eBooks are not declining as much as you might think

by on September 6, 2016 at 3:22 pm in Books, Data Source, Web/Tech | Permalink

And self-published “indie” authors — in part because they get a much bigger cut of the revenue than authors working with conventional publishers do — are now making much more money from e-book sales, in aggregate, than authors at Big Five publishers.

And this:

The AAP also reported, though, that e-book revenue was down 11.3 percent in 2015 and unit sales down 9.7 percent. That’s where things get misleading. Yes, the established publishing companies that belong to the AAP are selling fewer e-books. But that does not mean fewer e-books are being sold. Of the top 10 books on Amazon’s Kindle bestseller list when I checked last week, only two (“The Light Between Oceans” and “The Girl on the Train,” both mass-market reissues of novels that have just been made into movies) were the products of major publishers. All the rest were genre novels (six romances, two thrillers) published either by the author or by an in-house Amazon imprint. Their prices ranged from 99 cents to $4.99.

That is from Justin Fox at Bloomberg.

1 Bill September 6, 2016 at 3:31 pm

Excuse on the first day of class by a student who failed to read his reading assignment:

The Robotic Dog Ate My Ebook.

2 JWatts September 6, 2016 at 3:35 pm

It would be nice to have a decent rating system for eBooks on Amazon. The Amazon rating system is highly gamed. A large number of either 1’s or 5’s is usually a case of some type of gaming of the system.

I’ve had some success with GoodReads. Does anyone else have recommendations for other rating sites or systems?

3 KM32 September 6, 2016 at 3:58 pm

I work in publishing. I can’t speak for other products, but this is not true for books. The vast majority of those ratings are actual readers.

4 JWatts September 6, 2016 at 4:39 pm

“The vast majority of those ratings are actual readers.”

I see plenty of new sci-fi books come out that are mediocre at best and yet have a large percentage of 5’s They might be actual readers who bought the book, thought it was great and wrote a review. However, it seems more likely that someone is soliciting good reviews. It’s quite possible that the authors themselves use conventions and an active Facebook page to gen up loads of great reviews from various contacts. I don’t mean to imply that Amazon is gaming the system, just that it’s easy to game.

Plus, Amazon has a re-occurring problem whereby people who bought an audio book and had problems with playback will post a review that shows up as an e-Book review. A 1 star (“I hated the readers accent”) audio book review shouldn’t be mixed in with the eBooks review.

5 ivvenalis September 6, 2016 at 7:20 pm

I think this is a combination of even minor-league authors having a couple of fanboys who will reliably upvote works (we’re talking maybe a dozen max here, right?), the fact that many users consider the ratings binary (5 = worth a read, 1 = I didn’t like it), and yeah probably some legitimately illegitimate reviews. For what it’s worth, I and others have noticed that “nerds” seem to be proponents of the binary voting system (“sucks/rocks dichtomy”).

The whole problem is easily avoided by actually reading 2 or 3 reviews, anyway, and disregarding anything obviously low content.

6 Harun September 6, 2016 at 9:32 pm

Fakespot can help show if the reviews arereal

7 Hadur September 6, 2016 at 3:37 pm

I have a friend who makes about $20,000 – $30,000 per year writing novels he sells as self-published eBooks on Amazon. The novels are very niche, and sell well despite most of the reviews being mediocre and noting the high incidence of typos. He serves as his own editor and his own graphic designer.

8 Melmoth September 10, 2016 at 1:59 am

Which genre?

9 rayward September 6, 2016 at 3:44 pm

Of course, the problem for e-books is that they compete with so many distractions, like email and twitter and texting and browsing the internet. But don’t books? I can’t check my email with a book. Books never read fill space on the bookshelf. E-books never read are like the dog who never barked.

10 8 September 6, 2016 at 4:30 pm

The big publishers are dinosaurs who don’t like the new market because it cannibalizes their business. The independent publishers can sell books for $5 and the writer earns more money than he does with his big publisher selling the books for $12.99. No overhead.

11 prior_test2 September 6, 2016 at 4:43 pm

‘The independent publishers can sell books for $5’

Amazon begs to differ, at least if Baen can be trusted – ‘The good news is that Baen ebooks will be available directly from Amazon, making it easier than ever for new readers to discover some fantastic fantasy and science fiction. No longer will you have to log in, purchase books, and then transfer them via USB or have Baen email them directly to your Kindle. The process was simple enough for the technically inclined, but not quite simple enough for your grandpa.

The bad news is that those fantastic bundle deals will no longer be available once the distribution agreement takes effect, which will be in just a few days. If there is anything you’ve been thinking about getting, now is the time to do it. The early bundles (starting way back in 1999) are the best deal; as little as $10 for four full length novels, many of them omnibus editions that actually comprise 2-4 novels each. Prices gradually increased over the years, so current bundles are now $18 each and generally include seven full length novels.

Future monthly bundles will still be available, but the catch is that you have to purchase them in the three month window *before* the books are actually published, taking advantage of a loophole for serialized publications. Once the books are in print, you can download your monthly bundle purchase in your choice of formats, just as you have always been able to do, and impatient readers will be able to read the first quarter, half, or three-quarters of upcoming books during the pre-publication window. If you absolutely, positively can’t wait for the next book in the series from your favorite author, you can also purchase eARC (electronic advance reading copies) that will be available exclusively from Baen.

Individual ebook prices will also be going up from the now standard $6, based on each title’s place in the print cycle. Newly published books that are only available in hardcover will be $9.99, trade paperbacks will be $8.99, and mass market paperbacks will be $6.99. This is one of the most disappointing portions of the deal; $6 was a price point low enough to tempt one into taking a chance on new authors. Newer books are still more expensive, leaving readers with the choice of waiting for a book to come out of hardcover several months to a year later, or pay almost twice as much for books from their favorite authors.

Sadder still, it is “unlikely” that future Baen hardcovers will come with those wonderful CDs absolutely stuffed with free content, including plenty of full length novels, that were perfect for sampling new authors and sharing with your friends and family. If you’re quick, you can still download the full CDs from the Fifth Imperium, but don’t delay too long–the easily browsed CD directories have already been removed from the site. Your only chance to get them at this point is to download the full CD zip files or ISOs. Baen’s popular free library has diminished significantly as well, with only a few books, short story collections, and reading guides currently available.’ http://www.pocketgoddess.com/2012/12/big-changes-at-baen-some-good-some-not-hint-buy-ebook-bundles-now/

12 JWatts September 6, 2016 at 4:56 pm

“‘The independent publishers can sell books for $5’

Amazon begs to differ, at least if Baen can be trusted –”

Actually you just helped make 8’s point. Baen raised its prices and also raised its royalties to its authors when it signed on with Amazon. So, it’s more profitable at Amazon pricing.

13 prior_test2 September 7, 2016 at 6:00 am

‘So, it’s more profitable at Amazon pricing.’

So, Amazon distributes book for free? Really? Baen’s Webscription was a leader in the e-book marketplace with multi-format, non-DRMed texts, being one of Amazon’s most significant competitiors in this marketspace more than 15 years ago – in part, as noted by Eric Flint, because Baen did not feel, and then proved using sales figures, that the DRM war was in its readers’ interests.

Amazon is not interested in competitors undercutting its margins, even if Baen was more than content to sell e-books for more than a decade at a price that Baen felt more than reasonable in Baen’s eyes.

That Baen passed on a significant amount of this forced – not voluntary – price increase to the authors is just another example that not all publishers are the same. One can read Flint’s Prime Palaver essays here for a bit more insight on how Baen’s fairly innovative online strategies have been submerged by Amazon’s desire to keep the marketplace conforming to Amazon’s desires – including forcing an independent publisher to artificially raise its prices as part of a distribution deal.

14 JWatts September 7, 2016 at 11:13 am

Why do you consistently feel the need to try and shape everything into some kind of narrative avoiding any inconvenient facts? I’m quite familiar with Baen, having been a customer for many years.

“So, Amazon distributes book for free? Really?”

Yes they do. Really. Even a casual check would have shown you that Amazon has pages of eBooks available for a free download.

“Baen’s Webscription was a leader in the e-book marketplace with multi-format, non-DRMed texts, being one of Amazon’s most significant competitiors in this marketspace more than 15 years ago …”

Sure and I’ll point out that Baen eBooks are still DRM free.

15 The Lunatic September 6, 2016 at 8:01 pm

You’re quoting, sure, you’re just not understanding. Baen is a traditional print publisher. Not one of the Big Five, sure, but an AAP member, not an ebook indie in the sense 8 was speaking of. It has all the overhead of a traditional print publisher working out of NYC. Thus it can’t sell for $5 on Amazon like the ebook-only indies; the combination of their costs plus Amazon’s cut forces a higher price.

16 prior_test2 September 7, 2016 at 5:40 am

Baen was a leader in selling – and giving away free – non-DRMed e-books before the Kindle was even a gleam in Amazon’s eyes.

The major reduction in the variety and breadth of the Free Library was another victim of Baen needing to agree to Amazon’s terms as a distributor, it should be noted.

17 prior_test2 September 7, 2016 at 6:20 am

‘not an ebook indie in the sense 8 was speaking of’

Just to emphasize this point – Baen was an e-book pioneer. One whose sales grew as it offered increasing amounts of online and digital material that could be copied and distributed. The CDs enclosed in various Baen hardcovers can still be legally found in digital form for anyone to download at a web site such as http://baencd.thefifthimperium.com/ Recognizing that Baen’s offerings are not exactly to everyone’s tastes, for years Baen offered the opportunity for its readers to legally read digital texts representing a significant amount of money at book list prices. With the full approval of authors such as Drake and Flint and Weber, it should noted.

Clearly, innovative marketing strategies that could pose a threat are the sort of thing that Amazon has no interest in seeing further developed. (And sure, things change, of course – CDs/DVDs are not a growth market, and Baen’s perspective on DRMed texts was not exactly mainstream or to the taste of traditional publishers or digital distributors at the time, not to mention the software companies offering DRM that ensured no access to a text except in a fashion authorized by the license owner.)

18 The Lunatic September 7, 2016 at 4:07 pm

Baen was an e-book pioneer.

Yes, they were an ebook pioneer. They are also a traditional publisher with traditional structure and a traditional paper product line and associated costs, which meant that they could not sell for $5 on Amazon, which pure ebook plays do manage. Baen sold new novels for $6 on their own site pre-Amazon, and given the Amazon cut, to make the same profit on Amazon they made on their own site, they had to charge more on Amazon.

Clearly, innovative marketing strategies that could pose a threat are the sort of thing that Amazon has no interest in seeing further developed.

Amazon doesn’t care about “innovative marketing strategies”, pro or con. What Amazon cares about is being used as advertising for a site that undercuts them on price. So Amazon has a MFN clause in its contracts, where you can’t charge more for an electronic edition on Amazon than you charge for the electronic edition elsewhere. The side effect of that clause is that Baen has to choose between giving electronic editions away free everywhere, including Amazon, or nowhere, including on the Free Library and on CDs. Given that choice, Baen chose to reduce giveaways, since free giveaways on Amazon wouldn’t have had the same effects as they had on the CDs and the Free Library.

Baen is headquartered in Wake Forest, NC

Well, somehow I missed that they moved from the Riverdale, Bronx, NYC location back in 2000. I don’t feel too bad about it, because they’ve still got a Riverdale PO box mentioned on the website ( http://www.baen.com/submit ) and use a Riverdale dateline on their press releases ( http://www.baen.com/pressrelease-baenfantasywinners2016 ).

19 prior_test2 September 7, 2016 at 6:23 am

‘It has all the overhead of a traditional print publisher working out of NYC.’

A final note – Baen is headquartered in Wake Forest, NC, and that is where mail is sent to. Maybe you are confusing Baen with Tor?

20 Edgar September 6, 2016 at 5:10 pm

The AAP press release that Fox links to says that “After peaking in 2013 at $3.24 billion, eBook revenue declined to $3.20 billion in 2014 and again in 2015 by 11.3% to $2.84 billion. Unit sales also declined by 9.7%, with eBooks now making up 17.3% of the trade book market.” One wonders how such figures reflect other trends in e-book retailing. Project Gutenberg and Amazon continue to increase the already vast library of free classics for kindle. Is that cutting into “book” revenue while helping maintain “device” sales and do such ‘purchases” of freebies count as “units sold”? Similarly, Amazon and other services offer access to titles by subscription. For a monthly fee you can read as many as you want of the catalog made available for that program. How would that fit into revenue/units sold figures? Another trend are the “complete works” editions available for kindle. For example, when I wanted to get a copy of D.H. Lawrence’s The Kangaroo, I just bought the entire 22 volume complete set from Delphi for $2.99. One unit or 22 sold? And where do podcasts fit in? If you are paying Apple for a podcast series do they count in “book on tape” figures?

21 The Lunatic September 6, 2016 at 7:47 pm

For example, when I wanted to get a copy of D.H. Lawrence’s The Kangaroo, I just bought the entire 22 volume complete set from Delphi for $2.99. One unit or 22 sold?

For purposes of the AAP numbers, zero units sold, which is much of the point of the critique of the AAP numbers. AAP is only counting sales by AAP members, and at least at a first glance Delphi isn’t one.

22 Edgar September 7, 2016 at 10:48 am

Thank you!

23 So Much For Subtlety September 6, 2016 at 7:14 pm

It is odd no one points out the obvious – mainstream publishers are billion dollar companies that employ thousands. Yet they cannot reliably pick books that people want to read. They are being humiliated by the independents. It is not that the economics are favorable or not. It is that the Big Publishers publish books that no one is willing to pay for. They are willing to take a chance on some unknown stranger on the internet who may have got his sister and her friends to write him a recommendation.

I expect that this is because the Big Publishers mainly hire single female English literature graduates and there is a limited market for embittered politically correct Sex and the City knock offs. That is ignoring the fact that they are regularly humiliated by publishing frauds that any sensible editor should have spotted.

24 Thomas Taylor September 6, 2016 at 7:52 pm

“I expect that this is because the Big Publishers mainly hire single female English literature graduates and there is a limited market for embittered politically correct Sex and the City knock offs. ”

I am sure you do. At the other hand, there is an unlimited market (os it just an u limited supply) for embittered sexism and racism at Internet. At least, if priced at its true value, zero.

25 So Much For Subtlety September 6, 2016 at 9:15 pm

Racism? How could I have forgotten the racism? Shameful really. Because yes, traditional publishing is something like 90% White. It is not merely the daughters of doctors publishing for the wives of doctors, it is the White daughters of White doctors publishing for the White wives of doctors.

Upper Middle Class, left wing, White, female. The rest of the country does not look like that. And not surprising they do not read books produced by and for people like that.

We know the rest of the country has different interests. The big publishing Houses would not touch the Left Behind series – one of the biggest selling book series in the history of the planet. Harry Potter was turned down by almost 30 of them. Too White and middle class ironically.

We know that Black audiences have different interests to what the middle class White cultural gate keepers think they should like. They do not want to read Maya Angelou. No one wants to read Maya Angelou. When it comes to films Tyler Perry is one of the most successful film makers of all time. He is a Black film maker who makes films for Black people – which no White person has ever watched.

So until the 1% of the population works out how to talk to the other 99%, whether it is the working class White proportion of that 99% or the Black proportion or the Hispanic proportion, or the patriotic proportion or basically anyone who doesn’t think Woody Allen is the great film maker of all time, they are going to go out of business.

If the readers want embittered racism and sexism, then the people who publish it will survive and the people who sneer at them for it won’t. Simple as that.

26 Thomas Taylor September 6, 2016 at 10:07 pm

“Like many first-time authors, Rowling struggled to get her first book, Harry Potter and the Philosopher’s Stone published. (The name was changed to Harry Potter and the Sorcerer’s Stone in the United States.) The book was rejected by over a dozen publishers. Finally, a small British publisher, Bloomsbury, said yes. Bloomsbury saw the potential of the book because the chairman of the publishing house gave the first chapter to his then eight-year-old daughter, Alice, to read. Upon finishing, she immediately demanded the rest of the book. However, Bloomsbury was not convinced that it had a bestseller on its hands. Rowling’s editor, Barry Cunningham, warned her that she needed to get a day job because it was impossible to make a living writing children’s books.” — http://www.biography.com/news/jk-rowling-harry-potter-facts

Not enough eight year-old girls working at the big publishing houses in England too, it seems. Of course, IF American publishing houses had been too eager to bring Harry Potter to the USA (specially while turning down Left Behind), Left Behind readers would quickly have considered it just another step towards Obama’s New Order (they do it anyway). When dealing with crazy people, the only winning move is not to play (by the way, if publishing crazy ramblings is the recipe of editorial success, soon or later, the Internet will replace books– and the living will envy the dead).

27 So Much For Subtlety September 6, 2016 at 11:00 pm

They could hire more eight year old girls. Or they could hire someone as children’s book editor who has a vague relationship with what children want. Call me a wild eyed idealist but I think if you’re paid the big bucks to commission children’s books, you should have some idea what children like.

A more telling example of the bankruptcy of the mainstream publishers would be hard to find.

There is no evidence the Big Publishers dislike publishing crazy people. They dislike publishing lower class people. If you are a middle class crazy person – and especially on the Left – they will publish you without any problem at all. Rant about the Anti-Christ and you’re out. Rant about vaccinations and you get published. Claim the Republican party was behind the killing of Kennedy and you might well win a Pulitzer.

You are simply lashing out for the sake of lashing out. I assume what I said touched a nerve. But we would all be better off if you thought about why you took that so personally and where I go wrong. Rather than what you’re doing – citing Harry Potter’s struggle to get published is not a good defense of publishing.

28 Thomas Taylor September 6, 2016 at 11:52 pm

“Rant about vaccinations and you get published.”
You can even become a Republican presidential candidate if you are lucky.

“Rather than what you’re doing – citing Harry Potter’s struggle to get published is not a good defense of publishing.”

You should tell us exactly where J. K. Rowling would have had a better chance of succeeding than in England, where she had been turned down by the big publushing houses. Not in America (which was the initial target of your rant), it seems– too White, not Sex and The City enough. Politically Correct Scandinavia? South Korea? Saudi Arabia? Angola?

29 derek September 6, 2016 at 10:03 pm

So if I don’t like Sex in the City knockoffs I’m racist?

Have you ever thought of the consequences of making that word meaningless?

30 Thomas Taylor September 6, 2016 at 10:11 pm

“So if I don’t like Sex in the City knockoffs I’m racist?”
It is just morbid curiosity, but have you ever read books? Or you only know them through hearsay?

31 Fazal Majid September 6, 2016 at 9:07 pm

To quote William Goldman on Hollywood: “Nobody knows anything”. The art of predicting success in creative content, whether books, music, movies, comics and so on is not reproducible, scalable or consistent over time, and the majors have no advantage. They end up buying successful tastemakers like Tom Doherty of TOR, but even that is no guarantee of long-term success. Conversely, J.K Rowling had to endure a constant stream of rejections for her Harry Potter series. There is clearly market failure, but it’s unclear what a viable alternative would be. The low barriers to entry for eBook publishing create an embarrassment of riches and make it almost impossible to sort the wheat from the chaff. Perhaps social networks can play a role, but they haven’t been active this far.

My book consumption is nearly 100% eBooks, the sole exception being coffee-table art books and the odd novel that does not have US distribution (the sole one this year being “Who killed Sherlock Holmes?” by Paul Cornell, in the UK edition).

32 So Much For Subtlety September 6, 2016 at 9:34 pm

I disagree. It is a nice quote and there is a limit to what people do know. But they know something. The big movie studios and publishers would not have survived if they did not know something. Decades of success means that there is a body of knowledge there. It is not 100% reliable – as Heaven’s Gate shows – but a lot of studios have been around for a long time.

If nothing else, Hollywood should know what does not work. Hating your audience does not work. So I can say with roughly 100% certainty that the next film Hollywood makes about the War on Terror will be a condemnation of the United States, the war will be about oil, the bad guys will be White Anglo-Saxons who are out to steal poor innocent Third World children’s organs or something – and it will flop at the box office. It won’t matter. They won’t learn. They will just make another anti-American anti-War film. Robert Redford’s asinine politics will always get funding no matter how many times he fails to interest a paying audience.

In the meantime they know what works. Top Gun is one of the most popular films ever. Remaking it, or something like it, is a no-brainer. No, they won’t. They have talked and talked about it but they would rather make something degenerate and anti-American. Tom Cruise and Mel Gibson are bankable stars. Most of Cruise’s best films have come after he was blackballed. Mainstream studios won’t touch them. Gibson showed there was a massive religious audience in America. So when Hollywood *tried* to tap into that market they made Noah – which was, of course, about Climate Change. They simply hate the religious too much to care what they think.

So the gate keepers are failing. No one cares what they think. They hate their customers and their customers are growing in indifference as they can buy what they like on Amazon. The wheat will be separated from the chaff in the same way it traditionally has been done – before the big publishers invented payola – word of mouth.

33 Thomas Taylor September 6, 2016 at 10:30 pm

“Top Gun is one of the most popular films ever. Remaking it, or something like it, is a no-brainer. No, they won’t.”

It is also the best way to spell “creatively bankrupted”. But I guess History really, really loves to repeat itself . Speaking of “paying audiences” and money, who would play the Soviets? ISIS? The Chinese? They couldn’t be the aggressor in the remake of Red Dawn (have I mentioned creative bankruptcy?). http://www.latimes.com/entertainment/la-et-china-red-dawn-20110316-story.html
This is what North Korea is for– as long as they don’t line up to watch American movies, I mean. Those Transformers movies don’t watch themselves, you know. Maybe Cuba, too (it is all Obama’s fault anyway).

34 Faze September 6, 2016 at 8:52 pm

There is (or was) nothing like the feeling of having your book published by a major house. After years of struggle and work, to finally win the confidence and approval of an establishment publisher whose logo looked out at you from a hundred spines on your shelves, was for me an incomparable thrill — as valuable to me as their generous advance. If the major publishers go away, who will be the e-book gatekeepers? As both a writer and reader, I need them.

35 Harun September 6, 2016 at 9:36 pm

Amazon readers and reviews. It’s a big world out there full of consumers.have fun

36 JK Brown September 6, 2016 at 11:07 pm

Of course, ebook sales from mainline publishers are down. Since the spat with Amazon, the industrial publisher ebooks are generally only a dollar less than the hardcover version. That not only gives the sense the publisher is profiteering in ebook sales, which don’t have the physical book production costs, but the physical book also has more value as it can be given away after reading. The physical book is less convenient as it produces clutter and now that we have a real alternative, is more burdensome to tote about for reading during downtime.

Question would be, does the author get an increased royalty from ebook sales from the mainline publishers given the publisher saves the printing, warehousing and distribution costs?

37 ChrisA September 7, 2016 at 1:07 am

I found that managing my ebooks on Amazon quite clunky and off-putting. So now I use Calibre. It also has the advantage that you can remove the DRM and share books with friends/family. I must admit I find the DRM paranoia the most annoying part of buying from mainstream publishers. The music industry has now realized that DRM is pointless and actually penalizing the honest people at the expense of the less honest people and book publishing will eventually get there as well. Even now if you want a book for free, you can easily find it. Nowadays the mainstream publishing industry is like AOL – basically a cashcow milking a smaller and smaller residual of less technologically savvy people.

38 Tom Jackson September 7, 2016 at 9:22 am

The article tracks with my own experience. I simply refuse to pay, with a few exceptions, the ridiculously high prices that traditional publishers demand for ebooks. I wait for them to go on sale, or do without.

39 Jasel September 10, 2016 at 4:04 am

In my view, it’s always useful to have eBooks as far learning is concern for obvious reasons, but we just got to make sure we do the hard work since that’s the best way we will be able to work things out. It’s seriously helpful with a broker like OctaFX, as they are special by all levels especially to do with steady conditions with smaller spreads from 0.1 pips to high leverage up to 1.500 plus much more; it all works in my favor big time.

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