Guest Post by Scott Nicholson

Scott Nicholson is launching his new thriller Liquid Fear today. He’s also giving away a $100 gift certificate on participating blogs if he hits the Top 100. Buy it at Amazon, BN.com, and Smashwords because it’s okay to forget your nightmares for a while or pop by Haunted Computer)

Good Cop, Bad Cop
by Scott Nicholson

I freely admit Joe has been an influence on my decision to enter the self-publishing world (or indie, or, hell, call it “vanity” if you want, I’m vain enough), and I’ve been a frequent visitor here, even though I disagree with Joe on some big points—particularly the rosy eternal-expansion model of six-figure incomes for indie writers.

I haven’t been around as much for the simple reason that Joe is mostly making the case why authors should do it themselves, and I was sold by last summer. Now, with Barry Eisler turning down half a million clams, I think we’re kind of past that debate. That’s about all the evidence most writers will need, because most writers will never reach that level. I mean, like 99.9999 percent of all writers.

Read their recent discussion if you haven’t yet (this interview needs a name, it’s like a bookmark of literary history—let’s call it The Summit), and Dean Wesley Smith makes a good counterpoint, though I am not fully sold on the positions of either. Dean, in particular, seems to think bookstores will remain valid for the next decade or two, whereas I foresee a collapse on the order of what happened to video and record stores.

In our little college town of 15,000 students and about 10,000 full-time residents, we had seven video stores and four record stores five years ago. Today, all we have is Blockbuster, which is a chain on the ropes, and one niche store that combines videos, books, albums, and CD’s, eclectic art for the discerning college hippie. Ironically, we have one other “record” store—and all it sells is classic vinyl albums, mostly on eBay. I think that’s the Bookstore Future—towns might have one weird shop that thrives on nostalgia and the personal touch. We do have a neat indie bookstore owned by former M*A*S*H writer Karen Hall, but it recently cleared away a section to put in a yarn store, not a good sign of the health of paper sales in spite of our recent Waldenbooks closing.

Since Joe, Barry, and Dean already made the point that the time to self-publish was yesterday, I’ll deal with some possible seismic shifts that would concern me if I was set on any specific outcome of the digital revolution. In fact, I was a lot more cynical about the future before I read The Summit, and if Barry has enough faith to walk away from enough money to keep a sensible family secure for life, there must be aspects I have been downplaying or over-inflating. My mantra in my wiser middle age is “Universal truth is nothing but a personal perspective inflated to a wish.”

I’m not sold on the “legacy” label Barry uses for traditional publishing, because my dictionary doesn’t have any definitions to justify it. But “traditional” doesn’t work, either. Which tradition are you talking about? Monks transcribing with quills? Hand-pressed books in the Gutenberg era? The 19th and early 20th Centuries when editors actually helped craft books and build careers? The 1950s through the 1980s, when run-of-the-mill paperbacks would sell 100,000 copies? Last year, when publishers made a number of major, major miscalculations (the Apple bet being the biggest blunder)?

I stick with the term “corporate publishing,” because every single decision will come down to the presumed well-being of shareholders and executives, not you, whether you are a reader or a writer.

We could do this all day, but I don’t want to write 13,000 words that I’m not selling. So I will play some Good Cop, Bad Cop of the Digital Future, and Joe will chime in with his 2 cents.

Good Cop: Joe foresees eternal expansion. He brings up Dark Side of the Moon, selling like crazy today after charting an incredible 736 weeks since its 1973 release, falling off, and then returning to the charts for another decade or so.

Bad Cop: The immortal Eric Weissberg topped the charts the week Dark Side launched. Trivia-question answers like Deodato, Dr. Hook, Anne Murray, Jermaine Jackson, and Edward Bear rounded out the Top 10.

Verdict: A few e-books will sell steadily for the life of copyright; almost all will not.

Joe sez: As I often say, forever is a long time to find an audience. There are few record stores left, and Best Buy probably doesn't sell Dr. Hook. But iTunes still does, and the good Doctor is still making royalties. What the hell was he a doctor of, anyway?

BTW, this from Barry, via Wikipedia:

"A legacy system is an old method, technology, computer system, or application program that continues to be used, typically because it still functions for the users' needs, even though newer technology or more efficient methods of performing a task are now available."

http://en.wikipedia.org/wiki/Legacy_system

Good Cop: Low-priced e-books will mean more people hoarding and reading more authors and more genres than ever, especially at 99 cents.

Bad Cop: 99 cents is great if you are selling in the six figures on multiple books. Otherwise, you are likely to use up your audience and still be looking for a job.

Verdict: A mix of prices and a broad platform will enhance your survival, because there are multiple audiences, not one single audience. Some want 99 cents, some equate it with crap, some do nothing but cruise for free books, and others like that stamp of corporate approval and are willing to pay for it.

Joe sez: Your best bet is to keep writing good books, keep posting them, and don't be afraid to experiment with pricing. Remember, success always involves luck. But you can improve your odds by being talented, smart, and persistent.

Good Cop: Corporate pricing has opened an incredible window of opportunity for authors who can compete with lower prices and equal quality.

Bad Cop: Most books are not of equal quality, and New York hasn’t even begun to compete—when they do, they can trim their staffs and go to war with a monstrous catalog of hoarded, cheap, and possibly stolen backlist. See Brian Keene’s experiences with Leisure/Dorchester if you don’t believe me.

Verdict: At some point, corporate publishers may organize enough to muscle in with economies of scale. “At some point” will likely be far too late for them and their poor authors who are locked into pitiful royalty rates virtually forever.

Joe sez: I don't believe that legacy publishers, as they now exist, can survive selling cheap ebooks as their main source of income. If they do downsize and start epubbing exclusively, they can expect a slew of lawsuits from writers who want their rights back after going out of print. Leisure is an important case study. Not to be mean, but they were always the low man on the publishing totem pole. When the bottom feeders can no longer make money, how can the bigger companies with much greater overhead?

Good Cop: E-book lending will help books reach potential new readers and expand the writer’s customer base.

Bad Cop: There are already sites illegally “selling” the “lending” rights, which means not only new readers, but new readers who don’t mind ripping you off.

Verdict: As with piracy, the main victims will be overpriced corporate books.

Joe sez: Agreed. Diffuse piracy by offering your ebooks at low prices, in a wide variety of formats. It's all about cost and convenience.

Good Cop: Agents are cruising the Kindle bestseller list and sharking the 99-cent writers, some of whom are thrilled to finally feel legitimate after years of trying to “break in,” so there’s new opportunity.

Bad Cop: I don’t see room for corporate publishers on 99-cent books or proof that those books will sell for significantly more, but I see easy paydays for lazy agents, bad return-on-investment for shareholders, and future lament for authors who make ego decisions instead of business decisions.

Verdict: Remember Boyd Morrison? He lost a ton of e-book audience but has expressed peace with his decision because he knew what he wanted—the hardcover deal. D.B. Henson went big because she wanted to pay off her house. Amanda Hocking plans to pursue both avenues. Some will win, some will lose, like always.

And this is all the proof you need that New York is not looking for quality. Nobody is sitting around reading slush in hopes of finding that great new literary talent (despite what agents say on Twitter when they are busy not reading your submissions.) Good books are largely interchangeable, and this is clearly explained in The Summit. Barry’s gone, but they probably already have a new Barry lined up. Not the same talent, of course, but there’s somebody out there whose agent saw the opening and made a convincing case for a good-looking, charming writer of intelligent, well-crafted thrillers.

No, get it out of your heads that quality is the defining attribute in corporate publishing. Only sales matter. Sales and numbers will always be the most important issue to shareholders. And, remember, it is shareholders who are the boss, not readers or writers or editors or distributors or bookstore owners or agents, despite how some of them act.

Joe sez: Education, research, and experimentation can help you make wise decisions. If an agent comes calling, know what questions to ask. If you don't know what those questions are, you aren't ready to enter the legacy world.

Good Cop: Amazon’s dominance of the e-book market is wonderful because they have been so considerate of writers.

Bad Cop: The royalty structure was designed to lure “real authors” away from publishers and make a joke of the agency model, not “lift up” the value of indie books to $2.99. And they could be working on a switch to a Netflix-type subscription model, as they did with their Prime accounts for movies. Or they could cut royalties to 20 percent after they bankrupt a bunch of publishers.

Verdict: This is about as incredible an opportunity as you could ask for, short of constantly selling content from your own site at full price, but given the complicated system required for that, Amazon is well worth the 30 percent and even the 65 percent. But Barnes & Noble, Apple, and Kobo have been working hard to secure their foundations, which is a good buffer against draconian royalty cuts (remember shareholders?). Worry about the future when the future gets here, and do what’s best for you right now.

Joe sez: Agreed. But there's a long way to go before it gets as bad as the 17.5% currently offered by legacy publishers.

Good Cop: The 99-cent e-book sells well and stimulates algorithms that put your book in front of more potential readers.

Bad Cop: It can create a rush to the bottom, make it more difficult for higher-priced books to be seen, and build a sense of consumer entitlement in which the intrinsic value of literature is demeaned.

Verdict: Both will happen. Why should books be any different than what has happened with digital movies, music, and game apps? What’s so special about books, anyway? You can go to any thrift store in America and load up boxes of paper books at 10 cents each, and some they will pay you to haul away.

Joe sez: I'm still experimenting with pricing, but my experiments are getting me more money and more sales than if I stayed at $2.99. Like it or not, 99 cent ebooks are a powerful weapon in an author's arsenal. Just learn how to use them correctly.

Good Cop: There’s one sweet spot for pricing and every author should do the same thing.

Bad Cop: Joe’s sweet spot was $1.99, went to $2.99, flirted with 99 cents, and now seems to be $2.99 again. Guess what? Most of that was defined by Amazon, not Joe (except his influential original pricing). If there was a 90 percent royalty at $3.99, I’d bet that would be his new sweet spot.

Verdict: Don’t worry about what’s best for Joe or for John Locke or for Michael Sullivan or for me (although I have books from 99 cents to $9.99, because I believe there are multiple audiences I don’t want to miss). Try different mixes and see what works best. Your own data will always be the most reliable.

Joe sez: Amen to that.

Good Cop: Joe and Barry are established veterans well-versed in the industry, so their path is good enough for me. I’m convinced.

Bad Cop: Barry walked away from half a million dollars. Joe turned down multiple book offers of guaranteed money. Almost everyone (who wasn’t paying attention to the publishing industry) would call that “dumb.”

Verdict: They both made the right moves, for them, at the right times. But you’re not them. You probably don’t have a huge audience and a solid backlist. Find out what is the right move for you—I hear there are some slots opening in New York.

Joe sez: If you write and release a solid backlist, I like your chances at finding that huge audience. At the very least, you have a better chance on your own than you would going through a legacy publisher.

Consider that I've worked with major publishers and have been given major releases, and in eight years I've sold a few hundred thousand books.

Last month, I sold 60,000 books on my own. I don't know too many legacy authors selling that many.

Good Cop: With the mainstream and well-publicized success of Amanda Hocking and John Locke (and J.A. Konrath before the trade press blacklisted him), “indie publishing” is now legitimate.

Bad Cop: There’s more crap than ever. Last year, I could upload my book and be #3 in the Smashwords queue. I uploaded a book yesterday and it was #1,249 in the queue. Clearly, not all of that is corporate quality, or even legible quality, and it will be harder to separate the wheat from chaff.

Verdict: The best comparison I’ve heard is to the number of websites. Do all those other websites out there that don’t interest you even bother you? Do you even know they exist? Do you care about the NYT bestseller list or do you look at the Kindle Top 100, or just books in your favorite genre? Readers will find a way to find the books they want. And, clearly, readers are better at picking winners than New York is. That’s why New York is belatedly picking books already chosen by readers—another point that proves one book is as good as another for their purposes.

Joe sez: We're pretty good at searching for and finding what we want. Crap has always existed, and always will. But it is still easy to discover worthy media.

Good Cop: People trust a solid corporate brand like James Patterson and will stay loyal even after the tipping point.

Bad Cop: What the hell does that mean? What exactly is a “James Patterson book”? It has no defining element at all except the factory name on the cover. Put them in brown paper wrappers and Patterson would be ranked in the middle tiers of the Kindle list, especially at those outlandish prices. And I used to like Patterson, back when he was a writer.

Verdict: Some corporate authors will make the transition, some won’t. The number of writers making a living will be roughly the same, but half the names will be different. Would we have needed a Stephanie Meyer if Amanda Hocking had happened first?

Joe sez: My prediction is that the bestseller list will drastically change. It's currently fueled by print runs and widespread distribution. People buy bestselling books because they make up the majority of what is available to buy.

That will change when ebooks become dominant. Watch and see.

Good Cop: The future looks great. Expanding sales, better royalties, more markets, more diverse selection for readers, a Golden Age revival of literature, more money shifting to authors and away from corporations, a growth of new ancillary cottage industries for editing and book production, an egalitarian rise in creative entrepreneurship.

Bad Cop: The future sucks. Piracy, hack work, unedited copy., 99 cents rapidly plummeting to free, millions and millions of slush-pile e-books, hoarders discovering they already have more books than they’ll ever read, slower waves of new adopters who will read less and with more resentment because you “took away their paper books,” cut-throat corporate practices that will lead to the Wal-Martizing of literature, and few avenues for any writer to make a sustained living.

Verdict: The future is neither good nor bad. The future doesn’t care. And the future is always changing. Some of both might be true, or it all might be wrong.

Joe sez: I'm going to be very rich. And I won't be the only one.

Good Cop: Sounds good. I’m going to pull that mystery manuscript out of the trunk. Let’s go get a donut.

Bad Cop: Clichés and stereotypes are lame, buddy. But I understand, because you are “indie,” and that makes it okay, because you’re a rebel sticking it to the Man. Plus, you got rejected 700 times. Ha ha.

Good Cop: At least I can write.

Bad Cop: So can anybody with an Internet connection.

Good Cop: Must you always have the last word?

Bad Cop: I’m not bad. I’m just written that way.

Verdict: I had 700 rejections. I was accepted by a corporate publisher. At the time, it was a dream come true and the best move I could possible make. Now, it looks like the biggest mistake of my career. It could be the moves I make today will seem like mistakes in 10 years. Right now, they are working. All I ever wanted was to do this for a living, and I’m doing that, so it’s all gravy from here, even if it only lasts a year.

Joe likes numbers and data, but I am avoiding those kinds of comparisons. While useful on the business front, my spiritual path is about the destruction of ego, and clamoring about ranks and money and other comparative measures does nothing to further my journey. However, here’s a little story about a little novel.

My first book The Red Church did very well for a midlist paperback. The sell-though was an incredible 95 percent (compared to today’s standard of 50 percent or less). It was an alternate selection of the Mystery Guild Book Club, got good reviews, and managed a second printing, but then the corporate publisher was done. In their business model, it made sense to be done, because they had other books to shove in its place. In my business model, it was tragic to have the book dead for five years. I was lucky enough to get my rights back, so now I am grateful the publisher let it go out of print. In the last two months, I have earned more than the book’s original advance. And I have it for the rest of forever.

That, to me, is validation that I made the right decision. I knew it wasn’t dead. And I am so happy that it still feels fresh today and still finds a receptive audience. I hope Liquid Fear is as fortunate.

I am not wed to any specific outcome for the digital era. Worry about the future when the future gets here, and do what’s best for you right now. Indie, self, vanity, whatever—it’s best for me, because I love every single aspect of my cottage industry. I hope you do, too, because it’s much harder to be happy than to sell a million e-books. Good luck.

Joe sez: All I ever wanted to do was write for a living. That's the whole point of this blog; to help writers who also have that goal. I never wanted to be the King of Self Promotion, and never wanted to be the Poster Boy for Self Publishing. While I'm grateful for all of the attention I've gotten, and thrilled at the money I'm making, the thing that matters most to me is watching my wife laugh, cringe, cry, and smile while she's reading one of my stories.

Yes, I quote numbers and figures. But that's a means to an end.

I've already helped someone on their journey.

Me.

Every other person I help is just icing on the cake...