Tag Archives: pricing

The delusions continue

Traditional publishers, especially the Big 5, have been dragging their heels, not to mention kicking and screaming in protest, from the moment the first e-book appeared on the scenes. For years, however, they knew they had nothing to really worry about when it came to the new format. After all, even though it was cheaper to produce and easier to distribute, there was no way for authors to leverage the platform on their own. Traditional publishers were not only the gatekeepers, but they were the sole guards of the industry. If they didn’t like your book for whatever reason, your only hope was to publish through a vanity press and that was a death sentence to any professional career as a writer you might have wanted.

They laughed at Jim Baen when he started offering e-book versions of the traditionally published books released by Baen. They told him the format was a fad and would die away.

They shook their heads and smiled when Fictionwise and Smashwords started giving authors a very small foothold into the market. There was no way anyone would take e-books seriously. After all, who wanted to read a book on their computer.Paper was king and would never, ever fall.

Then along came Amazon. Approximately 9 years ago, Amazon did something no one expected. They opened up a platform that allowed authors to publish their books as e-books and sell them directly through the Amazon store.  More importantly, Amazon created the Kindle e-book reader. Now reading the new format became easy. Better yet, readers could put dozens, no hundreds of books on their devices and carry them with them wherever they went. They could buy books directly from Amazon and the books would be delivered to their devices, making trips to bookstores unnecessary.

We all know what happened next. The Big 5 (then the Big 6) colluded with Apple and others to price fix the cost of their e-books in an attempt to harm Amazon. The Justice Department and the courts were not amused. In the aftermath, the publishers have contracted with the various stores to set the price for their e-books and discounts are only applied with their approval. Once that went into effect, e-book prices for titles from the Big 5 increased and sales decreased.

And the delusion that e-books would not be major players in the publishing landscape set in. They point to the “re-invigoration” of the print market as a reason to believe e-books aren’t in as much demand as they once were. Of course, they forget to talk about how that re-invigoration happened. All you have to do is look at the pricing of books from the Big 5 to know they are doing everything they can to cannibalize the digital market in order to prop up their beloved print books.

Origin: A Novel by Dan Brown came out earlier this month. The hardcover version sells on Amazon for $17.96. The Kindle version sells for $14.99.

Haunted by James Patterson sells in hardcover for $16.38. Paperback is listed at $14.39 and Kindle is listed at $14.99.

The Shining by Stephen King has been out for years. The Kindle version sells for $8.99 while the mass market paperback version sells for $5.43.

Secrets in Death by J. D. Robb sells for the exact same price for the paperback and e-book versions.The price? $14.99.

These are just a few examples. All you have to do is go over to Amazon and you can find hundreds, if not thousands, more. So is it any surprise readers aren’t buying as many e-books from traditional publishers who continue to overprice their e-books? Instead of stroking their egos and congratulating themselves on stopping the trend, publishers should be paying closer attention to the overall sales of all forms of books by ALL authors and publishers. They should be paying attention to the information being complied by Author Earnings. They should look at the best sellers lists from Amazon — which, whether they like it or not, is the gorilla in the book selling market — and see how many of those titles come from indies and small press authors.

There is a reason readers are reaching out to indies to find their reading material. It goes to price, yes, but it also goes to the fact that indies are offering stories that traditional publishing is not.

Oh, but the delusions continue along that line as well.

Publishers, Penguin Random House CEO Markus Dohle said, have a key role to play as curators of content. “Publishers stand for quality and perfect each product before it makes it to the market.” Of course, he doesn’t explain what he means by quality or the rest of it. If he is talking technical quality, I’d like to discuss with him the formatting issues, poor product quality (as in spines breaking much too easily, for example) and misspellings or other issues that should be caught by proofing that I find with traditionally published books. Sure, you can find those issues with indie published books but, when you are touting yourselves as the purveyors of quality, you should be able to stand behind that claim.

But we all know what he means, don’t we? Publishers are the gatekeepers of rightthink. If you aren’t presenting them with the fad of the day along with the proper tickler list of social issues, etc., they aren’t going to care about what the story happens to be. They have forgotten that readers of fiction want to be entertained. Sure, you can have a message in your fiction but the fiction had better be compelling and entertaining first and foremost or the reader isn’t going to keep buying your product.

But it gets better.

Simon & Schuster CEO Carolyn Reidy claims that nothing “went wrong” with e-books. It seems she believes people have gotten tired of reading on their screens. Again, a complete disconnect from reality. People don’t want to pay as much — or more — for an e-book as they will for a print copy. But the laugh out loud moment comes further down in the article when Reidy says she firmly believes “a new version of the book based on digital delivery will come eventually, though she does not know what it might look like.”

Blink.

Blink. Blink.

Hmm, wouldn’t that be an e-book? The bells and whistles might be a bit different, but it if walks like a duck and quacks like a duck and looks like a duck, isn’t it a duck?

And what about her argument that e-book sales have leveled off because we are tired of reading on our screens?

It constantly amazes me the way these folks continue to tie themselves into knots trying to explain how e-books are bad, or are a passing fad or a way for writers not good enough for traditional publishing to get their works into the hands of readers. All I know is that the real numbers, the numbers that look at more than the Big 5 titles, tell a different tale. As a reader, I know I find myself picking up more and more books from indie authors because they are writing stories I want to read and they are doing it at prices that allow me to read two or three or more books for the price of a single Big 5 title. When is the point going to come where an accountant who isn’t afraid of rocking the boat says they can actually sell more — and make more money — if they lower their prices to something reasonable?

Since I’m talking about reasonable pricing and I’m an indie author, I’m going to take a moment to tout my latest. The special edition of Vengeance from Ashes (Honor and Duty Book 1) is now available in both print and e-book editions. (Hopefully, they will link the two editions shortly.) This new edition contains approximately 20k words of next material. It is only available through Amazon.

The original edition has been released on KoboPlayster, Tolino (link not yet available) and Inktera. It will soon be available on iTunes, B&N and Overdrive.

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Of pricing and release dates

I don’t know a single indie author who doesn’t wish there was a handbook out there that was constantly kept up-to-date with information about formatting, blurbs, promotion, when to release your books and pricing. The best we can do is watch trends and be ready to adapt not only when necessary but as quickly as possible. It also means making hard decisions sometimes as well as taking the long view. That is especially true when it comes to pricing.

Last night, I finished setting Battle Wounds up on Amazon so it would be live this morning. For those of you not familiar with it, BW is a short story set in the Honor and Duty universe. I started writing the short stories a little more than a year ago when there was a glitch, to put it nicely, in the upload process of Honor from Ashes. Somehow, the wrong text file was attached to the product page and, well, let’s just say the next week was an exercise in frustration to get it corrected. The short stories were my way of thanking my fans for hanging with me as things got straightened out.

When I made the decision to write a series of short stories in the universe, I had several things I needed to consider. The first, of course, was where in the timeline they would fall. Since the books in the series follow very closely on one another, I couldn’t see an easy way to slip short stories in. Besides, I had folks who wanted to know how Ashlyn Shaw became the character first introduced in Vengeance from Ashes. So, that’s where I decided to begin — at the beginning.  With three shorts stories now out, I am closing in on the events that directly led to the events that kick off the series.

Anyway. . . .

Last night I uploaded the files and checked to make sure they converted properly — and, yes, were the correct file with the correct cover — and then continued on through the publication process. Part of that is choosing when to release the story. If you ask a dozen indie authors, you’ll probably get a dozen answers about when they think the best times are to time your releases. I’ve tried any number of different times and days. I’ve studied what other indies and small presses, as well as trad publishers, do. It seems there is a growing trend to release new titles on the first and third Tuesday of the month.

I’ll admit to pondering and wavering on deciding to follow this trend. After all, if I followed it, I would be one of who knew how many authors releasing a new title at the same time. But, let’s face it, that’s something we have to deal with no matter what day we choose to release our titles on. That’s the downside. The upside on releasing on either the first or third Tuesday is that there are a large number of readers who check for new titles on those days because they have learned to expect new releases then.

Hmmm.

So, guess what. I chose to try a third Tuesday release. It’s going to be interesting to see if there is more traction for this release than for the other short stories.

The next thing I had to determine was pricing for Battle Wounds. There’s been a lot of discussion since Amazon first opened up to indies on how much we should price our work for. If you ask indies, you’ll get a wide range of answers. Some look at pricing and take the long view on it all. Others look at the amount of money they earn per sale. Both sides have pros and cons. The problem with both, however, is that we are looking at it from the viewpoint of the author. Instead, we need to look at it from the point of view of the reader. After all, they are the ones making the decision to buy the short story or title.

And, like it or not, as indies, we operate in a world where our readers understand, on the whole, that we don’t have the overhead trad published titles have. Therefore, they aren’t going to pay as much for our work as they will for Nora Roberts or Stephen King or David Weber.

So how do we figure out the best price for our work?

The first thing we do is listen to our readers and to readers of our genre in general. We can do that by checking blogs and other social media platforms. We can also do it by checking the best sellers lists on Amazon. Look not only at what indie titles are on it but at their prices as well. Compare the price of the work and its length to what you are about to publish. Then there is the beta pricing tool you can use once you are setting up the title on Amazon.

There is something else we have to take into account when we are setting prices. Sarah, Dave and Brad can get away with charging more for short stories than I can. Why? Because they have a following of readers who have known them not as just indie authors but as trad published authors as well. They’ve earned their bones in the eyes of those readers. They have more published than I do as well. So, because they have the reputation and the experience, they can charge more for their work. Readers even expect them to.

But for me, even though I have 16 novels, 2 (?) novellas and a handful of short stories published, all but one of the shorts have been indie. I can charge more now than I used to — and I should — for novels, not so much for short stories. There are two reasons for that. First, and most obvious, I’m not a “name” that people are willing to pay additional money to read. Second, I look at short stories as loss leaders, which they are. They are promos in many ways to keep people interested in my work until the next novel comes out.

But there is something else. I know what I’m willing to pay. I can’t think of a single indie-only author I will pay more than $0.99 for a short story (for the purposes of pricing, I’m including anything under 20k words). I’ll pay $1.99 for work between 20k and 50k words or so. After that, I’ll pay $2.99 up to $4.99. There are a few indies I’ll pay $5.99 for a long novel but those are very few and far between. So I keep that in mind as I start thinking about pricing.

I also realize there are many, many, many readers who feel the same way I do about how much they are willing to pay for a title. Yes, readers to look at the price and, if they think you are pricing a work too low, they wonder if you aren’t convinced your work is any good. However, for a short story, you can quickly price readers out. So it comes down to deciding if you would rather sell more copies at a lower price and royalty or fewer copies at a higher royalty. For me, because I don’t look at my short stories as a major income generator in the short term, I price them on the low end, where most other short stories are priced. What I’ve discovered by doing so is I tend to sell more over time, more than making up for the difference in royalties.

But the decision is yours. Just remember, you need to look at more than how much are you going to make per sale. You need to take into account what the going rate for stories in your genre with a similar length. If you price yourself out of the market, you are not only cutting your own royalty throat, so to speak, but you are denying your readers the opportunity to read your work.

Shrug.

I really wish there was an easy to use manual that told me the best way to promote my work, the best price point, the best day for release, etc. Instead, I get to watch my hair turn even whiter as I try to figure it out for myself when all I really want to do is write.

Oh, go buy Battle Wounds. My kitties need kibble. 😉

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The Blinders are Still in Place

Ten years.

That is approximately how long it’s been since Amazon first allowed the infidels to dip their toes into the sacred waters of publishing.  From the beginning, traditional publishing has taken a two-pronged attack against not only indies but readers. They have told us that e-books were a passing fad, something that wouldn’t last. They also warned that allowing just anyone to publish without having to prove themselves by finding a way past the gatekeepers would allow nothing but dreck into the holy waters of publishing.

Well, almost 10 years into this so-called experiment in mediocrity, e-books are still here and more and more indie authors are earning more than pocket change for their work — and the blinders are still, at least as far as most of those in traditional publishing are concerned, firmly in place.

We’ve seen the Big 5 (which used to be the Big 6) and Apple run afoul of the Justice Department for price fixing in an attempt to undermine Amazon. All that accomplished was costing everyone involved in the conspiracy money in the form of fines and payouts to customers who got caught up in their antics. Oh, and let’s not forget about how it started readers asking why traditionally published e-books cost so much.

We’ve seen a few traditionally published authors condemning their counterparts, not only those who have never been traditionally published but also those who have chosen to go the hybrid route of both indie and trad publishing. Friendships have been strained and, in some cases, lost and over what? The fact someone didn’t take the same route as another? (yes, I’m rolling my eyes.)

In this time, we’ve seen not a gradual acceptance of e-books by traditional publishing and its proponents but a continued attack on them. All you have to do is look at the prices charged for the digital release of new titles to see what I mean. Here’s a perfect example. Echoes in Death by J. D. Robb is available for pre-order right now. The price? $14.99.

Yes, you read that right. By the time you add tax, you will pay more than $15 for an e-book.

Nor is this an anomaly. Silence Fallen by Patricia Briggs sells for $13.99. Fast & Loose by Stuart Woods sells for $14.99. There’s more, much more. All you have to do is look. When you do, you’ll discover a couple of more things. Amazon, not being a fool when it comes to marketing, makes it clear that these high prices aren’t set by anyone except the publisher. Also, if you, as a reader, check the terms of service when you buy your e-books, you’ll discover a couple of things. First, I bet you dollars to doughnuts that almost every e-book you’ve purchased from a trad publisher is filled with DRM (there are a few exceptions, like Baen). Second, you will discover that you haven’t actually bought the book. You purchased a license to read the book. Now, in some ways, that’s nothing new. It’s what you do when you “buy” software from most software publishers. Still, it rankles but the DRM rankles more because that smacks of the publishers telling us they don’t trust their readers not to do something evil like — gasp — loan the book to a friend, exactly what we do with our hard copy books.

Now, I don’t know about you, but I have a line in the proverbial sand when it comes to how much I will pay for an e-book. It’s a line that I will very rarely cross. I’ll admit I will rarely even get close to the line. That price, for me, is $9.99. It used to be lower but I had to change that when Baen finally got into Amazon. I groused, like a lot of others, because that move meant Baen now charged more. However, there are several Baen authors I will pay that much for instead of waiting for the price to come down. But paying $15 for an e-book when the publisher won’t even admit I own the book? Nope, not gonna happen. I will wait for the price to come down or, if it doesn’t, I will borrow it from the library.

The problem is that doesn’t really hurt the publisher but it does hurt the author. I hate that part but there isn’t much more I can do to voice my displeasure — not that the Big 5 listen.

A perfect example of how they don’t listen and don’t pay attention to market trends is this article from Publishers Weekly. Sure, the article is about how e-tailers are continuing to survive but the premise is what had me shaking my head. According to this post, e-book sales are down. Yes, it did say e-books by traditional publishers but then it basically acted as if those are the only e-books out there. That is the same sort of premise the Big 5 works under. They seem to think that the fact their sales are down for e-books, they are for everyone. No, what they need to do is look at their pricing, something indies and readers have been telling them for years.

Unfortunately, the idea that “the more I charge, the more I make” isn’t limited to trad publishers. Indies suffer from it as well. Pricing is a bitch to figure out and to make sure you are hitting the sweet spot. Part of the equation is also figuring out that the higher the price the fewer buyers you will have. So, while you may be getting more money per sale, you are actually losing money in the long run because you are losing readers. But that’s a post for another day.

But, to me, even more of a slap in the face when it comes to the Big 5 and their ilk is the insistence on trying to lock their e-books with DRM. That is especially egregious when you look at how much they charge. Sorry, but if you want me to pay more than $10 — heck, who am I kidding? If you want me to pay more than, well, anything — for an e-book, I’d better own it just as much as if I bought the hard copy version.

And then they wonder why people figure out ways to break DRM or why they go to pirate sites to find the book they want. It’s a lesson publishing should have learned from the music industry and didn’t.

Finally, for one more piece of “Huh? How is that going to work?” we get this announcement. Bill Clinton and James Patterson are teaming up to write a book. The premise is that the President goes missing. Okay, that alone isn’t all that strange. Where I did a double-take was seeing that the book is being published by both Knopf Doubleday and Hachette. Oh, and it is supposedly going to be edited by the chairman of Knopf Doubleday and the CEO of Hachette. Am I the only one going “riiiiight?”

Let’s look at this for a moment. By doing it this way, the publishers split the costs of production and distribution (one would assume). They both get the benefits from the promotion of the book and I guarantee you this book will be promoted. Hell, the publishers won’t even have to pay for it because the media will be all over it. They also get to split the advances. Of course, that might not be such a big saving for them because I have a feeling both “authors” are getting close to their usual advances.

However, it also means they will split the monies coming in from the sales of the books.

It is going to be interesting to see how this impacts their bottom lines over the next few years. Not that I expect them to admit if the book fails to perform as expected. Remember those blinders I mentioned earlier?

10 years and publishing has changed and yet, in all too many ways, the same mindset continues to permeate the ivory halls of NYC publishers. Sigh.

Next Tuesday, Battle Wounds, the third short story set in the Honor and Duty series universe, will be published. So, a little promo for two of the titles in the series.

Vengeance from Ashes

(Book 1 in the series)

First, they took away her command. Then they took away her freedom. But they couldn’t take away her duty and honor. Now they want her back.

Captain Ashlyn Shaw has survived two years in a brutal military prison. Now those who betrayed her are offering the chance for freedom. All she has to do is trust them not to betray her and her people again. If she can do that, and if she can survive the war that looms on the horizon, she can reclaim her life and get the vengeance she’s dreamed of for so long.

But only if she can forget the betrayal and do her duty.

Taking Flight

(1st short story)

Duty, honor, sacrifice. That motto meant everything to newly commissioned Second Lieutenant Ashlyn Shaw. She thought she understood the meaning of those simple words. Little did she know.

Challenged by those who believed she made it through the Academy on her family’s coattails, a roommate who just wants to see “some action” and a gunnery sergeant determined to make a real Marine out of her, Ash soon realizes what it means to be a Marine. As the signs point to war on the horizon, she is determined to do everything she can to serve Fuercon and do the Corps proud.

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Okay, it’s time to wake up

I’ve sat down several times to write today’s post and each time I find my fingers poised above the keyboard and I know what I want to write. Then it disappears and I find myself once again wondering at a comment I saw in a private group this morning. It was one of those messages that make you stop, reread, do a little research and still scratch your head and wonder what the heck happened to common sense during the night while you were sleeping.

The price of e-books is not a new topic here at MGC, or just about anywhere else where authors talk about the value of their work. Some of us have a higher threshold for what we are willing to pay than others. The one thing we have all agreed upon is that an e-book should not cost more than a paperback and most certainly shouldn’t cost almost as much as the hardcover. That’s not only common sense but basic accounting. It simply doesn’t cost as much to produce an e-book as it does the print version.

But this morning, the comment that had me wondering if I had fallen down some sort of warp hole into an alternate reality came from someone who was looking for recommendations for e-books to read. From the comments made by this person, it sounded as if they were like many of us. They had budgeted a certain amount for books and did not want to go above that amount. There’s nothing wrong with that. Many of us, myself included, do that.

So far, so good.

But where the person lost me was with their explanation for why they weren’t buying a certain book. The book, Conquistador (by S. M. Stirling) was first published in 2003 by Penguin. The Kindle version currently sells for $7.99. That seems a bit high to me for a book that has been out more than 10 years but it is pretty much in line with what traditional publishing charges for e-books. Oh, you will find some that sell for a bit less but that isn’t what the OP was complaining about.

It seems the OP looked at how much the other versions of the book were selling for. The mass market paperback version, apparently still in print, sells for $7.99. Okay, I have a problem with that. E-book and print versions should not be selling for the same amount. It is a slap in my face as a reader because it assumes I can’t figure out that it costs a publisher more to print, store, and ship the print version than it does to convert and transmit the digital version. But even that wasn’t what the OP was complaining about.

No, the OP’s reason for not buying the e-book came down to this: the hardcover version sells for as little as $0.40. Yes, this is for a used version of the book. Yes, tax and shipping and handling have to be added. The lowest price, after all that is done, would be approximately $4.40. But not even the fact that the total price would be less than the mmpb or e-book wasn’t what the OP objected to.

What was, you ask. Simple. The OP felt that if people valued the book so little that they were willing to sell it for $0.40 for the hardcover, then it most definitely couldn’t be worth the $7.99 they would be spending for the digital version.

Apparently it didn’t matter to the OP that there are 129 reviews of the book posted on Amazon and that the book has an average rating of 3.9 out of 5. Nope, they glommed onto the fact that approximately 8 folks were reselling a book that is more than 10 years old for approximately $0.40. They apparently didn’t look through all 9 pages of resell listings to see that the price for the book went into the $50.00 range. Nope, all the OP saw was the first page of listings for $0.40 and above.

So what does that mean to the rest of us as authors? I’m not sure, other than it is yet another instance showing that we need to educate ourselves and our readers on the economics of publishing. I would rather someone resell one of my print books than trash it, even though I will get no royalty from that second sale. Why would I prefer it? Because that person buying the used book might like what they read and then buy new versions of my other work for themselves. Even if they don’t wind up buying new copies, they might recommend my work to someone else and that can translate into sales.

That is all very good.

But we also have to take this as a cautionary tale. Readers are looking for the best bang for their buck. Not all of them will look through all the used book listings to see if that really low price is the norm or an abnormality, nor will they think to add in shipping and tax to see what the final version is. So, if our e-books are priced at or near what the mmpb cost is (for new), then we very well may be doing ourselves a disservice. (Or our publisher is.)

Just a little food for thought.

So, here’s a question for you. Do you look at the price of used print versions of a book before you decide whether you will buy the e-book version? If so, at what point do you choose the used book over the e-book?

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Publishers, you need to hear this

It continues to amaze me that now, years after e-books became a viable alternative to printed books, we are still having discussions about e-book pricing. When you look at what the Big 5 are saying about e-book sales vs what you see in the Author Earnings reports, you have to ask if they are operating in different worlds, maybe even universes. One tells us that e-book sales are slowing to the point of almost being flat. The other tells us the opposite. You look at the best seller lists on Amazon and you see more and more mid and small press books — as well as indie — finding their way onto the lists. So who is right?

If you want to be honest, both are. I have no doubt sales for Big 5 e-books are slowing. All you have to do is look at the pricing of their e-books to see why. The hard cover for Seveneves by Neal Stephenson sells for $20.83 on Amazon and BN.com. The e-book version is currently available for $17.99. The paperback version, currently listed at $12.22 won’t be available until May 17th.

Shadows of Self by Sanderson currently sells at $16.65 for hardcover and $14.99 for the e-book. What is particularly interesting is that the paperback version is apparently already available and sells for $11.44. If my math is correct — always doubtful this early in the morning — that is $3.55 less than the e-book version. If the product page is correct and the paperback version is available already, then it puts to lie the promises made by the Big 5 publishers long ago that they would drop the price of their e-books when the paperback versions came out.  (I will note the paperback versions being listed apparently come from overseas but I still have to ask why the publisher continues to sell the e-book at such a high price.)

Devoted in Death, the latest in JD Robb’s In Death Series, is available as an e-book for $7.99. The mass market paperback, which comes out today, sells for $6.79. Hmm, the e-book still sells for more than I would have to pay for the print book.

So, is there a trend — or possibly a clue — here as to why e-book sales for the Big 5 are leveling off?

Some folks were having this discussion yesterday in a private FB group I belong to. The consensus among those taking part in the discussion was that the price point publishers were charging, especially for newly released titles, was more than they were willing to pay. Not just for e-books but for hard covers as well. Those who aren’t big fans of  e-books lamented the fact they were turning to used bookstores to buy those hard cover titles they wanted. Not because they were paying less for the book but because they knew authors don’t receive royalties for those sales.

Note, they weren’t worried about the publishers.

And that is something the Big 5 needs to realize. The reading public is starting to look at the prices they pay for their books — whether they are print or digital — and wonder why the prices are so high. They are following their favorite authors, many of whom write for publishers that aren’t the Big 5 or who are indies, and they are paying attention to what the authors are saying. They understand that the life of the writer is closer to struggling author working in a coffee shop than it is to Castle. They are beginning to realize that the majority of the money they pay for that book, the vast majority of it, goes not to the person who created it but to the corporation what distributed it.

But more than that, the reading public can look at an e-book and realize that it doesn’t cost anywhere close to produce it as it does to produce a print book. So the reading public is asking why it should pay close to hard cover prices for a bunch of electrons, especially when the publisher tells them they don’t own the e-book.

The Big 5 continues to come back with the double talk about costs and then says that the real fan will pay the extra money to read the e-book as soon as the title becomes available. Sure, some will pay it for certain authors. But they aren’t paying it in the numbers the Big 5 believes they should so, duh, as far as the Big 5 is concerned, e-books are a craze that is slowly leveling out.

And so they believe their own press and continue to ignore what is happening around them. They aren’t looking at the number of commuters who read on their phones and tablets on the way to work. They don’t pay attention to their family and friends who are doing the same thing. They aren’t looking at the number of indie authors who are able to live off of their earnings — and do so by charging well below the $9.99 price that seems to be the cut off for most e-book buyers. In fact, I would say most e-books that sell well do so at $5.99 or less.

Yet the Big 5 continues to operate under a business plan that doesn’t adapt to the market and consumer demands. Instead, they issue statements about how the “trend” is a slowing of digital sales. Those blinders they have been wearing for so long must have been joined by a posture collar that prevents them from looking anywhere but straight down at their own P&L statements.

Here’s the thing. When readers understand they are being treated badly by publishers, they tend to look elsewhere for their reading material. As an indie author, I’m thrilled because it means more sales for me. How long will it be before the Big 5, and those who follow their lead, start looking beyond their own propaganda and realize what the full sales picture looks like? I doubt it will happen before the Big 5 becomes the Big 4 or maybe even the Big 3.

The problem is the only ones who will lose then are the authors contracted to those houses and the readers. And the suits in their corporate towers will continue to say e-books and whatever comes after them are only flashes in the pan and soon everyone will return to printed books, even as the price of print media continues to increase.

The wake up call has been issued. It was issued long ago. The problem is that the Big 5 and their hangers on hit the snooze button. Readers are sounding the alarm again and I can see the corporate hand reaching out to hit the snooze button once again. Will it deviate from its path or not? My money is on not. How about yours?

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What Price E-Books

No, this isn’t a rehash of the agency pricing debate — or should I say debacle? — that is still wending its way through the courts. This is more a warning that there is now someone out there who the legacy publishers will simply adore, if they don’t already. Someone who says two things those same publishers not-so-secretly seem to believe: first, that e-books aren’t priced high enough and, second, that e-books really aren’t books or even “product”.

Last week, Digital Book World published a post that set up the scenario where you are in New England on a cold winter day and you want a book. According to the post, you have several alternatives. You can brave the cold and go to your local Barnes & Noble. Or you can go online and order a physical copy from Amazon. Or, barring that, you can go online and order the e-book of the title you are looking for.

Let’s start first with the problem of the scenario set up by Frank Luby, a pricing consultant and former journalist. First, notice that Luby’s scenario only allows for purchase from B&N. He doesn’t say “bookstore”. Nope. He limits it to B&N. Maybe he is one of those who now uses the big box bookstore as a generic name for all bookstores. Perhaps he doesn’t realize there are other bookstores out there besides B&N. But that sort of simple oversight instantly puts me on guard against anything else he has to say, especially since his scenario also leaves out the local library where a patron could check out either the physical or digital version of the book in question.

Moving on. . . .

“Ebooks are terribly misnamed,” said Luby. “They’re not a product. They’re a reader service.”

Read that again.

“Ebooks are terribly misnamed,” said Luby. “They’re not a product. They’re a reader service.”

That one statement is why I have a feeling we have some publishers sitting in their ivory towers in NYC, rubbing their hands together and trying to figure out how to leverage that statement to their benefit. After all, those same publishers already tell us that, when we buy an e-book, we aren’t really buying the book. After all, an e-book isn’t a “real” book. What we are buying is a license to read the words contained in the e-book. That’s why they load e-books with DRM, limit the number of devices an e-book can be on per license, and why they are fighting any change to copyright laws that would allow us to resell the e-books we’ve bought.

Now we have someone who calls himself a pricing consultant telling everyone that e-books aren’t a product but a service. Yep, those publishers and their bean counters are doing dances of glee. Someone finally understands!

“Ebooks should be more expensive than they are, more than print books — a lot more,” said Luby, adding that ebooks are relatively cheap because publishers and retailers don’t properly explain their benefits, namely, convenience.

And now those same publishers and bean counters are singing as they dance. Hallelujah! Someone is finally saying what we’ve said all along.We should be able to charge the reader more for something that costs us less, much less, because it is convenient for the reader.

Now, as you can guess, I have several problems with this statement. First is the assumption by Luby that readers don’t already know there is a convenience to e-books. Yes, it is easier to simply download a book either directly from browsing the appropriate e-book store on your tablet or smartphone or by looking at their online store via computer and downloading that way. However, the counterpoint to this is that it isn’t really that much more convenient when you are limited to what store you can shop at because of the e-book reader or software you have. If you have a Kindle, you are pretty much limited to Amazon (or sites that sell MOBI files). If you have a Nook, you are limited to those sites that sell EPUB files. Oh, and you can only have that file on so many devices at the same time. And you can’t resell it. Or loan it, unless it is one of a very few marked as loanable by the publisher and, if it is, you can’t read it at the same time your friend is reading it.

And for this we are supposed to pay more, much more, than we would for a print book.

This reminds me of how the head of MacMillan — I think that’s who it was — back at the start of the agency pricing debate tried telling everyone that publishers had double charges on editing, cover design and layout, among others, when it comes to e-books and print books. He was double-dipping in his explanation of what a book costs a publisher and it made me, and a lot of others, wonder if they weren’t double charging their authors on expenses as a result. Now along comes Luby telling us that we should pay much more for a “book” we don’t “own” simply because it exists in digital format instead of print.

In other words, he has put out a plan that aims to curtail, if not kill, the e-book market. The only good side to his plan, should the major publishers put it into effect, is that it would create yet another spike of sales for indie and small press e-books because economics would mean people would try the lower priced books instead of paying double digits, perhaps high double digits, for a single legacy published e-book.

Instead of worrying about how to raise the price of e-books because they are so much more convenient, publishers — and this so-called pricing expert — ought to be looking at why print books aren’t selling in the numbers they once did. Yes, e-books are part of the reason but they are only a part of the reason. Another part is the high price of print books, especially hard covers. Gone are the days when avid readers who were comfortably middle class could go into a bookstore and buy half a dozen or so hard covers at a time. Now readers collect only a small number of hard covers compared to what they once did. As for soft covers, the prices for them have gone up as well. At the same time, quality of the product has gone down. That is especially apparent with the goat-gagger books that are so thick the spine breaks and pages start falling out, often before you have finished reading the book for the first time. If the product was of high quality, more people would be willing to pay the price for it. They still wouldn’t spend as much as they once did because most folks don’t have as much disposable income as they did. But they would still be buying books.

But to say an e-book should cost considerably more than a print book because it is more convenient is ludicrous. It is especially so when the publisher refuses to admit that a reader buys the book instead of just licensing the right to read the book. As for Luby, well, he needs to quit drinking the kool-aid and realize that the reading public isn’t quite as naive — or foolish — as he seems to think it is. As for the publishers and bean counters still doing their song and dance of joy over what he had to say, they need to adapt t changing times and demands or be left behind. As the song says, “the times, they are a-changing.”

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How much for the liddle book?

Or the mathematics of selling your literary children for a living.
There may be authors out there to whom writing is just a job, and the book or story, once done, is no more than any other production line item. But for the vast majority of us, those words are precious. So precious and perfect in our eyes that it is hard to accept edits at times, but that is another subject. We value them, want them to flourish, want them to be read and enjoyed.

And then we sell them.

So: how much for liddle book?

“Let the free market decide!” I hear the chorus.

Now, that’d be a great idea… if there was one.

Let’s just take a moment to consider what a free market is and how it works, and why. Take swords, which are useful, desirable objects in some societies. In a free market, swordsmiths sell willingly to willing buyers. The swordsmith will sell for what the buyer is prepared to pay. If there are lots of swordsmiths, with more swords than customers, the price dives, and swordsmiths go broke or go do something else. In the nature of things there will then be somewhat more customers than swords. So the price will rise, which means that would-be or ex-swordsmiths get into the business, and the number of swords rises… and after a while it more or less stabilizes at a level which allows the average swordsmith to earn enough to live on to the point where he would not be better off making plowshares. It gets a bit more complex because not all swords are alike, and for any industry to thrive in a free market, even new entrants have to earn enough to live on ramen and in leaky attics while they learn their trade, but in a nutshell, that’s it. Great swordsmiths survive the downturns, because their swords are in demand, even when demand exceeds supply, and the system gets rid of the less successful. Gradually, the swords made improve, because the system gives wide opportunity… and keeps the best on merit. Supply balances more or less with demand, and long term average price is set by the point at which the creator/grower can make a living doing that.

The minute it becomes ‘swordsmithing is an honorable trade, brings pride and honor and power to me and my family, I love doing it more than anything else’ and family, partner, the second job or the state provide so that Joe-the-swordsmith can go on producing swords even when supply exceeds demand, and the price is too low to pay for materials and to live on… the free market is in the toilet. Joe has just screwed it for everyone. The price of swords then has nothing to do with the free market, and neither does the price of books. And it is lose-lose equations for swordsmiths and sword-buyers. The good swordsmith who doesn’t have the supportive rich family/trust fund/ spouse/state dole system… can’t survive in an environment where Joe-the-Swordsmith can sell swords for less than he can live on. And no matter how good they are, Fred-newbie can’t really survive without the same. So the sword business is taken over by those who can get subsidized. Yes, a handful of really good swordsmiths do emerge who produce great blades, but the average sword is worse quality, and a huge number of great swordsmiths never even get started. And when it comes to war the customers find they’ve lost big time… In fact a lot take to axes or guns instead, which doesn’t help swordsmithing business one bit.

Most of this holds good for writing (except we added middlemen in). Let’s take a few figures to start working out what in a real free market without that subsidy, your words are worth. Now I believe the average author produces around a book a year. More or less 100K words. Exceptions like Sarah can do much more. I have slowed down – battle fatigue — and now do more or less 1K a day on average (actually it bobs around, from 5K to 0 when editing or researching), and now I do take days off. But let’s work on that 100K figure, figure that they’re in general not working more than 8 hours a day and 250 days a year. Yes, I would dream of those work conditions, and so would Sarah, and a number of authors who make superhuman efforts, but it is where 90% of the people calling themselves authors today are. The poverty line $11344 (not that these figures are absolutes and that someone in urban California has the same costs as someone in rural Texas – but merely as a point of calculation.) So they’d have to be earning – or charging 11.4 cents a word not be in absolute poverty. That’s a pretty tough life, so working on federal minimum wage (which yes, I know doesn’t apply universally) they’d need to earn 15 cents a word. Or if they lived in Australia like me where Cost of Living reflects a much higher wages average, and AU $17.50 is the minimum wage – 35 cents a word for the writer to not need some kind of subsidy (either from a second job or spouse, or the dole) to make those bare minimums. In effect that subsidy with books has gone to publishing and retail, as they have been able to swell their margins and costs on the back of it. It has not necessarily ‘saved’ the consumer a cent.

Advances for new authors tend to be, on average 3-5K. They will rarely earn out, and we don’t know if this is real or not. It could be. Of course there are the darlings that picked up and given huge advances and all the bells and whistles – and they too are subsidized, but by publishers (who bleed it from that second job Joe-5K-advance has to hold down, and the readers who pay more.) But that means they’re earning 5 cents a word at best. Oddly that is what Baen are paying for shorts from the likes of me.

But you’re an independent author. What has the price of word-slaves got to do with you? You’re putting your work up on Amazon, where hopefully, it will do well for you. But what to price it at? You can’t go lower than 99 cents, and if you price it lower than $2.99 – 65% of the sale price goes to Amazon – which is still a lot better than you got from your traditional publisher. Over $2.99, you get 70%
Or in figures – just under 35 cents on the cheapest or $2.09 as the cheapest high rate.

Or to assume you’re still writing 100K words – and selling 20 5K word shorts… on which you make 35 cents each – you need to sell 1620 copies of each story to make that.

Trust me on this – 10 copies of each story a month isn’t bad. It does peak and tail off, but you could see that in 13 and half years. Which means if you keep this up year after year for 14 years – living on heaven knows what in the meanwhile, would have the current average author earning the poverty level. After that you start to creep up.

From the free-market point of view, the 99 cent short is promo tool. If 100 K worth of shorts is to get you to an annual poverty level wage in 5 years (which is pretty big ask for most people to survive) – you need to make 94 cents a story, or charge $2.70 a short. At which point you might as well add another 29 cents, and you’d get to poverty line a lot faster (2. 26 years) – if you can still sell 10 copies a month of each story.

Experience says you’d have to keep adding stories, as the old ones sell less.

Oh and the equation for novels is different, as you may sell more copies, but NOT if you hope realize the same per word – You’d have to charge $26.85 a book – hardcover rates for an e-book.

Of course that is one way around of looking at it. The other is my preferred approach: what is a book worth to the reader? What is a short worth to a reader? Now here is one take on that – I’ve excised the name but it was from Bolg, PI: Away with the Fairies… where the reviewer was kind enough to give the novella 2 stars because of the price…

$2.99 for 60 pages? January 18, 2013
By XYZ

I enjoy this author but not at this cost. I have noticed several HB authors that think a short story is worth real money. Is 60 pages a novella? There are a lot of competent complete books at this price range and my money will go to them.

Or to quote another of the same reviewer –

I am reading the series because the price point is right. It is a page turner and does a fair job of setting life as it really was but the authors ability to create complete and deep charaters is limited

Now obviously this is someone deciding on price-point what he is prepared to read. He’s buying cheap swords IMO.

Hmm. Now a coffee – depending on where you buy it, and how good it is – you’re going to be lucky to get away with $1.35 and you could pay $5 and think you’re being ripped unless it very good. And it lasts at best 10 minutes you have some caffeine buzz which may last you an hour, and some urine which usually not much value. Any short (3-5K words) that last longer than a cup of coffee, and leaves you feeling good for as long, and can be enjoyed again later – unlike the urine, is surely worth at least as much?
A novella – in this case 20K words – is surely worth a little more?

And then a novel – I’ve had this ‘valued’ at two comparative points – a movie ticket or a couple of beers (presumably in a bar) – that was back when books averaged 50-60K words – and a paperback was literally competing for beer money. Maybe badly edited amateurish novels are best compared to bottle-store takeaways and $2 is a fair price point, and probably a comparable entertainment value. It seems like it would have to be a short novel or at least 4 beers to take the same time and possibly pleasure, if less diuretic effect, to me. So I’d vote for at least $4 for a cheap takeaway 60K book by a name I knew, if not one I loved. But a ‘bar price’ … well doesn’t that depend on the quality of the beer and the quality of the bar? Very like books IMO, which would probably have me price a novel at $6.00 – just to say this is not rubbish beer… reading. Of course if you want to get p*ssed cheap for entertainment and don’t care what it tastes like or what the place is like, it won’t have much appeal, and can I recommend the homebrew? Some of it is good. Some may make you puke on your boots… the same as some books.
Movies – hey, I did see one once. Really. I believe $7.40 is the US average. Is it worth more than a book to you?

So what is your take – what is a price point that will support authors, and be acceptable to readers? And just how much can we afford to give the middleman?

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