A number of other authors has weighed in on similar issues, motivated in addition by three recently released studies on author incomes and book sales. The first study summarizes the results of a survey of members conducted by the Authors Guild. According to Publishers Weekly, the survey revealed that "the majority of authors would be living below the Federal Poverty Level if they relied solely on income from their writing."
This is a scary conclusion. Is it correct? There is some evidence that the survey sample may not be representative of the wider population of authors
is based on responses from 1,674 Guild members, 1,406 of whom identified either as a full-time author, or a part-time one. The majority of respondents also lean older—89% are over the age of 50—and toward the traditionally published end (64%).Specifically, the sample seems to exclude a lot of self-published authors, focusing on older, more established and traditionally published authors. But punting on its accuracy for now, the numbers are grim
Given that a single person earning less than $11,670 annually sits below the poverty line, 56% of respondents would qualify, if they relied solely on income from their writing. The survey also indicated that not only are many authors earning little, they are, since 2009, also earning less. Overall, the median writing-related income among respondents dropped from $10,500 in 2009 to $8,000 2014 in 2014, a decline of 24%. The decline came for both full-time and part-time authors with full-time authors reporting a 30% drop in income to $17,500 and part-time authors seeing a 38% decrease, to $4,500.The conclusion many have drawn is the one pushed by Mary Rasenberger, executive director at the Guild: “Authors need to be cut in more equitably on the profits their publishers see, or we’ll stop seeing the quality of work the industry was built on.”
The second study was conducted by Association of American Publishers (AAP), whose 1200 members include the “Big Five”: Penguin Random House, HarperCollins, Simon & Schuster, Macmillan, and Hachette. The results were summarized by Alexandra Alter in the New York Times in an article whose title The Plot Twist: E-Book Sales Slip, and Print Is Far From Dead summarizes the message:
Now, there are signs that some e-book adopters are returning to print, or becoming hybrid readers, who juggle devices and paper. E-book sales fell by 10 percent in the first five months of this year, according to the Association of American Publishers, which collects data from nearly 1,200 publishers. Digital books accounted last year for around 20 percent of the market, roughly the same as they did a few years ago.The Times article also cites the rebound in the number of independent bookstores as evidence that print demand is stabilizing.
E-books’ declining popularity may signal that publishing, while not immune to technological upheaval, will weather the tidal wave of digital technology better than other forms of media, like music and television.
It is important to note, however, that the AAP study also focuses on sales of traditional publishers and ignores independents. Some evidence on independents can be gleaned from the third study, the recently released Author Earning Report, which looks at eBook sales through Amazon, and which finds that
the “Big Five”: Penguin Random House, HarperCollins, Simon & Schuster, Macmillan, and Hachette — have seen their collective share of the US ebook market collapse:Other authors have weighed in on this, and the data I discussed earlier this week, with some varying opinions.
- from 45% of all Kindle books sold down to 32%
- from 64% of Kindle publisher gross $ revenue down to 50%
- from 48% of all Kindle author net $ earnings down to 32%
Chuck Wendig weighed in with his thoughts in Peaks and Valleys: The Financial Realities of the Writers Life. Like me, he also noted that the sample may not be representative by pointing out that neither he, nor most authors he knows, are members of the Guild. As for whether excluding eBook sales matters, Wendig points to this:
Of course, what you also need to note is that publishers set the e-book prices, and have in the last several months bumped those prices up, up, up — and Amazon undercuts those prices by dropping the physical copy cost.John Scalzi has also weighed in with eBook Sales and Author Incomes and All That Jazz. Scalzi addresses both issues raised above. On declining author incomes, he points to alternatives sources of incomes for writers that are probably not counted in the Guild survey:
But with respect to writer incomes dropping via the Author’s Guild survey, this is one place where I wish we had better (which is to say more comprehensive and in some way independently verifiable) reporting from indie authors, because I suspect there’s a lot of money not being reported out there, not only in terms of direct indie/self-publishing unit sales, but through other avenues like Kickstarters and Patreons, which I anecdotally see adding a non-trivial amount of income to writers’ bottom lines. I suspect these are avenues that a lot of writers who are used to particular income paths are either not aware of, or exploiting — or perhaps can’t exploit because their established audiences are used to paying in them in particular ways. I’d love to see the figures on who crowdfunds, in terms of age; my suspicion is that it skews younger.As far as eBooks, he is inclined to think the data reflect short run factors related to traditional publishers relationship with Amazon:
Would this money I suspect is going missing substantially move the needle in terms of overall author incomes? I don’t know. I suspect it might, but it’s possible not as much as some people cheerleading indie/self-publishing would like to admit.
I’ve noted before that I think in general there are three kinds of authors: Dinosaurs, mammals and cockroaches, where the dinosaurs are authors tied to an existing publishing model and are threatened when it is diminished or goes away, mammals are the authors who rise to success with a new publishing model (but who then risk becoming dinosaurs at a later date), and cockroaches are the authors who survive regardless of era, because they adapt to how the market is, rather than how they want it to be. Right now, I think publishing might be top-heavy with dinosaurs, and we’re seeing that reflected in that Author’s Guild survey.
What we’re missing — or at least what I haven’t seen — is reliable data showing that the mammals — indie/self-publishing folks, in this case — are doing any better on average. If these writers are doing significantly better on average, then that would be huge. It’s worth knowing.
I don’t think declining eBook sales from publishers means they’re doomed, doomed, either. This is in part because (and this seems to be a point of some confusion) there’s more to publishing than maximizing eBook sales numbers in the short term. Publishers, for example, might decide that it’s in their long-term interest to stabilize and even grow the print market, and price both their eBooks and print books in a manner that advantages the latter over the former in the short term.He also points to other short term factors associated with the rise of the eBook market itself, such as this point made by a publisher:
Why would they do that? For a number of reasons, including the fact that Amazon is still 65% of the eBook market in the US, and publishers, as business entities, are appropriately wary of a retailer which a) clearly has monopsonist ambitions and tendencies, b) has been happy to play hardball with publishers to get its way. Investing time in strengthening alternate retail paths makes sense in that case, especially if, as the article suggests, consumers are happy to receive the book in different formats for an advantageous price. If people fundamentally don’t care if they read something in print or electronic format, as long as they get a price they like, that leaves publishers a lot of room to maneuver.
.@scalzi A publisher's take: ebook sales inflated as people bought up backlist releases. Now down to more realistic levels overall.
— Beth Meacham (@bethmeacham) September 23, 2015
Cedar Sanderson, an independent author, gives us her two-cents worth in Publishing’s Bellwether. Sanderson pays particular attention to problems with data on book sales:See, here’s the thing. Print books are, in theory, externally trackable through the Nielsen BookScan data, which is notoriously unreliable. In theory, publishers ought to know what their sales numbers are, but there are two problems with that data. First, they aren’t going to release proprietary and sensitive information to the public. Secondly, publishers themselves often rely on BookScan, and as Dorie Clark writing for the Harvard Business Review put it “Shockingly” slow and outmoded: “Publishing through a traditional house? Most of us get weekly Nielsen BookScan reports—courtesy of Amazon—and sales figures every six months from our publisher.” Studies compiling data from both BookScan and the Association of American Publishers have ‘holes’ in their data. “The AAP and Nielsen data, while providing useful information that can point to important trends, does have some holes. As mentioned, AAP data doesn’t cover the entire industry, while Nielsen BookScan data doesn’t cover e-books. And lack of reliable e-book data is the most important omission.”Sanderson interpret the sales data that I talked about last time as evidence of cross-subsidization in book selling and, in particular, the subsidization of "literary" work by best-sellers:
So the books that pay off for the publisher obviously subsidize the books that are published solely on ‘literary merit’ and the scapegoat trots off blithely into the desert to take his chances with the fickle public. With the rise of Indie Publishing, the scapegoat is no longer a necessary thing. No one can force an independent to bear the burdens of his less fortunate fellow authors, who write for awards rather than to sell books and make money.In her mind, the rise of independent publishing will result in the end of this cross-subsidization.
The flock is hearing that bell jingle, and they are changing their path to follow him toward the good green pastures. “It’s a world where authors with plenty of Big 5 sales experience choose to say, ‘You know what, I’m not playing this game any more.’ Where authors make a positive choice to walk away from the terms offered by good, regular publishers. This new era of publishing is one where authors have a meaningful choice.”
Amanda S. Green has views that are similar to Sanderson's.
I think there is a lot of truth in each of the above opinions. I suspect that the fiction market is in decent shape driven by the expansion of independent publishers, but also supported by some strength (if not strong growth) in the sales of traditional publishers. The experiments that traditional publishers have been running with the pricing of eBooks probably explain some of their recent sales results and especially the decline in their share of eBooks. I do not think this bodes well for their long-run financial health but suspect that they will eventually realize that they need to reform their eBook pricing model.
As for the end of cross-subsidization, I would point out that the inherent riskiness in publishing---it is hard to know in advance exactly which titles will sell---means that publishers will always release a portfolio of books knowing that some will do better than others. Ex post (after we know how sales turned out) some books will turn out to make money while others lose money. This looks like cross subsidization but is really just the outcome of holding a diversified portfolio of titles.
That does not mean that there is no ex ante cross subsidization: some well-known authors are no doubt surer bets than many new authors. But how much cross subsidization is going on here? I suspect the well known authors are commanding much bigger advances and more lavish supporting expenditures. But if there is cross-subsidization, I think Sanderson is correct that some of these bigger authors will eventually take the independent publishing route in order to collect some more of the profits that they generate. However, nothing in economic theory says that cross-subsidization is inevitably bad for consumers, and so in contrast to Sanderson's opinion, ending this system need not be a good thing for consumers as a whole.
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