How Publishing Really Works: From an Indie Writer's Point-of-View

Everyday I'm in my writing chair by seven a.m. and reading yesterday's output. I do my editing as I read, so that, by the time my book is written, it is in final draft form, not first draft. After the daily edits, I begin my writing (cup of coffee number two). I generally try to get down about 2,000 words for the day. Unlike all the "write 10,000 words an hour books," I violate one of their cardinal rules in that I also research as I write. Why? Because I have found that research so often flows into another plot twist or follow-through that I hadn't been thinking on my own.

So I Google this or that as I go, and I download eBooks that provide background I need as I go (I write legal thrillers, so there's always something new for me to be learning about forensic chemistry or DNA banking or cyberdata or some other cutting-edge manner of evidence acquisition). I can scan an ebook in about fifteen minutes to nail down the particular area I want to include in my book. Borrowing the book on my Kindle Unlimited account costs me nothing. By the time I'm ready to move from spectography to facial recognition software I have maybe thirty minutes invested and no dollars, which makes my reseach all but free. This was all impossible before Google and KU and these repositories make for much more fun and accurate writing.

My 2000 words take me all of about two to three hours and I'm done writing for the day. My books are targeted for 80,000 words so my calendar for finishing the final draft is forty days. This means that I can put out about nine novels a year. Yes, nine. Unlike tradpub's goal of a book a year for its top-drawer writers, I don't have to wait weeks and weeks for editing, re-editing, proofing, cover art, and the like. It takes me at most one week to accomplish all these things when my final draft is finished. By then I'm 20,000 words into my next book.

Editing takes my editor five days. I receive the book back in Word markup and it takes me about three hours to revise as advised. Then the book is proofed by software I'm subscribed to, and at the same time my cover artist is finalizing the cover. Covers are an incredibly important part of book sales, so I have searched around until I found the perfect artist for my novels. It takes him about four days (he works days at his FT "real" job) to get a finished product back to me. All told, moving my book from final draft to ready-to-publish inventory takes one week. My wife then reads the final item one last time and makes her suggestions, which I follow. She's a common-sense reader and gives me common-sense feedback. This is an important step. She does her read-through and makes her notes for me concomitant to the days when the cover is being done, so there's no delaying the process for my wife's read. I format the ebook for publication using Vellum; formatting takes less than the ten minutes, including the addition of front- and back-matter, which mostly is copied and pasted from earlier books. Then we're ready to put the book up for sale.

I put one copy of the book up on book funnel and send an email to my mailing list select group, which is a group of about 150 of the most active participants on my mailing list (8000 strong and counting) and I ask the 150 to please download the freebie from book funnel. If they want, they will review it on Amazon when I send them the second email in a day or two announcing publication. My participation from this group is about 70%. Which means that within a matter of a week or so from first publication my books will have anywhere from 50-100 reader reviews.

Publishing my book on KDP takes less than an hour. Publishing my book on Createspace takes even less. Now my electronic book and my paperback are both up for sale. Once they are, I announce the publication to my full mailing list. My book is not discounted during any of this. It usually will hit the Amazon Top Twenty for legal thrillers within about 24 hours and copies start moving out the door as the Amazon algos take over.

Compare this to what you know about how tradpub works. Compared to those "real" writers, we're living and writing and publishing in two different worlds. Two months after publication, Amazon pays me my first month's 70% of sales. Tradpub writers get something like 15% maybe a year after publication. Most of those brothers and sisters have day jobs. I don't--not since I started DIY on Amazon.

After I've finished up my 2-3 hours of writing every day, I spend maybe an hour a day doing marketing. This consists of checking my Facebook ads for cost-per-click values, and maybe applying for a Bookbub or buying a Bargain Booksy listing. I don't do much more marketing anymore. My name is pretty well known among my genre, my niche, and my books fly out the door accordingly.

Tradpub can't compete with me. If I don't like how a book is moving in the market, I'll rewrite the blurb or tweak the cover. Fifteen minutes tops on blurb re-dos. Cover change-ups are rare; my artist and I pretty much know what will move books and we put that into practice with each book. I don't mess much with keywords anymore; I used to; now that's refined down to what works best for me.

I have an assistant. She runs my author's Facebook pages. This consists of daily posts of this or that article about books or publishing, and consists of interacting with readers, which I also do through reader emails I get every day. Everyone's inquiry or complaint or compliment gets a response. She gets paid for two hours of effort a day and she's excellent. She also does occasional newsletters to the mailing list but I really don't paper those readers like every week or two weeks, like some writers do. I hate signing up for stuff and getting victimized by some over-the-top seller and I know my readers do too. But every now and then we'll give away a free book just to say thanks or talk about a day at the beach--something personal that I hope connects.

That's my process. The results are astonishing. At one time I was a pretty well known trial lawyer and handled some pretty impressive clients. I never, however, earned as much as I do now with my books. I sell about 10,000 books a month and gather in about 7 million page reads a month, and I'm only just starting my third year. This year I will earn in the mid-to-upper six figures.

Thank you, Amazon. Thank you, Bookbub. I got into this in January of 2014 as a way to supplement my Social Security. Even after forty years of law practice I hadn't managed to save very much for retirement. But there was also a time in there of a complete medical disability which required me to shut down my law practice for two years and basically start over in my sixties. Savings were depleted by this. So remaking myself into a thriller writer has been a godsend and I am very grateful. I try to pass this along by helping other writers with their questions about marketing, etc., keeping in mind that as JAK says this is not a zero-sum game. The fact that I sell a book doesn't mean that you won't. We will both sell if we have what readers want to read.

While my methods and run-times differ dramatically from tradpub, both those writers and I must reach the same goal: we must write books that readers want to read. There is no secret ingredient, nothing that can be learned or taught.

You either write books that readers want to read, or you don't.

Why Amazon Doesn't Violate Antitrust Laws (for the hundredth time)

“The central problem is Amazon’s enormous dominance of the entire book publishing industry,”

I am the publisher; Amazon is the retail outlet. The “publishers,” consisting of thousands of small fry just like me, exist in the most democratizing store front in the history of the world, Amazon’s website. Legally, one could argue that Amazon is a consignment store. “Here is a place to sell your goods,” says Amazon. “Bring them into our store and we will collect the money from the sale and keep a percent for rent and other overhead.”

How Amazon is strikingly different from Standard OIl and AT&T is that Amazon has no ownership interest in even one item out of the millions it sells. It doesn’t own oil lands, leaseholds, drilling platforms, tanker ships, or oil, the commodity itself. Neither does it own communication products put into the stream of commerce for resale. It uses communication products just like it uses carbon fuels, but it doesn’t own those things and has no competitive footprint in the market of such items.

Neither does Amazon have a competitive footprint in the market of books in the sense of ownership interest in the books it sells or the tires it sells or the garden hose it sells or the bracelets it sells–it’s simply a provisioner of a marketplace. You would never accuse a mall of antitrust; you would never accuse a website of antitrust. Offering other people’s products for sale in your mall just doesn’t fit inside the unfair competitive advantage by price-fixing and monopolistic practices the antitrust laws contemplate.

Finally, Amazon’s business practices in no way restrain trade. Every whiner and bitcher out there can go over to Go Daddy, buy a URL for $2.99 and set up a website for $9.99 a month and compete with Amazon 100% restraint free. There is no monopolistic practice that prevents that.

Late on Posts - Busy With New Book

The new book is Michael Gresham. Michael is 55, Catholic and prays, divorced, spends hours cleaning up after a brother who refuses to take his meds, negotiates with ex-wife who needs money to buy hormones and get pregnant, and defends a client with diminished capacity who is accused of killing the wife of a federal judge. This is enough to get anyone rolling down the the thriller tracks.

The idea for the book--it will develop into a series--is the constituency of my readership. The great majority of my readers will relate to Michael's age and marital status because so many fall within the same general characteristics. Is this a ploy? You're damn right it is. I want to read about people I can relate to and I bet you do, too.

Michael Gresham is a legal thriller. There's enough going on between the covers to keep you up late, reading when you should be sleeping and getting ready for tomorrow's mini-drama down at the office, or store, or station, or wherever you earn your keep. The book is written in the first person--your author's notion of how Michael Gresham sounds when he speaks. His words, his dialect, his depth of appraisal of the world around him, his reaction to events: you will come away knowing who he is, I promise you.

Now the question is, do I let one of Amazon's imprints publish the book or do I self-publish? On the one hand, Amazon has access to all the readers any writer could ever want. On the other hand, I do love my freedom and independence and ability to turn on a dime if I decide to change this or that about my work or manipulate the book's price or cover or the jillion other little things authors like to fiddle with. There's always that. So I'm going to let my beta reader Maia decide what I do with the book. She won't know she's making this decision: but when I see her reaction I'll know exactly where to place it for adoption. Another wounded child on its way home.

And that, my friends, is how I view the publication of one of my books.

100,000 Books Sold - What Happened?

I published my first book in January of 2014. I just published my eleventh book in September 2015. Number 12 is underway with a Xmas publication date.

I write "legal thrillers." I don't know how "thrilling" my books are, but I don't make up the categories, either; Amazon does that.

Bookbub
My first month I think I sold maybe 40 or 50 books. My second month 400. My third month 1100. I was growing and selling more every month until about August of last year when I came on KBoards and found everyone talking about Bookbub. So I submitted and got accepted for a freebie on about my third try. Since then I've had eleven more Bookbubs (upcoming one is next Tuesday). Most have been freebie giveaways although a couple were promo sales. All in all Booktrakr tells me I've given away about 300,000 books, which I couldn't have done without Bookbub. And I've sold over 100,000.

So I guess BB is really the story of any success I've had. Why did they accept me so often? I think much of it has to do with my covers, which are made by Nathan Wampler. If you would like to ask him about covers he can be reached atnathanwamplerdesign@gmail.com. Please don't get him so busy he ignores my pleas for help. The guy's a genius, as far as I'm concerned and I can only say, based on BB's acceptance of my promos, they must like him too.

It's funny, but I practiced law 40 years and never earned as much as I do now by writing. I'm also an old guy so I wish (if wishes were horses...) I had started this years earlier. Whoops, actually I did. I had an agent back in the nineties when Grisham got so hot, and my agent peddled my books around NY and no one was interested. Even last January when I first self-pubbed I had just queried something like 45 agents and none of them wrote me back except for two canned, brief, brush-offs.

Hot New Releases
I like self-pub. I like writing and releasing on my own schedule. More than that, however, I've come to know that you need to play the Hot New Releases cycle and self-pub allows me to do that. For example, right now my latest book The Trial Lawyer is under thrillers > legal and it's about #4 under HNR. Also, my next book is on preorder and it's also on the first page of HNR and will remain there for the ninety days while it's being written. This is very important to me in how I move books.

KU
I'm in KU 100%. Many of my peers are wide. But I like page reads and get between 1.5 to 2.0 million per month. It would be hard to give that up for the "wide" adventure. Maybe at some point I will, but right now it works for me. Maybe not for you, but for how I'm building my backlist it works just fine. Everyone will have a different plan and use these tools to best suit their plan.

Mark and Nick
Yes, I've taken Mark Dawson's FB course and Nick Stephenson's mailing list course, with crossover between them. These guys, have taught me so much. Mark is brilliant at teaching Power Editor for FB and even a dummy like me now has it figured out. Nick was equally brilliant in teaching now to building that mailing list. My list right now has 5100 names and I can launch a book quite high in the rankings.

Can you learn from me?
This is an area where opinion seems to be all over the road. If we could replicate success from posts like this one, then why don't we all take James Patterson's course and become megasellers by following his path. But that's where it breaks down for me. I think generalities have been good for me to learn here on Kboards (write series, publish often, don't respond to the 1-stars, etc) but so far I haven't had the success others have had simply by following what someone else did. I've had to find my own way.

If I were starting out today, I would: find a small niche; write and publish no more than 90 days apart; tickle the Amazon algos by boosting sales through FB ads. When I first started out I advertised on FB in order to get sales so Amazon's algos would sit up and pay attention. My ads were money losers--but it wasn't profit I was after, it was movement. A gradual upswing in sales. I am NOT saying I acquired hundreds of sales by FB, maybe 4-6 sales per day to start. It doesn't take much. But as a long-time advertiser on Adwords I had come to know that I had to invest money up front to make money on the back end. Why wouldn't that same business tactic work with Amazon? I believe it does. And what Mark and Nick are doing is showing us how to not only get movement in our sales but, by their methods, even to turn a profit. What could be better than moving books on FB ads AND turning a profit? The one feeds the other. Just my opinion, of course. But again, I was all but broke when I started publishing and I know how hard it can be to spend money you don't have on advertising. Yikes. We all come to this differently.

Finally, those who know me know that I have asked probably the most butt-dumb questions on KBoards in a long time. I had to, because I knew absolutely zero about self-pub when I first came here. When I found KDP I was a phone call away from publishing with a company called XLibris and the guy had me talked into something like a $3,000 program guaranteed to line my garage with insulating boxes of books. Thank God for KDP. I went on their site and read it like ten times, each time looking for the part where it says how much I would have to pay to publish a book. Amazon removed the last obstacle for me: the gatekeepers. And all I have to do is keep writing, which is like a virus that wracks me and won't let go anyway. With or without Amazon, I'm writing anyway.

Never give up. I lost my first six books I wrote before my first self-pub in January 2014. Left on other people's computers or lost in printed formats. Gone. But maybe it's just as well, I don't know. But the point I want to make is that I had written continuously for thirty-some years since college until Amazon opened the door for me. Nobody bought anything from me. Nothing. But once the door opened, I had unlearned a lot of bad habits and was left with a style that more than anything aims for clarity of story. That's it, simple. Nothing matters to me but clarity of story. Sometimes I hit it, sometimes I miss it. But there's my goal.

Good luck everyone.

ETA:

I'm a strong believer in preorders because a preorder can stay on the "coming soon" pages for 90 days. Then when the book is released it gets another 30 days on the HNR page and then gets into the "New Releases/last ninety days" pages after. At this point my practice is to then establish another preorder book and climb back on the "coming soon" pages again while my latest release is HNR for thirty then "New Releases/last ninety days." This is the cycle, of course. Your mailing list will help you maintain a high level of visibility as you do this.

This model requires constant publishing, every ninety days. But in my experience, it is these lists that sell books on a regular daily basis, moving them ever higher as they go. It also requires a mailing list to keep your book churn up while the HNR algos kick in.

What is beautiful is that Amazon gives us these data filters (the lists) as tools we can (and should) use. I have been unable to find another sales portal that gives me this.

National Book Awards: No Indies

It's happened again: another award another troubling result: the National Book Awards fiction longlist contains no Indie books:

Jesse Ball, “A Cure for Suicide”
Pantheon Books/Penguin Random House

Bill Clegg, “Did You Ever Have a Family”
Scout Press/Simon & Schuster

Karen E. Bender, “Refund”
Soft Skull/Counterpoint Press

Angela Flournoy, “The Turner House”
Houghton Mifflin Harcourt

Lauren Groff, “Fates and Furies”
Riverhead Books/Penguin Random House

Adam Johnson, “Fortune Smiles”
Random House/Penguin Random House

T. Geronimo Johnson, “Welcome to Braggsville”
William Morrow/HarperCollins

Edith Pearlman, “Honeydew”
Little, Brown/Hachette Book Group

Hanya Yanagihara, “A Little Life”
Doubleday/Penguin Random House

Nell Zink, “Mislaid”
The Ecco Press/HarperCollins

Surely some Indie writer somewhere penned a tome that should have found its way onto the list. But wait, there's a catch: Indie publishers are eligible IF they have published the works of other authors. The full eligibility text is here:

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"WHO CAN SUBMIT BOOKS?

Each April, the Foundation sends the official National Book Awards guidelines and entry forms to the publishers in its master database. Those publishers who do not receive the materials automatically can call or email the Foundation to request a copy. Authors cannot submit their books themselves; they must have their publishers contact us directly. However, the guidelines are always available for informational purposes here:www.nationalbook.org/nbaentry.html.

In order to be eligible for the Award, a book must be written by an American citizen and published by an American publisher between December 1 of the previous year and November 30 of the current year. Self-published books are only eligible if the author/publisher publishes the work of other authors in addition to his own. Books published through services such as iUniverse are not eligible for the Award."

---

 

Did any Indie writers make it onto the long longlist? Or even the long long longlist?

Are there other Indies out there who, with me, would like to form a publishing co-op with an eye toward entering the NBA next year?

Just saying.

New Thaddeus Murfee Book: The Lawyer's Lawyer

I love writing about court cases where the target is moving. Where things are not what they seem. Because, in truth, that is the human condition: that things are never what they seem. We think we know our spouses or our children or our best friends, but do we really? The same thing is true with what happens in court. A guy gets arrested for something. Lawyer A, who has been paid $100,000 to defend the guy, pulls out all the stops. There is scientific evidence, there is a human factors expert, there is an economist, a treating physician, DNA testing and etc. Lawyer B, who has been paid $10,000 to defend the guy, shows up for court in a new suit and a recent haircut. There are no experts, no paid witnesses, no DNA testing experts and evidence, and no stops are pulled out. Lawyer C, the public defender, is paid $0 and immediately starts looking to plead the guy guilty to something. No offense meant; this is a budgetary matter. PD's are damn good lawyers, many, many of them even better than private lawyers, but, alas, they have no money to work with.

What's this all mean to me? That a lawsuit in my novel can have many different faces, depending on the motivation and expertise of the attorneys involved. So my main guy, Thaddeus Murfee, has money to burn. Why? Because that's how most all of us lawyers would like to handle our cases: ones where resources are unlimited. What a different world that would be.

In my latest Thaddeus adventure, due to be released in about 5-6 weeks, Thaddeus is defending a man with multiple motives to murder his wife, opportunity, and means. But there are other possible suspects as well. They also have motive[s], opportunity, and means. Are things as the client says they are? That's the rub: they never are. Which is the great thing about fiction: you can have two legitimate narrators in one book and they can both report the exact same scene differently--even vastly differently. So my client tells me one thing in the office, the police say something entirely different in court, and then the judge comes along and decides out of all of it what parts the jury gets to hear and what parts they won't access.

This is courtroom fiction at its best, this latest Thaddeus book. Be sure and preorder on Amazon. A good one-half of the book is taken up with the trial, my most ambitious yet.

Entertainment.

Amazon and AntiTrust - the Real Truth

All the anti-Amazon bashing that’s underway again vis a vis Authors United simply goes too far. As a lawyer, the latest AU letter is presumptuous and just a little insulting.

As a “law,” U.S. antitrust is really a conglomeration of federal and some state laws that seek to address cartels, lessened competition and prohibit either (1) the creation of a monopoly or (2) abuse of monopoly power. It’s the latter which the AU is holding up in its grievance.

The fact is, U.S. antitrust laws do not outlaw cartels, business competition, or monopolies. That’s right, a business that operates as a monopoly is not per se illegal. It is illegal only when it takes action that abuses monopoly power.

But what I’ve seen so far is akin to the guy who runs into the fire station and cries out, “Fire! Red! Hot! Falling roofs! People fleeing!” and the fire department asking, give us an address. Because that’s the crux of all the adjectives being flung about by AU: symptoms, maybe, but address, none. In other words, tell the DOJ the address of the abuse of monopoly power. The DOJ will want an abuser, a fact of abuse, a date, a place, etc., all the stuff that enables it to fight the fire. But "fire, red, hot, falling roofs, people fleeing”—those are not enough. Not if you are seeking warranted action.

Again, it’s just a little bit insulting that some would try to inflame action with adjectives. The DOJ lawyers are much better trained than that.

Authors Guild Calls for DOJ Investigation of Amazon: a New One

Just when I thought the waters over at AG might be warming a degree, I receive this latest email from AG, calling for a huge Amazon bashing by the DOJ. It is republished below in its entirety:



 

The recent decision in United States v. Apple raises the spectre once again of Amazon’s excessive power in the publishing landscape. The federal appellate court in the case agreed with the lower court that Apple had indeed violated antitrust law by cooperating with publishers to establish agency pricing for e-books (which allows publishers to set their own prices and pay the retailer a commission). The irony of this decision is that Apple’s actions actually helped to open the e-book market and to reduce Amazon’s monopoly from a 90% market share in 2009 to around 67% today.

Without commenting on the outcome of the Apple case, or the facts that led the majority to its conclusion, we’d like to point out the long-term dangers of interpreting antitrust law solely to favor low book prices over a thriving, competitive and robust literary marketplace. The majority’s opinion takes a narrow view of antitrust law, assuming that low book prices to consumers trump all, even if the low prices are artificial loss leaders intended to lure buyers into a single company’s shopping platform. The much larger issue in our view is the dominance that Amazon—through its artificially depressed book prices—wields over the book ecosystem, and the potential repercussions on the free flow of information and free expression.

Despite the decision against Apple, Amazon’s tactics seemed troubling to the court. All three opinions, the majority, concurrence and a dissent, referred to the fact Amazon controlled 90% of the e-book market in 2009, and two of the three judges expressed clear concerns regarding Amazon’s anticompetitive behavior.

Judge Dennis Jacobs, in dissent, characterized Amazon’s behavior as so extreme that Apple had little alternative other than to enter the market on the terms that it did in order to create needed competition. Judge Raymond Lohier, concurring in the majority, found some “appeal to Apple’s argument that the e-book market, in light of Amazon’s virtually uncontested dominance, needed more competition.” Judge Lohier, however, felt that “more corporate bullying is not an appropriate antidote to corporate bullying.”

What, then, is the appropriate antidote?

We once again request the Department of Justice to investigate Amazon for its anti-competitive behavior, a far more dangerous variant that Apple’s.

Here is a letter to the Department of Justice, written by Douglas Preston and Barry Lynn in cooperation with the Authors Guild. Preston is a Council Member of the Authors Guild, which from the beginning has been a partner in this initiative. Last summer he spearheaded a grassroots protest against Amazon’s punishment of authors during its dispute with the publisher Hachette. Under the rubric “Authors United,” he gathered over 900 authors’ signatures and took out a two-page advertisement in The New York Times, in a public challenge to Amazon’s actions.

This letter addresses the larger issue of Amazon’s control of the book market and requests an investigation of the company by the Department Of Justice. The Authors Guild supports Preston’s actions and endorses his request, as do the American Booksellers Association and the Association of Authors’ Representatives.

Roxana Robinson
President
The Authors Guild

Half of Net Proceeds New Standard for Trad Pub EBook Royalties

From Authors' Guild 7/9/15:

We announced our Fair Contract Initiative earlier this summer. Now our first detailed analysis tackles today’s inadequate e-book royalties. At the heart of our concern with the unfair industry-standard e-book royalty rate is its failure to treat authors as full partners in the publishing enterprise. This will be a resounding theme in our initiative; it’s what’s wrong with many of the one-sided “standard” clauses we’ll be examining in future installments.

Traditionally, the author-publisher partnership was an equal one. Authors earned around 50% of their books’ profits. That equal split is reflected in the traditional hardcover royalty of 15% of list (cover price, that is, not the much lower wholesale price), and in the 50-50 split of publishers’ earnings from selling paperback, book club, or reprint rights. Authors generally received an even larger share than the publisher for non-print rights (such as stage and screen rights) and foreign rights.

But today’s standard contracts give authors just 25% of the publisher’s “net receipts” (more or less what the publisher collects from a book sale) for e-book royalties. That doesn’t look like a partnership to us.

We maintain that a 50-50 split in e-book profits is fair because the traditional author-publisher relationship is essentially a joint venture. The author writes the book, and by any fair measure the author’s efforts represent most of the labor invested and most of the resulting value. The publisher, like a venture capitalist, invests in the author’s work by paying an advance so the author can make ends meet while the book gets finished. Generally, the publisher also provides editing, marketing, packaging, and distribution services. In return for fronting the financial risk and providing these services, the publisher gets to share in the book’s profits. Not a bad deal. This worked well enough throughout much of the twentieth century: publishers prospered and authors had a decent shot at earning a living.

How the e-book rate evolved

From the mid-1990s, when e-book provisions regularly began appearing in contracts, until around 2004, e-royalties varied wildly. Many of the e-rates at major publishing houses were shockingly low—less than 10% of net receipts—and some were at 50%. Some standard contracts left them open to negotiation. As the years passed, and especially between 2000 and 2004, many publishers paid authors 50% of their net receipts from e-book sales, in keeping with the idea that authors and publishers were equal partners in the book business.

In 2004, we saw a hint of things to come. Random House, which had previously paid 50% of its revenues for e-book sales, anticipated the coming boom in e-book sales and cut its e-rates significantly. Other publishers followed, and gradually e-royalties began to coalesce around 25%. By 2010 it was clear that publishers had successfully tipped the scales on the longstanding partnership between author and publisher to achieve a 75-25 balance in their favor.

The lowball e-royalty was inequitable, but initially it didn’t have much effect on authors’ bottom lines. As late as 2009, e-books accounted for a paltry 3–5% of book sales. Authors and agents ought to have pushed back, but with e-book sales so low it didn’t make much sense to risk the chance of any individual book deal falling apart over e-royalties. We called the 25% rate a “low-water mark.” We said, “Once the digital market gets large enough, authors with strong sales records won’t put up with this: they’ll go where they’ll once again be paid as full partners in the exploitation of their creative work.”

E-books now represent 25–30% of all adult trade book sales, but for the vast majority of authors the rate remains unchanged. If anything, publishers have dug in their heels. Why? There’s a contractual roadblock, for one: major book publishers have agreed to include “most favored nation” clauses in thousands of existing contracts. These clauses require automatic adjustment or renegotiation of e-book royalties if the publisher changes its standard royalty rate, giving publishers a strong incentive to maintain the status quo. And the increasing consolidation of the book industry has drastically reduced competition among publishers, allowing them more than ever to hand authors “take it or leave it” deals in the expectation that the author won’t find a better offer.

The elephant in the room

And then there’s the elephant in the room: Amazon, which has used its e-book dominance to demand steep discounts from publishers and drive down the price of frontlist e-books, even selling them at a loss. As a result, there’s simply not as much e-book revenue to split as there was in 2011when we reported on the e-book royalty math. At that time, publishers made a killing on frontlist e-book sales as compared to frontlist hardcover sales—at the author’s expense—because, as compared to today, the price of e-books was relatively high.

When we analyzed e-royalties for three books in the 2011 post, “E-Book Royalty Math: The House Always Wins,” we found that every time an e-book was sold in place of a hardcover, the author’s take decreased substantially, while the publisher’s take increased.

Since 2011, we have found that publishers’ e-gains have diminished. But the author’s share has fallen even farther. Amazon has squeezed the publishers, to be sure. The publishers have helped recoup their losses by passing them on to their authors.

These were our calculations for several books in 2011. The trend was obvious. Compared with hardcovers, each e-book sold brought big gains to the publisher and sizable losses to the author when the author’s royalties are compared to the publisher’s gross profit (income per copy minus expenses per copy), calculated using industry-standard contract terms:

Author’s Royalty vs. Publisher’s Profit, 2011

The Help, by Kathryn Stockett

Author’s Standard Royalty: $3.75 hardcover; $2.28 e-book.

Author’s E-Loss = -39%

Publisher’s Margin: $4.75 hardcover; $6.32 e-book.

Publisher’s E-Gain = +33%

Hell’s Corner, by David Baldacci

Author’s Standard Royalty: $4.20 hardcover; $2.63 e-book.

Author’s E-Loss = -37%

Publisher’s Margin: $5.80 hardcover; $7.37 e-book.

Publisher’s E-Gain = +27%

Unbroken, by Laura Hillenbrand

Author’s Standard Royalty: $4.05 hardcover; $3.38 e-book.

Author’s E-Loss = -17%

Publisher’s Margin: $5.45 hardcover; $9.62 e-book.

Publisher’s E-Gain = +77%

What’s happening now? We ran the numbers again using the following recent bestsellers. Because of lower e-book prices, the publishers don’t do as well as they used to, though they still come out ahead when consumers choose e-books over hardcovers. But authors fare worse than ever:

Author’s Royalty vs. Publisher’s Profit, 2015

All the Light We Cannot See, by Anthony Doer

Author’s Standard Royalty: $4.04 hardcover; $2.09 e-book.

Author’s E-Loss= -48%

Publisher’s Margin: $5.44 hardcover; $5.80 e-book.

Publisher’s E-Gain: +7%

Being Mortal, by Atul Gawande

Author’s Standard Royalty: $3.90 hardcover; $1.92 e-book.

Author’s E-Loss= -51%

Publisher’s Margin: $5.10 hardcover; $5.27 e-book.

Publisher’s E-Gain: +3.5%

A Spool of Blue Thread, by Anne Tyler

Author’s Standard Royalty: $3.89; $1.92 e-book.

Author’s E-Loss: -51%

Publisher’s Margin: $5.09 hardcover; $5.27 e-book.

Publisher’s E-Gain: +3.5%[1]

Exceptions to the rule

It’s time for a change. If the publishers won’t correct this imbalance on their own, it will take a critical mass of authors and agents willing to fight for a fair 50% e-book royalty. We hope that established authors and, particularly, bestselling authors will start to push back and stand up to publishers on the royalty rate—on behalf of all authors, as well as themselves.

There have been cracks in some publishers’ façades. Some bestselling authors have managed to obtain a 50% e-book split, though they’re asked to sign non-disclosure agreements to keep these terms secret. We’ve also heard of authors with strong sales histories negotiating 50-50 royalty splits in exchange for foregoing an advance or getting a lower advance; or where the 50% rate kicks in only after a certain threshold level of sales. For instance, a major romance publishing house has offered 50% royalties, but only after the first 10,000 electronic copies—a high bar to clear in the current digital climate. But overall, publishers’ apparent inflexibility on their standard e-book royalty demonstrates their unwillingness to change it.

We know and respect the fact that publishers—especially in this era of media consolidation—need to meet their bottom lines. But if professional authors are going to continue to produce the sort of work publishing houses are willing to stake their reputations on, those authors need a fair share of the profits from their art and labor. In a time when electronic books provide an increasing share of revenues at significantly lower production and distribution costs, publishers’ e-book royalty practices need to change.

[1] In calculating these numbers and percentages for hardcover editions, we made the following assumptions: (1) the publisher sells at an average 50% discount to the wholesaler or retailer, (2) the royalty rate is 15% of list price (as it is for most hardcover books, after 10,000 units are sold), (3) the average marginal cost to manufacture the book and get it to the store is $3, and (4) the return rate is 25% (a handy number—if one of four books produced is returned, then the $3 marginal cost of producing the book is spread over three other books, giving us a return cost of $1 per book). We also rounded up retail list price a few pennies to give us easy figures to work with.

Likewise, in calculating these numbers and percentages for the 2015 set of e-books, we are assuming that under the agency model—which is reportedly the new standard in the Big Five’s agreements with Amazon—the online bookseller pays 70% of the retail list price of the e-book to the publisher. The bookseller, acting as the publisher’s agent, sells the e-book at the price established by the publisher. The unit costs to the publisher are simply the author’s royalty and the encryption and transmission fees, for which we deduct a generous 50 cents per unit.

Whew, Christine II is Finished!

Today is July 4 and I spent the day finishing the first draft of Hellfire: I, Lawyer, a Sisters In Law series novel. It's a terrific book with a fuse burning down at the end and my fingers were flying as I wrote it, excited to see what came next. Hopefully lots of people will read it and like it and word will spread about what a fun six or seven hours of reading Hellfire is.

Should be published by mid-July.

Thaddeus Murfee Book 9 is Underway!

Thaddeus Murfee update: The new Thaddeus Murfee thriller us being plotted and character development begun. Working title is "A Small Death in Orbit" and takes Thaddeus back to Orbit, where it all began five years ago. He is called upon to defend an old friend and much more, including his agreement to run for public office. Will he actually run? Get elected? We'll find out in the next couple of months.

This Thaddeus Murfee book will get back to basics: crime > court > outcome. Thaddeus has personally asked me for that kind of approach and I have wholeheartedly agreed.

Welcome back, Thaddeus.

Now to watch.

New Path Maybe Taken

I have written nine novels in 14 or 15 months that now keep the bills paid. So far, so good. But for many years I have wanted to write a series of about four novels, financial/family in nature, that each would take about two years to research and write. At the end of that time I would probably give up writing and take up kite surfing (I would be 81). I would be very proud of these four novels, much prouder than I am of the ones written so far. Maybe "pleased with" is a better way of putting it. They would please me more than the ones to date have pleased me. I love my novels written thus far, but I know I can do much better, tell much wider stories with more power than what I've done. Now if I can just figure out how to stop publishing for two years while I write the first one. Will my little publishing shop go under while I don't feed the Amazon algos for two years? Or is there enough to keep things going? I really don't know. But I'm leaning toward trying.

Learning to Write - What I Did, Example 1

When I was just out of college I was very taken with two writers: J.D. Salinger and John Updike. I read Salinger's stuff and I saw that it "was mostly dialogue," as I saw it way back when. I looked at Updike's work and I felt like I was in the presence of an angel describing the world in ways I had never seen it before. My first inclination, as maybe it is with all young writers, was to imitate what I was seeing.

So...I opened [i]Nine Stories[/i] to page one and began...typing Salinger's story on my typewriter. I wanted to see how it felt to write those sentences. I wanted to see how the meter and rhythm of the sentences changed so the reader wouldn't become bored.

And moved on. Many new writers back then, when I was learning, were Hemingway imitators. Everything was a simple sentence. Until it wasn't. Gerund phrases, said Hemingway's critics--you must learn to use gerund phrases if you are ever going to describe action that's happening right before the reader's eyes. So...I was teaching English to high school students then...I learned what the heck a gerund phrase was. Then I went looking for the animal of that name in Hemingway's writing. I tried it out. I wrote a hunting story and it ran on for about a half page in one place, building gerund phrase upon gerund phrase until the protagonist must have been winded and exhausted by all the movement.

Moving forward. I wrote out John Irving's first chapter to Garp. This was after I studied under John at Goddard College in 1976 in Vermont. He was teaching that summer session in their low-residency MFA program and I showed up ready to earn an MFA, but instead was told that writing couldn't be taught, it had to be learned. Oh well.

Writing out other writer's words.

What methods or techniques have you used to improve your craft?

The New York Times Bestseller: a Novel

Know what I like? I like writing. I especially like writing when I'm 68,000 words into an 80,000 word novel. Which is where I am with the NYT Bestseller. At this stage, a novel either takes on a life of its own and becomes more than the writer knew it could be, or it becomes stale. I'm lucky, because this book has suddenly begun to run away with itself. Sub-plots that I never imagined, going in, are rising to the surface and torquing the story. It's going to be a fun read, worth every penny of $2.99.

If you'd like to sample the first two chapters of this cool book, free, go here: http://johnellsworthbooks.com/free-chapter/

Excuse me now while I get back to it. The book should hit the shelves "Kindle Market" in about thirty days--edits and all that once I've done my part.