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Don’t Believe The Hype – David Gaughran Separates Myth And Reality About Indie-Publishing

They say tomorrow never comes, so when I said, last post, that David Gaughran would be my guest here “tomorrow” I was sort of right.

Okay, I was wrong. Events overtook my plans, as far too often recently, but (fingers crossed) MWi resumes normal service from today. Honest!

So, David is finally here as promised, fresh and  forthright as usual, and taking no prisoners!

For those unfamiliar, David has, in the space of a few short months, gone from the proverbial “nowhere” in literary circles, to one of the foremost indie bloggers on the publishing industry circuit, and probably the most significant commentator this side of the pond.

His Let’s Get Digital blog is  a must-read for its up-to-date common sense news and analysis of the latest in publishing, and his latest book, also titled Let’s Get Digital, is a must-read for anyone still on the fence about the future of e-publishing, or anyone about to embark on the journey.

Because of my connection problems back home in monsoon-ridden West Africa the intended post here on MWi to help launch David’s new book never saw the light of day. So before we move to David’s guest post for today here’s MWi regular and indie-publishing success Sibel Hodge on Let’s get Digital:

If you want to self-pub, you absolutely have to read this book. When I started out, I didn’t have a clue about all the things that an Indie author has to get involved in. It’s not just a question of writing a fab book – that’s the easy part! The hard bit is what comes next…

I didn’t have a clue where to find covers, good editors, how to market effectively and gain lovely readers and fans. PRC, MOBI, Epub sounded more like a scratchy disease than anything to do with e-pubbing. I had to learn it bit by bit and very slowly, but in LET’S GET DIGITAL you get you all the information you need in one place. David’s done all the hard work for you!

And the authors who contributed their stories to this book will show you that it really is possible to be a success as an Indie self-pubbing. Their experiences are uplifting and truly inspirational.

So do you want your manuscript sitting in a dusty drawer somewhere, or do you want to live your dream? If so, you need to get a copy of this book!

Let’s get Digital is in the top ten in its genre on amazon.co.uk with five star reviews across the board. It’s also in the top ten in three categories on amazon.com, with similar rave reviews.

Without further ado, here’s David:

Don’t Believe The Hype

Big Publishing likes to characterize self-publishing as an annoyance, a gadfly, an inconsequential nuisance that it would smote if it weren’t too busy counting its gold doubloons and polishing its Fabergé eggs.

Self-publishing is a side-show. The Digital Revolution will be tamed and assimilated. And if any indie writer does actually manage to slither out of the primordial soup, they will be co-opted.

Indie advocates are branded nefarious prophets, Pied Pipers leading clueless writers off the wharf to perish in the endless self-publishing sea.

Why the hysteria? Well, fear is a powerful tool. It can cow entire populations. What chance does a new writer have? All their hopes and dreams are wrapped up in one manuscript, and they are being forced to make a choice.

They know the publishing business is in trouble. They know that e-books are becoming a lot more popular. And they keep hearing indie success stories – new names all the time too.

But when they look at the map they were given, one path clearly leads to being published, once they get past the Gatekeeper, and the other just leads to a dark forest, and all the legend says is “Here Be Wolves.”

I prefer to deal in facts.

  1. You can earn 70% royalties from self-publishing. Big Publishing will pay you 14.9% once your agent gets their cut.
  2. If you self-publish, you will get to decide who edits your book, and who designs your cover. Your book will look exactly like you want it to. With Big Publishing, you have no choice. They may say you will have “approval” over the cover, but in practice you will be railroaded into taking whatever the designer comes up with.
  3. If you self-publish, you will decide the price. Big Publishing won’t care what you think.
  4. If you self-publish, you will decide when the book is released. With Big Publishing you will be locked into a schedule of their choosing, meaning a minimum of twelve months before it hits the bookshelves, often eighteen months, and sometimes even longer.
  5. If you self-publish, you will be paid every month. With Big Publishing, you get paid every six months, if they send the royalties out on time, if your agent processes it quickly, and if the statements are accurate.
  6. If you self-publish, you will have access to up-to-date sales figures. With Big Publishing, you never know how your book is selling until well after the fact.

Those are just some of the clear, irrefutable advantages of self-publishing. If any defender of Big Publishing would like to argue with any of the above, without resorting to nonsense arguments based on fear, I am all ears.

Big Publishing has its advantages too, and the two biggest are you the advance, and access to the print distribution network they have monopolized.

Let’s break that down. The average advance for a new writer is $5,000. If you are lucky, and you bag a contract with one of the major publishers, that might rise to $10,000. Maybe.

That cheque will be split into three payments. A third on signing the publishing contract, a third on acceptance of the manuscript (i.e. when you have made all requested edits), and a third on publication.

The overwhelming likelihood is that you will never see another red cent for that book, so their meagre royalty rate won’t even come into play. That’s all your getting. Forever.

How does that compare with self-publishing? Let’s say you price your book at $2.99, meaning over $2 per book royalties for you. To beat the publishing deal with its $5,000 advance, assuming costs of $1,500 to publish, you need to sell around 3,250 books.

That might sound like a lot to a new writer, but you have forever to hit that number. Well, not quite forever, that’s just shorthand for the length of your life plus 70 years. In other words, your grandkids will still be getting paid by Amazon, long after you are gone. Hey, it’s one way to be remembered.

Forever is hard to think about, and tastes change. For the sake of argument, let’s assume the book will sell for ten years, and then it will be badly dated and no-one will really want to read it. That means you need to sell 325 books a year to beat the average publishing deal. That’s less than one a day.

Therefore, if you think your book is good enough to sell one a day or more, then, on average, you will lose money by going with Big Publishing.

Maybe you think your book is good enough to bag that contract with a major publisher, and step up to that $10,000 advance level. As a self-publisher, you just need to sell two a day and you have that well beat too.

That should show the much-touted advance in a different light. To me, the only real advantage in going with Big Publishing is their ability to get your book into lots of bookstores. That’s near impossible for a self-publisher. So let’s examine that a little closer.

I’m sorry to break this to you but, on a $5,000 advance or even a $10,000 advance, your book is not going to be in every bookstore across the country. It’s not going to be in the window display. It’s not going to be in that prime spot behind the cashier. And it’s not going to be on that table that everyone sees when they walk into the store.

It’s probably not even going to be “face out”. All that bookstore real estate is bought and paid for by the publishers. They only purchase those spots for the books they have made significant investment in, i.e. not a $5,000 or $10,000 advance.

Bookstores are dying. That might sound callous, but it’s a fact. People are moving online, either because of reduced prices and greater selection, or because the recent spate of bookstore closures and chain collapses have left them without a physical place they can buy books other than the box-stores like Wal-Mart or Tesco which only stock the bestsellers anyway.

Amazon is on its way to controlling 50% of the overall US book market in 2012. Each week that one clear advantage of going with a large publisher is worth less and less, and at the kind of advance most writers will get, you won’t even get to exploit it.

These are the facts. But Big Publishing doesn’t want to engage in that argument. Instead, these self-appointed Guardians of Literature do battle with straw men, delighting in these Pyrrhic victories, cheering as straw heads are placed on their crumbling parapets.

Look over there: an awful cover by a self-publisher! Look at this atrocity: prose riddled with dangling modifiers! Look at this poor misguided soul: he only sold five copies!

They can’t defend the status quo with reasoned debate. They must resort to fear-mongering and myth-spreading. You will never make any money. You will never be taken seriously. No agent or publisher will ever touch you. No reader will ever be able to find you.

Amanda Hocking

All of these claims are false and have been debunked again and again, but my favourite is a new one doing the rounds. Apparently, the fact that Joe Konrath, Barry Eisler, Blake Crouch, Amanda Hocking, Michael Wallace, J Carson Black, Scott Nicholson, Mark Edwards, and Louise Voss have all signed deals with large publishers is proof that self-publishing is some kind of dead-end, that the smart ones are getting out, and that Big Publishing can co-opt the successful anomalies and assimilate them.

J Carson Black

This ignores one very important fact. The power relationship has been inverted. All of these writers were able to get the deal they wanted on the terms they wanted on the back of their self-publishing success.

All bar three of those writers have signed with Amazon and their royalty rates will be far, far in excess of 14.9%, and they will get an unparalleled marketing push. The other three have received eye-popping advances, which will also force their publishers to throw the entire weight of their marketing machine behind them.

Because they self-published. Fact.

David Gaughran, thank you.

Of course, you’ll be thinking “All very well, but these named writers have all been break-out successes selling in numbers most of us can only dream about.  What about the rest?”

Well, Marion G Harmon had a post recently on his progress as a newly self-pubbed writer who hasn’t yet broken-out. Marion will be joining us later in the month to tell us more, but I’ve stolen the following from his blog as a fine example of what David is describing.

Marion is author of a simply brilliant superhero novel called Wearing The Cape. He’ll be back on MWi later this month to tell us about a bold new experiment he’s trying. But for now, the numbers.

Marion started off at 99c to get some traction, as an unknown name with a unknown book, and has now upped to $2.99. Here’s what he reported on his blog last week:

After spending nearly a year seeking an agent, I self-published on April 25th, three months ago. Assuming that I had found an agent, who then immediately found me a publisher (an insanely optimistic assumption, since agented writers often go for years before closing a book deal), I would likely have earned a $7,000 advance–the industry standard for newbie writers–then had to wait for at least a year for the publishing company to actually publish my book. They might have printed 7,000-15,000 copies, not all of which would have sold, and I would probably have never seen more than my initial advance.

So. After spending a year writing Wearing the Cape and another year finding an agent/publisher for it, I would likely have made no more than $7,000. But what is happening now?

This month I sold nearly 300 copies of WtC, more than 200 at the new price, and cleared $400. Assuming growth in sales remains steady, adding around $100 more a month, in half a year I’ll be getting $1,000/month from my first book (and assuming sales of 500/month is not being wildly optimistic). Taking that out to one year, I will have made more than what would have been my author’s advance on a book doing no more than moderately well by self-publishing standards!

Let’s just here that last bit again:

Taking that out to one year, I will have made more than what would have been my author’s advance on a book doing no more than moderately well by self-publishing standards!

And of course had he signed with a paper publisher his book would not even be available in that time!

Nor is Marion a lone voice.

DD Scott - WG2E

The chicklit-and-chocolate girls at WG2E are also not just balancing the books but beating the odds with their great range of novels.

Tonya Kappes -WG2E

They’ll all be joining us here on MWi shortly to tell us more.

And in a bizarre twist of fate I’ll be doing a regular feature over at WG2E from September. Well, as regular as I can manage.

LA Lopez - WG2E

So how about you guys? David shows you don’t have to be a phenomenal success to beat the big publishers at their own game. Remember, most paper published books sell less than a thousand copies. Most new authors never get a second book accepted.

I know not everyone likes to talk exact figures, but speaking generally, how are you doing? Are you close to exceeding, or have you already beaten, the likely return from an “average” trad-published deal?

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The Demise Of Print – Excerpts From David Gaughran’s Blog.

West Africa’s infrastructure and seasonal storms have once again banished me to a net cafe service, so it’s another quickie ride on someone else’s blog today.

And once again the short straw has fallen to David Gaughran, who together with Joe Konrath are stating a few home truths as the final end for Borders looms.

True, some last-minute deal might salvage a few key elements of the once grand book store, but the reason it failed is because it relied on paper books. Paper books that have no future.

Yes, we’ve all been shouting this for a while now, and apologies to those who’ve moved on and have embraced the new world, but many wannabe writers are still stuck with their head in the sand, dreaming the dream about seeing their name in print on a paper book, their best-selling novel sat next to Patterson, King and Rowling on the plinth.

It wasn’t likely before.

It’s getting less and less likely every day.

And very soon that dream will be over.

Best wake up now and make the most of the new opportunities out there.

David says,

A new writer, deciding whether to self-publish or to submit to agents, needs to consider not just what the market is like now. They need to look at where its going to be in two years.

That’s the absolute quickest any new writer could get through the query system, snag an agent, go on submission, receive an offer, go through the lengthy publication process, and finally hit the bookstore shelves.

For most, of course, it will take significantly longer than that (if they are one of the tiny percentage that is successful at all). So a new writer, being a little more realistic, needs to look at where the market is going to be in three years, or even five years.

David concludes,

All that time spent researching agents, learning how to write query letters, personalizing each submission, sending off each partial, and waiting for responses that will never come could be spent building an audience or, you know, writing.

Writing stuff you can publish yourself.

Writers have more choices than ever before. And I firmly believe that this is a great time to be a writer. But only if writers seize the opportunity that is staring them in the face.

The choice is yours.

Now head over to David’s site and read the full post, and then pop over to Konrath for his take. Sorry – no link. Unable to access blogspot sites again. But there’s a link in David’s post anyway.

Borders Inches Closer to Liquidation. What Happens Next?.

Reformation & Renaissance – the future of publishing.

I’m an optimist.

In this game, you have to be.

I’m optimistic that you’re reading this blog. Okay, perhaps not quite so optimistic you’ll ever come back, but it’s a start.

But this post is about optimism. Because anyone who has written a book, let alone submitted it or had it published, is an optimist.

It is a triumph of hope over experience to stare at that blank page / screen and start hitting keys with the intention of producing x-thousand words of coherent story that will interest and entertain a complete stranger. No sane person would even contemplate it!

But optimism is what keeps us sat at the keyboard until the very last word is in place.  Optimism is what has us sending the ms out time and again despite the cruel and heartless rejections from evil agents on a mission to make our lives a misery. Optimism is what has us stick our books on Kindle and let “real people” judge them.

So why are we so pessimistic about the future of publishing?

To be sure the Konrathian soothsayers haven’t helped. Predicting the demise of publishing is their stock in trade. And of course we all love to read Joe’s latest rant on how evil the publishers are, how paper is dead, and how everyone should rush out and indie e-publish this very second. We all love to read how Barry Eisler turned down x-gazillion dollars to be a self-published indie, etc, etc.

But sometimes we have to take a step back and make sure we’re all reading from the same script. That same Joe that is telling us paper is dead is bemoaning indie booksellers not stocking his paper books. And haven’t these two just signed up with Amazon’s new publishing venture to have Amazon produce their books both as ebooks and on paper?

Is the Big 6 about to become the Big 7?

So in fact paper isn’t dead at all. But all credit to these guys for knowing how to generate hype and get sales boosted. Who needs a Big 6 publisher to buy you a plinth in Barnes & Noble when you can have the virtual plinth on Amazon?

~

But the statistics speak for themselves. Paper sales are declining. And as ereaders become the norm it seems likely paper will continue to decline, to the point where it is a luxury niche market.

So is this the end for publishing?

Back in 2009 there were two schools of thought. Either this “new” epublishing fad would die a death and paper would remain king (the experience of the newspaper industry being a classic example) or the Big 6 were finished.

As one leading pundit said in April 2009, the Big 6 were not even “rearranging the deck chairs on the Titanic – they’re staying put and ordering more piña coladas and charging them to rooms that are already underwater.”

Two years on the Big 6 are most definitely still with us, and while there’s no question they are changing, there’s little sign that they are going under. Which will be a great disappointment to Konrath, but should be a big relief to the rest of us.

But there’s no doubt opinion is divided about which way things will go. And two of my must-read bloggers have run posts recently which have epitomised this debate.

First came Meghan Ward (left) in a post called 10 Ways To Save Publishing.

I commend the post to you for its list of things we all should be doing, as readers and writers. Buying more books. Reading more books. Reading to our kids. Etc, etc.

But as I said in response to Meghan’s post, “I agree with everything you said bar the reason for saying it!”

As an aside, Meghan’s Memoir May event over at writerland is just drawing to a close, but be sure to check out her guest Rachel Howard (right) who has a post this week on writing memoir using the second person singular.

Meghan by the way is a professional editor. Surely everyone’s dream job?! Getting paid to read all the latest books before anyone else knows they exist! If you ever need an apprentice, Meghan…

Then this past week along came Lexi Revellian with a great post entitles Who Chooses What You Read?

By which Lexi meant who chooses the choice available from which you choose to read. In Lexi’s own words:

If you go to a bookshop, what catches your eye, the piles of books in the window or on a table near the entrance, or books spine out on the bottom shelf at the back of the shop? Most members of the public are unaware that the prominent books are not those the manager has selected on merit; publishers have paid a lot of money for particular books to be well displayed.

Please tell us your desk isn't always the tidy, Lexi!

Thanks for that poignant reminder of reality, Lexi.

Invariably what sells best is what the publishers put most money into to make sure it sells best.

As for the rest… The simple fact is, most traditionally published books are lucky to sell just a thousand copies.

Which is why Lexi has every reason to be delighted her latest book, Replica, which is a feel-good thriller with a sci fi element, has already sold nearly 5,000 copies, and has only been out five minutes.

Although that pales into insignificance compared to her first feel-good thriller Remix, which has sold over 22,000 copies. And no, not by pandering to the least-savoury elements of the thriller market. If you like fast-paced thrillers that you wouldn’t  be embarrassed to read out loud to your grandmother, then Lexi’s books are for you.

But despite 25,000 happy readers Lexi has yet to capture the interest of the UK agents.

Why? because her books don’t tick the right boxes to be commercially viable . Which comes back to the matter of the huge expense necessary to publish a paper book.

So can we assume the publishers only publish books they know  will sell? Far from it.

Another tragic reality of traditional publishing is that most bookstores stock “new” books for maybe three months before returning them. To be pulped. Yep, brand new, unread books, many still in their packing cases, being pulped. Those that escape this ignominious fate go to the discount stores, having been bought up in bulk for a pittance by an optimistic reseller. There simply isn’t enough room in even the biggest bookstore to stock everything

The fact is, publishers print far more books than they expect to sell, just in case they have a successful breakout book on their hands. They expect to have substantial returns, even on big names, and budget accordingly.

Put simply, most books fail to sell. Fact.

Yes, the majority of books that pass the gatekeepers’ test and get into print are then rejected by the true gatekeepers: the buying public. Although again, by reject I mean that in most cases the buying public just never knew these books existed.


So one can understand the pessimism of both Meghan and Lexi about the future. Paper sales are plummeting, giant bookselling chains like Borders are in liquidation, and Konrath and co have already written the orbituaries for the Big 6 and are there, spades in hand, digging their graves.

But I disagree. I simply cannot see the end for the Big 6 or for publishing.

Just the opposite in fact.

~

No question there is a revolution in publishing taking place. It is a Reformation unparalleled in publishing history.

But far from seeing the death-throes of publishing I think we are seeing a painful rebirth. A revival – dare I say a Renaissance? – on an unprecedented scale, where every author who has a good quality book will, in the near future, have a chance to reach an audience.

Of course, those that are unwilling or unable to adapt will go to the wall.

Yes, there will be casualties along the way, and real people will lose real jobs in publishing, printing, book-selling, distribution, et al.

But get real. The days of carting shed-loads of printed blocks of paper around the country so people can buy them is coming to an end. The loss of huge stores like Borders is of course a tragedy, but dinosaurs become extinct.

Are less books being sold since Borders closed? Less paper, perhaps, but e-books are surely more than countering that, and ebook sales will increase exponentially as technology improves and the range of available titles is widened.

The epublishing revolution opens up huge new opportunities for those willing and able to take advantage.

Agents and editors will need to adapt and change, for sure, but their skills and service will still be needed. More so than ever before as the indie movement finds that quantity alone cannot compete with quality.

The big publishers are investing massively in digital, however much they try to appear aloof from it all. They have the financial muscle to do so, and at the end of the day they will make more money, not less, as the industry stabilises in the new world where paper will be the luxury niche.

The future for readers, writers and those publishers willing and able to move with the times, is brighter than at any time in history.

How so? Consider:

Traditionally an author’s chances of being published were governed by one single factor: can the publisher hope to get a return on the huge financial investment needed to bring a book to market.

For those that get the coveted place in the window display or on the plinth, yes. But unless you’re a celebrity, a mega-selling author, or are sleeping with the CEO the chances of that happening are remote.

If you are published, your fate will inevitably be a few book signings in your local store and then a place on the shelf, spine out, among however many hundreds of thousands of other books that are in the store with you.

And this is why, day after day, week in week out, perfectly good books are being rejected by agents and publishers across the globe.

The points Lexi makes about being an anonymous spine in a bookshop are exactly why so many perfectly good books are rejected. Former Big 6 editor turned million-selling author Ruth Harris spills the beans about reasons why agents may reject your book in her guest post over at Anne R Allen’s blog.

Of course agents rightly turn away appallingly written manuscripts by the hour. But they also turn away perfectly good ones. And the key reason for that is quite simple:

It’s because they are not commercially viable.

That doesn’t mean no-one will buy them. It means not enough people will find them and buy them such that they will recover the tens of thousands of pounds / dollars outlay required to publish in the first place.

Let’s hear that once more: It doesn’t mean no-one will buy them. It means not enough people will find them and buy them such that they will recover the tens of thousands of pounds / dollars outlay required to publish in the first place.

But now, with epublishing, there’s suddenly infinite shelf space for infinite categories and sub-categories, and the most intimate niche markets can be catered for with negligible outlay by the publisher.

Far from being less books, publishers can now reproduce their entire backlist of everything they’ve ever published (if they have the rights) and once that happens readers will be able to read that book they loved as a child, long since out of print, or a novel previously only available in some far off land.

And prices will come down.

Publishers will only need to pay for the time of the editor, proof-reader, formatter and a few other key staff.

Cover design is now a simple front page. No back cover or spine to worry about.

No time and resources spent physically producing, storing and distributing  heavy books.

No collecting and pulping the unsold titles. In fact, not a single wasted product.

Whether it sells a single copy or a million copies the production cost is identical (bar the author’s advance, perhaps).

And of course, the book will never again be “out of print”, “not in stock”, only available in if you live in a big city, or any of a thousand other reasons that buyers previously could not buy a book they wanted.

Far from turning away perfectly good authors because their book is commercially unviable, publishers will be queuing up to find new authors with a decent product, because any good book wll be commercially viable.

And it won’t matter whether the author or reader lives in New York or New Zealand. Don’t tell Barnes & Nobel, but there’s a whole wide world outside the United States. (When will it occur to them that’s why Amazon is leaving them standing?)

A revolution is taking place that we are not just witnessing, but are participants in. It’s up to us how far we get involved, but burying our heads in the sand is no longer an option. Peer-review sites like authonomy and youwriteon, are you listening?

It may take a few years to stabilise, and there will be casualties along the way. But when it does settle down there will be a whole new world of opportunity for both readers and writers.

Not to mention the publishers…

The glass is half full!

The future is bright. The future is digital.


PS Literally just having posted this article my attention was drawn, via the above mentioned Lexi, to a post over at The Daily Beast where Dale Peck has a very different take on the future. Check it out. Join the debate!

The numbers game.

Okay, today’s blog is about… numbers.

Yes, I hear you. We’re writers, not mathematicians, and words are our tools.

I know how you all hate maths, or even math, for our American readers.

But this is about real numbers. Numbers that matter to us as writers.

Royalties, in other words.

Yeah, thought that would get your attention.

As previously blogged, Barry Eisler’s turning down half a million bucks to “go indie” and darling Amanda “selling out” (not my words!) to the dead-tree guys has over-night changed the way the world views publishing.

On top of that, as Borders US finally succumbed to the inevitable and went into liquidation (Borders UK did so a year or two back) the CEO of Barnes & Noble stated on record that digital books would be the primary delivery system for books within two years.

For Amazon, that’s already the case. They sold more e-books than paper books last year, and that was before the Kindle took off big-time (eleven million Kindles sold).

Britain’s biggest retailer Tesco now sells Kindles over the counter and rival groups are selling rival e-readers. Six months e-readers were virtually unheard of in the UK. Now we see them everywhere, and the trend is growing by the day.

In the US, as the B&N CEO concedes, that trend is far more advanced.

A tipping point has been reached.

The next generation of e-readers will be more savvy, more creative, more must-have, and perhaps most importantly less costly.

There can be no question that e-books are the future. The question is just when, and how it will effect us, both as readers and as writers.

Nathan Bransford has just published a most informative blog that spells out the reality of numbers as they relate to us as authors. You can read his full blog here.

Essentially, he asks, is it better to go “indie” and e-publish, or to keep chasing the dream of a real, printed book in your hands and try to get an agent and publisher?

Of course we all want the pleasure of a real book, our book, in our hands.

We approached agents before we decided to e-publish, and had one offered us the chance at the time we would almost certainly have signed on the dotted line, agreed to anything they wanted, and now be sitting waiting for our book to appear in the shops in maybe a year’s time.

Hopefully having been given a huge advance, but as an unknown author with an unknown book the chances of any advance being offered was slim, let alone a life-changing one.

As you all know, the agents were intrigued but not convinced. So we put our book out as en e-book and got on with life.

Had we signed up with an agent and then a publisher, and leaving aside any advance (which is clawed back from future sales – it’s not a gift from the publisher!) what could we have expected?

Nathan has kindly laid out the figures for us and I reproduce them here with due acknowledgement.

Standard royalties via traditional publishers (note: these may vary):
Hardcover: 10% retail, sometimes escalating to 15% after sales thresholds are met
Trade paperback: 7.5% retail
Mass market: 8% retail
E-book: 25% net (usually translates to 17.5% retail)

Kindle revenue share for self-published authors:
Priced higher than $9.99: 35% retail
Priced between $2.99-$9.99: 70% retail
Priced below $2.99: 35% retail

B&N revenue share for self-published authors:
Priced higher than $9.99: 40% retail
Priced between $2.99-$9.99: 65% retail
Priced below $2.99: 40% retail

E-distribution fee:
Smashwords: about 15%. Usually translates to about 60% of the retail price.

Approximate E-book market share:
Amazon: ~55%
B&N: ~25%
Others (Kobo, Apple, Google, Sony, etc.): ~20% combined

Okay, so what does that mean in real money?

Let us suppose that we had been offered, and signed, a deal for Sugar & Spice and it had not been e-published independently by us.

What would have happened?

First off, you would not be reading this, because you would never have heard of the groundbreaking debut crime thriller Sugar & Spice, or Saffina Desforges or Mark Williams.

Possibly by the end of 2011, but more likely 2012 (according to Publishers’ Lunch most manuscripts now being signed up will not see print until spring 2013!) our book would finally be published.

Now unless that publisher is taking a huge interest in us, is buying us a plinth in Waterstone’s (don’t for one second think bookshops hand over the plinth and poster space out of the kindness of their heart!) and is sending out sample copies and lunch invitations to all their well-connected reviewers, etc, then our book will be just another spine on the shelf.

Again, who ever heard of Saffina Desforges?

In 2012 the name would be as just as obscure as in 2010.

But we’ll be hoping that readers who have never heard of the author or the title will risk ten pounds (or whatever the dollar equivalent may be) on us rather than spend that ten pounds on Stephen King, James Patterson or another big name they know and trust.

Come to that, dollar equivalent? Forget that!

Our book would only be available in selected high-street stores in the UK.

Okay, so sometime in 2012, a year down the line, our book is finally published and if we’re really lucky people buy it.

Nathan states royalties of 10% for hardback and 7% to 8% for paperbacks. E-book royalties if put online via a publisher are 25%, but in  reality only 14% to 17%.

Now this month, March 2011, we have sold approximately 13,000 e-books at our chosen retail price of 71p. That could go up or down next month, though the trend is most definitely up.

We were only a top twenty seller at the beginning of March. As I write this we are a top five seller. On our current daily sales we are on target to sell 20,000 next month if nothing changes. And believe me, those figures pale into insignificance compared to Stephen Leather’s sales!

And our sales are only for Amazon Kindle. We haven’t listed on Waterstone’s yet, and we haven’t started marketing ourselves on Barnes & Noble properly.

But let’s take 13,000 sales in one month as our base-line.

Now the Amazon royalties are public knowledge. No trade secrets here. We make 35% of retail because we choose a low retail price.

What chance our paper-published book selling 13,000 copies in a month? Virtually impossible.

Of course, the mega-names like Cornwell, Patterson, King, Grisham, etc, do it all the time, sure. But this is an unknown author with no history, no loyal readership built up over years, and no publicity machine behind it.

So in a year’s time Sugar & Spice is published by a “real” publisher, and released through them as an e-book on Amazon. And we’re lucky and it does as well as it is now, and we sell 13,000 copies in a month.

Read out those figures again, Nathan!

E-book: 25% net (usually translates to 17.5% retail).

17.5%!!! And Barry Eisler reckons the real figure is nearer 14%.

But let’s stick to 17.5%.

So we sell 13,000 e-books at the same price, with the same amount of marketing effort on our part.

But instead of getting 35% of the royalties we hand over half of that to the publisher!

Suddenly we have to sell over 25,000 e-books a month just to get the same money back we earn by selling just 13,000 as “indie” publishers.

True, only people with a screen can read our book now, and we are missing out on a huge number of prospective readers who only read on paper.

But by the time the book actually sees print the number of e-readers will have multiplied a zillion times while the number of paper readers will have dwindled.

Not fantasy. That’s the very near future as seen by the CEO of America’s biggest bookstore chain, B&N.

Now go a step further. Supposing our book continues to sell in volume over the coming months, or even increases as word spreads. Supposing we get our act together (remember, this is all new to us – we’re learning as we go) and get our book on Waterstone’s e-books list and somehow make it happen on Barnes & Noble too…

Supposing we maintained 13,000 sales a month over the coming year. That’s 156,000 sales that, if we had signed a contract and were waiting for our book to be published, would not exist.

And as previously said, we’d then have to sell 25,000 e-books a month (300,000 a year!) just to make the same money.

We have several more books in the pipeline this year and many more after that. The first of our Rose Red crime thriller series is due on Kindle this summer, and the first of our dark fantasy trilogy Equilibrium will be on Kindle in September. Two follow-ups to Sugar & Spice are planned for the future (Puppy Dogs’ Tails and Cold Blood), and the projects list beyond that is a book in itself!

None of these would be seeing the light of day before 2012/ 2013 if we were with a dead-tree publisher.

Perhaps more importantly still, we would not have had the confidence to be planning this far ahead if we hadn’t already proven we could do it through e-sales.

Of course, a “real” publisher can potentially offer so many things we’d love to take advantage of.

Professional proof-reading (if you’re not a writer you can have no idea how time-consuming that is – time that could be spent writing the next book), foreign language translation, etc, etc.

Don’t think for one second we are trashing “real” publishing.

We are most definitely not.

If the right deal comes along of course we’ll grab it and run!

We still have bills to pay, families to provide for, and we still subscribe to Private Jet Monthly, just in case… (The one in the pic is mine. Saffi wants a pink one!)

But if the offer ever comes, we will have to balance the short-term delight of being able to hand over a real, made of paper, signed copy of our book to our loved ones, against the realities of the new publishing world that is now emerging.

If you’re on the fence with your manuscript, still sitting on the hard-drive while you weigh up the same issues, ponder the following conclusion from Nathan.

If you can sell print copies, all things being equal there’s still the bulk of the money to be made there.

But if you’re not going out in print in a big way, a self-published e-book is absolutely the way to go.

Hocking sell out. Eisler sells in. Or is it quite that simple?

Amanda Hocking has pretty much captured the headlines this past week with her decision to sign up with a major publishing house and finally see her books in real print.

For those of you living on another planet this past year or two, Amanda became the first writer to become a millionaire never having had a book published on paper. She achieved fame and fortune purely by selling her work on-line, and had become the icon of indie writers for her pains.

My co-author Saffi has blogged on this issue already, so here to address the other side of the coin: a major paper-published author who has just turned down a half million dollar book deal because he believes e-books are the future and he can do better without a big publishing house behind him.

Barry Eisler is the author in question, and he and fellow author Joe Konrath conducted a “live debate” on google docs discussing their experiences, hopes and fears for the future.

As they have kindly made it available for the purpose, I have selected a few salient points from their debate that address issues which are relevant to us, as new and aspiring writers, struggling to make sense of the huge changes taking place in the publishing world.

Eisler began by rehearsing an argument he first put forward a year previously: that digital was going to become more and more attractive relative to paper.

First, because the price of digital readers would continue to drop while the functionality would continue to increase; second, because more and more titles would become available for digital download at the same time more brick and mortar stores were closing.

In other words, everything about paper represented a static defense, while everything about digital represented a dynamic offense.

Not hard to predict how a battle like that is going to end.

Apple sold 15 million iPads in 2010, and the iPad2 just went on sale. And Amazon sold eight million Kindle books in 2010–more digital books, in fact, than paperbacks.

Meanwhile, Borders is shuttering 224 stores.

So I think it’s safe to say the trends I just mentioned are continuing. And the trends reinforce each other: the Borders in your neighborhood closes, so you try a low-priced digital reader, and you love the lower cost of digital books, the immediate delivery, the adjustable font, etc… and you never go back to paper.

The reverse isn’t happening: people aren’t leaving digital for paper. There’s a ratchet effect in favor of digital.

The figures for book-store closures are of course from the US, but we see similar trends in the UK and Europe, and the rise in popularity of e-reading devices and options is beyond dispute.

So is this the end for traditional publishing houses? Some people seem to think (or even hope) so but to me that seems unlikely just yet.

But what is certain is that the publishing world is being transformed, and there will be casualties along the way.

Back to Barry and Joe:

Barry: I can’t tell you how many people I’ve heard saying, “But paper isn’t going to disappear.”

That isn’t the point!

If you ask the wrong question, the right answer to that question isn’t going to help you.

So the question isn’t, “Will paper disappear?” Of course it won’t, but that’s not what matters.

What matters is that paper is being marginalized.

Did firearms eliminate the bow and arrow? No–some enthusiasts still hunt with a bow. Did the automobile eliminate the horse and buggy? No–I can still get a buggy ride around Central Park if I want.

Now, some new technologies really have completely displaced their forebears. For example, there’s no such thing as eight-track tape anymore. And yet some people still do listen to their music on vinyl, despite the advent of mp3 technology.

The question, then, is what advantages does the previous technology retain over the new technology? If the answer is “none,” then the previous technology will become extinct, like eight-track. If the answer is “some,” then the question is, how big a market will the old technology continue to command based on those advantages?

Joe: You’re talking about niche markets.

Barry: Exactly.

Joe: We’ve discussed this before. Paper won’t disappear, but that’s not the point. The point is, paper will become a niche while digital will become the norm.

Now it may well be that Amanda Hocking’s deal has helped delay that eventuality, and provided succour to those who like to pretend the e-publishing revolution is just another dot.com bubble waiting to burst.

But the truth is that while many more e-book-only writers will of course leap at the chance of reaching the real-book market currently beyond them, established paper-based brands like Barry Eisler will increasingly abandon the dead-tree sector because they have a choice.

They no longer need to be shackled by paper contracts, write only what the huge expense of paper-publishing can justify, and endure the ponderous speed of the dead-tree publishing process.

As my co-author Saffi observes on her own blog today, we are writers, not just genre writers

It may well be that Barry Eisler has no intention of diversifying his style and genre preferences, but at least he now has that freedom to experiment.

And as we shall examine in forthcoming blogs following more of Barry and Joe’s debate, that freedom is not just about style and genre. It’s about the freedom to choose your cover, your cover artist, the time and date of your book launch, and perhaps most critical of all, the price of your book.

Writers write to be read. Publishers publish to make money.

Nothing wrong with that, of course. But until recently the publishers entirely justifiable need to make money meant that writers wrote what publishers wanted.

It’s not an “us and them” issue, but the reality of the publishing world is changing before our eyes.

There’s never been a more exciting time to be a writer.

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