Category Archives: Book Pricing & royalties

With Amazon MatchBook Bundling One Big Step Closer to Reality

Publishers Weekly reports that “After years of false starts, bundling e-books with print books may have gotten the spark it needed Tuesday morning when Amazon announced an October launch date for Kindle MatchBook. Under the program, customers who buy—or have bought—print editions of titles can buy the e-book at prices ranging from $2.99 to free. At launch, Amazon expects to have over 10,000 books in the program, ranging from new books to books that Amazon began selling when it first opened in 1995.”

For background here’s a piece we published several years ago:

Bundling is an age-old merchandising technique in which customers are offered a discount if they purchase two related products. In the case of books, it’s a combo of two formats, print edition and e-book. Though the technical barriers to delivering both in one transaction are coming down, the real issue is how much to charge for the bundle. A little test we gave readers a few years ago will give you a sense of how challenging the concept is:

When you purchase a print book you should be able to get the e-book for…

a) the full combined retail prices of print and e-book editions
b) an additional 50% of the retail price of the print edition
c) an additional 25% of the retail price of the print edition
d) $1.00 more than the retail price of the print edition
e) free

The choices aren’t just economic but philosophical, reflecting just how aggressive a publisher wants to be and the various thresholds at which the publisher believes consumer resistance will melt. A good argument can be made for each, and as the bundling issue warms up you can expect to hear them all endlessly debated.

The time will soon come when publishers will have to choose one of the above strategies and put it into effect. Misjudging consumer attitudes could prove to be a big mistake and possibly a ruinous one. My own view? I strongly believe that the e-book version should be included free of charge with the purchase of the print edition. What do you think – and why?

Details in Bundling: Publishing’s Next Battleground.

Richard Curtis
This blog post was originally published on Digital Book World under the title Why Do We Have to Choose Between Print and Digital?

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Auditing Your Publisher

Most book publishers’ contracts have provisions granting authors the right to examine the books and records of their publishers under certain conditions: for example, the examination must take place on the premises of the publisher during normal business hours; no more than two audits may be conducted in any given year; an audit must be commenced within a reasonable time after the issuance of the royalty statement in question; the records on any given book shall not be examined more than once; the publisher is not required to keep records on a book for more than a certain period of time, etc.

Although, I am told by one accountant, examinations of publishers’ accounts are on the rise, invariably these have been conducted by authors with lucrative contracts. I can say with certainty that the vast majority of authors has only the vaguest notion of what is involved in an audit. Perhaps we can rectify that problem here. Harder to rectify is the somewhat bovine attitude on the part of many authors that their contracts are too small to merit auditing, and the royalties to be liberated by an examination of a publisher’s books would not be worth the cost, which can run to a thousand dollars a day or more.

These assumptions are not necessarily correct. While a publisher’s profits from midlist and category books are indisputably smaller than those from best-sellers, the total profits from the former can be immense by virtue of the fact that there are so many more of them on publishers’ lists than there are best-sellers. And because most best-sellers are by established big-name authors, the huge royalties they earn are usually paid in advance, giving publishers little leeway to reserve royalties, whereas publishers commonly hold at least half the royalties collected on midlist and category books for which modest advances are paid.

If collective audits of such routine books could be undertaken, thus spreading the cost per author, they might well yield a surprisingly good return on the authors’ investment in an accounting firm. More important, such group audits would keep publishers honest by exposing questionable accounting practices. It is therefore heartening to note that some author and agent organizations are sponsoring such group audits or making funds available for them. Because your book, or books similar to yours, might be spotlighted by an audit, you might want to tag along with the C.P.A. for a visit to a publisher’s ledgers.

Before we embark, we ought to discuss just what gives us the right to audit a publisher, anyway. As I said at the outset, many publishers grant that right in the boilerplate language of their contracts. Certainly, every author or agent negotiating a book contract should insist on an audit provision. But if it is absent from a contract through oversight or design, or if a publisher refuses to grant that right to an author, does that necessarily rule out the possibility of an audit? Not according to the attorneys and accountants I have spoken to. They maintain that any licensor whose contract calls for royalties is entitled to examine the statements and supporting data of the licensee. Therefore, whether your contracts stipulate that right or not—indeed, even if you’ve been so foolish as to waive that right—your publisher cannot legally prohibit you from auditing his books. He can make it extremely difficult: he can postpone and stall, he can “misplace” and “lose” documents, he can subject your accountant to unpleasant conditions—a monastic cell with a hard chair, rickety table, and one flickering taper. But he must, ultimately, let your accountant go over the books.

Within recent memory there were some shady publishers who did that sort of thing, but happily they were driven out of business by their legitimate competitors. Today, while some publishers are frugal with their hospitality toward accountants, many shrug and say, “Come on in, we have nothing to hide.”

Assuming your publisher is cooperative, the first step is for the accounting firm to make an appointment. The accountants will have examined the author’s contract and all royalty statements from publication date to the present and will use these as the jumping-off point for their investigation. They will then request the printer’s affidavits stating how many copies of the book were run off, along with information about damaged or destroyed copies. They will, of course, expect affidavits for all printings of the book. If there has been more than one printing, the accountants will want to know if the cover price of the book was raised.

Then the accountants will examine the records pertaining to distribution of the books, either to wholesalers or directly to book chains. The number of copies distributed plus the number of copies left in the warehouse plus the number of copies damaged, destroyed, or given away for free should add up to the number of copies printed. If they don’t, suspicion will certainly be aroused that the publisher printed copies he has not reported.

The next critical source of information is copies returned. In hardcover publishing, the books themselves are returned to the publisher for credit, and counting these, while tedious, is not as stupefying a task as counting returned paperbacks, for the dimensions of hardcover printings and distributions are nowhere near those of paperback. In paperback publishing, however, returns are usually effected simply by stripping the covers off the bound books and returning the covers to the publisher’s warehouse, saving the substantial cost of shipping whole books back whence they came.

Obviously, the job of counting paperback covers, which even for a modest-sized publisher number in the hundreds of thousands each month, is impossible to do by hand. Modern paperback houses handle the problem by printing product codes, those black-and-white coded bars similar to those you see on canned and packaged goods at your grocery store, on the backs of their book covers. The stripped covers are fed through machines that read the codes and compute title, author, list price, number of copies returned, and other data.

We now have all the information we need: number of copies printed, number of copies distributed, and number of copies returned. But there is still a gap between what the author feels is owed him and the actual amount of royalties he has been paid. That gap is the royalty on the number of copies the publisher has reserved against returns. As most authors now know, publishers create such reserves in order to give credit to distributors and stores that might return copies of books in the future. The reserve is determined by the executives who run the publishing company, and while it is to be hoped that these individuals will base their judgments on experience, reasonable evaluations of market conditions, and common sense, the existence of this tempting pool of undisbursed money has a tendency to cloud executive judgment, particularly in the pressure cooker of corporate bottom-line expectations.

Here, then, is the answer to the commonly asked question, “Is it possible for print, distribution, and return figures to be falsified?” The answer is, not without enormous difficulty, for it is neither safe nor practical to do so. For that to happen, the entire publishing organization—the clerks who document the printing and distribution information and count the returned covers, the bookkeeping and accounting departments of the publishing company, and the staffs of the printer and distributor—would have to be in on the conspiracy and sworn to secrecy. That is plainly preposterous: there simply isn’t enough profit in the publishing business to make such wide-scale corruption worthwhile.

It is also completely unnecessary, because the same results are achieved by the decision of a handful of publishing officers to fix reserves against returns at an excessively high level. And it’s all perfectly up-and-up from the publisher’s viewpoint, because the establishment of reserves is a business judgment that may be argued but cannot be cited as fraudulent—unless one takes the position that the entire system is a license for publishers to earn interest at the expense of authors.

No, my observation is that print, distribution, and return information are not falsified, at least not in a way that could be described as deliberate and systematic. It would be closer to the truth to say that publishing bookkeeping is subject to the same goofs as the bookkeeping of any other industry. And though it may seem that the errors always fall in favor of publishers, the accountants I’ve spoken to state that as many fall in the authors’ favor. Thanks in good measure to the consignment method of selling books, publishing bookkeeping is far, far more complex than it has to be, and that makes it a breeding ground for error.

One of the standard provisions of every audit clause in book contracts is that if errors of more than a certain amount, usually 10 percent of the sum stipulated in the publisher’s royalty statement, are found by auditors, the publisher pays for the cost of the audit. Such a provision might make it tempting for authors who feel shortchanged by their publishers to hire an accountant, figuring the accountant will certainly be successful in detecting an excessive reserve against returns and get at least 10 percent of that reserve released. Thus the publisher would be required to pay for the audit, right?

Wrong. A high reserve against returns may not be considered an error. It’s merely—in the publisher’s eyes at least—a judgment call, a prediction or anticipation that a certain number of copies will be returned. Anybody contemplating an audit of his publisher’s records should therefore be prepared not to recoup his accountant’s fees from the publisher. Released royalties might defray or pay for the audit, but the publisher will stoutly maintain that no bookkeeping error was made.

Is there some alternative to hiring an accountant to find out whether your publisher is giving honest weight? Well, if you can prevail on your publishers to furnish you with information about the number of copies printed, distributed, and returned, you need nothing but a pencil and paper and a grade-school math education to figure out whether you have collected everything that is due you, and what the reserve against returns is. Then it’s simply a matter of arguing with your publisher over the propriety of holding so much reserve money, or holding it for such a long time. The problem is getting that information: if publishers wanted you to have it, they’d put it up front routinely in their royalty statements. With persistence, however, you or your agent or your lawyer will be able to secure the information.

After reviewing it, however, you may feel in your bones or have other reason to believe that the figures furnished to you are incorrect, that your publisher printed or distributed more copies than he’s told you, or took in fewer returns. You will then have to hire a professional accountant to examine the publisher’s books, as the job is too complex and time consuming for untrained individuals. This is especially true if there is reprint, book club, foreign translation, or other subsidiary rights revenue—another very common source of bookkeeping errors among publishers but one that space prohibits me from analyzing in detail.

Some agents are able to build into book contracts provisions requiring publishers to furnish details of printing, distribution, returns, and reserves against returns in royalty statements, or copies of contracts and statements from sublicensees, such as book clubs and reprinters. For many agents and authors, however, it is futile to attempt to make publishers comply with such demands. This can only be achieved by collective action on the part of a determined, organized, and fearless cadre of professional writers or agents.

Richard Curtis

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Psst. Wanna Buy a Used E-Book?

No no. I said used E-BOOKS!

It takes a lot to leave me speechless but when I read that Amazon was contemplating selling used e-books I was too flabbergasted to make sense of it.  Luckily Brian Merchant, a freelance writer, editor and blogger (http://www.treehugger.com/author/brian-merchant/) expressed his dismay, in a posting on Motherboard, better than I could ever hope to.  So, with his kind permission, I reproduce his piece in full below.

Richard Curtis

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Used Ebooks, the Ridiculous Idea that Could Also Destroy the Publishing Industry

By Brian Merchant

Amazon has a patent to sell used ebooks. When I first scanned that headline, I thought it must be some Onion-esque gag, and I’m sure I wasn’t alone. Used e-books? As in, rumpled up, dog-eared pdfs? Faded black-and-white Kindle cover art, Calibri notes typed in the margins that you can’t erase?

Barely-amusing image aside, used ebooks are for real. Or at least have a very real potential to become real. See, Amazon just cleared a patent for technology that would allow it to create an online marketplace for used ebooks–essentially, if you own an ebook, you would theoretically be able to put it up for sale on a secondary market.

The approved patent describes the process:

Digital objects including e-books, audio, video, computer applications, etc., purchased from an original vendor by a user are stored in a user’s personalized data store … When the user no longer desires to retain the right to access the now-used digital content, the user may move the used digital content to another user’s personalized data store when permissible and the used digital content is deleted from the originating user’s personalized data store.

Used ebook shoppers could buy your digital copy, directly from you, and Amazon would facilitate the transfer of files–and it would pocket a fee.

It’s a fascinating concept, really, but it could ultimately be devastating to the publishing industry and, potentially, to authors. First, the elephant-sized absurdity in the room: a “used ebook” is identical to a new one. It is a precise digital reproduction. The file does not age, it cannot be damaged, it cannot be altered–therefore, it is worth no less than any other copy, and the only premium purchasers of “new” ebooks would be paying for would be the right to read it first.

And that’s where we start running into problems. Nobody, besides die-hard fans of a given author on a big release date, would ever care enough to pay extra for digital dibs. Used ebooks would eliminate nearly all the incentive to buy “new” ebooks. And Amazon could be banking on that, even though at first blush it might appear to undercut its own business.

Bill Rosenblatt, a copyright expert and witness in numerous digital content patent cases, argues that the online retail giant may be angling to push publishers out for good with such a move. He explained his case to Wired:

Rosenblatt believes that a digital resale marketplace wouldn’t ultimately make Amazon a lot more money on books or music, at least not at first. But he thinks it would move much more of Amazon’s digital content business beyond the interference of publishers, just as publishers can’t dictate the terms of, for example, the sale of used physical books on Amazon. Just as with physical books, publishers would only have a say — or get a cut — the first time a customer buys a copy of an e-book. The second, third and fourth sales of that “same” e-book would be purely under Amazon’s control.

“If Amazon is allowed to get away with doing resale transactions without compensating publishers, then what they can do is say, ‘hey authors, sign with us and we’ll give you a piece of the resale,’” he says. “That could attract authors who might otherwise sign with traditional publishers.”

It would be an exceedingly brazen move on Amazon’s part, and would likely require the combined strength of every copyright lawyer its side of the Mississippi, but it’s entirely possible. And it’s bad news for authors too.

Because, what if they don’t sign on? Well, on the grounds that publishers and authors don’t get a cut of physical used books, Amazon could easily seek to justify refusing to pay writers for secondhand transactions. That’s what worries John Scalzi, the president of the Science Fiction and Fantasy Writers of America.

“I’m awfully suspicious that it means nothing good for writers who want to get paid for their work using the current compensation model,” he writes on his blog. Scalzi foresees writer-led class action lawsuits aplenty should Amazon ever try to cut out author royalties on ebook resales. And Scalzi agrees that it’s trouble for the traditional publishing industry, too: “if I were a publisher I really wouldn’t have any doubt Amazon wants me dead,” he writes.

Still, the whole phantom of a secondhand ebook marketplace might not ever amount to much. As Marcus Wohlsen notes, Amazon may have secured the patent simply to bury it, to eliminate any possible threat of a secondhand ebook market to its standard business. It may deem the legal threats too great and deign not to push on. Or it may realize that if it ever admits to boxing out authors, consumers may revolt and just download pirated files or directly from author sites.

If Amazon does try this stunt, however, it will be attempting to seize on our nostalgic understanding of physical secondhand marketplaces: many readers love used bookstores and swapping well-worn paperbacks. Thanks to the cloud and increasingly bottomless RAM, the bookshelves of the future are near-infinite–we have no need to “swap” files. We can copy and forward them. Amazon would be relying on the notion that our habits of buying and selling tangible goods are deeply inculcated enough that we’d overlook the absurdity and potential exploitation of a secondhand ebook market.

Used ebooks are a paradoxical anachronism, a cannily capitalistic construct whose only aim is to squeeze authors and publishers. Again, it’s fascinating–but it’s also complete bullshit.

 

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Print/E-book Bundles on the Horizon?

Michael Clarke, an executive at Silverchair Information Systems and a passionate music lover, is torn between vinyl and digital – squarely split down the middle. Vinyl to him means warm sound, beautiful packaging, tactility and the special rituals of opening record jackets, reading the copy, placing the record on a turntable and lowering the needle on it. Against these advantages he weighs only one for digital music: convenience. But that one completely balances the scales.

But Michael Clarke wonders why he has to choose. Why can’t he have both? Why can’t he buy the record and get the download too – at no extra cost? It’s not unprecedented. Blogging in The Solitary Kitchen, he writes : “What indie rock bands have figured out is that the purchase of music does not have to be an either/or proposition. They don’t make their customers choose between analog or digital. Whenever you buy a record from just about any indie band, it comes with either a CD or with a card that contains a URL and a download code so you can get a digital copy at no additional cost.”

Clarke doesn’t use the word, but what he’s talking about is bundling, and we think it’s the next big step in the evolution of the book business. We also think it’s the next war zone.

Bundling is an age-old merchandising technique in which customers are offered a discount if they purchase two related products. In the case of books, it’s a combo of two formats, print edition and e-book. Though the technical barriers to delivering both in one transaction are coming down, the real issue is how much to charge for the bundle. A little test we gave readers a few years ago will give you a sense of how challenging the concept is:

When you purchase a print book you should be able to get the e-book for…

a) the full combined retail prices of print and e-book editions
b) an additional 50% of the retail price of the print edition
c) an additional 25% of the retail price of the print edition
d) $1.00 more than the retail price of the print edition
e) free

The choices aren’t just economic but philosophical, reflecting just how aggressive a publisher wants to be and the various thresholds at which the publisher believes consumer resistance will melt. A good argument can be made for each, and as the bundling issue warms up you can expect to hear them all endlessly debated.

The time will soon come when publishers will have to choose one of the above strategies and put it into effect. Misjudging consumer attitudes could prove to be a big mistake and possibly a ruinous one. My own view? I strongly believe that the e-book version should be included free of charge with the purchase of the print edition. What do you think – and why?

Details in Bundling: Publishing’s Next Battleground.

Richard Curtis
This blog post was originally published on Digital Book World under the title Why Do We Have to Choose Between Print and Digital?

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Big Six Shift to E-Originals Places Authors – and Editors – in Jeopardy Part 1

In the last year a number of major publishers have begun offering authors contracts for “e-originals” – books released originally – and exclusively – in e-book format.  Though this is a logical step in the evolution of traditional publishing houses from tangible to virtual formats, the deflationary nature of its business model poses a serious threat to author earning power. Less obvious but ultimately more dangerous is the implosive effect the shift may have on the publishing companies themselves and the people who work for them.

What’s Wrong with Paperback Originals?

The first and obvious question is, what’s wrong with paperbacks books, that publishers are abandoning them in favor of digital originals? The fact is that in the past fifteen or twenty years, mass market paperback books have  transformed from a breeding ground for fresh talent to an exclusive club for bestselling authors.

The reasons for this metamorphosis are complex (you can read about them in The Rise and Fall of the Mass Market Paperback: Part 1, Part 2), but in essence the ruthless math of an industry based on the returnability of books has made it almost impossible for fresh talent to develop over time in the nursery of original paperbacks.  Though many promising genre authors, especially romance writers, continue to be introduced in mass market paperback, the sales thresholds they must achieve in order to make a profit for their publishers have risen to almost unattainable heights.

Cue e-book originals.

At first blush, e-originals appear to be the perfect way for publishers to pull authors out of this death spiral, for many of the costs of manufacturing and distribution are lower or negligible. You would think that the savings would be passed along to authors in the form of higher advances and royalties.  So far, that has proven far from true.  Why?

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How Much Does It Cost You to Produce an E-Book? Part 2

This is the second and concluding installment of an article about how publishers arrive at the prices of ebooks. It’s written in response to consumer criticisms that “Publishers are making a killing on e-books because they cost nothing to produce, distribute and sell and are almost 100% pure profit,” as one reporter phrased it.

In the first installment of this article we took you through the processes that at least one publisher – my own, E-Reads – performs to convert a previously published book into an e-book distributed in all formats, plus a print on demand paperback. We calculated what it would cost an individual to replicate those processes, including hard costs, labor and overhead. We concluded it would take about 31 hours for a person whose time is worth $40.00 an hour (adjust that number if your time is worth more or less).

Adding some incidental charges, we figured the total cost for you to convert a previously published book to an e-book and print on demand paperback was $1,600.00, not counting the cost of marketing, advertising or publicity. How should you price your book to recover that investment and make a profit to boot? And how many copies must you sell to hit that number?

E-book retailers take commissions that roughly range between 30% and 50% of the list price. For sake of argument let’s say the average discount is 40%, meaning 60% of the list price will be paid to you. If you charge $.99 you’ll have to sell over 2600 units just to break even on that $1600 investment. In order to make a 25% profit, you have to sell another 650 copies. (And by the way, to make $2.00 per copy on the sale of your print on demand book you’ll have to price it at $16.00.)

If you don’t think you’ll be able to sell 2600 copies of your $.99 e-book, try charging $2.99. You will then have to sell only 900 units to break even. Add 225 units to make a 25% profit. Think you will sell that many?

If you don’t think so, raise your price again. If you raise it to $6.99 you’ll make a 25% profit on less than 500 sales. But you may also incur the wrath of consumers who think you “are making a killing on e-books because they cost nothing to produce, distribute and sell and are almost 100% pure profit.”

Of course, if you can’t or don’t want to do this yourself you may want to hire an outside party do do it. Let’s call that party a publisher, a publisher whose labor costs and overhead are considerably more than $40.00 per hour. More like several hundred. A publisher that must make a profit in order to stay in business. Since it costs a publisher more to produce a book than it costs an individual author, you will realize that if you have to sell, say, 2000 units of your book to make a profit, your publisher will have to sell two or three times that many – or raise the list price to double or triple yours.

Still think publishers are making a killing?

If this commonly held belief were mere ignorance we’d continue biting our tongues. But it is a pernicious supposition that has been responsible for driving down fair profit margins for authors and publishers and for sending consumers to pirate sites in protest against what they consider to be overpriced e-books.

We understand that E-Reads’ business model – the reprinting of previously published books – is atypical for authors who simply want to upload their books down and dirty. There are many options for them to do so at a fraction of the costs that E-Reads incurs.

But hopefully, some consumers who complain about e-book prices will take a more benign view of the challenges confronting publishers.

Richard Curtis

This blog post was originally published on Digital Book World under the title Are Publishers Making a Killing on E-Books? Part 2

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How Much Does It Cost You to Produce an E-Book? Part 1

In a post last spring DBW’s Jeremy Greenfield wrote,”Publishers are making a killing on e-books because they cost nothing to produce, distribute and sell and are almost 100% pure profit. At least, that’s what many consumers think.” I’ve been brooding about it since then and thought it might be helpful to give those consumers some insights into how publishers arrive at their prices.

Few subjects have elicited as much wild conjecture as the prices of e-books. Reading rabid allegations of price-gouging, one has to wonder what these critics know about manufacturing costs that we in the e-book industry don’t. Following the proverb Don’t judge another until you’ve walked a mile in his shoes, it might be educational for you to imagine what it would cost you to duplicate the processes that at least one publisher – my own, E-Reads – performs to get a book into the marketplace from raw state to finished product.

E-Reads is among the oldest independent e-book publishers. From its founding our principle has been to split all net receipts with authors on a 50-50 basis. Although we occasionally publish original books, our stock in trade is reprints of previously published ones, particularly genre fiction such as fantasy and science fiction, romance, and action-adventure thrillers. Unlike self-published authors for whom the publication process is generally fast and inexpensive, E-Reads’ production line is artisinal, calling on skills – many of them quite demanding – drawn as much from Old Publishing as from New.

All publishers  incur three fundamental types of expense: hard costs, labor and overhead. Many authors contemplating self-publication look at the hard costs but don’t always focus on the softer ones, namely the value of their time and the cost of living.

Let’s, therefore, start with this question: how much is your time worth?  If you earn, say, $60,000 a year, your time is worth a bit under $30.00 an hour for a forty-hour week. That is the cost of your labor for publishing your own e-book.  But you also have overhead expenses to meet such as rent or mortgage, utility bills, transportation, computer equipment, depreciation and countless other necessities and amenities. When publishers prepare a profit and loss analysis for books they contemplate publishing, they tack on to their hard expenses something like 30% or 35% as the cost of overhead, and you should too.  By adding $10 – around 30% of your $30.00 an hour – onto your labor cost,  your true hourly expense is more like $40.00 than $30.00. Obviously, you should adjust these numbers if your time is worth more or less than that.

The first task we perform to reissue a previously published book is to accurately reproduce the printed text as a digital file. Even if you possess the original text file, for publication purposes it’s useless. The text you turned in to your publisher was subsequently copyedited and proofread. You may want to key into your computer the changes that your publisher made to your original text file.  That will probably take you a minimum of a week – 40 hours. If your hourly cost is $40.00 that’s $1,600.00, a foolish expenditure when it is so much cheaper to have your printed edition scanned.

Scanners in effect take a digital photo of every page of your book and create a crude computer-readable text. I say “crude” because although good scanners are 99% accurate, a 1% error rate in a 300 page book amounts to as many as 900 errors. In any event, scanning costs vary widely from $50.00 a book to several hundred dollars.  Let’s say $150.00, plus, say, an hour packing up and delivering or sending your book to a professional scanning firm.

You will then need to proofread your digitized text. Reviewing and correcting should take about one or two minutes per page, or about 450 minutes for a typical novel that will end up at 300 printed pages.  That’s about eight hours.

Once you have a clean file in hand you’ll want to convert it to ePub, the universal language of e-book publishing. The conversion software is a free download, but the time to convert your text and make sure it’s properly formatted for various retailers may take three or four hours. Say four.

You’ll have to make a cover.  If you choose to buy or commission commercial art the sky’s the limit. We use, and adapt, stock art, also known as clip art. We subscribe to a stock art service to guarantee that the rights to the images we use have been cleared. To the cost of clip art fees or subscription add the value of your time to produce the cover and write jacket copy (and don’t forget the bar code!).  This will all take two hours if you’re lucky. Better allow for three.

You’ll need to furnish a variety of metadata to retailers or they won’t accept your upload. That includes list price, territory, ISBN number, BISAC code, foreign currency conversion, sample chapter, and many other items. For a taste of what you’re getting into, you might want to read Mastering the Mysteries of Metadata first. But allow one or two full days. For the sake of argument we’ll split the difference at 12 hours.

If you want your book printed on paper you can do it cheaply enough through a variety of commercial processes. How good the book will look – many have special formatting issues – is hard to say. Because we are a professional publisher and our POD titles are sold on Amazon, Barnes & Noble and other retailers, we take great pains. It may take a day or two of special formatting for print on demand, for the editorial processes are quite demanding. If you want to adhere to our standards, let’s say one eight-hour day.

Assuming you’ve performed these tasks to perfection you will want to upload the book to various e-book retailers and a print publisher as well. E-Reads’ uploads are managed by Ingram’s excellent CoreSource, but as you’re only uploading one or two books it makes no sense to subscribe to such services. You can distribute via Bookbaby for $99.00, but if you prefer do-it-yourself uploading to all significant retailers it will take several hours of trial and error, for retailers often send you error messages and you will need hours more to troubleshoot and re-upload.  Three hours sounds about right.

There are other functions but these are typical ones.  Tallying up the hours you’ve spent we get 31. At $40.00 per hour that’s a cost of $1,360.00, plus several hundred dollars in hard costs.  Let’s round it off at $1,600.00 to get your previously published book back in print in all formats. That doesn’t include a penny for marketing and publicity.

In the next installment of this posting we’ll set some price points for your book and figure out how many copies you have to sell to make your money back plus a profit.

Richard Curtis

This blog post was originally published on Digital Book World as Are Publishers Making a Killing on E-Books? Part 1

 

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With Students on the Fence about E-Textbooks, Amazon Steps Up Print Rentals

If print books are going to make a comeback, it may start with textbooks. Efforts to motivate students to adopt e-textbooks have collided with some hard realities, causing publishers and retailers to rethink their digital strategies if not retrench altogether. The latest example is Amazon, which has plunged bigtime into the textbook rental market.

Why has it proven so hard for digital textbooks to establish a beachhead? In 2010 we reported on a number of campuses around the nation. Students complained that it was much harder to to navigate back and forth in an e-textbook than a print one.  Annotating and bookmarking was more challenging in e than p. Charts and graphs didn’t match up with the texts to which they referred. One student told a Seattle Times reporter that “You don’t read textbooks in the same linear way as a novel. You have to flip back and forth between pages, and the Kindle is too slow for that.” (See Students Give E-Textsbooks a Failing Grade.)

Recognizing consumer resistance to e-texts, a number of enterprising companies, including Amazon’s arch-rival Barnes & Noble, launched print textbook rentals, catching Amazon at a disadvantage. But of course Amazon seldom stays on the wrong side of a competition for very long, and has now stepped up its print textbook rental business. The rentals are on a semester basis, and the rent for print is on a par with the rent for digital.

Details in Laura Hazard Owens’ Amazon adds print textbook rental. See also Not So Fast, Guv! Wisconsin Students Not Ready to Terminate Paper Books.

Richard Curtis

This blog post was originally published in Digital Book World as Digital Textbooks Still Not Catching On With College Students.

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Settlers to Refund $69 Mil to Overcharged Customers

Publishers Lunch‘s Michael Cader reports that the three Big Six publishers settling the Department of Justice price-fixing lawsuit will be refunding to customers some $69 million in overcharges resulting from the “agency” business model.

Just how the proper recipients will be ascertained, their refunds calculated, customers notified, and payments issued are questions that seem pretty daunting to our untrained eye. No surprise that a number of attorneys general “told the judge that working out the mechanics of how restitution would be provided to consumers ‘ has proven to be a far slower process than we originally contemplated,'” Cader reports.

If you think you qualify, look for an email, and when offered a choice you probably should elect to get credit towards your next purchase. It’s impossible to project the tally if everyone asks for a refund check to be cut and mailed, but it may be sufficient to rescue the US Postal Service from impending bankruptcy.

Richard Curtis
This blog post was originally published in Digital Book World as DOJ Settlement Will Rescue US Postal Service

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Price-Fix Trial to Start on Opening Day of BEA

Don’t be surprised if the Macmillan booth at next year’s Book Expo America is set up in the courtroom of Judge Denise Cote.  It happens that the date when the Department of Justice’s e-book price-fixing lawsuit is scheduled to commence, June 3, 2013, is also the first day of BEA.

Publishers Lunch‘s Michael Cader, reporting plans for the trial, says that Judge Cote “wants to move the trial swiftly.”

A year to begin arguments is swift? We know that “The wheels of Justice grind slowly” but that is simply preposterous.

While we understand that this is a very big case on which a lot is at stake and on which law could possibly be made, the idea of waiting a year for the proceedings to get under way while the entire publishing industry plus Apple and even Amazon twist in the wind feels like the very thing for which the maxim “Justice delayed is justice denied” was created.

Particularly hard hit is Macmillan. Says Cader: “They argued for a ‘more extensive’ trial schedule because they ‘have already produced hundreds of thousands of pages in extensive discovery over the course of a two-year investigation conducted by the DOJ and the States…over a far-longer span of time than the plaintiffs are now proposing, and it still stretched Macmillan’s resources to the maximum.’ Macmillan also calls their burden ‘entirely asymmetrical’ since the DOJ ‘have disclosed they have relatively little data and documents to produce beyond the contents of their investigative files.”

It’s hard to believe that the distractions –  to say nothing of the expenses – being borne by the accused publishers will not filter down to the day to day business of our industry in terms of editorial and financial decisions.  Perhaps that’s what is meant by the other half of that legal maxim – “But they grind exceeding fine.” We are really worried that books and authors are going to be ground to bits in the excruciating wait for justice to be done.

Richard Curtis
This blog post was originally published by Digital Book World as Yeah, We know, “The Wheels of Justice Grind Slowly”, But This is Ridiculous

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