Thursday, March 31, 2011

Why Zero Sight Will Only Cost $2.99

What can you buy for $2.99?

  • one Starbucks skinny vanilla latte
  • or 2 loaves of white bread
  • or 3 small apples
  • or 4 tea candles
  • or 5 ounces of toothpaste
  • or 6 Dirt Cheap Premium Light beers
  • or 7 first-class stamps (almost)
  • or 8 paper cups
  • or 9 chicken McNuggets
  • or 10 yards of floss
  • or 11 chocolate chip cookies
  • or 12 eggs
  • or 250 pages of novelly goodness with tons of magic and mayhem

    Raw eggs may cause a biotin deficiency. Choose the Novel!


    Wait. $2.99? Have you gone mad, Mr. Shier? Why is Zero Sight selling for such a low price?

    Because the game is changing. 

    Let's look at the standard math:

    • A hardcover novel costs $25.00; the author earns $2.50 (10.0%)
    • A trade paperback costs $14.00; the author earns $1.05 (7.5%)
    • A pulp paperback costs about $8.00; the author earns $0.64 (8.0%)

    Wait, authors only get 10% of the sale price?

    Yep.

    Many people are surprised by how little authors make on paper books. After all, $25.00 is quite a bit of money. But unless they're someone special, they're only walking away with 10% of those sales.

    Why?

    Because to produce print novels, you need large publishing houses, numerous distributors, and thousands of retail stores. Plus, publishing is not unlike the fashion industry. Each year has it's own trends, fads, and not so tiny surprises. But months (if not years) before their release dates, publishers have to guess which books will be hot, and retailers try to decide how many copies they want to buy. If and when they miscalculate, thousands of books get left on the shelves. That is a terrible waste of both paper and money. And these losses must be absorbed somehow. The publishing houses have come up two simple solutions—pay authors less and charge readers more. 

    Their decision making was understandable, but it was also poisonous. Big list prices generated even bigger problems. I might spring for a new Jonathan Franzen novel at $25.00. Franzen's an awesome writer, I've read all his books, and I can't wait to get my hands on anything new he's written. But Franzen is the exception, not the rule. I wouldn't want to risk $25.00 on an unknown—and I'm guessing that you wouldn't either. This apprehension created a logjam. New authors became risky propositions. They didn't sell many hardcovers, and hardcover sales determined which books get reprinted as a paperbacks. Publishers make most of their money on hardcovers, so they decided to only take a few risky bets like this per year. They focused on maintaining the great Franzen-esk brands they already had. For many years, it was rough going for new authors. It was also not good for the industry. Instead of developing more new talent, they were stuck burning future revenue streams to answer the needs of the day.

    Fortunately, ebooks came along and offered a different paradigm:

    Under Amazon's new scheme, as long as an ebook is priced at or above $2.99, the author walks away with 70% of the sale. The reader gets an 88% discount off the hardcover price and doesn't have to deal with one of those cursed dust jackets. (I never know what to do with mine. I hate it when I rip them, so I remove the jackets while I read...they seem to serve the purpose opposite their intent.)

    But why the dramatic change in royalties?

    Because ebooks eliminate paper waste and printing costs. Retailers don't have to worry about inventories, and much of the pre-emptive guessing has been removed from the system. Online ratings help filter the good from the bad, and hesitant readers can peruse free samples before committing to even a $2.99 purchase. Authors now sink or swim on their merits, and Amazon and Barnes and Noble have passed some of these savings on to their authors and readers. That's why you can buy a brand new book for 8-times less than a hardcover, while I still earn a respectable profit.

    If you haven't picked up an e-reader yet, I would urge you to do so. Zero Sight is not the only indie title out there. I've personally discovered dozens of books that I wouldn't have dared pluck off a bookstore shelf. E-readers have turned out to be the opposite of what many of us feared—they encourage more reading, not less. And it's the adventuresome kind. The kind we thought we lost. That's why I'm not just excited to be an author right now—I'm excited to be reader.

    The only one not happy is Dieter. It looks like he's not gonna catch a break!

    B.

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