Archive for the “Book Economics” Category

I published Mediactive a little over a year ago. The project, including the sale of publication rights in Japan, is in the black financially. And I’m ready to try some experiments as I move toward version 2 of the book and website.

Barry Eisler, who published his latest thriller, The Detachment (highly recommended) with Amazon, suggested I try this: Cut the price, temporarily, to 99 cents — and watch what happens. In his case, the book rocketed up to the top of the Kindle sales rankings.

So I’ve done that. For a limited time, the Kindle version of Mediactive is just $0.99. Obviously I’m not going to move to the top sales spot. But I’m looking forward to seeing what happens.


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Terrific piece by Cory (a friend) about who’s cut out for self-publishing, and who may not be. Excerpt:

I firmly believe that there are writers out there today who have valuable insights and native talent that would make them natural successes at marketing their own work. If you are one of those writers – if you have a firm theory that fits available evidence about how to get people to love your work – then by all means, experiment! Provided, of course, that you are pleased and challenged by doing this commercial stuff that has almost nothing in common with imagining stories and writing them down. Provided that you find it rewarding and satisfying.

 

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I’ve just signed a site license with a journalism school for the e-book. We worked out a sliding scale of payments. The university will pay a discounted rate from the list price for the first 40 copies. For each copy beyond that, up to 250, the rate will be lower yet. And after 250, the license will be free for anyone else at the university who wants to download the book.

This is a good deal for both sides. The school gets a deeply discounted book. I get some cash. If more schools sign up for this kind of thing, I could end up making a non-trivial amount of money.

Why should the schools pay? Because they are engaged in a business arrangement in which they sell courses to students and assign this book as part of that arrangement. The Creative Commons license I’ve used to publish Mediactive allows copying at will for non-commercial purposes, but universities using the book in classroom settings are, in fact, engaged in a commercial activity even if the universities are not-for-profit entities themselves.

My agent, David Miller, says he’s heard of major publishers doing site licenses for books. He hasn’t heard of self-published authors doing it this way. That doesn’t mean it hasn’t happened, of course — but it’s definitely new to me! (I continue to learn new things about the publishing business with this project, which is one reason I’m doing it this way…)

If you are teaching journalism (or anything else) and are interested in using this book, please get in touch to discuss a site license. They book isn’t expensive even at its list price, but there are even better deals for bulk orders, especially e-book bulk orders.

By the way, I’m working with several colleagues on lesson plans for Mediactive. They’re coming along nicely and will be available, if all goes well, by mid-summer or so. We have a few nifty ideas in mind for this part of the project, so stay tuned.

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Some members of the traditional publishing industry don’t care for what I write, and some who do aren’t thrilled with one of the ways I try to spread my ideas. So when Mediactive appears between dead-tree covers a bit later this year, the traditional publishing industry won’t be in the mix.

I’m going with Lulu, a company that understands the changes in media. This is a self-publishing service — an operation that takes my work and turns it into books that can be sold, by me and by anyone else who wants to sell them.

Some background: Last fall, when I started serious work on the book part of this project, I was under contract to the publisher that brought out We the Media a few years ago; we parted company in January. At which point, my literary agent — the beyond-terrific David Miller of the Garamond Agency — started looking for a new publisher.

My former publisher was fine with Creative Commons, as proved by the fact that we did the first book that way. But as David told me at the outset of the new search, I was likely to limit the potential field because I had one non-negotiable requirement: The book will be published under a Creative Commons license. In this case, as with We the Media, the kind of Creative Commons license would say, essentially, that anyone could make copies of the work for non-commercial use, and if they created derivative works, also only for non-commercial purposes, those works would have to be made available a) with credit to me and b) under the same license.

The principle was simple: While I want my writing to get the widest possible distribution, if anyone is going to make money on it I’d like that to be me, my publisher and my agent.

Almost a decade after Creative Commons was founded, and despite ample evidence that licensing copyrighted works this way doesn’t harm sales, book publishers remain mostly clueless and/or hostile. As David explained to editors, the main reason I’m still getting royalty checks for We the Media is that the book has been available as a free download since the day it went into bookstores. Had we not published it that way, given the indifference (at best) shown by American newspapers and magazines, the book would have sunk without a trace.

That logic persuaded no one in New York (not that we got that far in most cases — more about that below). And to my genuine if not major regret, the Creative Commons roadblock forced me to turn down a deal from a publisher that would have been perfect for this project had I only been writing a book and nothing more.

Two points: First, and most obviously, if a principle means anything, you stick by it when doing so is inconvenient, not just when it’s easy. Second, this isn’t just a book, at least not way traditional publishers understand books even as they dabble online.

To publishers, books are items they manufacture and send out in trucks. Or else they’re computer files to be rented to publishers’ customers, or customers of Amazon, Apple and other companies that use proprietary e-reading software to lock the work down in every possible way. In both cases, publishers crave being the gatekeepers.

Mediactive aims to be a multi-faceted project. Over the next few years, I hope to experiment in lots of media formats and styles with the ideas here. And — this is key — I also plan to experiment with it in the broader context of the emerging ecosystem of ideas.

That ecosystem is evolving at an accelerating rate, and the people who have had specific roles in the one that prevailed in the past — authors, literary agents, speaking agents, editors, publishers and others — are going to have to change with it. Some get this and some don’t, but I’m happy to say that the people I work with directly at this point are definitely in the getting-it category. (I’ll talk much more about this broader context in an upcoming post.)

Meanwhile, I’m having terrific conversations with the folks at Lulu. They aren’t the only outfit of this kind around, by any means, but I like the way they see their own part of the emerging ecosystem.

Incidentally, had I signed with a traditional publisher, the book would not have reached the marketplace for a year, most likely, if not even later. With Lulu, it’ll be available this summer.

Rejections

Editors from big publishing houses have a habit of rejecting books in what they must believe is a kind way. They say something to this effect: “It’s really interesting and we like Dan a bunch, and while it isn’t for us we’re sure it’ll find a great home with someone else.”

Please, folks. Any competent author would prefer this: “We didn’t like it, and here’s why….” Honest criticism is more helpful.

One reason several editors did offer was a bit surprising. An editor wrote, echoing several others, “The main problem that people had was that they felt that they knew much of the information that Dan was trying to get across…”

Wow. You mean that people who read and publish books for a living already know the value of deep and thoughtful media use? Uh, one of the major motivations for this project is the ample evidence that way too many other people don’t know this.

In my days as a newspaper reporter, I learned that the only audience that really counts is your editor. It  was a reality in the world of highly concentrated media, but no more. Any serious writer needs a good editor, but people who become your audience — and if you do it right, your collaborators — are the ones who really count.

Another reason for saying No had the ring of actual truth: The publisher’s publicity and marketing people “felt that the major media would avoid the book because of the criticism of their techniques.” One reason I’m writing it…

Lulu

It was after I turned down the New York publisher’s offer that I contacted Bob Young, Lulu’s founder and CEO. Bob also started Red Hat, one of the first companies to prove that it was possible to make money with open-source software by providing services, and he’s been an ardent supporter of ensuring that what we call “intellectual property” involves as many choices as possible.

Bob had told me about Lulu several years earlier, and in that conversation he’d suggested it would be a good fit for me someday. Now, we both thought, this might really be the time.

He put me in touch with Daniel Wideman, who runs what Lulu calls its new “VIP Services” for established authors making the move to this kind of publishing. Daniel said he very much liked what I was trying to accomplish in this new project, and we had several further discussions. In the end it was clear to me that this would indeed be a good fit.

So here we go. I’ll be letting you know how all this works, by which I mean many of the details of the process.

Back to work…my to-do list has just gotten a whole lot longer. But it’s my list this time.

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kindle.pngA number of folks whom I admire greatly have signed a petition aimed at Amazon’s control-freakish policies with its Kindle e-book reader. The most notable recent example of what’s wrong with the Kindle is the remote-deleting of books that people had bought (with a refund).

The irony in Amazon’s action, since the deletions included George Orwell’s 1984, contributed to the mini-firestorm that erupted. In any case, Jeff Bezos, Amazon’s CEO, publicly apologized. That was a smart and welcome move, but his letter to the Amazon community carefully didn’t promise not to do it again. This disappoints me as an author, Kindle owner and owner of a small amount of Amazon stock. (And I’m glad to see that a student is standing up in court against what happened to his own note-taking in the electronic edition.)

The petition to Amazon was organized by the good folks at the Free Software Foundation, an organization I respect immensely. You can read it here.

Although I agree with almost everything the petition says, I declined to sign. My reason was the use of the word “demand” — a word that, as I said to a foundation staff member, feels wrong in every way.

It strikes me as hollow to demand anything. Just as the incessant use of the word “must” in newspapers editorials — as in “President Obama must do this or that” — betrays editorial writers’ fundamental impotence in such matters, demanding that people do this or that seems so unlikely to lead to action that it’s nearly pointless.

I prefer to urge, and try to persuade. So here’s the petition language (which I proposed but which was not adopted) that I’d have gladly signed:

Our way of life based on the free exchange of ideas, in which books have and will continue to hold a central role. Devices like the Kindle are setting the standard for how people interact with books, but the use of software to control, monitor, or eliminate users’ books from afar constitutes a clear threat to the free exchange of ideas.

That is one reason why we — readers, authors, publishers and librarians — strongly urge that Amazon remove from the Kindle device the ability to control or access the books its users have purchased.

Amazon’s assurances that it won’t abuse this power are insufficient. Having this power is the problem. Until the company gives up this capability, the company will be tempted to use it — or may be forced to use it, by narrow private interests or by governments. Whatever Amazon’s motives for maintaining this control may be, they are not nearly as important as the public’s freedom to read books without interference or supervision.

Meanwhile, we are actively seeking alternatives to the Kindle. We will support — with our dollars, and the common sense that when we buy something we should own it — the companies that understand, and provide, true freedom of speech in the marketplace of ideas.

In the end I think Amazon will come around on this, but I also believe the people there will be unnecessarily put off by your petition, which may make it counterproductive to all of our goals.

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A New York Times reporter asks an interesting question — How Much Should an E-Book Cost? – in a Week in Review article, but her reporting is so shallow that the answer is murky at best.

kindle pic 999She starts this piece with an anecdote about a best-seller by political thriller writer David Baldacci. The book’s Amazon Kindle price was originally set at over $15, but that price set off a rebellion among the author’s fans, one of whom wrote on the comments at Amazon that the price was just too high to bother with his work.

The fan’s comment, Rich writes:

was a chilling sentiment for authors and publishers, who have grown used to an average cover price of $26 for a new hardcover. Now, in the evolving Kindle world, $9.99 is becoming the familiar price. But is that justified just because paper has been removed from the equation?

For many readers, this may sound like sufficient reason. Buying music, after all, is so much cheaper now that there aren’t discs and plastic cases. Shouldn’t the same logic apply to books? And if not, won’t the temptation to steal electronic copies online simply increase?

Publishers and authors say it is much more complicated than the cost of paper and shipping. The lower e-book price “is not sustainable,” said Mr. Baldacci, whose novels regularly rise to the top of hardcover best seller lists. If readers insist on cut-rate electronic books, he said, “unfortunately there won’t be anyone selling it anymore because you just can’t make any money.”

First things first: The price of Baldacci’s book was re-set at $9.99 (a price I will henceforth refer to as $10), and it’s selling like digital hotcakes; I guess you can make money this way, after all. Nowhere in the article is this mentioned. I truly hope that’s a reflection of sloppy editing, not incompetent reporting.

Now, sellers have every right to charge more for popular books, especially when they’re new. This is basic supply and demand. But the revolt by Amazon customers has had everything to do with the publishing industry’s belief that it can charge higher prices for inferior products.

The kinds of books I buy for my Kindle, as I noted in a recent piece for the All Things Digital site, fall generally under the casual entertainment category. I buy a Kindle book the way I buy a movie ticket — for books, like most movies, that I’ll read or watch once and forget about. A physical book is more like a DVD–something I want to own and enjoy again and again.

So my Kindle purchases are like the books I used to buy in airport newsstands, such as mysteries, thrillers and semi-trashy novels that I’d sometimes leave in hotels or airplane seat-back pockets once I’d finished them. And once I got accustomed to reading e-books, I started doing something that had been out of character in the analog era: buying new books that, in print, were available in hardcover only. Why? The $10 price felt right. In fact, my new-book purchases soared.

Then the Kindle prices started soaring for new best-sellers. I stopped buying. (I save these titles to a list I keep on the Amazon website, called “Too expensive on Kindle,” and periodically check to see if the price has dropped. So far, not yet on any of these.)

Hiking prices this way creates a bad deal for the customer. Amazon’s price for a new hardcover is typically just a couple of dollars higher. This means I could buy the hardcover, read it and donate it to my local library, and–after the tax deduction–come out ahead. I’d do even better taking the book to my local used-book store and getting cash.

The ability to give away or sell a used book is called the “First Sale Doctrine” in copyright law. But by sending me a digital file and tethering that file to a specific device, Amazon and the publishers have removed my right to transfer it, and thereby destroyed a portion of the book’s value. By all rights they should offer me a better price, considerably better, than the hardcover (or, for that matter, softcover) edition.

Nowhere in Rich’s article does she even hint at this. Moreover, she appears to entirely take the word of publishers on several key facts, notably when they claim that Amazon’s $10 price is a loss-leader and not a price to which they’ve agreed. An Amazon customer service person told me that the higher new prices for Kindle books were a reflection of the publishers’ decision that they, not Amazon, wanted to charge higher prices.

I’m not saying all this to defend Amazon (in which I own a small amount of stock). In fact, I find the Kindle an extremely troubling device, in part because of the way it removes my rights to do what I want with what I’ve purchased. Amazon’s digital rights management system is, like that of the DRM employed by the entertainment industry for movies and music (thankfully disappearing with the latter), a system for restricting customer rights, and it’s bad news in every way.

Moreover, I agree with Cory Doctorow that the publishing industry is foolish to allow Amazon to set the terms of its future existence, as Amazon is certainly trying to do. The publishers could market their own electronic versions and cut out the middleman entirely (like my publisher, O’Reilly Media – though O’Reilly sells via Amazon, too, in non-DRM versions in all cases). Amazon’s value-add, however — or their own myopia — is sufficiently robust that they toe the line, at least in part.

The whining by author Baldacci, unchallenged by reporter Rich, is just pathetic. No one is forcing him to release his books in digital form. He and his publisher are entirely free to say no, or to offer their own digital edition. The real worry, as Rich does report:

The doomsday scenario for publishing is that the e-book versions cannibalize higher-price print sales. Publishing houses, already suffering from the recession, could be forced to cut author advances or lay off more editors.

Ah, now we understand what’s really going on in this situation. It’s about the enormous advances that Baldacci might have to trim. It’s the possibility that people will buy at the paperback price (actually higher) for a new book, not that they’ll stop reading what authors write.

The business is definitely changing. It’s too bad that publishers and rich authors are resisting change with all their might.

It’s equally problematic that journalists on these issues can’t be bothered to dig just a little deeper when they raise important questions.

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Mediactive by Dan Gillmor is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 United States License.
Permissions beyond the scope of this license may be available at http://mediactive.com/cc