Guest Post by Lee Goldberg (and Konrath talks numbers)

Lee sez: There was a turning point when I realized that I’d completely shaken free of all of my previous, deeply held perceptions and beliefs about publishing….and fully embraced an entirely new publishing model.

It wasn’t when my out-of-print backlist, which the publishing industry deemed played out and worthless, started pulling in $70,000 a year for me in ebook royalties.

It wasn’t when I signed a 12-book digital, print and audio deal with Amazon’s 47 North imprint for The Dead Man, a monthly series of original books that Bill Rabkin & I created, and that we are writing with a dozen incredibly talent authors, and that we began in February as a self-publishing venture.

And it wasn’t last week, when I agreed to a two-book digital-print-audio deal with Amazon’s Thomas & Mercer imprint for my new novel King City and a sequel.

It was Tuesday, when I delivered Mr. Monk is a Mess, my 14^th Monk tie-in novel to Penguin/Putnam and informed them that my 15^th book, the last in my current contract and due this coming May, would also be my last book in the series.

In other words, I quit.

They were surprised, of course.

I am walking away from a hugely successful book series, one published in multiple languages around the world, and from the certainty of another three-book contract and an increase in my advance.

There was a time, not so long ago, when the idea of ending a hit book series, in hardcover, with a major publisher would have been inconceivable to me and just about every author I know.

But the publishing world has completely changed.

The Monk books, like the Diagnosis Murder novels that I wrote before, were licensed tie-ins. That means I was hired for an advance, and given a tiny royalty, to write books based on characters that belong to someone else. I was a hired hand…albeit one paid very well by tie-in standards.

I had a great fun writing those books, took enormous pride in them and, until recently, considered myself very fortunate to have the gig.

And in that old world, I was.

But now, in this new world, my attitude has completely changed.

I am still very proud of the books…which is why I find it incredibly frustrating that I have written 22 novels that I dearly love but that don’t belong to me.

They belong to studios.

It’s frustrating because if they belonged to me, I could be earning so much more money from them now…and, more importantly for my family, in the future.

I won’t make that mistake again.

Instead of writing two books a year for Penguin/Putman, I will be writing that many books… or more…for myself that I own.

Some I will self-publish, others I will write for Amazon’s imprints.

But they will be mine.

I know what you’re thinking. What about those books for Amazon? Haven’t you just traded one master for another?

Every aspect of the deals that I have with Amazon’s imprints on The Dead Man series and the King City books are far, far, FAR more author-friendly and potentially lucrative than anything I ever had before…as are my chances at success with such a savvy partner, one who, incidentally, operates the biggest and most successful bookstore on the planet.

And I own King City. If I end up writing 15 books in that series, all of those books, now and in the future, will be mine.

Ah, but what about all those writers who are doing The Dead Man books for us? Aren’t we exploiting them? Aren’t they making the same mistake I’d have made if I’d signed to do more Monk books?

Nope.

That’s because unlike the old school publishers (and, let’s face it, publishers are what Bill and I have become with The Dead Man), we have thrown away the old rules of doing business with writers on licensed properties.

In fact, what we are doing is revolutionary in the tie-in world.

We are splitting all of the publishing royalties from digital, print, audio, and foreign translations on The Dead Man books 50/50 with the writers.

Our success is their success…and vice-versa.

We’ve made them our partners.

(And publishers of tie-ins should follow our lead…or there won’t be any tie-ins anymore, because it won’t make any financial sense for writers to write them).

The Dead Man series relaunched on Oct. 24^th and is already doing amazing business. Our next book comes out later this month.

And King City is coming in May.

It’s a bold, exciting new world for authors and I haven’t been this excited about writing since I was a teenager.

Joe sez: I've had several conversations with Lee where we discussed him making this move (both his wife and I have been trying to convince him for years) and it's great to see him finally embracing the future.

Work for hire, in this publishing climate, is a damn stupid thing to do.

Lee is also correct that publishers should follow his lead. It would be a smart, and fair, thing to do.

But publishers haven't shown any evidence that they are smart or fair in this new publishing climate. All they've done is make mistake after mistake.

They won't offer better tie-in terms, because there will always be young, hungry, eager writers willing to work for pennies just to be associated with a well known intellectual property.

Writers do fan fic for free. If given the opportunity to do a real book based on a property they love, they'll do it.

I can understand this. There are a few IPs which, if offered to me, I'd consider. It would be worth the pay cut.

But--and this is important--it would only be worth it to me because I already have a lucrative writing career and a known name. I write several books a year.

Lee can also write several a year, but he had sold his soul to the company store. Penguin/Putnam was making him write so many Monk books, he didn't have much extra time to pursue his own projects.

A company infamous for this is Harlequin. They keep offering multi-book deals with low advances and small royalties, and authors have to keep writing them just to stay afloat. But that leaves them no time to write other projects, where they'd get better royalties.

Because publishers have been in control for so long, they've forgotten their place. I'm happy to remind them:

Publishers get paper books into stores.

That is the main thing they do. The one thing that writers can't easily do.

But guess what? Bookstores and paper books are becoming a smaller and smaller share of the market, while ebooks are becoming bigger and bigger.

Why would anyone still want to work with a publisher? Especially while earning 17.5% royalties on ebooks?

Now, publishers may eventually wise up and offer 50% to authors, which at the agency model rate is 35% of the list price. This is better, but still not wise for authors to take when we can get 70% on our own.

Q: But Joe, legacy publishers still get paper books into stores. Isn't that worth something?

A: Not much.

Here are my latest royalty statement figures for my six Hyperion titles and my Hachette title, for Jan 1 - June 30, 2011. Paper sales are hardcover and mass market combined.

Whiskey Sour paper sales: $1450.00
Whiskey Sour ebook sales: $5395.00

Bloody Mary paper sales: $463.00
Bloody Mary ebook sales: $2591.00

Rusty Nail paper sales: $226.00
Rusty Nail ebook sales: $3220.00

Dirty Martini paper sales: $415.00
Dirty Martini ebook sales: $3370.00

Fuzzy Navel paper sales: $485.00
Fuzzy Navel ebook sales: $3110.00

Cherry Bomb paper sales: $224.00
Cherry Bomb ebook sales: $3864.00

Afraid paper sales: $1608.00
Afraid ebook sales: $12,158.00

Looking at those numbers for the first half of this year, you can see how much ebooks are outselling print in my backlist. Any author would be foolish to take a 17.5% ebook royalties from a legacy deal, or even 35% royalties, just so they can have a book in print.

Q: But all of those are old books. We all know paper sales are greatest at the release date, then they trickle off. Did your total paper sales beat out your total ebook sales for these legacy titles?

A: Whiskey Sour, which was published in 2004 in hardcover and 2005 in paperback, has earned me $52,474 in paper sales, and $11,453 in ebook sales.

So six years ago, paper sales made a difference.

Cherry Bomb, my last novel with Hyperion, was published in 2009 and has earned $20,782 in hardcover and $10,759 in ebooks.

But the ebook thing didn't really start taking off until 2010, which is when the Cherry Bomb paperback came out. The Cherry Bomb paperback has earned $3901. That's about 1/3 of what it made as an ebook, and 1/6 what Whiskey Sour made in paperback.

Q: Isn't that because your series is dying?

A: Shaken, the 7th Jack Daniels novel that I published with Amazon, is doing very well. This series is not dying at all.

Q: How well is Shaken doing?

A: I can't disclose details due to an NDA. But I'll discuss more about Shaken in a bit. First let me prove my point with paper vs. ebook sales.

Afraid, which came out in 2009 and had a hardcover release in the UK and a paperback release in the UK and US, has earned $29,183 in combined paper sales, and $27,657 in ebook sales.

Dead tree books are, well, dead. And any author would be foolish to release a book with a legacy publisher because they believe paper sales will make up for the lower ebook royalty rate. Especially when legacy publishers set the price, which is always too high.

If I had these above titles back, I'd be earning a lot more than I am now.

Q: Really? How much more?

A: I'm glad you asked. Here are my top four self-published books.

Origin (rejected by publishers) has earned over $72,000 since April 2009.
The List (rejected by publishers) has earned over $82,000 since April 2009.
Endurance (rejected by publishers) has earned over $71,500 since June, 2010.
Trapped (rejected by publishers) has earned over $85,000 since June 2010.

Why the hell would anyone want to continue publishing with legacy houses? Even if they raise royalties to 35%?

Q: But I heard that Amazon imprints like Thomas & Mercer and Encore also offer 35%.

A: First of all, Amazon is not a legacy publisher.

Second, even though I'm unable to discuss the royalty amounts in my Amazon contracts, or how much Shaken (published in ebook in October 2010 and paper February 2011) has earned, I will say that I'd absolutely sign with Amazon again.

And an extra word on Amazon's NDA, which some people on the internets seem to think is suspicious. As Lee mentioned in the comments below, Amazon is changing all the rules on how publishers deal with authors. I've never been treated better, or gotten better terms. If Amazon wants to keep those terms hush-hush because they think other publishers may try to emulate their contracts, I'm happy to remain silent on the issue.

But publishers will have to do MUCH MUCH BETTER than they're doing now if they want to even come close to offering what Amazon offers me.

Q: Would you ever sign with a Big 6 publisher again?

A: I can't say that I would never sign with a legacy publisher again. If they offered me a huge amount of money, I'd consider it. If they became really progressive with their contract terms, I'd consider it.

But they'd have to do a lot to convince me that they're worth the big chunk of royalties they're taking.

I'm not the only one who understands this. Lee Goldberg is the latest in a growing number of authors who are coming to this realization.

There will be many, many, many more.

I'm in this business to make money and reach as may readers as possible. I've got hard evidence that I can make more money on my own than I can with a big publisher behind me. This isn't speculation; it's cold, hard facts.

If you can self-pub, then also sign with an Amazon imprint, even better.

Q: But aren't you worried Amazon will gain so much control they become a monopoly and then start cutting royalties?

A: As Barry Eisler recently pointed out, and I've said many times before, why worry about what might happen in the future with Amazon when we're currently getting the shaft with legacy publishers? You need to be concerned about the tiger chomping on your leg right now, not the lion you might meet someday.

Q: I thought you're on a blogging hiatus.

A: I am. This was a guest blog.

But I will say that I'm getting tired of critics bemoaning my blog and attacking my guest bloggers.

I understand that this is a scary time. Change is frightening. This is nothing less than a revolution, and no wars are fought fairly.

But I still get irritated when some pinhead starts criticizing me, or my blog, and does such a poor job doing so.

Attack the argument, not the person. Focus on the facts, not tone. Offer counterpoints based on logic and experience, not feelings.

I don't care what you think of me. I want to hear you debate my points.

There are a lot of writers who have done well playing the social network game (I'll follow you if you follow me!) and are spouting their uniformed opinions, which amount to nothing more than masturbation and speculation.

I talk the talk because I walk the walk. Since 2009, I've made over half a million dollars self-publishing. I've worked with three major legacy publishers for novels, and half a dozen more with anthologies.

I know what I'm talking about. I've played for both teams, and the self-pub team is better, hands down.

You're welcome to post your numbers and prove me wrong.

Otherwise, take your pill. It's the one in the bottle marked "Shut the hell up."

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Guest Post by Selena Kitt

Selena sez: I’ve always been a proponent of higher ebook prices.

Not the crazy $12.99 more-than-the-paperback prices that legacy publishing is so fond of so they can continue to pay Manhattan rents—but higher than $0.99, certainly. Even for a short story.

That’s right, once upon a time, my short stories were selling for $2.99. And yes, they were selling.

But things changed. The indie market got more crowded. Authors started selling their full-length novels for $0.99 and some even gave them away for free. Blogs popped up everywhere telling Kindle owners where to find free and cheap ebooks.

So I decided to experiment with my prices. I lowered the prices on all my stories to $0.99—that was everything from 3K-15K. Everything else (some of which was priced as high as $5.99) I lowered to $3.99. And I left them that way for three months. A full quarter of ebook sales.

What did I discover?

At first, I found that lowering my price to $0.99 shot me up on a few bestseller lists. That increased my e

xposure, which was great. And I also found that my sales of those $0.99 titles doubled. Stories that had previously been selling 50 a month were now selling 100.

Sounds good, right?

But, of course, at $0.99 I was getting a 35% instead of the 70% royalty I’d been making when I was selling them at $2.99. I was now making roughly $35 a month on a story that had previously been taking in about $100 a month—a loss of $65 a month in income. Multiply that by twenty-five short stories (which is about what I have out there) and that’s a $1650 a month loss.

Worth it?

At first, I thought it might be, given the exposure. The higher you are in the rankings, the more people see your name, the more sales you make, right? But over time, more and more (and more!) indie authors started selling their stuff at $0.99 too, and those lists became overrun with cheap books.

I’d pretty much decided to quit the experiment when I read a comment from Konrath on his blog confirming my suspicion—that authors don’t make money at anything less than $2.99. Which meant, and I’ll quote Joe here:

“My data also shows that novels outsell short stories, even though I've priced my shorts at 99 cents. It stands to reason that if I switch shorts to $2.99, I'll sell fewer, but I bet I make more money. So the next step is to raise novels to $3.99-$4.99 and short stories to $2.99 and see what happens. Assuming I have the guts to do so...”

I’ve now changed all my short story prices back to $2.99, and raised my novel prices to $4.99. I imagine I’ll run this experiment for another three months and see what happens. If logic prevails, I’ll sell fewer books, but make more money.

But as Joe pointed out, doing this takes guts. Moving beyond the magical $2.99 price-point for novels, pushing those higher, to make room for short stories at that price, is a risky proposition. Will the market bear it?

Honestly, I think it will. And here’s why—Kindle readers are tired of $0.99 cheapies. The shine is off the new toy, people have stopped loading their Kindles up with freebies and cheapies, and have started getting more discerning about what they download. Many Kindle readers are starting to shy away from the $0.99 price point because they’ve read some stinkers and don’t want to travel down that road again. What was once a huge draw for Kindle readers—oooh, look, cheap books for my new toy!—has now become the opposite.

Of course, I could be wrong.

Which is why it’s a scary experiment!

Apropos for Halloween, don’t you think?

So let’s kick off this frightening new price point with a $2.99 story very fitting for the season, shall we?

HUNTING SEASON – A Love Blood Story by Blake Crouch and Selena Kitt

For those of you scratching your heads, wondering how in the heck the pair of us ending up writing together, given that our genres are so vastly different, I’ll explain. Back at the beginning of the year, I’d posted some of my sales numbers on Joe’s blog, which at the time were astronomical (I was making $30,000 a month at Barnes and Noble alone!) and Joe jokingly said, “If you ever want to collaborate, let me know!”

I’d just finished reading and reviewing DRACULAS – and being the huge horror fan that I am, how could I resist? I emailed him to say, “I know you were kidding, but I’d love to collaborate with you guys.” And to my surprise, Joe Konrath and Blake Crouch actually took me up on the offer! They were planning a sequel to DRACULAS called WOLFMEN, and wanted me on board, along with a fourth writer (who has yet to be disclosed).

It made perfect marketing sense to cross-pollinate their audience and mine, which were both large, but vastly different.

Of course, no one knew if this great idea would work in practice…

So Blake Crouch agreed to take me out for a test run, and that’s how this story was born. The collaboration process was, I must say, an amazing success, and I couldn’t be prouder of the result. I really think this story is something special—but I’m probably a little biased!

If you want to know more about how HUNTING SEASON: A Love Blood Story was written, what the process was and how things developed, there’s an interview between myself and Blake included as bonus material at the end.

It’s available on Amazon and Barnes and Noble for… you guessed it.

$2.99.

Is it worth it?

You be the judge!

HUNTING SEASON – A Love Blood Story by Blake Crouch and Selena Kitt

This 8,000 (approx) word collaboration by thriller/suspense/horror writer Blake Crouch and erotic romance author Selena Kitt includes bonus interview material with the authors about the upcoming sequel to the Konrath, Crouch, Strand and Wilson bestseller DRACULAS.

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He’s a butcher.

She’s the trophy wife of a trophy hunter.

They used to be high school sweethearts, but that was two decades ago, and times have changed.

Meet Ariana Plano...40 years old, miserable, stuck in a loveless marriage to the worst mistake of her life.

Meet Ray Koski...40 years old, miserable, a lonely butcher who can do nothing but immerse himself in the drudgery of his work.

Once a week during hunting season, she brings her old teenage flame game meat for processing. They do not speak. They rarely make eye contact. Some histories are just too painful.

But this week will be different.

This week—a shocking encounter twenty-two years in the making—will change everything.

Joe sez: In November, I'm going to raise some of my prices on shorts, just to see how it goes. In December, I'll do the same with novels.

No gain without risk. I'm on a lot of bestseller lists, and raising prices may make those ebooks fall off, resulting in fewer sales. But will they be so many fewer I earn less money? Only way to find out is to try it.

As for HUNTING SEASON, it was a really fun, very twisted horror story, perfect for Halloween.

And yes, it was worth the $2.99.

Guest Post by Barry Eisler

The Bogeyman and The Axe Murderer

Barry sez: A lot of conversation in and about the publishing world is fixated on fear of Amazon’s purported potential monopoly power—on the possibility that Amazon will eventually enjoy such market dominance as a publisher that it will abuse its position and begin to punish authors, perhaps with extremely low royalties. Which leads to aquestion I’m not sure I can adequately answer, though I find it fascinating:

Why all the fear about what Amazon might do in the future, when legacy publishers are doing those fearful things right now?

Today, Amazon pays self-published authors 70% of the retail price of titles sold on the Kindle Store through Amazon’s Kindle Direct Publishing. Legacy publishers, by contrast, pay their authors 17.5%. Now, certainly 17.5% is appallingly low. But if appallingly low royalties are your concern, why would you expend so much energy speculating about a lower royalty that might eventually come to pass, while caring so little about the extremely low royalties in effect today? It’s like panicking about possibly getting sick in the future while failing to treat the pneumonia killing you right now.

I know from experience that some people will respond to the paragraph above by claiming New York publishers are not a monopoly. After all, don’t the big houses fight with each other over new manuscripts? Aren’t there sometimes bidding wars over a hot new property? And they even poach each other’s employees and authors, too. So of course there’s competition, right?

No. Everything I just described is, relatively speaking, a distraction—Kabuki competition, not the real thing. If the legacy houses actually competed with each other—if they actually strove to attract authors and serve readers and lower costs and improve performance—the publishing world would not be universally characterized by the following:

• An identical, lock-step, onerously low 17.5% digital royalty rate
• The practice of forcing readers who prefer digital to wait, sometimes for over a year, until a title is also ready to ship in paper
• Digital retail prices equivalent to paper ones despite the obvious lower costs of digital distribution
• Byzantine and opaque royalty statements, delivered twice-yearly as much as six months after the end of the applicable reporting period
• Non-compete clauses that attempt to preclude authors from meaningful control over their own professional and artistic destinies
• Morbidly obese contracts delivered months after agreement on high-level deal points, written in unendurable legalese and drawn up in nine-point font on 14-inch legal paper, the only purpose of which is to intimidate authors into not reading the document, and to obscure the meaning of what’s written just in case they do
• Payments tendered months after they’ve come due
• A refusal to share sales data with authors, even though authors have long clamored for such information and the web technology to provide such access was already old a decade ago.

We can argue about whether the system I just described is properly known as a monopoly, or as a quasi-monopoly, or as a cartel. What can’t be argued is that such a system is only possible—indeed, is only conceivable—in the absence of meaningful competition.

So don’t go for the head-fake—the bidding wars, the poaching contests. These are as meaningful between publishing houses as are election contests between Democrats and Republicans; wars between Hapsburgs and Bourbons; arguments between supposedly liberal and supposedly conservative media. The skirmishing on the surface is meaningless by comparison with the cooperation, collusion, and confluence of interests beneath.

Which brings us back to my original question: why are so many authors afraid of a possible monopoly while sanguine about a real one?

I can think of several possibilities.

First, fear is a powerful emotion, and, as Gavin de Becker observes in his superb The Gift of Fear, is by definition related to something that hasn’t happened yet. Once the feared thing has happened, we’re no longer afraid of it. New York’s quasi-monopoly is a longstanding and accomplished fact; therefore, it can’t be feared (though it can be loathed). By contrast, Amazon is relatively new in publishing. Whether it will attain and abuse monopoly power is currently unknown, and therefore is something people can fear. It may be that because of the nature and survival value of fear, the mind ascribes greater weight to potential threats than it does to actual problems, and this difference might explain the skew between fear toward Amazon and acquiescence to New York.

Second, and perhaps related, is the concept of the devil you know. Sure, New York functions as a cartel, but it always has, and people are accustomed to it. It seems normal. Amazon, by contrast, is unknown.So hey, your husband beats you, but it’s been going on for a long time and you’ve survived. Do you really want to divorce and remarry? Maybe the new guy will beat you, too. Maybe the beatings will be even worse. Better to stick with what’s familiar.

Third, and again perhaps related, is Stockholm Syndrome, or what might also be known as a serf’s attitude toward his feudal lords (Mike Stackpole calls it a “house slave” mentality). New York has been abusing authors for so long that a lot of them have come to identify with their oppressors—to think their oppression is desirable and even just. And rather than welcoming a powerful new player as a potential rescuer or reformer, these authors fear the new entrant and fling their bodies over their captors in an attempt to protect them from harm.

For me, that last metaphor really gets to the heart of the matter. Amazon is like an inkblot test of submissiveness to New York, with some authors welcoming a newcomer with the clout to crack the cartel wide open; and others fearing anything that might change their current circumstances.

Well, you know what the inkblot looks like to me. I think you’d have to be in profound denial to believe that Simon and Schuster’s recently announced Author Portal, which will finally give authors the kind of access to sales data they’ve been pleading for, is the result of anything other than a belated attempt to counter Amazon, which provides authors such information as a matter of course. If legacy publishers next clean up their royalty statements, which are currently designed to be as transparent as the Dead Sea Scrolls, the timing and circumstances of that improvement will be no more coincidental than their sudden conversion to the benefits of sharing sales data. I just got my first royalty statement from Amazon, by the way, and it’s the first royalty statement I’ve ever seen that I immediately and easily was able to understand. Amazon also provides its statements monthly, not twice-yearly, so expect legacy publishers to coincidentally change that practice in due course, too.

Will Amazon become functionally the same kind of publishing monopoly the New York houses currently comprise? I don’t know. But it’s silly to argue that you’re afraid solely because you believe Amazon wants to be a monopoly, as though a monopoly motive is itself dispositive. All companies want to be monopolies—a company wants competitors like an army wants a fair fight, like a politician wants a serious opponent, likea lover wants rivals. Without means and opportunity, motive alone is meaningless, and I’m confident that with competitors like Apple, B&N, Google, Kobo, and Smashwords, Amazon will be driven to continue pursuing business practices based on enlightened self-interest. Another thing that will be useful in this regard is more and more authors creating their own website stores, and cross-selling each other’s books on them. The more choices authors identify, create, and exploit, the more motivated Amazon and other publishers and distributors will be to continue to offer favorable royalty splits and to otherwise treat authors well.

Because, remember. If Amazon ever becomes a real monopoly, they could lower those 70% royalties a lot. After all, oppressively low royalties are simply what monopolies do, and Amazon could lower theirs all the way down to, I don’t know, 17.5% or something. And a royalty rate that low would really suck. Damn, just imagining it scares the hell out of me.

Will the New York houses be able to shake off their torpor and rebuild their businesses based on more enlightened practices? It’s hard to say. The same monopoly that protects a company’s profits also withers its strength and adaptability. A company coddled by monopoly is like a fighter who never trains—who never even fights. Will a company like that be able to answer the bell when a real challenger enters the ring? I don’t know.

What I do know is that a vigorous new player just kicked open the locked door of a dark and moribund fortress and is finally letting in some sunlight. If you see a better way than Amazon to reform New York’s previously unassailable quasi-monopoly and all the suboptimal business practices that monopoly has enabled, I’d like to know what it is. In the meantime, I welcome Amazon and any other new entrant that can continue to loosen the legacy houses’ monopolistic grip,and force them to rely on practices beneficial to authors and readers rather than on monopoly rents beneficial only to themselves.

Because, remember. A 17.5% digital split for authors would be a terrible thing. Little better than serfdom, really. We simply can’t afford to let that happen.

Joe sez: I've mentioned many of the things Barry brought up in this essay on previous blogs, but I'd like to add a few things.

Let's pretend that Amazon will lower author royalty rates on April 1, 2013. How does that prevent any author from taking advantage of the 70% royalty rate until that date? You can make quite a bit of money between now and then. Why worry about then, now?

But there is no set date. Amazon may never lower author royalties. So why would the possibility of something that may never happen prevent you from trying something right now? This isn't bungee jumping, where you can die, or gambling, where you can lose a lot of money. Right now, a system is in place where authors can earn 70%. Anyone who doesn't take advantage of that is, IMHO, irrational.

I see irrationality creeping up in other areas too, concerning Amazon and self-publishing. Authors have flat-out asked me how much they can expect to earn by self-pubbing, as if it is a guarantee of money. When I reply (as always) that luck plays a part, they respond they'd rather wait for a legacy deal and the chance to make it big.

There is so much wrong with that logic I don't know where to begin.

No matter which publishing path you choose, luck plays a part. Having played for both teams, I can tell you that legacy publishing requires a lot more luck than going solo. The more people involved in something, the more chances it has to fail. When you throw in poor royalty rates, dwindling paper distribution, returns, and non-existent marketing budgets, it is almost astronomical that any new author ever makes money.

Which is why most don't.

Holding out for a legacy deal isn't a guarantee of anything, other than an advance.

I'm not going to name names or point fingers, but I've been watching Amazon rankings of some self-pubbed authors who signed legacy deals. I've watched these rankings go from awesome, to mediocre (or worse.)

A notable exception is John Locke, because he kept his ebook rights. The rest have got to feel disheartened, unless they got a huge advance and sales don't matter.

But sales do matter, don't they? That's why we became writers. To be read by as many people as possible.

Right now, this very minute, writers have the ability to directly reach readers, quickly and easily with a great royalty rate.

Luck still plays a part. And this moment might not last forever.

But if you want to make a go at this, there has never been a better time. Missing this opportunity isn't smart. And if you're sitting on intellectual properties, waiting for some legacy publisher to sweep you up and make you a bestseller, you might as well be running for Mayor of Deludedville.

It's a bird in the hand, guys. Make money and find readers now, or hope to win the lottery later. This is especially deluded because those authors who have won the lottery (like me and Barry) are giddy to be able to get away from legacy publishers.

We've seen and heard from dozens of authors who had legacy deals, and are now thrilled to be self-publishing.

But where are those authors who have given up self-pubbing and are now singing the praises of legacy publishers?

Are there any?

Don't you think there is a reason there aren't any?

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Guest Post by Blake Crouch

THE MOST INTRIGUING EBOOK MARKET IN THE WORLD

Blake sez: I've just returned from a five day trip to China, where I was invited by a Chinese digital publishing company called Cloudary Corporation to speak at the Beijing International Book Fair.

The trip was an extraordinary experience, and not only culturally where I benefited from a surplus of generosity from my hosts, but from the standpoint of catching a snapshot of the current state of Chinese publishing.

The comparison to American publishing could not be more apt.

Without oversimplifying a complex situation, the Chinese are experiencing almost identical tension between traditional publishing and the advent of the ebook as we are here in America.

They even call their old-school publishers "traditional publishers."

At the forum where I presented, I was involved in a discussion with an American publishing consultant, and three Chinese writers who publish digitally.

I could've just as well been sitting on a publishing panel in America. Different language, same bullet points.

My Chinese counterparts are passionate about all the things American ebook writers are excited about: fair royalty rates, the ability to release books faster, getting paid in a timely manner, and most importantly: creative control.

The audience I spoke to was filled with traditional Chinese publishing stalwarts, who expressed....wait for it...concerns about "gatekeepers" disappearing. In other words, who would bring work of quality to the Chinese readers if there wasn't an elite coterie to separate the good from the bad.

The most classic moment was when Robert Baensch, an exceptionally impressive publishing expert of fifty years who has worked and consulted at all levels of Big 6 publishing told these Chinese legacy publishers that if they don't adapt to the new model afforded them by digital publishing, then "someone will come in, take your job, and do it for you."

Sound familiar? Denial is not just domestic.

On a quick side note, Baensch sees the refusal of publishers across the world to properly embrace and exploit ebooks as an epic "managing" fail.

Here was my second, bigger surprise....the Chinese don't just share our enthusiasm of ebooks. They are beating us in not only volume but creativity.

In China, there are numerous ereaders available, but most of the digital reading public reads on their 780,000,000 mobile phones.

As a writer, what I found most fascinating was the publishing model of Cloudary Corporation, the company that invited me to China.

Cloudary is the largest online community-driven literary platform in China. But they operate in a vastly different manner than Amazon, BN, or Smashwords. Instead of one platform populated by complete books, they aggregate content from a variety of websites, each tailored to a specific genre. And the most popular, most famous, richest Chinese digital writers release content as they write it. They author long, ongoing works, thousands of pages in length, and most popular is a genre of time-travel/fantasy in which young adults go back in time to visit historical moments in Chinese history where they play an integral role in fixing or changing something.

Getting back to the Cloudary model, the Cloudary writers publish portions of their "active" books on a daily basis to ravenous fans, who, if the writer is too slow in releasing the next installment, harangue them on public forums for the next chapter. If the writers don't release new content quickly enough, the fans desert them.

Cloudary has six writers earning more than $1,000,000 RMB/year, (about $200,000 US).

Of course, not everyone is successful. But anyone can begin the process of uploading their work. It's essentially a competition and the readers decide who wins, voting with their pocketbook, with page-views. Readers establish an account, which is docked based upon how many pages they read. When a certain book becomes popular, and heavily-viewed, Cloudary steps in on a partnership basis, where the royalty split is in the ball-park of 50/50. At this level, Cloudary plugs these popular books into various print and film channels to exploit additional sub rights.

But the thing is...digital is the big money earner in the most populous, most literate country in the world.

In addition, the mobile phone companies distribute a percentage of the content. Imagine if AT&T or Verizon hosted content and paid us as writers. That's the comparison.

I'm still processing the head-spinning information overload, but I was thrilled and humbled to witness firsthand to what level the largest market in the world has taken ebooks.

What this implies for us non-Chinese speaking writers, I'm still not sure, and I am not encouraging anyone to go pay to have their works translated, so we can skip all the hysterical tweets.

The complexities and challenges of bringing ebooks to such a diverse marketplace will be great.

To say things are different in China is the understatement of the year.

When the Kindle debuts in China, it will be interesting to see how and if it can compete with Cloudary.

Different culture. Different digital reading model.

But the point is they're having the same conversations we are, they're more innovative, they've got a lot more readers, and we would be fools not to begin actively looking for ways to export our work.

Joe sez: I've been blogging about the potential inherent in a world market for a while now. Not just a world ebook sales market, but also a world library market.

There are almost 7 billion people on earth. One billion of them speak English. The other 6 billion can be reached via translation. The worldwide standard of living is constantly going up, giving more and more access to cheap electronics such as ereaders and cell phones.

Authors don't have access to all of those people...yet. But we will. And if we can sell to the smallest fraction of the global market, we'll be making a very nice living.

Soon, Amazon will release a Kindle in India, which has the second largest English-speaking population in the world. And they won't stop there.

It is true that we can't know what new technologies are on the horizon, or what new formats ebooks will take. But the cat is out of the bag. Ebooks are here to stay, in one form or another, and they are going to go global the same way wrist watches, cars, radio, TV, microwaves, and mp3 players did.

There has never been a better time to be a writer.

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Guest Post by Jeffrey J. Mariotte

On Never Quitting

I used to think Joe Konrath was full of shit.

Here’s the thing. Since 1980, I’ve worked in the book business. I’ve been a bookseller, a writer, a publisher. Currently I co-own an independent specialty bookstore, Mysterious Galaxy (locations in San Diego and Redondo Beach, CA). The bookstore has never made anybody rich, but we’ve been in business for going on 19 of the most tumultuous years in the history of bookselling, and we’re still going strong.

I’ve worked for two start-up comic book publishers, in different capacities, both of which printed comics and books on paper, and both of them got to be major forces in that industry, and were acquired or partially acquired by much bigger companies with lots of money.

As a writer, I’ve published 45 novels on paper, most from the so-called Big 6 (my main publishers have been Simon & Schuster and Penguin, but HarperCollins and Tor and Warner/Hachette have been in the mix as well). In addition to those, I’ve published more than 100 comic books and graphic novels, a handful of nonfiction books, some short stories. Again, I haven’t gotten rich, but I was working as a full-time writer, having quit the publishing jobs and bought my little dream ranch in the high desert.

And then Konrath—Joe, who had put ungodly amounts of his advance money into promoting his books—got a book rejected and self-published it digitally and said he was actually selling copies. Then he started blogging, bragging about how many copies he was selling, and how he had found a way to make a living as a writer without using the traditional publishers.

See? Full of shit. The industry doesn’t work that way.

Only, he wasn’t. He really was selling books and writing more books and selling those, and making money on this new e-book thing.

I couldn’t see it. I’m a print guy. For decades. I collect books, mostly signed modern first editions. Some of Konrath’s included. Working in publishing, I was responsible for felling dozens, if not hundreds, of trees. Ditto bookselling. Ditto writing. Trees and books went together.

Then last year, the game changed.

I was looking out at 2010 and there were no book contracts on the horizon. The Great Recession had finally clobbered publishing, hard. Editors were getting laid off, lines were being cut. And e-book sales were cutting into print sales, but the big publishers had not yet figured out how to monetize that end of the business. They were treating it like just another format, not understanding that virtually everything about it is different than selling paper books. Those editors who remained were being more cautious than ever about what projects they took on.

With the day job as buffer, I could afford to take some time and write the best book of my career, rather than having to write three or four or five books a year to make ends meet. I did that. I sent it to my agent.k on. My pitches went out, but no offers came back. I was forced—and this is hard to admit, even now—to take a day job again.

It has not yet sold.

I kept working on other projects. I’ve had two novels out this year from Simon & Schuster, one a CSI tie-in novel, one a revised and updated reissue of a teen horror series, now titled Dark Vengeance.

And over there sat Konrath and then Barry Eisler, and my friends J. Carson Black and Scott Nicholson and Lee Goldberg, and some guy with the unlikely monicker of John Locke, and others. The list was growing. These folks were publishing e-books. Self-publishing e-books.

And as an aside, let me just tell you—in the interwoven worlds of publishing and bookselling, the only thing lower than someone who self-publishes is someone who publishes through a “vanity” press, like Vantage or iUniverse. The rule was, if you had to pay money to be published, you weren’t really published. If the only criteria the publisher used before they accepted a manuscript was whether your check cleared, you weren’t really published.

So that Konrath guy—he had to be full of shit.

Because I was doing it the right way, submitting my work to the same big publishers that had published me so many times before, and I was getting nowhere. But he and those others, they were self-publishing and building audiences and selling books.

Okay, I finally thought. I’m a print guy. But I’m a writer, and if that’s what it takes to make it as a writer, then sign me up.

I put out an e-book reprint of my one-and-only small press novel, a horror epic called The Slab. I put out an original thriller that I didn’t even try to sell traditionally, called The Devil’s Bait. I pulled together a collection of short horror fiction called Nine Frights. I did it all myself, even the covers. I self-published.

Now, I’m not here to claim that I’ve had anything like the success that Joe et al have had. I’ve been selling some books, but not boatloads of books.

Nor am I going to claim that I’m giving up on the world of print. I love it too much. My agent is still out with the thriller, and in a few weeks he’ll have another novel to shop.

What I will say is that I want to write, and I want to be paid for my writing. And to that end, I will, as much as possible, try to keep a foot in both camps. Because—you already knew this—Joe was not full of shit, and there is a world over there in e-book-land. There are people there who love to read but who don’t need to hold a paper book in their hands to believe it’s worthwhile. There are people who don’t need to see a publisher’s colophon on the spine—who don’t need a book to have a spine, in fact.

Every bookseller knows writers who have given up. They get a book published, or a few books, and they don’t sell. Offers stop coming, and they stop writing. Who knows what great writing we’ve been deprived of because the business, as it has been established for decades, didn’t see a way to turn a profit on those people?

Some of us are more tenacious than that, or more driven. We write and if we don’t sell we write something else. We don’t quit because we have faith in our abilities, even if the people in New York don’t.

And, it turns out, there’s another way. There are options.

Who knew?

Yeah, okay, Konrath knew. Some others knew. It just took this print dinosaur a while to catch on.

Guess I have to apologize to Joe. Sorry, man. I take it all back. I was wrong.

But you? You were right all along.

Bastard.

Joe sez: This is a ballsy post by Jeff because it goes against basic human nature. One of my truisms is that people would rather defend their beliefs to the death before opening their minds and considering alternatives. Jeff is entrenched in the world of paper, yet is willing to pursue other options. That isn't easy to do, and kudos to him.

He's not asking me for advice, but that never stopped me from giving it, so here it is.

1. Change your self-pub covers. They look homemade, and are probably limiting your sales.

2. Obviously I think searching for a legacy publisher is a waste of time, but even if that is your goal, there is no reason why you can't self-pub those as ebooks while your agent shops them around. There have been many cases of self-pubbed ebooks being picked up by publishers, and you could be making some money on these titles right now. Amazon in particular is buying a lot of self-pubbed titles for their imprints, and they are incredible to work with.

3. Read the post I did with Blake Crouch about how to save indie bookstores. Not a single bookstore has taken us up on our offer, and I know many authors willing to do the same thing Blake and I are suggesting.

4. Start self-pubbing your out-of-print backlist. It's buried treasure, just waiting to be unearthed. The more self-pubbed ebooks you can release, the more virtual shelf-space you occupy, the easier you are to find.

5. Raise the prices on your novels to at least $2.99. Various mounting evidence, along with insider info I can't go into, has convinced me $2.99 ebooks are pretty much always more profitable that 99 cent ebooks. I know that "insider info" comment smacks of bullshit, but I've been talking numbers with certain entities who have proof of this.

I don't believe there is a race to the bottom, and even though ebook prices will go down, pricing a novel between $2.99 and $5.99 seems to, according to my super-secret sources, generate more income than the 99 cent price point.

Now, you shouldn't take my tight-lipped word for it. But you should, as I have always encouraged, experiment with price points. Raising your prices $1 per month (November $1.99, December $2.99, January $3.99) then comparing figures, is a smart idea. It takes some guts, but you've already shown you have guts.

Recently, Blake Crouch and I raised all of our novel prices to $3.99 on Nook. Amazon will probably be next, once we sort through the data. We've also agreed that Stirred, which will be released at $2.99 on November 22, will go up in price after the initial launch.

And to those who whine, "But Joe, you said $2.99 is the perfect price point!" reread my previous comment about keeping an open mind and considering alternatives.

Paper books won't ever go away completely. But they will become a niche market. The legacy paper publishing industry can't survive on a niche market, and they haven't shown authors any value when it comes to the ebook market (and certainly nothing worthy of keeping 52.5% royalties.)

I'll continue to warn authors against pursuing legacy deals until I see substantial change. But so far, no change has come, other than the pathetically laughable announcement that they're finally sharing sales figures with authors.

Are you fucking kidding me? After decades of purposely obtuse, criminally slow royalty statements, they've actually chosen to allow authors to see how many books they're selling? Atta boy! How very progressive!

Pinheads.

Correct me if I'm wrong, but shouldn't this have been available to authors TEN YEARS AGO, when Nielsen Bookscan was launched?

How about just saying, "Sorry we've treated you thousands of authors so unfairly for the last decade in regard to your numbers, but now we're willing to release this data you already should have had."

There are multiple reasons publishers have been obtuse with sales figures. Because keeping authors in the dark suits a number of purposes, not the least of which is maintaining control over them. Because it is easier to hide the money that way. Because they themselves are so poorly run they often may not know how many they've actually sold. Because authors have never been treated fairly in other aspects of the biz, so why treat them fairly in this instance.

The fact that they decided to announce this in a big way is like a celebrity going on national TV and proclaiming, "I know I've said some shit in the past, but I really don't hate minorities anymore! Really!"

Ack. Fail. What a comedy of errors.

But I've gone off on a tangent...

Whichever path you choose to walk, keep an open mind and consider your options. That goes even if you are doing both legacy publishing and self-publishing. There are always more options to consider, more experiments to try. Don't get tied down to ideology, tradition, or loyalty.

You are the author. You are the essential component in the reader/writer relationship. Treat yourself accordingly.

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Guest Post by Adam Pepper

In July, I self published my dark urban fantasy novel, SYMPHONY OF BLOOD: A Hank Mondale Supernatural Case. The process leading up to this decision caused me to rethink my entire worldview on writing.

I’ve been circling the periphery of the publishing business for over a decade. I’ve had two agents, written five novels, accumulated hundreds of rejections but failed to land a mass market deal. I have had some success in the small press and built a loyal, grassroots following but I’ve always aspired to more. I wanted to be in the bookstore, front and center. I came from the school that always measured success by the size of your publisher. I was taught to start at the top and work your way down, no matter what you were trying to publish. Always aim high. Never settle.

The pecking order was easy to see, especially for genre fiction. New York publishers on top. Then other major publishers. Next, the reputable small presses. Then the niche and micro presses. And way, way, way at the bottom was self publishing. The place for wannabes without the talent to succeed. They were chumps, worse than hacks. At least a hack could write for a check. A self publisher was the bottom feeder.

These beliefs were so deeply ingrained in my thinking they weren’t easy to shed.

I’ve known Joe Konrath since before his first novel was published and I’ve always liked and respected him. I’ve been reading his blog since it began. But when Joe started talking up self publishing, I snickered. Then, my snickers changed to, “well it works for him but it won’t work for me.” What Joe calls Stockholm Syndrome, I know all too well, because I had a nasty case of it! Many of my friends and colleagues still suffer from it. It’s not easy to dismiss an entire mindset. Especially when you’ve built everything around it, your hopes, dreams, career aspirations—your entire identity even. You’ve invested countless man-hours into achieving it. And suddenly, you scratch your forehead and realize, “Wow. Konrath may have a point!”

People tend to focus on the extremes, and they do so at the expense of their own career. We aren’t all going to be Hocking or Locke any more than we’re going to be Patterson or Connolly. Most of us won’t win lotto either.

You don’t plan a career around winning lotto.

Make no mistake about it, playing the slush game, trying to rise above the mountains of manuscripts, getting past the intern, then the junior people, then the senior people, all of whom--no matter how well intentioned--are human beings who are overwhelmed and inundated with submissions, bring their own personal biases and subjective tastes to the table and generally treat slush with equal parts horror, humor and contempt.

It’s lotto, plain and simple.

I’ve seen many friends land deals and I’ve been nothing but happy for their successes, but I won’t concede they were better writers than me. Their work simply resonated with one person in a position of power who was able to make it happen. The question that I asked myself wasn’t how can I be the next Konrath or Locke, but simply what was best for my career? Put the preconceived notions aside and truly be objective. I’ve watched this industry and see what goes on. There’s no vast conspiracy to see Adam Pepper fail; there’s merely apathy. The only person I can truly count on to build my career is me.

I remember reading an interview with literary agent Scott Hoffman where he compared authors who submit to the slush pile to a desperate girl sitting by the phone waiting to be asked to the prom. At the time it infuriated me. He was calling me a loser. What the hell else was I supposed to do? To me it was just another insider who had no clue what it was like to be on the outside breathing steam on the glass trying desperately to get noticed. In fairness to Hoffman, I was in a bitter state of mind and I don’t have the quote in front of me today. But now, that’s sage advice. Why passively sit around praying for a break when you can take it upon yourself? Why play the slush lottery when you can stack your own deck? For the first time since I’ve been in this game, writers truly don’t need an agent or a publisher to succeed. Authors need an audience. And the audience is out there, reachable and eager to be captured.

Getting caught up in rhetoric. Choosing sides. Prognosticating. None of that means a thing to me. Selling books and reaching readers does.

I’ve always had the talent and the drive, now I have the opportunity. Digital books and the internet truly are the great equalizers. Self publishing wasn’t made for Konrath and Eisler, it was made for me. The guy who played by the rules, followed every guideline, submitted to every market, and never got a shot from New York. Now, here’s the chance to drive my own carriage instead of waiting for my editor in shining armor.

It took a long time to realize this. But I’m glad I have. SYMPHONY OF BLOOD has been out just two months. It’s been in and out of the top 100 Dark Fantasy ebooks on Amazon and the reviews have been great. The response from book bloggers has been positive. There’s been a nice presence on GoodReads and Library Thing. So far so good.

I have plans for two more indie books by holiday season. One of them is currently on submission with a big six house. I’m going to pull it and publish it myself. Sound insane? It does to me too. After all, I’ve spent the last decade building relationships with industry people in hopes of launching a career. There aren’t many editors in NY who give me the time of day, but this one does. I’m very grateful for the interest he’s shown in me. But I’ve reassessed everything. What gives me the best chance at success? If the editor was truly interested, he would’ve asked me to the prom by now, and I’m done waiting by the phone. It’s my career. After a decade of chasing a dream that was totally out of my control, I can’t tell you how incredible that feels.

Joe sez: Adam was one of the first horror writers I became chummy with, while doing the convention circuit back in 2003. I dug his first book, Memoria, but Symphony of Blood was terrific. When I read it, years ago, I was sure it would get picked up by a major house. It's a cool horror noir novel with a cool hero and a cool monster, and it has a huge twist in the middle that throws readers for a loop.

(Side note--it's 99 cents on Kindle right now. Buy it.)

But it didn't sell. Adam, like many other authors I know, was screwed by the system. Because the system, as it exists, eventually screws everybody.

The only authors still pursuing legacy deals are:

1. Those who have never had them, so their views are all rosy and idealistic. As Adam said, they're waiting for that phone to ring. In the past, there was no choice. Now, it's rather pathetic.

2. Those who have had legacy deals, and have convinced themselves it's the only way to make a living. As I've said before, this is Stockholm Syndrome. The publishing industry does not care about authors. They also are inept when it comes to making books profitable. Why are you still dancing with an abusive partner? Unless they're paying you HUGE money, I can't think of a single reason.

Yes, this is a lottery. Luck plays a huge part.

But you can get lucky on your own terms, by self-pubbing. Or you can get lucky based on the whims and trends of an industry that treats authors poorly, makes lots of bad decisions, and has a terrible profit track record.

In other words, you can put your fate in the hands of the readers, or a group of dinosaurs who are making themselves extinct.

Side note: I just had a one hour conference call with Amazon yesterday about the November 22 release of STIRRED, and it blows me away how smart these folks are. It was unlike any conversation I've ever had with any Big 6 publisher. Amazon truly understands that an essential part of making money is treating authors fairly. They pay much better than the Big 6, listen to and implement authors' ideas, and understand numbers on a near-savant level.

As a result AMAZON HAS MADE MONEY ON EVERY BOOK THEY'VE PUBLISHED.

Reread that sentence above. Now compare that to a Big 6 publisher, who only makes a profit on 1 out of 5 books they publish.

Now, there is no one-way ticket to success. Any way you go, you'll need luck. But legacy publishing involves a lot more luck and doing it on your own, or signing with Amazon, and legacy publishers can actually worsen your luck.

I just got my royalty statement for AFRAID. It has made $60k since 2009.

The two books Hachette rejected, TRAPPED and ENDURANCE, have made $160k since 2010.

My book TIMECASTER, published by Berkley, has failed miserably, saddled with a high ebook price and a terrible, generic cover. I begged them to sell it for $2.99. I begged them for a different cover. I begged them to put J.A. Konrath on the cover, since I have a huge fanbase. My pleas fell on unsympathetic ears, and the sales suck.

And don't even get me started about how much money I'm losing on my Jack Daniels books--try a few hundred thousand dollars per year.

Figure out what your goals are, and pursue them. But pursue them logically, armed with information, and don't be afraid to change your goals if the information changes.

Being naive, or having Stockholm Syndrome, shouldn't be among your goals.