Reading Notebook #14: Best Coverage of Publishing’s Current Dilemma

Kindle vs iPad

Snippets from “Publish or Perish” by Ken Auletta (New Yorker, April 26, 2010). You MUST go read the full article.

Excellent stats from article

  • Independent booksellers have declined from 3,250 to 1,400 since 1999
  • Big Six publishers account for 60% of all books sold in the U.S.
  • Breakdown of book sales in U.S.
    • 30% – B&N, Borders, other bookstore chains
    • 10% – independent bookstores
    • 45% – Target, Wal-mart, Costco, other big box retailers
    • 15% – Amazon
  • Amazon generates more than half of its revenues from products other than books
  • At end of 2009, Amazon accounted for 80% of all e-book sales

Selected quotes

From Amazon’s Russ Grandinetti:

“The real competition here is not, in our view, between the hardcover book and the e-book. TV, movies, Web browsing, video games are all competing for people’s valuable time. And if the book doesn’t compete we think that over time the industry will suffer. Look at the price points of digital goods in other media. I read a newspaper this morning online, and it didn’t cost me anything. Look at the price of rental movies. Look at the price of music. In a lot of respects, teaching a customer to pay ten dollars for a digital book is a great accomplishment.”

Asked to describe her foremost concern, Carolyn Reidy, of Simon & Schuster:

“In the digital world, it is possible for authors to publish without publishers. It is therefore incumbent on us to prove our worth to authors every day.”

Jane Friedman, former president and C.E.O. of HarperCollins:

“The publishers are afraid of a retailer that can replace them. An author needs a publisher for nurturing, editing, distributing, and marketing. If the publishers are cutting back on marketing, which is the biggest complaint authors have, and Amazon stays at eighty percent of the e-book market, why do you need the publisher?”

Ken Auletta states near the end:

“… aside from returns, royalty advances are by far publishers’ biggest expense. Although critics argue that traditional book publishing takes too much money from authors, in reality the profits earned by the relatively small percentage of authors whose books make money essentially go to subsidizing less commercially successful writers. The system is inefficient, but it supports a class of professional writers, which might not otherwise exist.”

Go read the full article.

Share on:
Subscribe
Notify of
guest

This site uses Akismet to reduce spam. Learn how your comment data is processed.

6 Comments
oldest
newest most voted
Inline Feedbacks
View all comments
trackback

[…] This post was mentioned on Twitter by JaneFriedman, Rebecca_K Weingarten, Terry L. Kennedy, Elaine B., Will Entrekin and others. Will Entrekin said: RT @JaneFriedman: Excellent coverage of publishing's digital age dilemma in New Yorker – a few best quotes & stats: http://bit.ly/bu0Adm […]

Benjamin

I had no idea Amazon was publishing well-to-do self published books and buying e-rights from those authors. What a crazy mess. Very eye-opening for an author to read, get a little behind the scenes. An author needs a publisher, need the relationship and the editing, but I don't think an established author needs a publisher anymore (platform, right?). It'll be interesting to se how this shakes out in the next decade, what's left after the storm. Will Amazon or someone simply create a press with editors and PR folks? Will publishers create e-divisions? Eh.

Simon Hay Healer

I think publishers have overlooked the benefits of lower priced ebooks. I think it's fair to say that the costs for publishers to produce and promote ebooks have been slashed. If we want more people to read then a lower price will be more effective. Everyone can make more money. If publishers use ebook sales to prop up the diminished profits from paper books then writers will be cheated. Writers can earn up to 70% royalty from self publishing an ebook. What will publishers offer? The profit margin on paper books is too small and market driven. There's no storage costs or returns with ebooks. Good sales and lower prices = more cash for everyone. J Konrath talks about this on his blog. It's worth a visit. Of course lower priced ebooks will force paper books into a niche market. If your pet is sick you put it down so it doesn't suffer. I love books, but all this hesitation and sitting on the fence is slowly killing something I love. Let's go hunting one last time and bury our favourite dog somewhere with a view. Watch the sunset and remember all the great times we had together.

trackback

[…] Read more here:  Reading Notebook #14: Best Coverage of Publishing's Current … […]

Jane Friedman

Exactly. Once an author is established, what's to stop him from cutting out the publisher? We're also seeing cases of where an author without *any* established base is also able to publish straight to Kindle and be successful:

http://jakonrath.blogspot.com/2010/04/interview

Jane Friedman

I believe that e-books will become the predominant and preferred form. The problem this presents, however, is that the cost to publish an author (or, let's say, produce intellectual property) is very much the same whether you sell that content digitally or in physical form.

There's an excellent blog post addressing this issue here (in direct response to the New Yorker article: http://industry.bnet.com/technology/10007228/th

A quick snippet:
“Consumers think they should be able to buy books for little. Big names in e-book selling want low prices to build the market at publishers’ expense. The publishers say that their business can’t survive on low prices because it’s not enough to pay for true costs. That conflict will take more than a calculator to resolve.”