WSJ: Authors Feel Pinch in Age of E-Books

[DiamondDave]

Just blogged about this article:

http://blog.tradepressservices.com/d...them-eat-cake/

[eGeezer]

All the rest is probably pretty much opinions and distortions from points of view, but I just loved the Marshall Crook video.

My guess on "remainders" is those books left over after a given "run time" that are then disposed of by being piled on a table in the middle of the store and sold cheap. Thot I'd throw that in since I am the next poster after slackv's posted question.

[markbot]

Originally Posted by SensualPoet

Excellent background article about the economics of e-books and the direct impact on authors and agents in this morning's Wall Street Journal here:
http://online.wsj.com/article/SB1000...987870022.html

Most articles focus on publishers; this one brings in some data about agents fees and authors. It's a bit negative in places, and rehashes some of the "woe is me" stuff in an attempt to "threaten" authors, but on balance it's full of interesting bits. And clearly the message is the world is changing. The article does not suggest a return to 1990s business model will work.

It also makes a few silly claims: that online browsing such as at Amazon's storefront make it difficult to stumble upon new authors and gems that you could find in a bricks and mortar store. This one is patently silly for anyone who has actually compared the experience. There is simply far more to explore at Amazon than even the biggest physical store -- and lots of reader recommendations, some intelligence behind the recommendation engine for repeat visitors, and simply a lot more content that would never be in a regular store.

The article is worth a read.

if digital books limit the secondary market then in the long run they might be much much more profitable than paper books. however, if people start trading digital books like mp3s....then the publishing industry will fare even worse than the music industry....since the music industry still has live performances and other ways to make money, not to mention that books are far smaller in file size.

the fact that there is so much great literature in the public domain means modern authors have to compete with ghosts as well. they always had to but now those public domain books can be distributed for free instead of $4.99 from Penguin. on balance, it isn't looking very good for the book publishing industry.

[Worldwalker]

Remember that the Wall Street Journal of today is not the Wall Street Journal of a few years ago. Thanks to the sale, it is no longer unbiased or neutral in any way, though it continues to pretend to be. You may agree or disagree with its political (and by association business) angle, but never forget that it has one, quite a strong one.

Back to ebooks: If I buy a pbook for $18 at a big box store, the author gets, what, maybe a dollar or so? If I buy an ebook for $3 from Smashwords, the author gets $2.00. And I'll be buying a lot more of those $3 ebooks. Maybe not six times as many (I do need to sleep sometimes, not to mention pay for my Internet connection) but I'll certainly be buying twice as many, at the very least. So I can spend $18 at Border's and some author gets $1, or I can spend $6 at Smashwords and some author(s) get $4. The only ones I see getting the shaft are the inefficient distributors and the people trying desperately to cling to their old business model, even if they have to legally mandate that every automobile carry a buggy whip.

[J. Strnad]

A remainered book is one that is unsold and has been "returned" by the bookseller. The book is marked so that it can't be returned as a new book and it's sold at a hefty discount. Authors do not earn royalties on remaindered books. Some authors have a clause in their contract that gives them first dibs on their remaindered books at the lowest remainder price, so that they can buy cheap copies to sell on tour.

Generally, the books will be sold to a company that specializes in remaindered books, which is why I put "returned" in quotes in the first paragraph. Rather than going back to the publisher, remaindered books might go straight to the remaindering company.

[J. Strnad]

Half or more???? 25%, usually, and you get it back after a year.

(This is from a few posts ago, talking about the money withheld from an author's check to cover anticipated returns.)

With the last paper book I published, earlier this year, the publisher held more than 68% against returns. I have an author friend who recently reported that his publisher withheld even more than that.

A book sold at Costco is a specially negotiated deal that won't pay the author a royalty based on the normal, full retail price. There will probably be a paragraph in the contract about books sold at a steep discount or promotional discount or somesuch, sharply reducing the royalty. So, no, if you buy a $30 book at Costco for $15.99, the author is not getting his usual royalty based on $30. Even with books sold at a chain like Barnes & Noble, B&N might have demanded such a stiff discount that the lower royalty will apply.

[SensualPoet]

Thanks for confirming remaindered books represent $0 royalty.

But what about the "sale" tables that are so prominent in some stores (certainly in Canada)? A great example is once the hard cover has had its run, the trade paperback comes in, or perhaps even the mass. On one table, the hard cover with a $9.99 sticker and on another the recently arrived trade paperback with a 20% off sticker at $12.99. If you really want the paperback, it's more money ... or pick up the "discontinued" hard cover for less.

I am calling these books "remainders" -- that may be the wrong term. My understanding is these are hard covers that have been returned to the publisher (or maybe "over-printed") and then bought back as remainders. The original price was $30; now they are $9.99 and the bookshop is still making some margin. Aren't these books royalty free as well?

[L.J. Sellers]

Few journalists or industry representatives ever mention the 25-40% of all hardbacks that are printed, shipped out, shipped back, and shredded without anyone cracking a spine. It's a wasteful business with unsustainable practices.
L.J.

[MrPLD]

LJ,

That's always riled me up as well - the grotesque wastage. Hoping eBooks can bring sanity back into the market along with the ever increasing number of PoD houses.

Paul.

[J. Strnad]

Originally Posted by SensualPoet

Thanks for confirming remaindered books represent $0 royalty.

But what about the "sale" tables that are so prominent in some stores (certainly in Canada)? A great example is once the hard cover has had its run, the trade paperback comes in, or perhaps even the mass. On one table, the hard cover with a $9.99 sticker and on another the recently arrived trade paperback with a 20% off sticker at $12.99. If you really want the paperback, it's more money ... or pick up the "discontinued" hard cover for less.

I am calling these books "remainders" -- that may be the wrong term. My understanding is these are hard covers that have been returned to the publisher (or maybe "over-printed") and then bought back as remainders. The original price was $30; now they are $9.99 and the bookshop is still making some margin. Aren't these books royalty free as well?

Most likely, yes.

[Seli]

Originally Posted by L.J. Sellers

Few journalists or industry representatives ever mention the 25-40% of all hardbacks that are printed, shipped out, shipped back, and shredded without anyone cracking a spine. It's a wasteful business with unsustainable practices.
L.J.

Keep in mind this is inherent to a market where the product is produced in batches with a large scale advantages and with a limited shelf-life. Especially because buying is partly impulse based, meaning that not having something in store the moment the buyer wants something it is a lost sale.

And even with newer technology such as print-on-demand, printing in bulk is still a lot cheaper for something that sells in any quantity. Even taking in account transport, storage and wastage.

Of course ebooks don't have these problems, but they are still a growing market.

[kennyc]

Originally Posted by L.J. Sellers

Few journalists or industry representatives ever mention the 25-40% of all hardbacks that are printed, shipped out, shipped back, and shredded without anyone cracking a spine. It's a wasteful business with unsustainable practices.
L.J.

This!

[kennyc]

From the article:

...

"Not everyone believes that the shift to digital publishing is necessarily bad for writers. Novelist E.L. Doctorow, who has taught creative writing for 23 years at the NYU Creative Writing Program, says the industry may be transforming away from big corporate-owned publishers back to a cottage industry like it was many years ago. The shakeout could help prune an overcrowded market.

"Writers come up from nowhere, from the ground up, and nobody is looking for them or asking for them, but there they are," says Mr. Doctorow. "If there is a weeding out that's going to occur because of such difficulties, it may be all to the good."

[kennyc]

Originally Posted by DiamondDave

Just blogged about this article:

http://blog.tradepressservices.com/d...them-eat-cake/

Great analysis and retort. I too picked up on the term "digital disruption" (as though it were only temporary - can you say "heads in the sand?")

Hee-Hee:

[MrPLD]

"digital disruption" - brilliant stuff. Perhaps they should hand in their cellphone, laptop, mp3 player (oops, sorry, iPod), heck even give back the Gutenburg press, thanks.