Quote:
Originally Posted by Xenophon
Those costs are certainly there, and need to be covered. That said, we have one useful data point -- Baen makes money on eBooks at $6.00 a pop, while charging each copy its proper pro-rated share of the fixed costs. That is, if a book sold half its total copies in bits they'd charge half the fixed costs to the e-sales for purposes of determining profitability. They report being very happy with eBook sales; they make a little less than hardcover, but more than paperback on each ebook sold.
Oh yeah, they also sell the majority of their eBooks via bundles that include four front-line and a zero-to-four re-issues for $15. So figure that their average selling price per eBook is actually well below $6.00.
|
Doesn't matter, because the numbers still work out.
In paper books, your big variable will be actual sales. You print X thousands and put them out through your distribution channels. You cross your fingers that enough will sell to cover your costs and make money on the book.
For hardcovers that don't sell, you get the actual books back. For paperbacks, you get the covers torn off and sent back. The actual body of the book is
supposed to become landfill somewhere, but often winds up being sold for a fraction of the cover price. To make it worse, the publishing industry has historically had a 100% returns policy, so there was no risk to the retailer. Didn't sell? Send it back for credit.
And because of the length of the distribution chain, it could be 6 months to a year before you even know whether a title has sold and see any revenue from it.
Ebooks change that. You don't have the same distribution chain, you know right away whether a title is selling, and you don't have the expense of unsold returns. But you
do still have to be concerned about sales, and you can lose money on titles that don't sell, since you spent the money to acquire and produce them.
Selling bundles may mean less on individual titles for Baen, but probably works out to more over all, as all the titles in a bundle sell.
And Baen is a smaller house in a lower rent area -- costs in NC are a fraction of NYC -- so the share of overhead will be less.
Making less than a hardcover sale but more than an MMPB sale at $6/book on ebooks is not a surprise. MMPBs are
really squeezed these days, and I've heard stories of press runs as low as 15,000 copies. Not that long ago, I wouldn't have believed you could print that few and make any money. Baen was struggling in the old days when they were an MMPB house. The Free Library helped drive their metamorphosis into a thriving hardcover house. If that hadn't happened, they might not exist now.
I wouldn't be overly surprised if at some point Baen did hardcovers and ebooks and dropped MMPBs entirely.
______
Dennis