Posts Tagged ‘Jane Austin’

 

eBooks

Monday, February 8th, 2010

So you’ve undoubtedly heard about the Macmillan/Amazon spat over eBook pricing. And you may have read John Scalzi’s snide play about how tough life would be for writers without publishers. And today, the CEO of Penguin has an op-ed in the WSJ on the subject as well. I think they’re all kind of missing the point.

Traditionally, publishing and retailing were distinct enterprises, with separate margins. Publishers would print up large numbers of copies of books which would then be sent to retailers for sale. Invariably, excess books would be printed, which then needed to be destroyed. The cost of printing, hauling, and destroying all those books was enormous, not to mention the capital costs of both the printing operation and the retailer. Because all of these costs were simply too high to be borne by a writer, writers would seek publishers to print and distribute their work.

Because the cost was so high up front to publish, publishers would make every effort to carefully screen the books they would choose to take on. They couldn’t publish any old crap out there because the cost would be prohibitive. In fact, there still exists an enormous imbalance between publisher and author. Publishers demand authors secure for themselves agents, who take a cut of what the author gets of course. Said agents act as a screening device for publishers, aiding the publisher from having to sort through volumes of junk to get to the good stuff.

I would posit that in a world of electronic publishing, where the marginal cost of producing an extra copy of anything is exactly zero, there ought to be no difference between a publisher and a retailer, and that the agency model should disappear entirely. In such a world, prices for books ought to come down enormously.

The CEO of Penguin attempts to argue that since the cost of a book is only 10% of its price, that that’s the only discount that ought to be available for electronic publishing. I have no idea if his 10% number includes printing and destroying the volumes of books that don’t sell, but clearly those costs go away too. Marketing costs wouldn’t completely go away of course, but the double margin for the publisher and the retailer, not to mention the agent, all ought to be compressed into one party’s profit margin.

Moreover, there’s no need for a CEO of Penguin, or all the stature and overhead that those organizations support. I think that people who live inside the entertainment world, publishing included, completely underestimate the resentment which consumers have toward them and the outlandish ways in which they spend their money. As a consumer, I have absolutely zero need for the fancy offices and executive management of a publishing house to enjoy my books. Same for the outrageous salaries and lifestyles of the Hollywood elite. Throughout most of human history, being an entertainer was not among the most lucrative professions on earth, and there is no reason why it should be today.

The model of the future, I believe, is one where publisher and retailer is one in the same, probably Apple and/or Amazon, maybe Barnes & Noble will get in on the act. The Penguins of the world go away except for printing and licensing out the works they already have a lock on. Agents will eventually fade away as well. The need to spend large marketing dollars on entertainment is folly. People discover what they like by means of social networks, and intelligent in-store algorithms that know what you would like based on your past preferences and buying history. That trend is only going to increase in the future.

Scalzi’s story about his difficulty in finding an editor and graphic artist for his books in a world without publishers is downright silly. Surely, he knows who his editor is today. Surely, in a world where Macmillan goes bankrupt, Scalzi and his editor can come to some sort of arrangement. I have been involved in the launch of a large number of websites, all of which are nicely laid out, and never found that the cost of hiring coders or graphic artists was prohibitive, if I used my personal connections and knew where to look. With respect to publishing, I wrote a book that I was looking to get edited, and was quoted a price of $3k. That was expensive for me at the time, but if you’re making a living at this, if you’re a known author, if you’re keeping more profits because your agent and publisher are now gone from the picture, surely you can afford it. And as for taking the time to find one you like, it can’t possibly be more work than finding an agent who you like and who will represent your work currently. No, those objections are red herrings.

I understand that the new world that is coming down the pike is a scary one, and a lot of people don’t like change. But it is coming. I suspect that in 20 years paper books will be mostly decorative items, used to show off which books you liked most, and to simply fill up the shelves we have in our homes. But we won’t really be reading books on paper much any more. That world will be a great one for aspiring authors and for consumers. Frankly, I can’t wait for the BS to get all sorted out in the interim.

Oh, and BTW, the CEO of Penguin ends his article by saying that he’d love to be the publisher for Jane Austin‘s novels in electronic form. But why would anyone want to pay him for works that are in the public domain? Surely Apple and Amazon will offer them for deminimus amounts, along with the rest of the world’s literature that’s in the public domain. If you think the publishers are in a bad place now, just wait until some sort of copyright reform happens…