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Originally Posted by darryl
I take your point, but there is a further consideration. Not "earning out" is not the same thing as the Publisher losing money. Particularly at low royalty rates there should be a significant range where the Publisher has recouped expenses and is making money but the book has not yet earned out. I haven't seen any actual figures on this but I suspect that for the business model to succeed a lot of books that don't earn out fall into this category, and that whilst Publishers do lose money on some books it would be relatively rare for them to lose very large amounts.
If you are aware of any figures available I would be very interested to see them. Though I do suspect that such figures have always been closely guarded secrets, just as Amazon now keeps a lot of information to themselves.
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Pretty much all the sales figures are closely guarded secrets. Occasionally some authors are willing to write about their sales figures. That's why the various sales estimates that get posted here on a regular basis are simply some guy's swag based on whatever indicators he thinks is important. My point is based on what various publishers have said over the years when they talk about the business. Authors not earning out is a common theme.
In general, not earning out is equal to losing money for the publisher. The term means that the author didn't sale enough books to earn the advance that the publisher paid him or her. The advance is a reasonable indicator for how much the publisher expects to sell and how much resources the publisher puts into the book, in addition to the advance. There may be some boundary cases where the author sells almost enough to earn out and the publisher breaks even.
The average non indie book sells 3000 copies over it's lifetime. The average indie book sells 250 copies in it's lifetime.
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http://www.kameronhurley.com/the-col...tability-love/)
The ball park figure that I've read for the burdened cost for publishing a book is $50,000. That means that the average book doesn't quite break even assuming that everyone is paying list price. Publishing is very much a boom/bust sort of field. The article I linked to above also mentioned that sometimes even name authors have a book that only sells a few hundred. It was said that up to the day he died, you really didn't want to ask Jim Baen about a certain book co-written by a very famous politician. Apparently, Baen lost a lot of money on that book. I've read the book and thought it was a pretty good book. As mentioned in the article, sometimes that sort of thing happens.