Turning a blind eye
I want to start by thanking Cedar for stepping in and handling MGC last Tuesday. This past week has been more than a bit trying and there was simply no way I could have blogged then. Life is slowly returning to normal and I will try to do Cedar proud today but I warn everyone that the brain is still a little battered around the edges after everything that’s happened this week. Anyway. . . .
There has been a lot of talk over the last week or so about the latest Author Earnings report. AAP report and now John Scalzi’s take on it all. If you want to read more about what Scalzi had to say about the two reports, you can check out this article on Teleread or check out what the Passive Voice has to say. I guess no one should be surprised to know that Scalzi puts more credence into the AAP report — the one put together by supporters of traditional publishing — than he does the AE report (indie publishing). After all, look at what camp he happens to be in and where his paycheck comes from.
From Teleread: He [Scalzi] scoffs at the latest Author Earnings figures on the basis of “the source [being] unabashedly pro-indie (and less-than-subtly in my opinion anti-publishing)” and thence opines that publishers know exactly what they’re doing in raising the price of e-books. They’re intentionally protecting the print market, Scalzi believes, at least insofar as the strategy touches on novels.
Of course publishers are protecting the print market. With Author’s Guild finally demanding traditional publishing amend their contracts so that authors receive a larger percentage of royalties for e-books, it makes sense for publishers to try to protect the remaining portion of their business where they get the lion’s share of royalties. For the last how many years have we heard from traditional publishing (and again I have to say Baen is the exception) that they have basically the same expense in making an e-book that they do a print book. They have even tried to make that argument fly when the print — and possibly two to three print versions — of the book already exist. We’ve been told e-books have to be edited and set (as in print set) and new covers, etc. That argument has finally gone the way of the dodo because there are too many of us out there in the trenches who know just how wrong that argument is and we’ve been letting others know.
So now, with the print market continuing to shrink, publishers are doing what they can to protect that market at the expense of the digital market. They continue to fail to recognize that their business model is outmoded and out-dated. Instead, they blame Amazon for their problems. After all, it is so much easier to blame someone else for your failings than to take a long, hard look in the mirror and realize that the problem rests with you.
But let’s continue with what Scalzi has to say.
Investing time in strengthening alternate retail paths makes sense in that case, especially if, as the article suggests, consumers are happy to receive the book in different formats for an advantageous price. If people fundamentally don’t care if they read something in print or electronic format, as long as they get a price they like, that leaves publishers a lot of room to maneuver.
As Teleread noted, this is part of Scalzi’s point that what publishers are doing is an anti-Amazon strategy. Hmm. So, before we get into the economics of what he says, let’s look at the alternatives to Amazon. I live in a large metropolitan area. There was a time when there were, by a quick mental count, half a dozen or so bookstores within a ten mile radius of where I live. Two were chains and the rest were locally owned bookstores. Then came the big box stores like Bookstop which was followed by Borders and then Barnes & Noble. The two chains were bought up by the big box stores and the mom and pop stores were run out of business. Flush with their success, Borders and Barnes & Noble, as well as one or two other national chains, expanded and expanded and expanded and then started to go bust. Now Barnes & Noble is the only major chain store still standing, at least in this part of the country, and a number of their stores down here have closed. In that same ten mile radius, there is one B&N and it is more than a bit difficult to get to because of its location. Lousy parking, worse traffic and an indifferent staff. Yeah, right, that is where I’m going to go to buy my books. Not.
But let’s look at the economics of what Scalzi claims. Without taking into account the time and cost to drive somewhere, if I go to my local B&N, I will pay full-price for a book unless it happens to be on sale. But, Amanda, you can get their membership card. Yes, but I won’t. You see, I remember when those loyalty cards were free. All you had to do was fill out the information and give them an email address. Now, you pay $25 a year for the same thing. For that, I would get 40% off of their hard cover best sellers (and note when you look at their membership page, it doesn’t say if that is NYT best sellers, B&N best sellers or what) and 10% off almost everything else (of course there are exceptions). Oh, and I would get free express shipping on orders from BN.com (again with exceptions). Hmm. Nope.
Let’s look a bit deeper. Say I want to get J. D. Robb’s latest book. Devoted in Death is now available in hard cover and e-book. The price set by the publisher is $27.95. I can order it right now from B&N for $19.16 for hard cover or $13.99 for e-book. I can get it from Amazon for $18.88 or the same $13.99 for e-book. I wouldn’t buy either of them from either store. Why? I don’t buy hard covers except for a very few authors any longer. Between declining quality of the actual book itself — not the writing or editing — and the lack of space, I have become a lot more picky about what I buy. As for the e-book, I refuse to pay that much for an e-book novel. I might pay it for a “boxed set” but not for a single e-book that is less than 400 pages.
But that’s me. Let’s go back and look at Scalzi’s assertion above. First, the sort of pricing we are seeing from publishers is not advantageous to anyone but the publishers. People aren’t as dumb as they seem to think. We know that an e-book doesn’t have the same amount of expense associated with it that a print book does. There are no physical resources necessary for an e-book such as paper, ink, press, physical storage and transportation — both to and from the distributor. Yet, they seem to think we are happy paying print prices for an e-book. They are not looking at the way indie and small press digital sales continue to climb while that trend for traditional publishers has slowed, especially after going back to an agency-like pricing.
There is something else folks like Scalzi forget — the generation that grew up loving physical books is aging. Our kids and grandkids are the tech generation. They live with their smartphones or tablets attached at one hand. They want and expect to be able to find a “book” quickly and have it instantly delivered to their phone or tablet or laptop. But they are also smart — hopefully — about their money. My son looks at the price differences between hard cover, soft cover and digital and will walk away from an e-book priced over $10. His basic response is why should he pay that much for a single book when he can go to Baen and get a month’s worth of releases for less than $20? He gets seven e-books for $18. That is a much better deal for him than buying a single e-book for $13.99 or more. Even if he doesn’t like a book or two from the bundle, he still has more than a few books that will entertain and engage him.
But, according to Scalzi and others, it is all about Amazon being bad.
I could go on. After all, Scalzi calls into question the methodology for gathering and reporting the AE data. I find that more than a little humorous (and possibly duplicitous) considering he is championing the AAP numbers which are reported by publishers that rely upon Bookscan numbers (see Cedar’s post on Tuesday, linked above, for more on just how “reliable” Bookscan is not). Oh, and there is the allegation that the AE findings are suspect because of the pro-indie and anti-traditional publishing stance of AE. Isn’t that sort of the pot calling the kettle black since Scalzi is pro-traditional publishing?
I guess this is all a case of which side do you fall on and how do you read the data. For me, I know what my sales have been over the last five years or so. I’ve seen them go up each year, not only as indie publishing has gained more and more traction but as I’ve put out more work. I know that I know make more in a year on my science fiction and fantasy than I would in a traditional advance for a new author (which I would be seen as by most publishers) from most traditional publishers. So tell me again why the AE report is bad and the AAP report is good.
The truth is, traditional publishing is going to hang on, at least for some time. It will eventually morph into something smaller that will survive. Indie publishing will continue as well. Tech has given us that. Readers will, given the chance, set the prices they are willing to pay. Unless and until traditional publishing finds a way to get the courts or the legislature to set a minimum price, indie publishing will continue to undercut them there and that will help expand the indie market. (And don’t think traditional publishing and its supporters aren’t already trying to undermine the indie market. Authors United is trying to convince the Justice Department to investigate Amazon. Funny, I don’t remember anyone having any problems with Amazon until they opened up to indie publishing and it started taking off. Hmmm. Could there be a correlation?)
Anyway, I’ve rambled on long enough. What are your thoughts on the issue?