what authors earn

The Business Rusch: Addendums, Rights Grabs & Agents (Yet Again)

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This post by Kristine Kathryn Rusch originally appeared on her site on 9/25/13.

Recently, I got e-mail from another career writer, talking about a rights grab from a traditional publisher. I saw the document in question; it’s egregious. I do not have permission to talk about this particular document nor would I, since it’s proprietary, but it’s the kind of document I’ve seen at least six times in the last two years.

These documents are addendums to publishing contracts. Since the rise of e-books, publishers have issued the addendums frequently and often en masse.

Before I go further, let me remind you that I am not a lawyer nor do I play one on TV (or in internet videos, for that matter). I have opinions about legal matters as they pertain to publishing, based on thirty-some years in the business on almost all sides of the business, but I am not an authority on this topic nor does anything in this blog substitute for legal advice.

Got that?

Okay.

Once signed, addendums to contracts become part of the contract. All well-written addendums have language that explains the addendum’s relationship to the contract. For example, the addendum might say something like “nothing in this addendum will supersede the terms previously granted in the contract.”

Or, as I’m seeing in all these publishing addendums, they’ll have clauses that say things like “if there is a conflict between a term that is specifically defined in this addendum and a definition of the same term is in the contract, then the definition specified in the addendum governs.”

In other words, the addendum will not only become part of the contract; it will make parts of the contract null and void.

Some addendums I’m seeing are pretty straightforward. They grant e-rights to contracts so old that ebooks did not exist when the contract was signed. Those addendums generally add the ebook information, how the royalties will be calculated, how ebooks are defined—basically the same stuff that would be in a contract if it were signed in 2013 instead of 1983. I know a lot of you traditionally published career writers have signed addendums like these—and many of you have refused, keeping the e-rights for yourself.

That’s all well and good, and is typical business.

But the addendums I’m writing about today are rights grabs.

 

Click here to read the full article on Kristine Kathryn Rusch’s site.

 

From Bestseller To Bust: Is This The End Of An Author's Life?

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This article by Robert McCrum originally appeared on the Guardian UK Books section on 3/1/14.

The credit crunch and the internet are making writing as a career harder than it has been for a generation. Robert McCrum talks to award-winning authors who are struggling to make ends meet.

Rupert Thomson is the author of nine novels, including The Insult (1996), which David Bowie chose for one of his 100 must-read books of all time, and Death of a Murderer, shortlisted for the Costa Novel of the Year awards in 2007. His most recent novel, Secrecy, was hailed as “chillingly brilliant” (Financial Times) and “bewitching” (Daily Mail). According to the Independent, “No one else writes quite like this in Britain today.” Thomson has also been compared to JG Ballard, Elmore Leonard, Mervyn Peake and even Kafka. In short, he’s an established and successful writer with an impressive body of work to his name.

After working seven days a week without holidays, and now approaching 60, Thomson, you might think, must be looking forward to a measure of comfort and security as the shadows of old age crowd in. But no. For some years he has rented an office in Black Prince Road, on London’s South Bank, and commuted to work. Now this studio life, so essential to his work, is under threat. Lately, having done his sums and calculated his likely earnings for the coming year, he has commissioned a builder to create a tiny office (4ft 9in x 9ft 11in) at home in his attic, what he calls “my garret”.

The space is so cramped that Thomson, who is just over 6ft, will only be able to stand upright in the doorway, but he seems to derive a certain grim satisfaction from confronting his predicament. “All I want is enough money to carry on writing full time. And it’s not a huge amount of money. I suppose you could say that I’ve been lucky to survive as long as I have, to develop a certain way of working. Sadly, longevity is no longer a sign of staying power.”

Thomson is not yet broke, but he’s up against it.

 

Click here to read the full article on the Guardian UK Books section.

 

Is #Indie Publishing Worth It? Would I Do It Again? A Tell-All.

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This post by Toby Neal originally appeared on her site on 2/13/14.

Perhaps because of the recent brouhaha in the blogosphere due to my hero Hugh Howey’s continued pioneering, this time in bringing full disclosure numbers via AuthorEarnings.com that paint a very different picture than traditional publishing would have us know, yesterday I heard from a talented writer who used to work in my former agent’s office. This person knew my writing from the get-go. She knew how hard the agency worked to sell my book series, and she had to find another job when my agent retired in frustration in 2011. She has continued to write herself, and watch my career as someone who has seen it from that very first version of Blood Orchids, that, while needing a complete rewrite, had enough promise to attract her boss. Spurred by the Authorearnings disclosure, and “on the fence” herself about which way to go with agent interest in her work, she wrote me a series of questions to help her decide whether to persist with the traditional route or make the leap to “author-publisher.”

The discussion was so good I thought I’d share it with other writers struggling with the same dilemma.

Writer-on-the-fence: Would you self-publish again?

As you know more than anyone, I was devastated when our agent retired in 2011 and I was left without representation. It had taken me two years to get an agent and 179 query letters! Then, we hadn’t sold the series in 9 months (well, we did get an offer, but it was too low and digital rights only.) Read more about my complex emotions here: http://tobyneal.net/2011/08/14/complex-emotions/

I felt after that much “lost time” I had to try self-publishing, and our agent’s comments on the market had been very discouraging, so I thought at least it couldn’t hurt to try. I did, however, go “high end” from the beginning, with a top-tier cover artist (Julie Metz) a publicist, and two rounds of professional structural editing… That first book cost me $12,000 to produce and market its first month. (Now I have my book development expenses whittled down to a mere $4-6,000.) However, Blood Orchids paid for itself within two months after debuting in December 2011, and last year alone I netted close to a hundred thousand in sales.

I think of my books as a start-up business, so I spent at least half of that on new book development and advertising. This has made my take-home income just replacing the middle-class amount I made as a school counselor, a job I was able to leave because my writing income had replaced the need for a 9-to-5. I choose to keep re-investing in new books because, as others have said, every title is a worker bee out there earning for me, and the model that works in indie publishing is capturing your readers and keeping them reading and engaged with a flow of new titles.

 

Click here to read the full post on Toby Neal’s site.

 

Common Ground in the Debate of Self v. Traditional Publishing

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This post by Jack W. Perry originally appeared on Digital Book World on 2/21/14.

A storm was created last week in response to Hugh Howey’s Author Earnings post. It was widely criticized by many but also praised. It started a lot of discussion.

Having read most of the back and forth, I did notice a few commonalities.

Some issues all sides generally agree upon:

1) Digital has demolished the distribution barriers to entry for self-publishing. Before digital a self-published author would have to pay to print and distribute books. That was an outlay of cash and inefficient. The author then went to indie bookstores to get distribution one book at a time. Hoping to eventually break through and signed a major deal. Today an author can upload their book and get instant distribution to the entire country. Sales can happen immediately. The goal may be to remain independent or to gain negotiating leverage with traditional publishers.

2) The data is incomplete and there is a definite need for more transparency. Amazon, B&N, Apple and Google don’t publically release sales data. There is no “Bookscan for ebooks” although Nielsen is working on it with PubTrack Digital. Self-published and the Amazon proprietary titles are generally felt to be under-reported if at all. This feeds into the debate of the size of self-published ebooks. By withholding the Kindle data, Amazon has created a massive hole in any analysis. Perhaps a company like App Annie could fill that void and be a resource of data and analytics.

 

Click here to read the full post, which includes four additional points of discussion, on Digital Book World.

 

Does What You Paid For A Book Affect How You’d Rate It?

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This post by Jane Litte originally appeared on Dear Author on 2/23/14.

When I first started buying my own books some twenty plus years ago, I had very little money. My favorite authors were starting to come out in hardcover (Julie Garwood, for example) and unless I wanted to wait to be the 80th person at the library to read the book, I had to fork over $22.00 or more which, at the time, was a lot of money for me. It basically meant I wasn’t going to be able to buy another book or maybe even eat anything but ramen and macaroni for the month.

Most of the time, however, I bought my books used at the Half Price Bookstore or some other used bookstore that sold romances for $0.10 or $0.25. And when I bought the hardcover, I knew that I was sacrificing at least four other reads for that one book.

As I got older, I was able to buy more books but my reading habit got to be really pricey so I instituted a book budget of no more than X amount of dollars to be spent a month. Because I read three to five books a week, I was only able to purchase about eight titles a month new and the rest would have to be library lends or used book store purchases. During the heydey of chick lit, I was really struggling!

Price has always been a big thing for me when it comes to books and from what I’ve heard from industry professionals, mass market purchasers are very price sensitive. Most romance readers are mass market purchasers although the new readers coming in to the market after Fifty Shades are probably not.

There’s an interesting concept called anchoring. Anchoring is the tendency of humans to rely on the first piece of information offered. In economic terms, anchoring means that the first price a consumer encounters for widget A is likely the price that the consumer believes she should always pay for widget A. (Widget is an official economic term. No lie.)

 

Click here to read the rest of the post on Dear Author.

 

Author Earnings: The Report

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This post by Hugh Howey originally appeared on Author Earnings with a publication date of 2/12/14. It contains some pretty shocking and encouraging book sales data, at least where indie authors and small publishers are concerned.

It’s no great secret that the world of publishing is changing. What is a secret is how much. Is it changing a lot? Has most of the change already happened? What does the future look like?

The problem with these questions is that we don’t have the data that might give us reliable answers. Distributors like Amazon and Barnes & Noble don’t share their e-book sales figures. At most, they comment on the extreme outliers, which is about as useful as sharing yesterday’s lottery numbers [link]. A few individual authors have made their sales data public, but not enough to paint an accurate picture. We’re left with a game of connect-the-dots where only the prime numbers are revealed. What data we do have often comes in the form of surveys, many of which rely on extremely limited sampling methodologies and also questionable analyses [link].

This lack of data has been frustrating. If writing your first novel is the hardest part of becoming an author, figuring out what to do next runs a close second. Manuscripts in hand, some writers today are deciding to forgo six-figure advances in order to self-publish [link]. Are they crazy? Or is signing away lifetime rights to a work in the digital age crazy? It’s hard to know.

Anecdotal evidence and an ever more open community of self-published authors have caused some to suggest that owning one’s rights is more lucrative in the long run than doing a deal with a major publisher. What used to be an easy decision (please, anyone, take my book!) is now one that keeps many aspiring authors awake at night. As someone who has walked away from incredible offers (after agonizing mightily about doing so), I have longed for greater transparency so that up-and-coming authors can make better-informed decisions. I imagine established writers who are considering their next projects share some of these same concerns.

Other entertainment industries tout the earnings of their practitioners. Sports stars, musicians, actors—their salaries are often discussed as a matter of course. This is less true for authors, and it creates unrealistic expectations for those who pursue writing as a career. Now with every writer needing to choose between self-publishing and submitting to traditional publishers, the decision gets even more difficult. We don’t want to screw up before we even get started.

When I faced these decisions, I had to rely on my own sales data and nothing more. Luckily, I had charted my daily sales reports as my works marched from outside the top one million right up to #1 on Amazon. Using these snapshots, I could plot the correlation between rankings and sales. It wasn’t long before dozens of self-published authors were sharing their sales rates at various positions along the lists in order to make author earnings more transparent to others [link] [link]. Gradually, it became possible to closely estimate how much an author was earning simply by looking at where their works ranked on public lists [link].

This data provided one piece of a complex puzzle. The rest of the puzzle hit my inbox with a mighty thud last week. I received an email from an author with advanced coding skills who had created a software program that can crawl online bestseller lists and grab mountains of data. All of this data is public—it’s online for anyone to see—but until now it’s been extremely difficult to gather, aggregate, and organize. This program, however, is able to do in a day what would take hundreds of volunteers with web browsers and pencils a week to accomplish. The first run grabbed data on nearly 7,000 e-books from several bestselling genre categories on Amazon. Subsequent runs have looked at data for 50,000 titles across all genres. You can ask this data some pretty amazing questions, questions I’ve been asking for well over a year [link]. And now we finally have some answers.

 

Click here to read the full, lengthy report (including many informative graphs) on Author Earnings. This report should be required reading for anyone who is, or hopes to become, a published author.

 

It's All Just Dumb Luck

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This post by Mitch Joel originally appeared on his Six Pixels of Separation blog on 2/5/14.

It’s a story that I will never forget. Back in 2008, I was prepping the release of my first business book (Six Pixels of Separation). I was very excited because the book was going to be the lead business title for Grand Central Publishing – which is a part of the largest book publishing company in the world (Hachette Book Group) – and the senior-most executive at the publishing house wanted to meet with me. I was excited. I was nervous. If you could close your eyes and imagine what the head editor of the largest book publisher in the world might look like, you would have the right visual of this powerful, smart and compelling individual. A beautiful corner office with a view, that is decorated with awards, celebrity author paraphernalia, photos of this individual with Presidents, royalty and more. As we sat down on the couch for a coffee, they leaned in and quietly said, “Mitch… I love your book. We all love your book. It’s a fascinating space and you have captured it perfectly. We are thrilled that we’re publishing it and look forward to its success…” and then there was a long pause. They finished the sentence with: “now, all we need is lightning in a bottle.”

 

Wait. What?

Write a book that one of the world’s most esteemed editors loves, get signed to a global deal by one of the largest book publishers in the world, get to be the lead title for their back to school season, and it’s all going to be dependent on how lucky we get?

 

Click here to read the full post on Six Pixels of Separation.

 

Playing with Permafree Books – The Results

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This post by Nick Stephenson originally appeared on his site on 1/9/14.

I’ve been experimenting with a permafree book over the last few weeks – admittedly, I’m a little late to the game, but with so many indie authors using this approach, I figured it was time to dip my toes in the water. I chose my shorter title, “Paydown” (a 95 page novella) as the guinea pig for this little experiment. The book has been well received, with a 4.2* rating on Amazon over 15 reviews at the time the title first went free. A few weeks later, reviews are still good, averaging 4.1* over 28 reviews. But I’m far more interested in measuring the ROI, so here’s the breakdown for y’all:

Price of Paydown prior to permafree = $0.99c
Average daily revenue for Paydown prior to permafree = $2.20
Average daily unit sales for Paydown prior to permafree = 6

Granted, I only had the book up for sale for 2 weeks before going free, but that gives you a rough idea. Essentially, for every day the book is free, I’m losing $2.20 off the bat (I figured I could live with that). So how did jumping on the permafreebie bandwagon help sales across my other titles? Here’s a lovely graph:

 

Click here to read the full post, which includes a breakdown of the sales figures, detailed analysis, and conclusions, on Nick Stephenson’s site.

 

Ten Things You May Not Know About Ebook Prices

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This post by Rachel Willmer originally appeared on TechCrunch on 1/15/14.

How much should you pay for an ebook? $9.99? $0.99? $0? And how much should you price your ebooks? I’m going to tell you what people have actually paid for their ebooks, based on some hard data from Luzme. You can set the price of your book to be anything you want; what really matters is what someone will pay for it!

Last year, Luzme captured a large amount of ebook price data and reader pricing preferences. I am analysing this data and will share any interesting results.

I do not claim that this is representative of the whole ebook industry, but I hope that some real data might contribute something useful to the debate.

So here is my analysis of the actual prices that people have paid at Amazon in 2013, when they bought via Luzme.

USA
For the US data, I have normalised it against the “standard price” of $10.

Here is the way the various prices worked in terms of units sold. [Click on image to view an enlarged version in a new browser tab/window]

The most popular price points are at the low-end, with a local peak around the $10 mark, and then tailing off as the price increases.

This does not surprise me. But what I did not expect, is how much people will actually pay for an ebook (well over the $10 price! How much do you think the most expensive one went for? I will tell you later…)

Now look at the revenue over the same price points.

[Publetariat Editor’s note: this is where it really starts to get interesting – please click through on the link below to see more charts and an analysis of the comparative net earnings across various ebook price points]

 

Click here to read the full post on TechCrunch.

 

The Tipping Point (E-Commerce Version)

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This post by Jeff Jordan originally appeared on his site on 1/15/14.

The news around shopping during the holiday season was dominated by two separate stories. One talked about how traffic to brick-and-mortar stores was well below expectations, and that these retailers were forced to discount tremendously to drive sales. The other talked about how an enormous late surge in packages coming from e-commerce companies overwhelmed the capacity of UPS and, to a lesser extent, FedEx, and caused many of these packages to arrive after Christmas.

But, to me, these two stories are not at all separate, they simply reflect different sides of the same narrative: We’re in the midst of a profound structural shift from physical to digital retail.

The drivers of this shift are simple:

• Online retail has strong cost advantages over its offline counterparts and is rapidly taking share in many retail categories through better pricing, selection and, increasingly, service.

• These offline players have high operational leverage and many cannot withstand declining top-line revenue growth for long.

• The resulting bankruptcies of physical retailers remove competition for online players, further boosting their share gains.

So, how has this shift been playing out? Recent data suggests that it’s happening faster than I could have imagined.

The U.S. Census Bureau publishes what I consider to be the most accurate figure on e-commerce penetration in the U.S. It reports that e-commerce penetration of total retail sales in the U.S. was around eight percent in 2012. But, as I’ve blogged previously, this aggregate figure seriously underestimates the impact of e-commerce in large sectors of the retail landscape. Let’s unpeel the onion and look at the next level of reporting from the Census Bureau, where it segments the retail landscape into six large categories of goods. It’s at this level that things start getting more interesting:

 

Click here to read the full post (which includes charts) on Jeff Jordan’s site.

 

The Self-Publishing Debate: A Social Scientist Separates Fact from Fiction

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This post, by Dana Beth Weinberg, originally appeared on Digital Book World on 12/4/13.

Is self-publishing an amateurish endeavor, a means of sharing stories, a strategic move in a writing career, or an entrepreneurial activity? To gain insight into this question, I have been analyzing the responses from the nearly 5,000 authors who responded to the 2013 Digital Book World and Writer’s Digest Author Survey in relation to whether an author is aspiring (not yet published), self-published only, traditionally published only, or hybrid (both self-published and traditionally published). In Part 1, I compared the top priorities of these 4 types of authors, and in Part 2, I examined the differences in their stock of published [and] unpublished manuscripts. Now I turn my attention to the differences in their income from their writing.

Not surprisingly, most aspiring authors in the sample reported no annual income from their writing. About 19% of self-published authors in the sample also reported no annual income from their writing, compared to 6% of traditionally published authors and only 3% of hybrid authors. While most of the survey respondents clustered at the lower end of the income distribution, some authors did report earning $200,000 or more from their writing, the highest income choice on the survey: less than one percent (0.6%) of self-published authors, 4.5% of traditionally published authors, and 6.7% of hybrid authors who reported on their income. (In the chart, I have collapsed the top categories to $100,000 or more for better visibility. These aggregated category represents 1.8% of self-published authors, 8.8% of traditionally published authors, and 13.2% of hybrid authors.)

 

Click here to read the full post on Digital Book World.

 

Scribd's New Ebook Subscription Service: Partnering with Publishers, Profiting from Piracy

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This post, by Michael Capobianco, originally appeared on Writer Beware on 1/9/14.

I was contemplating what to write for my first Writer Beware blog post, when a subject popped up out of the blue, packed with all kinds of fascinating questions.

Some of you may remember when SFWA tangled with the online “digital library” Scribd back in 2007. Scribd was loaded with unauthorized uploads of copyrighted material, but SFWA screwed up big time by sending a sort-of DMCA notice (it wasn’t really) to get works by many sf writers removed from the site. It was an embarrassment for SFWA, and over time made it less and less likely that the organization would do anything directly about illegal uploads, even though a plan had been developed to do so for members who had specifically authorized SFWA to act as their agent.

Since everything to do with online piracy left a decidedly bad taste in my mouth, I decided I would not go looking for illegally uploaded copies of my or other authors’ works, and I didn’t check to see if Scribd was following through on the promises it made at the time to provide real-time checking of works uploaded to the service.

Jump forward six years to now. The subject of Scribd came up on a SFWA forum as part of a controversy that I needn’t go into here, and I decided that it was finally time to check it out.

Six years has made a big difference. Scribd has set out to become a full-fledged bookstore to compete with Amazon and Barnes and Noble, and takes it one step farther with the addition of an all-you-can-eat subscription service that allows access to an unlimited number of ebooks for $8.99 a month. They are now partnering with HarperCollins and various other publishers, such as Smashwords, E-Reads, and Rosetta Books, with the promise of more to come. They cover a lot of ground; not only do they sell ebooks and subscriptions, they offer what look like unauthorized “previews” of many other books, with links to authorized retailers.

But finally, beneath all the new things, the old Scribd–offering not-necessarily-legal user uploads of copyrighted works–is still there. Only now Scribd has monetized them, since you can only see a “preview” of the material for free, and must be a paid subscriber to access the whole unauthorized upload.

 

Click here to read the full post on Writer Beware

 

Author's Year-End Marketing Checklist

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This post, by Stephanie Barko, originally appeared on San Francisco Book Review on 11/14/13.

Do you think of your writing as a hobby or a business? If your books mean business to you, this is a great time of year to evaluate how your 2013 marketing fared. Beginning now, there’s just enough time before the end of the year to assess performance-to-goals and plan for taxes.

Here is a list of questions designed to either save you money [this year] or expose some issues to correct before [next year].

SALES

How many books did I sell this year?

Which formats sold best?

Do I want to put my 2013 title out in another format or publish my next book or both?

Did I sell branded merchandise this year? Do sales indicate that it was priced right?

Do I want to merchandise my brand next year?

 

EXPENSES

Do I have the right amount of expenses to offset sales?

 

Click here to read the rest of the post on San Francisco Book Review.

 

The Good And Bad In Chaotic eBook Pricing

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This post, by Mike Masnick, originally appeared on Techdirt on 10/8/13.

For years we’ve discussed the ridiculousness of ebook pricing, where some publishers seem to think that sky high prices for ebooks (often higher than physical copies) make sense, despite the lack of printing, packaging, shipping and inventory costs. And, of course, we won’t even get into the question of the price fixing debacle. Art Brodsky recently wrote a fascinating piece over at Wired about how ebook pricing is an “abomination,” because it’s designed to price people out of reading. He points out that we should think more about ebooks like we think about apps, since that’s a much more direct comparison than “books.” And then he gets into a discussion of how publishers are going crazy with their library pricing:

Take the example of J.K. Rowling’s pseudonymous book, Cuckoo’s Calling. For the physical book, libraries would pay $14.40 from book distributor Baker & Taylor — close to the consumer price of $15.49 from Barnes & Noble and of $15.19 from Amazon. But even though the ebook will cost consumers $6.50 on Amazon and Barnes & Noble, libraries would pay $78 (through library ebook distributors Overdrive and 3M) for the same thing.

Somehow the “e” in ebooks changes the pricing game, and drastically. How else does one explain libraries paying a $0.79 to $1.09 difference for a physical book to paying a difference of $71.50 just because it’s the electronic version? It’s not like being digital makes a difference for when and how they can lend it out.

 

Click here to read the rest of the post on Techdirt.

 

Successful Authors Are Outliers, Not Statistics

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This post, by Bob Mayer, originally appeared on his Write on the River site on 12/10/13.

Digital Book World has put out another survey about authors, indie authors, hybrid authors*, hobbits, wizards and drones.

While I applaud the effort, I find a lot of the data about authors essentially skewed, especially when it comes to those of us who make our living writing. Especially for those of us who’ve made our living writing for more than a year or two, ie those who’ve made a career writing. Which is about as rare as a hobbit in an orc bar. Unless it’s being served for dinner.

While I’m not a fan of Malcom Gladwell’s public condemnation of Amazon while still selling his books there (also Scott Turow), I accept that they are both highly paid indentured servants to their publishers who have no control over whether their books are sold at Amazon. Gladwell wrote a book introducing a concept called Outliers, which looks at the factors that lead to high levels of success (see, I link to the book on Amazon—please donate all sales to charity, Mr. Gladwell). I submit that any person who can make a decent career as a writer of fiction (ie a professional bullshitter) has achieved a high level of success in the world of publishing. It’s something I learned in Special Forces, who are almost all outliers.

So how are successful authors outliers?

Gladwell: “the biggest misconception about success is that we do it solely on our smarts, ambition, hustle and hard work.”

I do think we need all four; and while I know writers who’ve come from nothing and pushed all four to the extreme and have become successful, there are certainly other factors that Mr. Gladwell explains.

At Cool Gus one of our mottoes is: the best promotion is a good book, better promotion is more good books. Gladwell has a term called “Accumulative advantage”. He uses the example that most elite Canadian hockey players were born earlier in the year. What’s the connection? Since leagues are done by year, a kid born in January has almost a year of experience and growth over a kid born in December. Thus the earlier birth players seem to be the best. Thus they are treated as better—it’s a case where the rich get richer.

In publishing this means those of us who came out of traditional publishing with rights to some or all of our backlist have had a huge advantage.

 

Read the rest of the post on Write on the River.