Further Thoughts on the Digital Revolution

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Someone posed this question to me the other day:

If digital sales will continue increasing as rapidly as they have been this past year, are we reaching a point where traditional print contracts won’t be as financially rewarding as e-published contracts or self-pubbing?

This question came about after I advised him that traditional print publishers pay a royalty of about 8% for print novels, and 25% for the corresponding e-book sales. In comparison, e-publishers pay out 30-40% royalties, and self-pubbed royalties are around 70%.

His point was, if e-book sales were around 10% of the total book sales last year but are now closer to 30% (figures we’ve heard but hey, we’ve got no statistical data to back it up), where will they be next year? Given that it takes one to two years to see a book published after signing with a print publisher, we may very well see a scenario where, by the time an author who contracts with a print publisher in 2011 releases her novel, the number of e-book sales will be greater than the number of print sales. In such a case, the author will only collect 25% of those e-book sales (as opposed to the higher 30-40% or 70% for choosing to publish with an e-pub or self-pub).

Here’s my thought on this. I think it’s still advantageous to have a print contract. The big publishers have one major draw: a huge customer base. Things are in flux right now, but e-book sales of books published with those print publishers will continue to increase, and they’ll attract people who trust the quality of their novels. On top of that, there will always be people who choose print over digital.

I think in the future we will see authors who publish across all sorts of media: traditional print publishers for mainstream/popular novels, and e-pub and/or self-pub for nontraditional works or novellas. That’s just my take on things.

Your turn to break out the crystal ball. Tell me, how do you see the future of the publishing industry? Do you think digital publishing contracts or self-pubbing will become more financially rewarding than traditional contracts? If so, do you see it happening within the next five years?

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9 thoughts on “Further Thoughts on the Digital Revolution

    Rachel Firasek said:
    March 16, 2011 at 6:59 am

    Rosalie, I think you’re right about the draw of the big NY contract! It’s what will take your name in a completely different direction. It puts you on the map…but I think that if authors want to make enough to live on, they are going to have to build an awesome back list and keep turning out stories, which means that quite a few of those stories my go to epub markets. The big dogs only contract so many a year. Great post!

      Rosalie Lario responded:
      March 16, 2011 at 7:03 am

      In my mind you hit it right on the head, Rachel. I don’t think the desire or popularity of the NY contract will be going away anytime soon, but to be able to make a living at it writers will need to diversify.

    Steve Konkoly said:
    March 16, 2011 at 7:34 am

    I agree that there is a shift afoot that will force us all to reconsider certain aspects of the writers’ world. The print contract will remain the most unaffected, for all of the good reasons you mentioned, but I see a huge shift in the way e-book rights are sold and marketed. The difference in cost alone for bringing a book to the e-market versus print will be a driving negotiating factor for agents and authors. Is a 25% royalty rate reasonable? I don’t think so, and I don’t think the backing of a publishing house has as much impact in the e-world as the physical bookshelf. However, this will likely also change as the market morphs (publishers aren’t going to take this sitting down), and if the publishers embrace and adapt quickly, they’ll maintain their top draw impact across all sales channels.

    Until then, I’ll negotiate the e-portion of any contract very aggressively…Now if only I could get some practical experience doing this.

      Rosalie Lario responded:
      March 16, 2011 at 7:50 am

      I think the publishers will change because they have to. But then you hear all this talk about publishers wanting to limit library usage of ebooks, so who knows?

    Kay Springsteen said:
    March 16, 2011 at 7:38 am

    New York will fall. I think it will take some time because it has been the gatekeeper into publishing for so long. Right now, many people don’t take those who are electronically published seriously (trust me, I’ve heard it all, from “I want to hold your book in my hand,” to “So you aren’t REALLY published.”) But as more people realize some very good writers are e-pubbed, and take a chance on reading what’s out there, I think there will be a shift.

      Rosalie Lario responded:
      March 16, 2011 at 7:48 am

      There’s still a lot of prestige attached to a NY contract that you don’t get with epub. The allure of that is hard to ignore.

    Julia Rachel Barrett said:
    March 16, 2011 at 9:44 am

    What do I see in my crystal ball? A major shift is coming and it will be come from the ground up, driven by consumers.
    1. Consumers are reading ebooks. They love the convenience and the fact that you don’t have to shelve lots and lots of books everywhere. They shelve them virtually.
    2. The price point is lower – a big selling point.
    3. Younger people love technology.
    4. Just like cell phones, ereaders are spreading rapidly around the world. My sister recently returned back from a very isolated resort in Mexico and she said everyone on the beach had a Kindle or a Nook. Every single person.
    5. Advances will drop. Giving huge advances to a few authors is simply not sustainable. It’s a bad business model in today’s market. Never put all your eggs in one basket.
    6. Many NY pubbed romance writers are making less than I am as an epubbed author. Yes, they do have a PR machine behind them, but I am still making more money and I’m getting it quicker.
    7. Even if you sign with a NY pub, I believe an author will have to take on more and more responsibility for marketing his/her work. This is already happening.

    I won’t pretend I wouldn’t love that NY contract because for me, just like for the most of us, it represents acceptance and vindication – somebody in NY thinks I’m a real writer! But that’s all in my head. I am a real writer and a damn good one. If the NY pubs can’t see that…well…ce la vie.

    R. Ann Siracusa said:
    March 18, 2011 at 12:46 am

    While I don’t see print books going away completely, the increase in e-books sales and the fact that many of the big publishers are hopping on the bandwagon with their own e-book imprints tells the story. Economically, it is the direction the industry has to go. Printing, storage, and transportation have become too expensive. But as long as big NY publishers market their authors, it will be hard for an e-book and small press authors to be truly competitive. I agree that diversification is the way to go. As far as earnings go, I did better with my self-published book than I do with my e-books.

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