting, using pass-throughs to subsidiaries to reduce “net,” publisher-sponsored discounts, etc.

        I will also say that, while you may believe that most advances don’t earn out, most legacy-published authors I know do earn out their advances on most of their books (at least those who continue to get more contracts). Most of the authors I know write a publish genre romance, however, which may have something to do with it. Frankly, the authors who don’t earn out their advances (which are usually modest) are the ones who aren’t offered additional contracts. Unless you’ve got data that shows BOTH that most authors don’t earn out AND that they get offered new contracts for similar or better advances, not earning out doesn’t seem like a good thing to me on balance because it often means not getting another deal.

        The main reason Hugh’s data interests me has nothing to do with any individual author’s earnings and everything to do with where the sales are and how the revenue stream generated by those sales is apportioned. It’s not a complete picture, to be sure, but this data coupled with the many authors I’ve seen go from a day job to full-time writing when they went from legacy to self-publishing convince me that those who can’t command the “never intended to earn out” advances do better, on average, in self-publishing than in legacy publishing. There are lots of caveats, of course. No one is guaranteed success in self-publishing. But then, no one is guaranteed success in legacy publishing, either. It all boils down to which risks you’re more willing to take and how long you’re willing to wait to achieve success, however you define it.

      • http://idealog.com/blog Mike Shatzkin

        The income data about authors isn’t so much “hidden” as it is “private” (in each individual case).

        I don’t pretend to be an expert on the situation in the romance field. There’s no doubt that’s a bit of a world of its own. It also has its own experts, like Jane Litte. Maybe it *is *more common in romance, where authors are published with more frequency and the books are both written and read faster, for authors to earn out. Part of my *point *here is that one size *does not fit all*. If you think that romance might be different than other categories, I think Hugh Howey is the one that needs that pointed out, not me. That’s what I’ve been saying since the start of this conversation!

        Mike

      • Jackie Barbosa

        The income data about authors isn’t so much “hidden” as it is “private” (in each individual case).

        Yes. Which means the closest we can come to estimating the values is by looking at what the standard royalty rates are. What’s the alternative? Unless all authors start sharing this information publicly, there really isn’t one.

        But if you are trying to make a decision (“Is this contract offer from a legacy publisher good for me/my book?”), one of the things you have to know is whether you’re likely to do better than “the standard royalty rate” or not. Is your advance intended to earn out or not? If it doesn’t, will your publisher decline to offer you a contract for your next book? You also need to be able to compare that to what you could make per sale if you published yourself or went with a publisher who offered you a lower advance or larger royalty.

        Knowledge is power, but because so much of the information here is “private,” as you say, there’s precious little knowledge on which to base a sound decision. I think Hugh is getting us about as close as we CAN get based on the information that’s public. And it’s not a bad yardstick for an author to use when answering those questions above.

      • http://idealog.com/blog Mike Shatzkin

        As for authors making decisions about whether their advance is “intended” to earn out or not, the first source would be their agent. But what they really have to do is to think about the money they’re being offered, think about what risk and effort it would take to self-publish, and think about what the likelihood is that they could sell enough to beat that royalty (which means fewer copies than the publisher would have to sell). If they feel confident they can beat it, they should turn it down. If they don’t, a bird in hand…

        Mike

      • Jackie Barbosa

        Certainly, that is something the agent and author should discuss. In a lot of cases, however, especially with new authors, these are issues they haven’t even considered. I just read a blog entry from December of last year by a YA author, Jessica Spotswood, who got a substantial advance for a series which then did not sell as well as she (and she assumes, the publisher) expected. The fact that she didn’t earn out her advance was a huge source of concern to her because she clearly believed it meant bad things.

        That’s not to say she shouldn’t have taken the terrific deal she was offered. But if indeed the publisher never had any expectation that she would earn out her advance, it would have been nice if they and/or her agent had let her in on that fact. They could have saved her a lot of anxiety and heartache.

        And I suppose this is my biggest bone of contention with the legacy publishing industry (and I include agents in “industry” in this particular observation). It’s the fact that they are playing the game, but they don’t let authors in on the rules. Whether that’s because they think the rules are irrelevant to authors or because they see keeping the rules under wraps as leverage or because they assume authors are aware of the rules doesn’t really matter. What matters is that authors are too often faced with having to make decisions without access to all the relevant facts, and that can happen even if the author has a great agent, simply because the author doesn’t know which questions to ask and the agent therefore assumes the author knows everything he/she needs to know.

        You clearly see the publishing industry from the publisher’s side of the table. That’s understandable and I find your perspective interesting because you filter your observations through that lens. What’s good for publishers’ business? How should they respond to the changing marketplace? They’re your clients, after all. Makes sense that you care about their interests.

        I, however, am an author and that means I look at the world from the author’s side of the table. That’s the lens through which I filter information. What’s best for authors? Clearly, there’s no one-size-fits-all answer but I think the only way any individual author can answer that question for him or herself is by having relevant information.

        More information = better. Always and forever, amen.

      • http://idealog.com/blog Mike Shatzkin

        It’s up to agents to explain the business to authors. That’s why they have them. Publishers are still on the other side of the negotiating table. In fact, an agent should be conversant with self-publishing options as well. Agents are hired by authors and compensated by them to provide the business savvy they need alongside their writing.

        Mike

      • Jackie Barbosa

        Publishers are still on the other side of the negotiating table.

        And this is part of what I fundamentally object to. While I agree that agents ought to explain the business to authors, I feel strongly that authors and publishers need not be adversaries. They can be partners.

        One of the things I value most about Entangled is the way they treat their authors as true partners. They constantly share their business strategy with us. They just set up an interface that allows us to log in and see our sales data on daily basis. And they just had an author hit the NYT this week.

        It doesn’t HAVE to be this way. It doesn’t have to be publishers trying to dupe authors into signing deals that aren’t in their best interests. And really, isn’t that the only reason for NOT being transparent? Because you’re hoping to trick the guy on the other side of the table into doing something that’s good for you and bad for him?

      • http://idealog.com/blog Mike Shatzkin

        Sheesh! How you do leap from one thing to another.

        No quarrel about Entangled. I haven’t managed to connect with them, but everything I’ve heard about the way they do business is smart.

        Publishers aren’t trying to screw authors or cheat them or deceive them. In most cases, the agents would consider it *unethical *if the publishers tried to explain or characterize a deal directly to the author. The agent is trying to get as much as they can out of the publisher, playing off other publishers. The publisher is trying to get the author signed. The way it works in the Big Leagues is that they figure out how much total revenue there’s like to be from the project and work out a way to divide it, then pitch the advance to that and plug in “standard” terms which are basically irrelevant in those (Big League) cases. The publisher believes that the agent is the *author’s representative*, and would endeavor to answer any questions posed by the agent honestly. But the agent and publisher have dealt with each other dozens of time since the last time that author was in; the agent doesn’t need all things explained to *them*.

        And this advance that doesn’t earn out thing has really gotten turned around in this conversation. This isn’t *cheating *the author or *deceiving *the author; it is *guaranteeing *the author more than standard terms are likely to earn them, or maybe could *possibly *earn them.

        And I know what I’m saying does not apply to the romance authors who do 5 books a year at $3,000 a book and make a living on the royalties. But what I’m saying *does *apply to most of the books bought by big houses, and that is still the 20,000 titles a year that, collectively, I’m quite certain gross a dollar amount that *dwarfs *what indies do, whatever any biased slice of the market might say.

        See my original point: one size does *not *fit all. That was my original complaint with the piece I criticized. None of this conversation is persuading me that I was off base.

        Mike

      • Jackie Barbosa

        No, I’m not saying paying an author more in advance in lieu of royalties is “screwing” the author…but I think both sides of the arrangement should clearly understand that that’s the expectation. And I see too many authors angsting over the possibility of not being offered another contract because they didn’t earn out a $10-$15k advance to believe that most agents are explaining to their authors that they aren’t meant to earn out. You can say that’s the agent’s responsibility, not the publisher’s. I won’t disagree. It’s still, in my mind, a problem, especially because there’s no conflict once the deal is signed. If business partners don’t understand each other’s expectations, how can they work together to achieve a result that is beneficial to both of them?

        More information always = better. That is DEFINITELY one size fits all.

      • http://idealog.com/blog Mike Shatzkin

        If an author doesn’t have a full understanding of what’s going on, their problem is their relationship with or the competence of their agent; the publisher doesn’t enter into it. That’s a big part of the agent’s *job *description.
        You don’t engage the publisher who can explain things best; there are other more important criteria to apply there.

        Mike

      • Steven Zacharius

        The Entangled business model is fairly unusual where most people are freelancers who work on a specific book and these freelancers share in the success or the lack of success of the book. Whether it’s a good business model will be determined in the future when the freelancers decide are there enough books that are selling well enough for them to make a living this way. Just like the author earning a royalty, the freelancers are as well, although a much smaller piece of the pie. Books that sell only a few hundred copies or a thousand copies take as much work to produce as a book that sells 25,000 copies, but the freelancers will not make any money from those small sellers. Imagine a freelance editor who spent a fair amount of time editing a full length novel to only make a couple of hundred bucks. It’s a very good business model if the pie is big enough because everyone is sharing in the revenue.

      • Steven Zacharius

        I don’t think this is a matter of transparency. If an author or agent wants information all they have to do is ask their publisher. Publishers consider their business dealings with an individual author as a private matter. There is no need to broadcast that private information. If the author wants to tell the world what they made, that’s up to them but it’s not a matter of transparency. I don’t think that most people want their next door neighbors knowing how much money they make at their job. It’s private. This is why you hire a good agent, lawyer or you have enough business acumen to make the deal yourself.

      • Steven Zacharius

        I don’t know where you’re getting the idea that publishers are trying to dupe authors into signing a contract. The offer is totally above board. An agent or lawyer can look at it and advise the author. A digital only publisher is not the same as a traditional publisher. First of all daily sales data is not available from all digital accounts and it certainly isn’t available daily from print accounts. They can check certain accounts like Kindle or Apple for daily sales. I’m curious because I’ve studied Entangled’s model….what do you feel that there business strategy is? Isn’t it to sell as many digital copies as they can? Their freelance editors get paid a percentage of the net receipts on the books sales; which means if a book only sells 500 copies; the editor basically worked for free. On the other hand if the book had big sales; the editor could make a fair amount of money. I believe they have other people who work on the book that also get a percentage of the pot; but they should weigh in on that rather than me just speculating.
        Most digital publishing lines now pay a higher royalty rate than you were paid years ago. Things have changed and most of the houses have different royalty structures for these lines since they generally don’t pay an advance; although there are exceptions of course.
        Most authors don’t find their publishers as adversaries thankfully. We’ve published many authors for more than 15 years now, several times a year as well. It really seems that the adversarial relationship is being fostered in indie blogs. As we said earlier you don’t see many traditional authors blogging and talking about an adversarial relationship with their publisher.

      • Steven Zacharius

        The agent is working for the author, not the publisher. They should be sharing any and all information with their client. Agents are told how many copies have been distributed when they ask and they are sophisticated enough to figure out if that means if a book will earn out the advance. There are good agents and there are bad agents as well.

      • Steven Zacharius

        Let’s also not forget that a publisher can be laying out an advance years before the final books are turned in for a multi-book contract. The publisher can be paying out a third of the overall total of a contract on signing and then keeps paying out more money upon delivery of an outline, manuscript, delivery and publication of each book. Amazon reports their print sales to Bookscan. Why don’t they share how many units are being sold on Kindle? In fact why don’t they share any information with publishers about Kindle? How many Kindle’s have shipped for instance. Why don’t they share their publishing profits?

      • http://idealog.com/blog Mike Shatzkin

        Well, that’s easy. They get no competitive advantage disclosing that information so they don’t. I think that every time their Bookscan contract is up, they probably ask themselves again whether they want to share the print data. Here’s the big one. What we really want to know is how many USED books they sell! That’s the big number, but there’s no reason for them to reveal it so they don’t. I want to emphasize that I never quarrel with a company (or person) acting in its own self-interest. I am not questioning Amazon being tight-lipped about some of these things, just explaining it.
        Mike

      • Steven Zacharius

        The information isn’t being hidden. It’s being shared between the publisher with their author/agent. Most traditionally published authors don’t share their information with the world. They want to keep their deals private which is their right.

      • Steven Zacharius

        There are loads of romance authors that are getting very respectable advances….I’m talking about 25,000-100,000 that don’t earn out and they still get new contracts all the time because both the publisher and author are still making money despite the advance not necessarily earning out.

      • Steven Zacharius

        Whoa whoa whoa. Legitimate publishers don’t hide sales data from their agent/author. They’re not hiding behind reserves either. The amount of copies being reserved for future returns are spelled out on the royalty statement. I don’t know who uses pass throughs to subsidiaries…..unless you’re talking about publishers that might be selling books to their book club operations….not sure what you mean here. I can only speak for Kensington but I don’t think we’ve had a basketed contract in over 20 years or longer. What is a publisher sponsored discount….are you talking about a sale that’s made at a deep discount which would cause a smaller royalty to be paid? If that’s what you’re referring to it’s because the discount is so high that the publisher is making less money on the book than normal, so the royalty rate has to be lower as well. There aren’t normal traditional accounts that fall into deep discount accounts though….these are generally special sales or non-returnable sales.

      • Steven Zacharius

        The fact of the matter is that when a publisher pays a major author a large advance, the publisher knows upfront that it will probably never earn out. It wouldn’t make a difference if the royalty was a larger amount in many cases because the advance still wouldn’t earn out. That doesn’t mean that the publisher or the author didn’t make money however.

      • http://idealog.com/blog Mike Shatzkin

        Thanks for the observations from the top of an important company, Steve. But I’ll ask this question. Are you “losing” any authors to self-publishing? Are you being forced to *justify *yourself more? Or are most authors still happy to be signed and recognizing the advantages of what a publisher and print sales can do for them?

        Mike

      • Steven Zacharius

        Well Jackie Barbosa wasn’t happy with us but there is no shortage of new books coming from agents. There aren’t very many times when we lose an author to self-publishing unless they are debut authors whose books didn’t perform well in the traditional marketplace. Most authors are thrilled to get an advance and be with a NYC publisher. We do have two lines eKensington and now Lyrical Press that are digital first lines and we are moving some of these authors into print now because they have had very successful digital sales. That’s what it’s all about….keep testing new authors and trying to build them.

      • Jackie Barbosa

        Being completely fair, Kensington didn’t pick up my option book. At the time, I was pretty bummed about that.

        That said, I could list the names of at least a dozen former Kensington authors who are now self-publishing. I’m not sure how many of them “left” Kensington and how many were shown the door, though.

      • http://idealog.com/blog Mike Shatzkin

        I think there’s a business in focusing on the authors who have a name built by publishers who then cut them loose. The fact is that the business as it is now run *is *getting smaller, there *are *more and more authors that are quite viable under a different business model made available and they are now being reflected in the growing number of self-publishing successes.
        Mike

      • Steven Zacharius

        I’m willing to bet that the list would almost entirely be made up of people where we didn’t want to continue their contract because the sales weren’t where we hoped them to be. This happens on a routine basis with every publishing company. We generally do a contract for at least two books and sometimes three and if the numbers aren’t good at the end of that contract we have to make a decision whether to continue the high risk of the investment or to not renew the author. If those authors want to comment on their private dealings in a public forum, I’d be willing to answer their comments openly; otherwise it’s between us and them.
        And off the top of my head I can’t think of a single author that has said I’m going to leave Kensington to self publish by their own decision.

      • Steven Zacharius

        Unfortunately it is quite common to not pick up an option book after the third book or even later if the company is losing money. Every single major retailer bases their next print buy based on a combination of factors, most importantly the prior sell-thru. So if the print numbers keep getting smaller and smaller because the author’s book isn’t selling for whatever reason…..then we can’t renew a contract. That’s the business. This doesn’t mean it’s not a good book or a good writer. It could have been lousy covers, lousy cover copy, poor promotion, etc…. This is why sometimes publishers if they believe in the author will often ask to change to another pseudonym.

      • Elaine Levine

        Hi Steve! I’m one of those exceptions, I guess. I had 2 contracts with Kensington. At the beginning of negotiations for the 3rd contract, I learned that K wanted to change my author name–a decision that made absolutely no sense to me. I know that’s done to repurpose an author who didn’t sell well, but frankly I was never given a chance to sell well at Kensington. My cover branding was inconsistent. I was only allowed to release 1 book a year. Kensington didn’t even acknowledge the 4 books I sold to them were part of the same series…until the 4th book. When I told my editor that I was going to start a new romantic suspense series, she let me know that K wanted it but that I would have to change my name. When I told her I wasn’t interested in that approach and would be self-pubbing the series, she said then K would like to continue with my historical western series, at the old terms ($2500 advance, 8% of list for print, 15% of list for ebook). I laughed. I really laughed. I asked what she could do for me that I couldn’t do for myself. She had no answer. When I counter-proposed better terms, I no longer received any correspondence from her. I put out 4 books in 4 years and made only pin money from Kensington. In the past 18 months through Amazon KDP (and the other vendors), I’ve made enough income to leave my day job. Amazon KDP–not Kensington–allowed me to realize my life-long dream of being a full-time writer. I’m very happy to hear that Kensington is still helping new authors and its other long-term authors. There are many roads to success. And there are many reasons why any given author might choose one road over another. For me, because I like to pay my mortgage, I had no choice but to go indie.

      • Steven Zacharius

        I’m glad things worked out for you Elaine because obviously you are a good writer even though your sales were not good enough to continue writing with under your own name for Kensington I’m glad to hear that we offered you an opportunity to continue under a new pseudonym. You had two of the best editors in the business and obviously they recognized you had writing talent. You said you made pin money with us. I don’t know if we were your first publisher but assuming we were, we paid you an advance on those four books and took the risk that we would lose money on them….and in fact, we probably did. That’s part of the publishing business.

        Everybody is touting the success of KDP and the hundreds of thousands of dollars they’ve made self publishing but no one is understanding that there are 150 or 250 or whatever the number is….of authors here that are doing that. There are probably 10,000 others that are making $2.00 per year. You don’t hear from them, although one or two have indeed commented about that. I don’t begrudge anybody making money and doing what they think is best for their career.
        Also accept for one reply; what do you think would happen if publishers cut the prices on their ebooks down to the price that indie authors are charging? Do you think readers would buy the bestselling names or the names they don’t recognize for the same price?
        Amazon is paying you 70% of revenue now. What’s going to happen when they’ve wiped out most of the competition because of their predatory pricing practices of selling books at a loss to wipe out competition and take marketshare? Do you think you’re still going to be offered 70% then? There wasn’t an increase reported in Kindle units sold this past holiday season. What’s going to happen if new devices aren’t being sold and the market has peaked like it has been reported by all the big publishers for their digital sales? Is there going to be a glut of writing available all at cheap prices? is Amazon going to remain a friend or foe in the future? Time will tell.

      • Elaine Levine

        Thanks for your kind words, Steve. You know, I don’t have a crystal ball. I can only deal with facts as they are at this moment. I think if Kensington and other publishers priced ebooks as competitively as indie authors, they’d have a lot of very happy readers and the publishers would make a lot more money for themselves and their authors. I have no fear about competing with any other author or publisher. I have a very good relationship with my readers who read me and many other authors. They know what they like. They know how to find me and other authors. And best of all, they tell their friends who tell their friends….My fan base is continuing to grow. Maybe I’m looking at life through rose colored glasses, but I have no sense of fear for the future. It will be what it will be. And right now, I can provide for my family with only my writing.

      • Steven Zacharius

        And there’s nothing wrong with that. It’s wonderful.

      • Jackie Barbosa

        I tried. I really, really did. I sat on my hands until they hurt. But I just cannot let this go unremarked on:

        Amazon is paying you 70% of revenue now. What’s going to happen when they’ve wiped out most of the competition because of their predatory pricing practices of selling books at a loss to wipe out competition and take marketshare? Do you think you’re still going to be offered 70% then?

        If that happens, do you think publishers are going to continue to be able to negotiate 70% of list from Amazon? There are already a lot of publishers getting only 50% of list (Kensington among them, if my royalty statement is any indication). Why wouldn’t an Amazon that had a lock on the ebook market force publishers to accept even less than 50% of list?

        I’m sure you’ll say that because 70% of the book market is still in print, it won’t hurt traditional publishers to the extent it would hurt self-publishers. But that proposition depends on facts not in evidence, including: 1) Publishers will have as much print shelf space as they do today; 2) Print sales will still be 70% of overall sales when Amazon becomes the Titanic; 3) Print sales on Amazon will be a meaningless percentage of publisher sales (not the case now, if I understand correctly). Amazon’s becoming a juggernaut is every bit as much as concern for traditional publishers as for self-publishers, if not more so, since I rarely see self-published authors angsting over Amazon becoming a monopoly, but it’s a refrain I hear from other publishers quite often.

        The reason self publishers aren’t all that worried about it is: 1) 70% of list today vs. 12.5%-17.5% of list today; 2) Those of us who aren’t in KDP Select are generally seeing a higher percentage of our sales from other vendors, particularly Apple in my case, so the danger of Amazon taking over the world doesn’t seem imminent; and 3) Even if Amazon were to cut royalty payments, it’s unlikely to be down to 12.5%-17.5% of list (a rate which, I might add, would be even less if Amazon becomes a juggernaut for books with traditional publishers, since traditional publishers pay on net, not list, and if the publisher’s net goes down, so does the author’s).

        All of this means that what Amazon might do at some indeterminate time in the future as a reason to publish with a traditional publisher today is a little like using the world might end someday as a reason. I mean, yeah, it would suck, but it’s pretty much going to suck either way. Also, incidentally, I’m only SURE that one of those two things is actually going to happen at some point in the future. :)

      • Steven Zacharius

        There are only 5 publishers on Agency with Amazon that I know of….actually Agency lite now, because the books are able to be discounted. I think Amazon being a monopoly for indies is far more turn than it being a monopoly for publishers. BTW the print portion of Amazon is not the overwhelming force like ebooks are for them….not even close. I think we should all be worried about the size of Amazon, indies and publishers.
        There’s an article that came out today reported in Publisher’s Lunch stating that ebooks including self publishing has decreased and how small a piece of the pie indie publishing is to the industry. It gives facts based not on Amazon but on two other surveys from Smashwords and Codex which surveys consumer buying behavior.
        So Jackie what do you think is going to happen when and if publishers made their ebooks 2.99 or the same price as indie authors? Do you think readers are going to pick up the indie books or the author’s whose name they recognize and are already on the NYT list?

      • Jackie Barbosa

        There’s an article that came out today reported in Publisher’s Lunch stating that ebooks including self publishing has decreased and how small a piece of the pie indie publishing is to the industry. It gives facts based not on Amazon but on two other surveys from Smashwords and Codex which surveys consumer buying behavior.

        Apologies to Mike. This is HELLA long!

        I saw that report. It’s based on the utterly fallacious assumption that the only avenues for selling self-published books are either Smashwords or KDP Select. Neither is true. My books are available on Amazon, Apple, AllRomance eBooks, B&N, Kobo, Smashwords and (as I find the time to do them) Google Play. I only use Smashwords to distribute to other retailers when I want a book to be free on B&N (it’s the only way to list a book free there, as NookPress does not provide a free option). My sales of *pay* books through Smashwords is something like 1% of my total self-published revenue (I get a few sales from Sony and Diesel, to which I distribute, but Sony US is going away soon, so I expect that to decrease).

        So, Smashwords is 1% of my total revenue, but Amazon isn’t the other 99%. It’s another approximately 60-65%. The rest is distributed 15-20% Apple, 10% B&N, 5% Kobo and the rest from the other retailers I mentioned. Moreover, I am noticing that Apple, in particular, is *gaining* on Amazon; that is, my Amazon sales aren’t falling, but my Apple sales are growing.

        The point I’m trying to make here is that the author of that article (which wasn’t a study of any kind; it was SWAG, pure and simple). He said IF Smashwords is a third of the ebook market and Amazon is the other two thirds, then the total revenue comes to $180M. But as I’ve just demonstrated, that IF is utterly fallacious. The choice is not EITHER Smashwords or Amazon. It can be Smashwords AND Amazon AND Apple AND B&N AND Kobo AND Google Play AND other retailers including ARe and XinXii, just to name two I know of. How can you accurately estimate the total value of the market if you’re not looking at the whole market? And I guarantee you, that project is NOT looking at the whole market.

        So Jackie what do you think is going to happen when and if publishers made their ebooks 2.99 or the same price as indie authors? Do you think readers are going to pick up the indie books or the author’s whose name they recognize and are already on the NYT list?

        Well, first, I think I as a reader would rejoice because I would buy a lot of books I don’t buy now because I am almost never willing to pay more than $4.99 for a digital book. Instead of having to choose between buying one book at $8.99, I could buy three at $2.99. That’s a win for me as a reader.

        Also with my reader hat on, I will say that I don’t recognize the names of most NYT Bestselling Authors AS NYT Bestselling Authors. I can’t tell you how many times I’ve seen “NYT Bestselling Author X” and thought, “Who the heck is that?” So the fact that a book is by an author who has hit the NYT doesn’t sway me in the slightest unless I’ve read that author’s work, and if I have, I don’t particularly care who the publisher is. I care about price (see above; I rejoice at lower prices) and whether the book appeals to me (I don’t always like every book by every author). If those two factors meet my approval, I click “Buy.” And I think a lot of readers are like me.

        Yes, there are readers who are swayed by what is on the digital bestseller lists, and that certainly affects velocity. If all traditional publishers dropped their prices to $2.99 and bought coop space on Amazon for all their books so they got more visibility (which self-publishers can’t do), it would definitely be harder for self-publishers to make a living. But the amazing thing to me (and I say this because it truly awes me) is that even when my books have virtually no visibility that I can discern, readers still find them and buy them. It’s–to me–nearly inexplicable that most of my books have maintained a very steady velocity at relatively low rankings over not just months, but years.

        So this is another “if” that doesn’t worry me a whole lot. It could happen, and then self-publishers (and small digital presses) would have to figure out how to adapt to the new reality. But if self-publishers have proven anything, it’s that they’re pretty good at adapting (see Courtney Milan’s bacteria analogy :>).

      • Steven Zacharius

        I disagree with you on the article. They did mention that it was Smashwords and then they compensated and greatly enlarged the size of the remaining market to compensate. They also talked about Codex which is a very legitimate market research firm talking about ebook sales slowing down.
        I think you’re not being realistic with the bestsellers being identifiable by consumers. If you’re a thriller reader you know all the big names….Clancy, Child, etc….if you read suspense or others you recognize, Hoag, Gardner, Roberts, Steele, Flynn, etc…..these names would take away most of the other business if consumers were able to buy them at a very discounted price. Time will tell.

      • Steven Zacharius

        There was also the article the other day that stated that Amazon was cutting the royalty rates that Audible was going to be paying. Is this the beginning of a trend now that they’ve cornered the bulk of the market?

      • http://idealog.com/blog Mike Shatzkin

        I don’t think anybody knows what Amazon will pay in the future, but we can assume that it will be determined by what’s best for Amazon. Right now paying a high rate to authors is clearly beneficial. It won’t always be. However, I think Big Five publishers (or however many there are, which will likely reduce from five) will always have more leverage than self-published authors.

        Either way, I agree that what might or might not happen in the future carries very little weight in determining what choice makes sense for an author today.

        Mike

      • Steven Zacharius

        We’ve already seen last week that Amazon has substantially reduced the royalty on books in Audible.com.

      • Steven Zacharius

        There’s a big gap between most authors and Sylvia Day Jackie as you know. There are loads of authors making substantial advances. The publisher doesn’t WORK for the author. It’s more of a partnership. Ideally the publisher is helping the author with editing, marketing, publicity, etc….and the writer is giving the publisher a good story that’s going to make money.

      • Steven Zacharius

        The advance not earning out because royalty rates are too low is a cyclical argument. You could always say that the rates should be higher….but as Mike pointed out the publisher has an idea of how many copies they’re going to get out and sell when they make an offer. There are plenty of times when we know an advance doesn’t stand a chance of earning out but the publisher (an author), can still be making money and a profit. The advance doesn’t have to earn out for the publisher to make money. The sales have to be high enough to cover the manufacturing, distribution, marketing and advance so that the publisher has a chance of making a return on their investment.

    • Steven Zacharius

      And not all authors only get a $2500. advance. There are established authors as well as new authors that get substantially more than that as you know. There are authors who get hundreds of thousands and some even millions of dollars.

  • Nick_Stephenson

    How about I respond to this from the perspective of an author who doesn’t currently have any titles in the top 7,000

    1. Author revenue from print sales.

    This analysis was posted today, so I don’t have much to add.

    2. Getting an advance before publication versus having costs before publication.

    What’s the average author advance these days? $5,000 per book? That’s roughly six weeks’ royalties for me, or four months’ royalties per book (which is going up each month). Should I really be giving up my lifetime copyright and the lion’s share of royalties for that amount? Assuming I live another 50 years that’s a lot of money I’m leaving on the table if a publishing can’t guarantee they’ll sell more copies than I can sell by myself. This is a business – and Hugh’s data is far more unbiased than anything else out there (and we’re not being asked to pay $265 for it, either) which can only help business people make better decisions.

    3. Unearned advances and their impact on author earnings.

    What’s the average advance these days?

    4. Getting paid for doing the work of publishing which goes beyond authoring.

    Everything I do that isn’t writing earns me a profit or some other tangible benefit. I spent time figuring out what “non-writing” works, and I stick to that. As for editing and cover design, I’d rather pay a one-off fee than 85% of royalties for life. Would you give your decorator a cut of the proceeds when moving house?

    5. Current indie successes where the author name or even the book itself was “made” by traditional publishers.

    Are we talking authors who reclaim their backlists? One might wonder why they feel the need to do this – perhaps it’s because the publisher isn’t making any effort to sell those titles? How did the publisher “make” these authors if their backlist sales are poor?

    6. Rights deals.

    Like you said, you can find an agent to do this for you. The story is the same whether self-published or not – an agent or publisher isn’t going to fight for rights deals if the sales numbers aren’t there. If your sales numbers are good, rights deals are open to you on both sides of the fence.

    7. How well Amazon data “maps” to what happens elsewhere. Is it really projectable?

    A single retailer representing 30% of the market in dollars, but considerably more than that in terms of volume. I’d say it’s pretty representative. More representative than Bookscan or self-selected surveys, certainly.

    8. The apparent reality: flow of authors is self- to traditionally-published, not the other way around.

    There’s a HUGE amount of testimonial content out there about indies turning down self-publishing contracts and those with publishing contracts moving to work on their own. Spend five minutes over at kindleboards, and you’ll see what I mean.

    9. Publishers can raise royalty rates (or lower prices) when it becomes compelling to do so.

    I’d say the last few years has been pretty compelling. What’s the hold up? And to your point in the comments about ranking books by customer spend – how does that help figure out what authors are getting paid? I’m earning $3.50 per book. A publisher would need to price my ebook at $23 to match that, assuming 15% royalties. And that’s not even taking into account the retailers cut. I don’t think customers want to spend that much, do they?

    I’m not an outlier. I’m one of thousands of independent authors NOT spending much time in the top 7,000 titles on Amazon, but still making tens of thousands of dollars a year. The headlines often don’t mention us, but we’re the ones paying very close attention to everything Hugh is showing us – because, for the first time in publishing history, somebody is actually starting to say things that make sense. A focus on the reader, a focus on the author. They are the ones that keep the publishing business afloat – not the other way round.

    • http://idealog.com/blog Mike Shatzkin

      Nick, yes, if it works, keep doing it. Unless somebody offers you enough money to make it smart to change your mind. And, who knows, maybe you’re in the top 7,000 on some OTHER days.

      Mike

      • Nick_Stephenson

        I am from time to time – I agree that expanding the data to include more than just the top 7,000 will be very telling, and I believe Hugh is working on that in the coming months. Will be interesting to see what that “new midlist” looks like!

      • http://idealog.com/blog Mike Shatzkin

        Nick, as long as we take one day’s data and multiply by 365 to figure out what an author would earn in a year, we aren’t dealing with numbers that are worth the time to open the email. It’s Alice in Wonderland.

        Mike

      • Nick_Stephenson

        so let’s just focus on one day – the splits are still the same. The same methodology is being applied to the entire sample. Unless you’re suggesting a traditionally published author is more likely to spend more time in the top 7,000? That’s the only thing I can think of that would cause a problem with the conclusions raised. In which case, I don’t think there’s any data to support that, either. What I do see is 250 indie authors earning $130+ in that 24 hour snapshot, versus around 50 authors with publishing contracts. Or 1,000 indie authors earning $30 in 24 hours versus only 250 traditionally published authors. The figures are all there!

      • http://idealog.com/blog Mike Shatzkin

        Good going. You thought of the things that could cause a problem. The problem is that it can cause a BIG problem. Yes, the turnover is almost certainly faster among the authors who are lower-priced fledglings. More important is this: all the established authors got an advance, most of which didn’t earn out, so you can’t calculate their royalty based on some notion of the contract percentage!!! A lot of them already got paid.

        Mike

      • Jay

        Actually, I keep seeing this assertion (about the one day’s data), but it is a statistically invalid criticism. One day’s data would quite possibly give an inherently inaccurate reading of a given author’s sales, but there is no reason to assume that it wouldn’t provide a fairly typical snapshot of overall market categories, unless there is some reason to believe that on the given day self-published works over-performed their normal market share. Similarly, lacking any major stimuli, one might expect various publishers’ market shares to be representative of their norms on any given day, unless they have a very major release or a surplus or deficit of new titles relative to the competition. Lacking any particular reason to expect statistical wiggle from one day to the next, you would expect overall market share numbers to remain fairly consistent day to day.

      • http://idealog.com/blog Mike Shatzkin

        Well, actually, Jay, your logic is contradicted by the facts. The Amazon lists don’t just vary a lot *day to day*, they actually vary a lot *hour to hour*, and they are compiled according to private data that may well be gamed to make Amazon look good. That’s on top of the fact that they’re (presumably) all about unit sales and that requires us to believe that a book that sells 100 units at $0.99 is equivalent to a book that sells 100 units at $14.99 and SUPERIOR to a book that sells 80 units at $14.99.

        So we have lots of variation that can be misleading: the regular fluctuations and, most of all, the lack of actual unit sales data which is then “inferred” by “rank” and whatever understanding the inferrer has built up about how rank translates to units (which, by the way, is *also *subject to regular fluctuations in overall sales).

        The data is damn near worthless for the purposes of projection as it is used here. That’s why engaging on the details is an exercise in futility. And a big waste of time.

        Mike

      • Steven Zacharius

        One day is not a statistically significant sample. It depends on the day. Were new bestsellers released that day that will make everything else drop down the list substantially?

    • Maia Sepp

      A single retailer representing 30% of the market in dollars, but considerably more than that in terms of volume. I’d say it’s pretty representative. More representative than Bookscan or self-selected surveys, certainly.

      *
      Indeed.

      • http://idealog.com/blog Mike Shatzkin

        Probably no more “representative” than either. Except, perhaps, for genre fiction. As I said. It sure wouldn’t tell a historian or poet very much. Of course, neither would the DBW survey. In their cases, Bookscan would tell them more. And that’s the point: you have to apply data with some sensitivity. My complaint from the beginning was that, although I seem to have gotten that point across more effectively to some people than others.
        Mike

      • Steven Zacharius

        Bookscan’s numbers are very accurate if you understand what they’re measuring. They’re measuring point of sale information at something like 80% of the retailers. What they’re missing are the sales to libraries primarily, but now that their sales information includes WalMart, their numbers are increasing accurate. When you look at some of the indie authors who have been picked up by traditional publishers and see how many print copies have actually been sold, in most cases it’s a pretty dismal picture. BTW, this information is very transparent for anyone who has access to Bookscan. All publishers can see everyone else’s sales numbers which is both good and bad. It means now that an author or an agent can’t inflate what their sales are but it also means that the more successful authors can easily be targeted and poached by other companies as well.

    • Steven Zacharius

      There has not been a single major bestselling author to leave traditional publishing. There is not any evidence to support this theory. There is a lot of coverage of indie authors talking about their success but this success is limited to hundreds of authors. What about the other 10,000 or whatever the number is that don’t sell a copy. Mark York who is indie published mentioned the other day that is Kindle check was for $34.00. There are a lot more people like that who aren’t on the blogs talking about this. An Amazon certainly isn’t sharing the information because they want to keep they hype going that indie publishing is a huge piece of their business when the overall probability that in terms of revenue it’s a minuscule amount of their sales.

      If you’re implying that Kindle is 30% of the market that’s woefully underestimated…It’s probably closer to 60% of the ebook market….but the portion of revenue from indies is small. The real money is from traditional publishers selling ebooks by bigger name authors.

      I don’t think there’s any such thing as an average advance. There might be a typical advance for a first time author in a specific genre. But when the range of advances can go from a few thousand dollars to well over a million dollars per book, averages are meaningless.

      • Nick_Stephenson

        Mark York made $34 from selling his work? That’s awesome. That’s fantastic. There’s thousands of others with a similar story. I WANT to hear from them. Because that’s $34 more than they would have made shopping their manuscripts around for years.

        Can’t give me an average figure? Fine, what about median? Or mode? Or any figure?

        And how representative do you think the “major bestsellers” are? I’m more interested in the thousands of mid list authors finding a better deal with Indie House, or the many more who aren’t even trying to get a publishing deal. That’s the real story here.

        I mentioned the 30% figure in relation to the book market as a whole. And, as we can see in black and white from this study, the portion of revenue ACTUALLY GOING TO AUTHORS is larger for Indie House. By nearly 30%.

        Think of it this way: Indie House is now the most successful, highest volume, highest revenue, most profitable publisher on the planet.

      • Steven Zacharius

        Are you just making this stuff up? Indie House is only looking at ebooks and most of the sales are at low priced units…..definitely not highest revenue. BTW, have you heard what the profit is from Amazon from publishing? No, and you won’t.

    • Steven Zacharius

      To say Amazon sales rank data is more accurate than Bookscan data is just silly. Bookscan represents an enormous cross-section of the industry. Amazon sales rank data is fine and dandy if you’re looking at ebook sales and trying to guess what the sales rank number equates to in sales…..but you can’t extrapolate Amazon sales to print numbers. Amazon’s print numbers are a small piece of the overall business. Bookscan I believe captures over 80% of the print business or somewhere thereabout.

  • ET (Liz) Crowe

    wait, Hugh has an agent? Ok, back to square minus one….*grumbles*

    • pixiedust8

      He’s been very open about being a hybrid author. He retained digital rights and sold the print rights to Wool, if I remember correctly. (Someone correct me if that’s not right.)

      • ET (Liz) Crowe

        I guess I was under the assumption that he did all that negotiation on his own. It’s just a frustrating thing trying to sort out how to get so lucky. but thanks for your response.

      • pixiedust8

        He did everything himself at first, then got an agent (Kristin Nelson), if that knowledge helps you at all. Also check out wikipedia (assuming it’s accurate).
        http://www.publishersweekly.com:8080/pw/by-topic/industry-news/publisher-news/article/51416-self-made-bestseller-weighs-traditional-deals.html

      • http://idealog.com/blog Mike Shatzkin

        He sold the print rights to Wool in the US. He sold print and digital rights outside the US and in other languages. But only AFTER he had made Wool a success on his own primarily through Amazon.

        Mike

      • Steven Zacharius

        I believe he had a widely publicized six figure deal announced for Wool which I heard is a great book. Look up the Bookscan numbers and let me know if you think the publisher made back their investment on that deal.

    • http://idealog.com/blog Mike Shatzkin

      Hugh GOT an agent as a result of selling his novella-cum-novel successfully himself first. And what she did for him in the first six months was make movie deals and foreign deals. He’s still entitled to status as an Indie Hero. He hardly had any name buildup before and he had no backlist. He and his writing really did it from a standing start.

      Mike

      • ET (Liz) Crowe

        thanks for the clarification Mike. As a multi-pubbed moderately successful small house semi-niche but not really author, trying to sort out where to my put my energies with my next projects has me awake at night. I have the marketing bona fides…I opened and market a highly successful micro brewery in Michigan. But I will damned if I can figure out how to break through in THIS business. I have no doubt of Mr. Howey’s hero status. He is certainly the standard bearer but as he himself states, “luck” is such a hugh part of the equation I just feel like I’m back at square minus one relative to “onward! to self publishing success Huzzah!” vs. “ok, back to agent query hell.” but I do value your more business-like analysis. It’s certainly how my mind works.

      • Anthea Lawson

        Liz, there are lots of resources out there. Drop me a line and I’ll point you to two great self-pub loops and a handful of awesome blogs full of info. anthea at anthealawson dot com.

  • ET (Liz) Crowe

    I’ll start a new string here, and am interested in the replies: Mike, you state:”Totally ignore it if you’re not a genre fiction author; there’s precious little evidence or thinking in it that applies to you. And if you are a genre author, be very clear about the extra work and extra risk you take on in order to get some extra margin. Both will be required for sure whether the extra margin materializes or not.”

    So for those of who consider ourselves “non genre authors” and hope to get beyond the pigeonholing of genre specification (I’ve been excoriated by hard core romance fans because other “romance fans” have recommended my books–what to do? My books are not romance and break pretty much every “rule” that exists for romance books. I have New Projects to get out into the world that are similarly genre-non-specific it behooves us to go the traditional agency-go-round-via-query process?
    I am honest to god trying to sort out what to do next. I have plenty of marketing chops (I opened and market a highly successful craft brewery in Michigan) but need to “hire out” the editing/cover art stuff plus figure out my own marketing plans sans any assistance time-wise. What are MY odds in the flurry of self-publishing eagerness? thanks

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  • Harry Connolly

    The report has an update that compares the sketchy Amazon digital sales against Bookscan print sales, as though Bookscan reflects 100% of print sales.

    • http://idealog.com/blog Mike Shatzkin

      They lost me on the opening round. I will follow the updates through other people’s reports. I’m not an indie author and I have a limited appetite for meaningless data interpreted with an ax to grind.

      Mike

      • Maia Sepp

        Sorry, are you implying that Hugh Howey has an ax to grind? If so, I have to say, that’s the first time I’ve ever heard him described in – even close to – such terms.

      • http://idealog.com/blog Mike Shatzkin

        I have no idea where Hugh is coming from. I really don’t. I think Michael Cader nailed it today: the only institutional beneficiary of his arguments is Amazon, and Amazon is the primary cause of the industry’s data opacity, but I have no grounds except that to think anything. I take Hugh at his word that he’s doing it out of the goodness of his heart, but I also think he’s worked himself up into partisanship against the publishing establishment that may not have a selfish foundation but which certainly affects his thinking and his approach.

        Mike

      • Harry Connolly

        If you look at the comments on the “Bookscan vs Kindle” update post, Howey himself refers to traditional print publishers as “the other side.” http://authorearnings.com/what-writers-leave-on-the-table/#comment-205

      • http://idealog.com/blog Mike Shatzkin

        A truly ridiculous paradigm! UNLESS you have some *other *agenda besides just telling people what you’ve learned.

        Mike

      • Jay

        I think he is coming from the perspective that a lot of authors probably do not have accurate data upon which to base publishing decisions. I agree with your other comments to the extent that publishers still have more content pitched to them than they can accept, and as businesses, they may not yet have an imperative to offer better deals. But how much of that mass of “pick me, pick me” authors are fully educated on their options and completely free of generations of a prior belief structure? The market has been that way for generations…simply because many people still seek what they have sought for many years doesn’t validate it as a well-conceived business decision (nor, necessarily invalidate it). People join cults, drink poisoned Kool Aid. People 20 years ago, 40 years ago had moral and ethical points of view that have changed considerably since that time. Simply stating that there are still many wannabe authors willing to beg publishers to take their manuscripts (with generations of momentum behind that) doesn’t mean that situation will continue indefinitely.

      • http://idealog.com/blog Mike Shatzkin

        If anybody here said that publishers could count on the submission stream they now have to continue indefinitely, that was somebody else. What I said was more or less the opposite: the publishers’ terms will change when commercial circumstances force them to change. You’ll know that day is on the horizon when we see major authors say “no thank you” to major deals. Not once in a blue moon, but fairly frequently. You’ll probably see those same big authors setting themselves up as publishers, as imprints. Two years from now? I think not. Five years from now? Maybe. Now? Nowhere close.
        Of course, by then, the publishers will all have different deal choices on the table, as they have been developing for some time.

        Mike

      • Steven Zacharius

        Publishers have already began changing terms. There are definitely different advances and royalty rates depending on the success of the author. It only makes sense that a new author will be given a smaller advance and smaller royalty than an established author because the publisher is taking a risk in their capital investment with this new author. Most of you are talking only about the digital business which is a totally different animal. And for digital only authors many publishers, including us, have more lucrative royalty rates than the normal 25% of net receipts.

    • Steven Zacharius

      Everyone knows that Bookscan doesn’t represent 100% of print sales. They only represent point of sale information from the bulk of the industry. They don’t count sales to libraries which is a nice chunk of business but they include all of the major print retailers and mass merchandisers.

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  • VIProgrammer

    I am enjoying this discussion.. On the whole though, I believe the long term trend is away from the traditional publishing model, as that traditional model just doesn’t make as much sense in the digital world, as it did in the past.

    Mike correctly points out that there are things that need to be done, that authors may or may not be willing or able to do for themselves.

    I think we are already seeing the emergence of more “lightweight” publishers, perhaps offering ala carte services, to assist authors with specific services that authors cannot or do not want to provide for themselves. This will cause great disruption in the publishing industry, but also opens the door to significant opportunity for those organizations that can provide those needed services, priced so that authors choose to pay for those services. With great change, comes great opportunity. ;-)

    • http://idealog.com/blog Mike Shatzkin

      Exactly. But just don’t discount the idea that the current establishment can create those lite versions of themselves. In fact, most of them are already embarked on the process. Commercial terms will change when commercial circumstances dictate that they change.

      Mike

      • VIProgrammer

        Yes, current publishers could reinvent themselves. Some will almost certainly do so, but our experience with large educational publishers and the response by music publishers, would suggest that many traditional publishers will ride to the current model all the way down. Change does not come easily to large organizations, particularly organizations that successfully used an earlier model for a long period of time.

      • http://idealog.com/blog Mike Shatzkin

        All true. The reason I have faith in change is that I believe the current executive leadership of big publishing houses is very smart. That doesn’t mean they don’t have a terrific challenge in front of them but I don’t think there are any hidebound CEOs at the Big Five right now. None. On the other hand, we won’t need five big trade houses in ten years, or maybe in five.

        Mike

      • VIProgrammer

        I’m more familiar with educational publishers, but many of those publishers are burdened by infrastructure and expertise that is increasingly irrelevant. Even with the best of intentions, it’s difficult–and painful–to make changes in a large organization when you need new skills sets and new expertise. It can be done, but the organization itself will resist those changes. Many do not adapt and they get swarmed by smaller, hungrier competitors who have nothing to lose and everything to gain.

      • http://idealog.com/blog Mike Shatzkin

        Every word of that is true. At big trade houses, the most obvious big shift is moving bodies from sales to marketing. The newcomers brought in to improve digital practices are all shocked that sales reps outnumber in-house marketers. And we know for pretty damn sure that in 10 years they won’t, anywhere. But they still do, everywhere.

        Mike

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  • mledetroit

    From S&S, via PW:
    “Fourth quarter sales were driven by an increase in sales of print books, something CEO Carolyn Reidy attributed in part to the mix of titles, especially the strong physical sales of the three Duck Dynasty books–Happy, Happy, Happy, Si-Cology 1, Commander Family–plus Rush Limbaugh’s Rush Revere and the Brave Pilgrims.”
    In Detroit, Three Duck Rush is a cartoon.

    • http://idealog.com/blog Mike Shatzkin

      Too bad that’s what’s selling, but these are books that I suspect don’t have much of a digital present, or perhaps much of a digital future. There *are *such books…

      Mike

  • Wernernhnh

    Data needed not available? Just ask my colleagues for example at Bridgeport National Bindery. They used to be a strict Library Bindery, now they have 11 digital printing units and are buying even more, serving self-publishing, POD. 5 million new titles a year in the U.S. alone are the new realities.

    • http://idealog.com/blog Mike Shatzkin

      Not sure what that would tell an author about his or her choices, but it certainly speaks to the changes we are seeing in the industry.

      Mike

      • Wernernhnh

        Mike , you are right about changes we see in the industry. I predicted that in a PW article in July 1981! Our computers make it so easy to put together text and pictures. Digital printing and binding one book at a time equipment does make such changes a reality.

      • http://idealog.com/blog Mike Shatzkin

        John Ingram’s decision to push his family and his company into doing Lightning Print (now Lightning Source) in the mid-1990s was one of the most visionary business decisions in the history of the industry.

        Mike

    • Steven Zacharius

      POD is fine for printing very short runs or for when a publisher runs out of stock and needs to print a few copies. The costs are many times that of traditional manufacturing. POD is great for Amazon so that they can say the book is always in stock and ready to ship within 24 hours but POD sales are a very small piece of the print business.

  • nedworking

    Mike, I’m a writer who has sold about 3,000 books in the last month. Print, e-book and audiobook. I’ve worked with publishers large and small over the last 15 years, and have been repped by multiple agents.

    Frankly, I have no interest in any “stinking advance.” Of any size. What I’m interested in is NET profit to author (me) for my book. If that’s big enough, I’m willing to forego any advance at all.

    At the end of the day, show me the money. Not some loan.

    • http://idealog.com/blog Mike Shatzkin

      But what if a publisher offered you an advance that you figured was *larger *than whatever you would earn by any calculation of sales and net revenue? You wouldn’t take it and be content to have some of it “unearned”? If so, I admire your principles but I’m glad I’m not your business partner.

      Mike

      • nedworking

        If said advance allowed me to retain the rights to publish all future books — and the current book in any form I wish, on any platform, then yes, I’d take it. I’d be happy to “rent” my book to them for a period of 5 years, but retain all rights after that time, and I reserve the right to publish what I wish to publish on any platform I choose.

        I don’t see the publishers lining up with that offer, do you? And therein is the problem. The terms offered — and the strings attached — to current contracts today would be stupid for any business partner to take, including you and me.

      • http://idealog.com/blog Mike Shatzkin

        Ah, details. And pointless ones too. Of course you can figure the net present value for future earnings that are compromised: for five years or a lifetime. What difference does it make to the calculations, except in the details of how you do them? This is not a conversation about what’s best for an author financially; it’s a conversation about what in today’s publishing terms really strikes an author (you, in this case) as particularly annoying. OK. But a lousy way to make business decisions.
        Mike

      • nedworking

        Wait, giving up my IP for my entire life is “pointless” ? Wow.

        And ham-stringing my future earnings to a partner (publisher) who fails to perform, who has not provided me with any way to negate the deal, just “annoying.” Not hardly.

        That’s not the way I operate in my day job for big companies. And not the way I run my writing career.

        IP is gold, and I own it.

      • Steven Zacharius

        Why are you giving up your IP for life? Hopefully the publisher will continue to keep your book in print if it continues to sell and it can certainly lower the digital price to the same level you would to continue to have the book sell on Kindle.

      • nedworking

        I’m not. Not at all. And you’d have to ask a bunch of trad. published authors why they did sign those contracts.

        If you’d want to entertain my 5 year lease, works for me. Thanks, Steven.

      • nedworking

        One more point, which seems to be elided here. “Lowering the price to continue to have the book sell on Kindle” is a strange idea. Why would I want my publisher to lower the price on my books? 12% or 15% of the cover price is not much in the first place.

        Now, if the publisher has a way of giving me 80% of net when the price is lower, then we can talk. Otherwise, it’s a non-starter.

      • Steven Zacharius

        Keep dreaming. See if anybody can find your books six months from now when you can’t distinguish it from the crowd other than by giving it away for almost nothing. You have no marketing or publicity machine to push your books for libraries or backlist sales.

      • nedworking

        Time will tell, won’t it, Steve?

        And yes, actually I DO have a substantial marketing and PR machine. I’ve successfully gotten coverage for my work in WSJ and NYT for a few years now. I think that (day job) marketing and PR management experience will serve me well over the next ten years of building. I’m in this for the long haul.

        See you down the road.

      • Jay

        A perfectly legitimate comment, but one that makes me wonder what the average new Kensington author’s book is selling, say, a year out. It’s tempting to point out the challenges that face one group while ignoring the fact that the same problems plague the alternative. And, of course, since you understandably cherry pick the best of the many submissions you receive (is 1% a fair estimate of what you publish from what is submitted?) then your books one year out should be compared to the top 1% of indie published books the same 12 months after publication. I don’t pretend to know the answer to this, and this debate already has more skewed and twisted data than it needs. But I suspect if most publishers could show an attractive comparison, they would.

      • Steven Zacharius

        I have no idea what percentage of submissions we accept but I don’t think even if publishers could do what you suggested; that they would. Most publishers haven’t had any concern about self published authors. Why would they if they don’t perceive indie books actually being any kind of shift in the model? Remember that there have hardly been any authors of major bestseller status that has elected to self publish.

      • Jay

        My post wasn’t inquiring why or why not publishers would choose to do anything in particular. It was a direct response to your comment:

        “See if anybody can find your books six months from now when you can’t distinguish it from the crowd other than by giving it away for almost nothing. You have no marketing or publicity machine to push your books for libraries or backlist sales.”
        To put forth such a challenge as an indictment of self-publishing implies, but does not state, that the results are superior for your published authors. You seem to be unwilling or unable to support this, yet you make the comment anyway, as if simply saying it makes it so.
        It’s also somewhat odd that successful self-published authors are always characterized as outliers, but then major bestsellers are thrown up as being in any way remotely indicative of the situation facing the vast majority of authors, as if the top bestsellers themselves are not extreme outliers. There’s no evidential equivalency between the market as a whole and that experienced by major bestsellers. The financial terms involved in those transactions are enormously different from the average author.
        I certainly understand why you would choose not to disclose the sales results of your new authors’ books or the percentage of submissions you publish. However, it should be readily apparent that, in the absence of any of this, your implication that self-published books will fade into obscurity after a certain period and those published by your firm will not strains the bounds of credibility. It’s the rough equivalent of saying, McDonalds is unhealthy (and therefore by extension, with no documentation or even anecdotal evidence) Burger King is a healthier option.
        Lacking specific data, I haven’t made any claims about the performance of your firm’s average new author’s book sales, but I don’t see any factual data to imply that they are superior at all to a comparable cross-section of the independent market (e.g. the same percentage slice from the top that you pick from your slush pile).

      • Steven Zacharius

        My comment was a common sense generality that if a Lee Child book was 2.99 and an unknown or little know author was also 2.99 which did you think a consumer would buy? I think the answer is obvious. Backlist sales for our firm run about 30% of our gross sales for the year. Backlist is critical for a publisher because publishers make money on backlist because they have a higher sell thru rate since they are being reordered based on prior demand.

        I didn’t say that indie books would become obscure, I said that if publishers wanted to lower the prices on big authors the choice would be clear for consumers and then self published books would begin to suffer.

        BTW, we have many new authors where foreign rights are sold but this is generally something that occurs after an author has built a reputation….but when it does the right’s income can be substantial.

        The publishers have plenty of data to share if they’re interested but evidence from Kindle rankings and any comparisons are totally meaningless because the numbers vary from hour to hour and are so skewed by low prices to make any revenue comparison not worthwhile performing. The argument about Kindle rankings was answered well by Mike Shatzkin already and the numbers are totally shrouded in secrecy.

        I think we’re starting to go round and round in circles because there is any lack of imperial data from indie authors other than the constant hype about the top 100 or so who make earnings in excess of a hundred thousand dollars. My main point in all of my comments is that there is no discussion about the others tens of thousands of authors who sell two copies a year of their book which is the bulk of indie publishing.

      • http://idealog.com/blog Mike Shatzkin

        From my perspective, you are asking Steve to do what Howey attempted and which I am trying to say is *impossible*, to do a meaningful survey-type comparison in the performance between self-published books and house-published books. The data just isn’t there to do that, and if Steve gave you some metrics about his house it would add no light, just fuel for heat. His results might not be the same as Harlequin or HarperCollins, in the first place. But even if it were, there’s no data from which to make a meaningful comparison. So he can’t back up his taunt with data, but you can’t refute it with data either. Sometimes logic is more important and useful to reaching a decision than data.

        Mike

      • Jay

        Actually, I was responding to the following:

        “Keep dreaming. See if anybody can find your books six months from now when you can’t distinguish it from the crowd other than by giving it away for almost nothing.”
        Perhaps I interpreted that differently than it was intended, but it certainly looks to me as if the implication is a book published by his firm (or another publisher) would be “distinguished” from the crowd in a way that a self-published book would not be six months after release. That’s a nice theory for a publisher to have, but there’s not a scrap of evidence offered to support it.
        It’s intellectually dishonest and pointless to attack a data set without offering meaningful counter-factuals.
        I keep seeing reference to the fact that the data presented represents one day of sales. Clearly, that makes it statistically invalid to track individual authors’ results in such a way (which I do not believe was done at all in the sampling). Obviously, individual authors’ results will vary throughout a larger time period with new releases, etc.. It does not, however, erode the validity of overall market sampling based on a one day snapshot of sales, unless there are specific reasons to expect that day to deviate substantially from the norm in a way that expressly changes market share numbers. Thus, we can’t look at one day and say John Smith sold 1,000 books so therefore he will sell 365,000 in a year. But we can say, for example, that if the average author in the data set sold 10 books, it is likely (though certainly not proven) that the yearly average would then be 3,650. A proper sampling would seasonally adjust these numbers, but again there is no reason to assume that would affect the breakdown between published and self-published.
        Merely saying a time of year is slow for sales is inadequate, as lacking other stimuli, this would affect all books’ sales, not just traditionally-published ones.

      • http://idealog.com/blog Mike Shatzkin

        Am I the only one who is put off by the “intellectually dishonest” accusation in this comment?

        In fact, it is not at all evident to me that if the “average author” sold 10 books in the daily sample that there would be an average of 3,650 sold per average author in the year. The authors in the mix change every day (every hour…) The presumption is wildly out of line.

        There are *very few *meaningful conclusions that can be drawn from one day’s data.

        Mike

      • Jay

        No offense was intended, I can assure you. I regret if such was taken.
        However, the notion that a single day’s snapshot of a market is inherently inaccurate is simply without basis in mathematics. The notion that very few meaningful conclusions can be drawn from a single day’s data is just an incorrect analysis of the math involved.
        Certainly, and I said this before too, a longer sampling will increase accuracy. Clearly, a one-day sampling will show more random factor and statistical wiggle than a week or a month, but that does not make it inherently inaccurate. Unless there is a specific factor invalidating the data (e.g. two of the biggest self-published authors had released books that day), one would actually expect a single day’s sampling to be relatively close in results to a longer one…and any refinement and increase in accuracy is as likely to go either way.
        My point on the average sales per author is also mathematically valid. Remember, I am not saying that a specific author who sold 10 books on sample day would, by extension, sell 10 every other day. I am saying the overall average sales per active author would likely track closely to the one-day sample (of course, subject to future changes in the marketplace).
        The phrase that “very few meaningful conclusions” can be drawn from one day’s data is not supported by the mathematics. A more accurate statement would be that a larger margin of error exists than would with a bigger sampling.

      • http://idealog.com/blog Mike Shatzkin

        Well, gee, Jay, you can know some things for sure. But they don’t tell you anything meaningful. And, in fact, the 10 per day thing doesn’t work either because the total number of books sold per day varies widely so ALL the numbers change. And all the unit sales numbers are approximations based on knowing some smattering of the data and *believing *you know how to use that data to interpolate all the other sales numbers by interpreting the *ranks,
        *which is what Amazon really reveals, into unit sales data. But even granting that all *that *works (and that would require a *lot *of faith), the point was to compare what a self-published author earns compared to a house-published author as though it were some guide to which choice an author should make. Sorry, but the idea of that this exercise is meaningfully informed by this data is so Alice in Wonderland it makes my head explode.

        Didn’t mean to take offense where none was intended. At that point I don’t think you were talking to me; I’m just being the host and making sure civility is maintained at my party.

        Mike

      • Jay

        I don’t entirely disagree with what you are saying, and there is little point in beating it to death, so let me just wrap up as follows:
        1. Sales may vary considerably day to day…I offer you no argument there. But, unless there are specific stimuli, you would still expect the percentages to remain similar. Again, absolutely no argument that a longer, larger sample would give more reliable results. But I think a one day sample has considerably more value than you seem to. Total accuracy? Not by a long shot. Significant statistical validity. Yes.

        2. I would never argue against a call for greater accuracy and reliability in any statistical analysis. But Amazon in secretive; publishers are secretive…we’re unlikely to ever get the kind of data we’d like to have, so any effort to gauge the status of the market is going to be subject to the data that is available. It was never my intention to suggest that Howey data is utterly reliable and accurate as an analysis of the market (and I didn’t get the impression that he presented it as such). However, it is certainly among the more focused and accurate offerings I have seen. How many pontifications have we seen purporting to designate ebook/print market share without even including self-publishing data?
        There is so much deliberate obfuscation by parties in this debate (not referring to anything you wrote, just the situation in general), we have all become beggars rather than choosers with respect to any useful data.

      • http://idealog.com/blog Mike Shatzkin

        Let’s get back to where this begins, Jay. Hugh Howey took this data and proclaimed meaning from it. I personally challenged whether — *whatever *is in this data — it was sufficient to draw the comparisons and conclusions Howey was attempting. I didn’t get into the details of how flawed the analysis is, the selection of one day, etc, but others did. And they’re right. I’m not saying there’s nothing to be learned from any set of data. But not that much from what we have here. And certainly not nearly what was suggested by the person who compiled and presented it.

        Mike

      • Steven Zacharius

        The numbers on any single day are absolutely meaningless. Look at Bookscan numbers and see how books drop off generally from week to week. You can’t take sales data for one day and analyze. When new books come out from publishers they generally push the older books down the list and the new titles takeover the top slots….I’m talking about bigger authors here. Of course there are many authors whose books stay in those top spots for long periods of time as well. But looking at sales for one day is meaningless because there are so many variables that aren’t being taken into consideration.

      • Jay

        In a sense, it is true that one day’s numbers can be highly inaccurate. There are two problems with this argument from the publishing industry perspective.
        First, you seem to be suggesting that the subject analysis is attempting to extrapolate sales for specific, individual authors on an annual basis. That is not the case, however. The implication that a one-day snapshot has validity at assessing overall market shares is a considerably different problem in statistics, one that provides far more validity, even with a one-day study. The conclusion isn’t that John Smith sells 1,000 books that day, so he sells 365,000 for the year. It is that a market segment (e.g. self publishers) hold X market share as a group. While there may be outside effects that change these percentages on one day as opposed to another, there is no inherent reason to assume this is the case with relation to the day of the study. A vast range of polling is done based on one day of data, though I have no argument that longer, larger datasets can only improve accuracy. But the assertion that the short period of study renders the conclusions valueless is without factual basis. If publisher marketing is inherently superior, how do we explain the percentage of Amazon bestsellers that are self-published?
        Second, to the extent that a given, randomly selected day may not represent a typical range of percentages, it is just as likely the traditional publishing market share is exaggerated as unrepresented. That’s not opinion, and it’s not propaganda…it is mathematical fact.
        What is most unfortunate is that the arguments attacking the study seem utterly devoid of any type of evidence. Why does the data from the day of the study overstate the self-pub market share? What evidence is there that publishers provide a level of marketing support and promotion commensurate with what a self-publisher does for him/herself? To attack the data in the study as factually inadequate while flinging empty assertions back seems pointless to me.

      • Steven Zacharius

        The way we explain the amazon titles making the list are twofold. One, amazon controls the list and it’s in their interest to have titles published by them showing up there and also by the fact that the books are cheap. People will take a chance on an inexpensive book.

      • Steven Zacharius

        Publishers have far more options for promoting backlist than any single author by themselves. Even if you’re talking only about ebooks which most of you are. Publishers get promotional spots with the etailers for backlist titles, especially when they’re promoting a new book in the series for that same author. The tool most indie authors use to promote their book is simply to drop the price for a period of time. Publishers do that with ebooks as well but they can do it in bulk and draw more attention to those discounted books.

      • Jay

        Yes and no. In gross, publishers may have some additional options, but I question the assumption that these are sufficient to support the premise that each individual author will benefit more than he/she would through his/her own promotional efforts. The comparison needs to take into consideration that a self-published author is seeing over 5x the revenue at the same sale price, which frees up considerable resources for the author to deploy to marketing. Notwithstanding bestsellers, the publishing industry has a spotty reputation (at best) for putting strong promotion behind midlist books.

      • http://idealog.com/blog Mike Shatzkin

        There’s the germ of a legitimate point to be made here, although no data to give it context. Publishers are notorious for exerting the lion’s share of their marketing efforts to books when they are new. In fact, optimizing backlist for discovery is not something they devote much (or, in my opinion, enough) resource to. But compared to a bunch of individual authors whose only “lever” is price and who don’t really know much about search optimization anyway? Probably the publisher’s overall discoverability would put them higher, but not where they should be.

        Mike

      • Jay

        I’m only going to touch on this, because I’m truly not looking to simply be argumentative. I appreciate that you feel that publishers could more effectively market their backlists and, while I certainly don’t have your industry experience, I’m highly inclined to agree. However, as with any industry, they are what they are, not what they could or should be. Considering that the industry tends to be very focused on promoting huge bestsellers and not on maximizing middle of the road stuff, one wonders what “levers” a publisher has for a year old book that the author, with more revenue per sale to utilize to fund marketing does not have.

      • http://idealog.com/blog Mike Shatzkin

        Publishers have information about what happens when they push the levers on a *lot *of books. So do the retailers, but they don’t have the vested interest in particular titles that publishers and authors do. Publishers are definitely way behind in developing good approaches for backlist — it wasn’t in the industry’s marketing DNA before digital — but it is hugely counterintuitive to me that a single actor whose main capability MUST BE writing could be a more effective marketer than a publisher who would have good reason to develop capabilities at scale across a list.

        Mike

      • Steven Zacharius

        Why does everyone keep coming back to new authors? Are new authors the norm for publishing companies or are authors who have been with the publisher for many many years the norm? Of course a publisher is going to generally pay less for a new author and yes there have been many exceptions to this generality. But if the author is new and doesn’t have any sort of track record would you invest your money in terms of an advance, manufacturing, distribution, etc….? If so, become a publisher.

      • Steven Zacharius

        Hopefully you realize that a publisher cannot simply reduce the printed price of a book a year out….well there are ways, but it’s very tricky. Just like an indie author, we can reduce the ebook price a year later to stimulate sales and I’m sure you’ll see more of that. We’re doing it now.

      • Steven Zacharius

        So you’d like the publisher to take all of the risk by giving you a large enough advance that would cover your earnings for five years when they have no idea if the book is even going to sell? That sounds a little one sided.

      • nedworking

        I have no interest in the advance. I think I stated that pretty clearly. I want a higher percentage of Net.

        If a publisher is foolish enough to offer a high advance on a book they don’t actually have a firm plan around selling, and can’t figure out how to sell, that’s actually not my bad business decision, is it?

        If the money is offered under terms I like, I accept the terms. I’m sure you’d do the same, Steven.

        For example, if I offered you $20M for your company, with no continuing IP ownership, annuity, equity or director slot for you and your family, you’d probably turn it down, as the terms were not agreeable.

        Once we change that number to $700 million or more, it’s likely you’d stay in the room talking. It wouldn’t feel one-sided anymore to you, would it?

        Again, I don’t want an advance. If a publisher wants to offer one that I find agreeable, that’s their business.

        My business is retaining my IP and monetizing it.

      • Steven Zacharius

        Then you’ll stay as an indie author. Good luck on selling those old titles in a year against the other 10,000 new titles that came out at $.99 cents and having any discoverability of your titles at all.

      • Christa

        Steven – I had cancer in 2013 and did very little writing/publishing due to fatigue and my chemo and surgery schedule. I won’t give exact numbers because I haven’t combined all my platforms and I found an error in my Amazon spreadsheet three days ago that I have not fixed (two Aprils, no December, although the amounts are roughly consistent) — but over 80% of the $195,000 in self-published royalties I earned in 2013 came from 2011/2012 backlist. Granted, not all of that was a full year old throughout the 2013 tax year, but a good portion of it was. I am glad for my backlist, but don’t plan to depend on it going forward. I have a mailing list of over 2000 subscribers and have worked on building my platform and staying in touch with my readers despite only having a few releases (short fiction) in 2013. So I don’t expect discoverability issues (which you were both over and under-inflating) you mention on my new releases. I don’t mean this disrespectfully, but your reply to Ned came off as patronizing and I don’t get the impression from your posts I’ve seen online in the last month that you actually understand self-publishing very well or want to. We are a very open group and not dripping in vitriol when we are approached with an open mind and absence of a patronizing air. Publishers would do well to consult with more of us — not only will you find out why many of us doubt we will ever sign or even seek a trade publishing contract, but you might pick up a thing or two on genre marketing, SEO, price pulsing, A/B testing and so on. Best regards.

      • http://idealog.com/blog Mike Shatzkin

        Your list at the end hits all the right notes.

        Mike

      • Steven Zacharius

        Thank you for your comments. First of all I hope you’re doing well; that’s the most important issue. I don’t know if you were a Kensington author or not.
        Because you have 2000 names doesn’t equate to having a big marketshare. Publishers have lists far greater than that and the big authors have lists in the 100,000’s of names. As I just said previously in another post; if publishers were to make their books the same price as indie authors; don’t you think the readers would spend their money on the author’s names that they recognize? Those names that they see on the NYT bestseller lists; those names that they see in the front of stores in print? There’s already a glut of books in the market and less and less shelf space for printed books. The same thing is happening in ebooks. With having over 1,000,000 books online, how are you going to make your books standout?
        I would have to disagree with your comment about me not having an open mind. I have spent dozens of hours online in various forums here and debating with Joe Konrath and the Passive Guy….I’m the only publishing exec that I’ve seen online. I’ve taken the opportunity to listen to what you have all said. I’ve read the Naked Truth about Indie Publishing and I have the other books that indie authors have recommended that I read. I’m willing to listen and exchange ideas. That being said almost all of the comments in these indie discussions have been vitriolic in their tone against traditional publishing….almost 100% of them.
        In terms of consulting with some of you….many have written to me privately and given me their ideas and they’ve been greatly appreciated. As a matter of fact I’m going through our backlist now of thousands of titles and looking to see which are out of print inventory and I’m going to drop the prices on ebooks so that we can increase their sales like all of you do. You can teach an old horse new tricks. We do price testing all the time by the way but with traditional publishing it’s very different than what you can do. We are regulated in our pricing with Agency pricing and in our dealings with Amazon.
        We’ve acquired a digital first publisher, Lyrical Press, to learn how to do things better and we’ve gotten a tremendous amount of new submissions already. When you’re only doing books digitally there’s a lot more leeway and less constraints with pricing regulations with the print component.
        I want to go back to my initial comment a month ago….all of the indies or a lot of them are saying you won’t consider a traditional contract any longer. However, the big authors don’t agree with you. They haven’t left traditional publishing at all and they’re still signing multi year contacts with big advances.

      • http://idealog.com/blog Mike Shatzkin

        I’m glad I have been able to able to host you here, Steve. I think you have added a lot of value with your contributions. And you’re right, almost nobody else in your position is willing to engage in the way you have. I hope it is appreciated by the authors who are reading it as it should be.
        Mike

      • Steven Zacharius

        Thanks Mike…I’ll shut up now and let this be your blog like it’s supposed to be. We’ll meet when we’re all back in NYC. Thanks for allowing me to ramble and sometimes get a little hot-headed.

      • http://idealog.com/blog Mike Shatzkin

        You maintain your cool better than I do. And don’t feel you can’t comment again if you’re moved to. I wasn’t trying to kick you off! See you on our little island here.

        Mike

  • Stanislav Fritz

    I totally agree with most of this. Even us, as a TINY press, are in reality a bit of the farm system. So many independent/self-published authors that do a fair job are so vitriolic with “publishers” that they make decisions based on that (vitriol) versus logic. The big publishers are certainly stumbling a bit, but to say that they are lost/confused by using self-publishing as a farm system (which many people say they don’t get the new world) is to miss the point. They do get it. They are still making mistakes, but they get that self publishing is actually a boon for their farm system. It used to be only agents as the filter, now they have an even better test and filter.

    Finally, I also agree with the genre comment and would go further. There is mainstream but quality genre and there is pure volume. One person who I saw blasting agents and publishers had 70 books to his name over a period of 5 years. Yeah, better to self-publish. But, you get a George RR Martin (to choose big and genre) and he puts something out every three years and really doesn’t need the distraction of all that self publishing entails. I don’t know why so many indie authors resent that it is in effect a farm system. At least NOW in the farm system you can get SOME money. I think that is the really big change and a positive one.

    • http://idealog.com/blog Mike Shatzkin

      Thanks for adding a little light to the heat!

      Mike

    • Steven Zacharius

      Amen. I got yelled at last time for mentioning the terminology of farm system.

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  • Nirupam Banerjee

    But what if — in a developing country — a Publisher has not had the CAPACITY to evaluate a topic, e.g. a scientific research based one? Won’t then the self publishing the basic route?

    Or because of the typical Non-English language problem still plaguing the eBook world, the Non-English writer (being unable to self-e-publish) would again come back into the doors of the Trade Publishers and try to still convince them?

    Maybe for the sake of only Gutenberg-model distribution? (Not even POD distribution.)…As the local language Publishers still avoid the entire disruption i.e. both POD & eBook.

    • http://idealog.com/blog Mike Shatzkin

      It should be stipulated that my post was definitely US-centric, or English-language-centric. The arguments for self-publishing are much stronger if you can’t get a US- or UK-based publisher behind you and, again, it depends on the advance (level of commitment) and your skill and stomach for business management to make any meaningful comparison for a decision.

      Mike

  • Joseph Harris

    Mike,

    Sidestepping he long conversations, I’d make a short comment as one who – if a long time ago – actually worked on statistics. I found Howey making assumptions that had nothing to do with his data set. The value was in the set itself as an addition to the very sketchy data we have on the business.

    The weaknesses in those assumptions were mostly, it seemed to me, covered by your comments. There were a few more but I’ll leave that aside.

    In the comments I see the same problem that bedevils most discussions. Too few people realise how large and disparate the publishing industry is. I laugh specially when I see “publishers” lambasted. Is that all the thousands in the US (the usual discussion focus), or the tens of thousands in the world.

    The greatest pleasure at the moment is the number of different ways an author can see their work published. And how many different types of people can be served by that wide variety. As to the money to be earned; well, isn’t that in the lap of the Gods?

    • http://idealog.com/blog Mike Shatzkin

      I’m not sure the money earned is “in the lap of the Gods” but I certainly think it is a dangerous and usually incorrect assumption than an author can do a better job of it without a publisher than with one.

      Mike

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  • teresahill

    As someone who’s been published for almost 22 years, I find it astonishing to hear how fabulously big publishers treat authors, the huge advances, big print runs, great distribution, expensive covers, incredible editors, huge marketing budget ….

    I’ll give you a hint. Anyone who’s been published for any length of time is laughing hard at publishers trying to sell that idea right now. We’ve been in publishing. We know how few authors get big advances, big print runs, great distribution, expensive covers, editors who aren’t completely overworked and any kind of marketing budget at all.

    I’m sure Stephen will show up saying as diplomatically as he can that if I was a better writer or a more popular one, I’d have gotten to those big advances and all those great perks. (Stephen, you’ve published so many friends of mine over the years. Can you say $2000 advances? 4% royalties? Sucky covers. Incomprehensible royalty statements and incredibly long periods for reserves against returns? Your authors certainly can.)

    No, I’ve never made it to the top of the big publishing heap, but I have been published regularly over those 22 years, and I don’t even recognize the publishing business as described now by big publishers trying to convince authors they offer such a better deal than self-publishing.

    It’s completely out of touch with the reality that we know. That very few authors — a very small percentage of authors — have ever been treated very well by big publishing. There’s another group of working authors, people who make enough to survive and keep writing as a job, but without getting rich or even earning a good living by most standards. And a ton of people getting $5,000-$10,000 advances, getting next to nothing in terms of publisher support.

    I left my publisher a couple of years ago — my choice — and last year I made more money than I ever have in my career by self-publishing. I don’t are who believes me and who doesn’t, except when I hear publishers claiming things I know aren’t true, all to try to convince authors the publishers offer a better deal.

    I won’t even try to tell authors that they’ll all make tons of money self-publishing. They won’t. But some of us will, more of us than would through traditional publishing, I believe. And some of us will make a lot. A few will get rich. (I suspect it’s mostly the same kind of income distribution we see from traditional publishing.

    But I will laugh in the face of any publisher who tries to say they absolutely treat all their authors incredibly well and have so much more to offer than self-publishing. I know that’s not true.

    • http://idealog.com/blog Mike Shatzkin

      Teresa, no matter whether you self-publish or *are *published, the odds of getting rich, or even making a living, are long.

      However, I would expect in your case that the success you have been able to achieve self-publishing (and congratulations on that) was in some way(s) assisted by your history, either because you had books that had rights reverted to build on or name recognition from your prior efforts that helped. That doesn’t change any of your complaints, but it should be acknowledged.

      Mike

      • teresahill

        Mike,
        You’re right. It’s a huge advantage to know what I know about publishing, whether it’s have written as much as I have, having been edited, helped design covers, helped write back cover copy, etc.
        But on the flip side of that, we all know the vast majority of new writers who go the traditional publishing route get tiny advances, little or no marketing support, small print runs, small distribution, etc.

      • http://idealog.com/blog Mike Shatzkin

        Of course they do. *Most *people start at the bottom of any endeavor. There are many ways to work yourself up the ladder and you’ve obviously found one of them. Other people do it within the structure of publishing, sometimes by moving from one house to another.

        Mike

      • teresahill

        The last three or four years of traditional publishing that I’ve seen, that I’ve heard about from a number of published friends includes lower print runs, worse distribution, lower advances, lower earn-outs if they’re still getting contracts. And being offered the same advance again is considered a victory. Many people are seeing advances cut.

        Publishing is changing faster than publishers are changing with it. They cling to the old ways of doing business, denying the changes taking place and keep yelling about how they’re the only ones who can publish a book well. When what they should be doing is figuring out how to work in this new marketplace.

        It’s time for publishers to prove to authors that they can do things for us that we can’t do for ourselves, and so far, they’re not making the case.

      • http://idealog.com/blog Mike Shatzkin

        I can tell you for sure that publishers are changing. But the world is changing in ways that aren’t favorable for them. I have written about that extensively.

        I know they aren’t proving *to you *that they’re worthwhile, but they aren’t suffering from a shortage of authors. At least not yet. They definitely feel a shortage of *bookstores*, but that’s why the last few years have looked so different to you. And to them.

        Mike

      • teresahill

        Mike,
        You know how long it took publishers to figure out that they could move a lot of books using a Bookbub ad? It was laughable how long that took. And yes, that moves them at Amazon, and Amazon is maybe 30% of the total book market. But Amazon and e-books are a growing market. Bookstores are not.
        Publishers are still pretending there are no computers that can tabulate in an instant how many copies of a book have sold and that it doesn’t take two years after a book went on sale to know enough to pay an author. It’s laughable how long that went on when Amazon pays us in 30 days.
        Publishers still put books on the shelves for about six weeks and then, unless you’re a mega-seller whose backlist is always out, stop pushing a book. They haven’t begun to understand that you can keep selling and selling a book online.
        And do you know what Harlequin has been doing this past year? (And you can dismiss them as a crappy publisher or someone who only publishes romance if you want.) But they’ve been begging their authors to commit to writing twice as many books as they did the year before, because so many authors aren’t writing for them anymore and they’re not getting the numbers of submissions they need or want to buy anymore.

      • http://idealog.com/blog Mike Shatzkin

        Teresa, you’re so smart and they’re all so dumb that I don’t see why you even spend the time to spell that out for people.

        Mike

      • Steven Zacharius

        Teresa you’re comparing apples and oranges. Any publisher can tell you your ebook sales and there is NO reserve held against those sales. It’s physical books that can come back in three months or two years later; with most of them coming back within the first year where a reserve for returns is needed. During this time if a book is continuing to sell and the publisher is reprinting the book there are future returns that will come back even further out; hence the longer time for reserves being held. A publisher can’t take a print book and reduce the price to $.99 to stimulate sales, that would be below their cost with discount, manufacturing and royalties. But I think you’ll be seeing more publishers lowering ebook prices on backlist titles and they are going to start eating into independent author sales. Readers are going to want to buy books from authors where they recognize the name. Maybe they saw them in a store on a rack or in a promotion.

      • teresahill

        Steven,
        Right, because there’s a ton of room in bookstores to store a ton of books for years and then decide to return them for credit. I’m sure that happens all the time, and it’s why you hold back so much money for so many years as reserves against returns. I’m sure it’s not that holding the money for years lets you earn interest on it.

      • Steven Zacharius

        Yes we hold reserves to make interest of .03% on our money….that would make a lot of sense. You truly do not understand the business side of printing and distributing physical books. There is no reserve on digital books with us and royalties are paid quarterly. Hopefully these digital authors will build to a level where it makes sense for us to move them into print. We’ve just had this happen with two authors in the past three weeks.

      • Steven Zacharius

        Let me also add that authors don’t just get small print runs. Publishers don’t decide that they’re going to give an author a small print run. It’s based on orders from accounts. They look at reviews, the marketing, the competition and the amount of money they have to buy books for that month or season. Then they make a choice as to which books they’re going to order from all of the publishing houses. We don’t tell them how many copies they’re going to take. If the book starts selling well in the first 8 weeks of sale, they’re going to reorder the book. If not, they’re going to give that space to a new book or a title that is turning over the space faster. And at the same time we’re selling an ebook with ALL of the ebook retailers.

      • teresahill

        Stephen,
        Right. It’s the author’s fault. It’s her story’s fault. But remember, one of your big arguments about why authors need a publisher is distribution. You’re supposed to get us great distribution, when you just admitted you can’t.

      • Steven Zacharius

        First of all, it’s Steven not Stephen. We’re not supposed to get YOU big distribution….we’re doing it for both of us. We’re trying to get accounts to buy the books and then readers to buy them as well. There are many variables that have a bearing on the print run including the cover design and the track record of the author most importantly. Stop talking about only new authors; that’s not the business that publishers are in. We’re in the business of building an author up to bigger levels. We can’t control how many copies a buyer will order but we can do all we can to help build an author over a period of time. Some don’t work and fortunately many do.

    • Steven Zacharius

      Teresa I don’t know where you’re getting your information from but you are being severely misinformed. I don’t remember the last time we offered a $2000 advance unless maybe we did it for our Precious Gem line of non-returnable romances 10 years ago; where the authors also received sub-rights income. However I can’t remember a 4% royalty rate in ages. Times have changed.
      Sucky covers? First of all cover art is subjective and Kensington has always been know as having some of the best covers in the business. In fact, we were the leaders in putting foiling and embossing on almost the entire mass market list 25 years ago. We publish 450 books per year and have been doing so for 40 years now….how many authors have you talked to? Have you talked to authors who are now self-published with a vitriolic attitude towards traditional publishing? Have you talked with authors that have been with us for over 20 years; there are many many of them including some of the biggest in the business. I can assure you that we deal with some of the biggest agents in the business and their not taking $2000 for an advance for their authors. Please get your facts straight before spreading misinformation. Oh and by the way, I can’t even remember the last time we ever had a royalty audit so apparently if authors have a question with their royalty statements we’re doing a pretty good job answering their questions.
      Lastly, if you have an author you have spoken to who has dealt with me personally; ask them how they were treated. There isn’t an author that I don’t treat respectfully and where we don’t roll out the red carpet when we meet them. How many of your author friends have met the CEO of their publishing house or sat down in their office for an hour and just chatted with them?

      • teresahill

        Steven,
        So you’re offended by the idea of advances as low as $2,000, but you offered them about 10 years ago? So what have you gotten your base advance up to? All of $3,500? And maybe $7,000 in total earnings over several years?
        That doesn’t quite sound like the fairytale-like nirvana of big publishing we find publishers trying to convince authors they are.
        And I heard you brag about spending $5,000 on some covers, but I bet that’s very, very few. What’s the median amount you spend on a cover? $200? $300? It’s nowhere near $5,000.

      • Steven Zacharius

        Teresa, your rudeness truly astounds me. I’m here voluntarily talking with people and I don’t see any other CEO’s from publishing houses here. But I will answer your questions. The average advance if there is such a thing is nowhere near the numbers you are talking about. You’re talking about authors that are published for the first time. Do you really think a publisher should take the chance and offer a new author with no track record a large advance and in addition to that spend the money to manufacture, warehouse, distribute and market the book? If so, thank goodness you’re not running a publishing business because you’d be out of business by now. You build new authors over a period of time gradually. We have loads and loads of authors making very substantial money as does every publisher. And I don’t think we’ve had a single author who has been with us for any period of time who has left us to self-publish. Your claims are delusional. There has been no rush to self-publish that I’ve seen happening. When I talked about the $5000 per cover for art, I was talking about artwork by Franco and Pino and they were on hundreds and hundreds of historical romances. BTW, original Pino artwork now goes for in excess of $45,000. for the oil paintings. If you’re talking about the area where I assume you know something about, digital publishing, that’s a different animal. Publishers don’t spend much on the artwork because you see a postage stamp size piece of art without any special effects. It’s only when the book is in a store on a shelf that expensive artwork and effects are used to capture the buyer’s attention. Please don’t tell me what we spend on artwork, I know my business.

      • Steven Zacharius

        First of all your ignorance about traditional publishing is really shining through. The average cover I would guess is somewhere around $3500 if it’s not a cover done from stock art images which get manipulated. And no our average advance is certainly not the numbers you’re talking about. You’re referring to first time authors. We have authors that have mega contracts like any other publishing company.

    • Steven Zacharius

      Anyone who has been published for a long period of time is laughing now? Do you realize how ludicrous that sounds? If they’re still being traditionally published by the same publisher, why would they be laughing? i can’t even begin to count the number of authors that we’ve been publishing for years and years that are not laughing.

      • teresahill

        Steven,
        They’re laughing because the publishing you describe — while trying to convince authors they need you — bears no relation to the publishing they’ve experienced with you and companies like you. And they’ve stayed for years because until very recently, there was no alternative to publishers like you.
        And they may be signing contracts with you right now, but you have no idea how many authors are saying privately to other authors that while fulfilling those new contracts, they’re working toward self-publishing. It’s what they want to do, but they need to have material ready and learn how to do it. They don’t stay because they think it’s a great deal.

  • tommywallach

    Hey,

    For the love of God, I just thought I’d leave a nice comment of support. I recently accepted a two-book deal with a major publisher, for a very healthy advance that will give me the time and space to write my second book without any fear or worry (and to cut back at my day job). Every self-pubber on her keeps talking about how terrible advances are. Well, I just went to a conference with 50 published YA writers (from my agency), and people were overall pretty content with their advances. And that’s money RIGHT NOW. No wait. No long-tail. No questions asked. No need to go out and do marketing all the heck over the place. How are people acting as if that’s not a real thing?

    Also, there’s something in this conversation that we’re ignoring, which is about literary quality. I can’t speak for my own book, which is YA, but I can say that getting buzz around a quality work of literary fiction online/Amazon is a lot harder than getting buzz for an epic fantasy trilogy. A lot of self-pubbers are content just to talk about genre books, but there is more to publishing than that.

    Keep fighting the good fight.

    -t

    • http://idealog.com/blog Mike Shatzkin

      Thanks so much for this information which helps balance the perspective that the whole industry is run by idiots and charlatans.

      Mike

      • Steven Zacharius

        Yes thanks for pointing out that there are still writers who are accepting advances from traditional publishers and that they consider the deals fair.

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