Quote:
Originally Posted by dkb
“People would have heart attacks if they knew all the costs associated with digital publishing,” says Maja Thomas, senior vice president of the Hachette Book Group’s digital division.
I think Hachette should fire her and poach someone from Baen Books since Baen Books has figured out how to keep ebook prices at $6. Of course one of the ways Baen Books keeps costs down is not using DRM. The extra lawyers are so they can sue anyone they think is breaking DRM or pirating their books. They're also probably hiring extra legal help to aid in their lobbying efforts to make copy right more restrictive and extend it as close to infinity as they can make it.
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It wouldn't help them if they did. Baen's model works for
Baen. It may not work for another publisher.
For a starter, Baen has lower overhead. They are located in NC, where costs of things like rent are lower. They used to have editorial offices in NYC, but relocated.
For a second, more of their work is done by contractors. The eBook editions, for example, are produced by Arnold Bailey, their webmaster, who also set up and runs the Webscriptions program, and gets a cut of the take. Contractors get fees, but things like insurance are on them. Baen doesn't have the salary and headcount expenses larger publishers have.
Third, and probably most important, Baen is a niche publisher. They publish mid-level action/adventure SF and Fantasy. They understand their market, and what it likes. They aren't likely to have best sellers, save David Weber's "Honor Harrington" books, but they also aren't likely to invest large amounts of money in books they think might be bestsellers, but which bomb, so they don't get buried alive in returns costs.
And last, Baen still does the majority of its business in print editions. The Free Library was originally set up as promotion for the "dead tree" editions, and Jim Baen at the time did not see opportunities for profit in purely electronic publication. The promotion worked, and drove Baen's transition from a struggling mass market PB house to a thriving hardcover publisher with a 70% sell-through rate. A fair number of people buy the paper
and the ebook editions.
If paper editions all magically went away tomorrow and only the eBook sales remained, could Baen survive selling only eBooks at their current prices? Frankly, I doubt it.
They big guys like Hachette have different cost structures and business models, and what Baen does is only partially adaptable to them, if at all.
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Dennis