.99 Cent Books = Armageddon???

Salutations compadres!  I've been poked and prodded so much in the last week that I'm starting to feel like 'The Catch of the Day' at the local fish market.  That's right, I went to the doctor!  Heck, they even let me run on a treadmill ...

I couldn't help but identify with a lab rat when they started greasing me up and sticking wires all over my chest.  Seriously, an alien autopsy would probably have been less invasive.  A good time it was not.  Maybe that's why my feathers got all ruffled when I thought about today's topic.

I keep reading ... and keep reading ... AND KEEP READING about the scourge of the .99 cent book.  Those of you who are in the ePublishing Circle of Trust will immediately know what I'm talking about.  Those of you outside the Circle might not, so let me catch you up.

(I'm going to simplify a little a lot, but there are lots of little linkable words and phrases if you want to learn more.)

A little while back a small family-run Internet retailer named FREAKING AMAZON--I heard they got their start as shoe cobblers--decided they would let any old author upload their books for free to be sold on their site in electronic fashion.  Amazon, by this point, had officially become the largest retailer of paper books on the planet.  In short: Readers knew Amazon.  Readers trusted Amazon.

Coincidentally, Amazon had also popularized the eReader with their snazzy little device, Kindle.   For the historians out there, they released it in November, 2007 @ $399 US.  I say "popularized", because the Kindle wasn't the first eReader, it just happened to be the first REALLY consumer friendly one in both price and function.  (Yes, they were once MORE expensive than $399.)  Amazon had also become THE place to purchase eBooks--the things you read on an eReader.  Convenient?  I think so.

At the point authors were invited to share their wares on Amazon, eReaders were still relatively niche gadgets.  A little too pricey, and a little too unknown for the common woman or man.  That changed as other companies began to throw their names into the electronic book arena.  Two years after the release of the Kindle, physical book retail giant Branes & Noble released their own reader (Nook) and announced that they too would allow authors to self-publish on their website.  Shortly after B&N, Apple developed their own eBookstore.  All the while, a major Internet eBook retailer named Smashwords was also allowing authors to self-publish.  Even Google got in on the action.  

Fast-forward to Now



eBooks and eReaders are HUGE.  Sales of electronic books are surpassing their paper cousins and that gap is only going to widen with the growing number of popular electronic gadgets capable of functioning as a reader.  As a result, many authors are running to get on board the eTrain.

Economics ... BLECH

An initially unnoticed aspect of authors being able to circumvent the traditional publishing process--you know bleed tears, find an agent, bed-down with a publisher and hope your book made it to the front of the bookstore for a couple of days--and self-publish their work was pricing flexibility.  All of the sites that allowed for DIY publishing also let the author more-or-less set the price of the product (a privilege usually afforded to only publishers).  In the old model, the author's job was to write, not worry about profit margin.  A good thing for many authors who feel as I do about the E word.

So what did authors do when they put on their big boy and girl business undies?  What any entrepreneur would do, of course!  They undercut the poop out of the competition.  Why?  Why does Walmart sell things cheaper than everyone else?  Because they can afford to.  The Indie/DIY author was no different.

eBooks from traditional publishers are more expensive, and here's why.  You're going to pay more for Stephen King and Twilight because the big traditional publishers are corporations with big payrolls.  They have many editors, secretaries, etc., etc. to feed.  They also publish more than one or two books in a year.  That requires coin.  Furthermore, Stephen King and Twilight are responsible for making money for all the lesser-known authors who might not earn back the investment publishers make in them.  Combine that with the cost of making paper books (ya know like ink, shipping, feeding the gnomes who blow on the binding glue to make it dry it faster, etc.), and you've got a formula for mark up.

Here's a pretty solid list of why traditional publishing is 'spensive.   

It's a well known fact that most authors survive off of Saltine Crackers and various canned meat products, and they wouldn't know the difference between a board room and the Bahamas if you showed them a photo.  (I kid, I kid!)   So you see, the idea that an Indie author would be willing to price their baby at a scant .99 cents and think they were making a killing isn't that far fetched.

I'd like to point out that at this point no crimes were committed--by either party--and no animals were harmed during the making of the price war.  Traditional publishers have a right to determine what an acceptable profit is, as do Indie authors.  As with most things, however, the actual decision is going to come down to consumers.

I say tomato, you say I'm destroying an entire industry

There has been A LOT of mudslinging in the transition from paper to electronic publishing ...

Let's pause for a sec to clarify something:  It is a transition.  Not a fad.  Not a phenomenon.  Not a tryst.  This is a lasting change to how we primarily consume a product.  Proof?  I just got my nearly 70 year old dad an eReader for Father's Day on Wednesday of last week.   He told me on the phone this morning that he has already read half a book on it even though he didn't think he'd ever use it.  It seems he really likes being able to enlarge the font.  Now he wants to know how to get some of his favorite old paper books on it!  Call it anecdotal if you want, but for my money when the "old folks" are buying in, the "change" has already come and gone.

Back on task, everyone (including me ... wait for it) has seemingly had an opinion about what has happened to the publishing industry.  Readers, authors, publishers, editors, agents, Wall Street, grandfathers, granddaughters--you name it--have expressed everything from joy to dismay over the first real change to come to the reading medium since we swapped out stone for papyrus.

With those opinions have come accusations and prognostications.  Accusations of wrong doing and right doing in the transition, prognostications of good things and bad things still to come.  I've applauded some, laughed at others and scoffed at most.

The biggest bur to stick under my saddle of late is the scuttlebutt over book pricing.  Former literary agent and current author, Nathan Bransford, posted this poll last week to essentially gauge what the perceived value of a $25 hardback paper book in eBook form is.  He had posted a similar poll last year and the results were compared.  The highly unscientific, yet utterly compelling, findings showed that a year ago 63% of the folks who voted believed an acceptable price for the eBook version of a $25 paper book was greater than $10.  This year, 72% went the opposite direction and said that the eBook version should be priced below $10.  Even as a somewhat random sample that's a pretty big shift.

Nathan isn't the first person to illustrate or surmise that the value of a book is falling.  Consumers are starting to speak up.  THIS EXCELLENT ARTICLE (highly, highly recommended) posted back in March on The Digital Reader noted that of the top 20 bestselling eBooks on Amazon, 9 were priced at $1 or less.  With this evidence in hand a number of people have started predicting a day when all books are free, because no one will be willing to pay for them.  I've also read a number of hostile comments directed toward the authors who are pricing their books in the bargain basement, blaming them for hastening the collapse of the written word's value.

Let's pump the brakes, m'Kay?
Here are my reasonings (told you I had 'em) for why we shouldn't go all 2012 on books just yet:

  • The Entertainer: Entertainment and talent have always carried a price tag.  People will pay to escape.  People will pay to enjoy and whiteness things they cannot, or are not willing to do themselves.  It's why we have sports.  It's why we have Lady Ga Ga.  If you can offer an experience of value, someone will pay for it.  From puppet shows in the street to sold out arenas; if you build it, they will come.
  • A Change Will Do You Good: eBooks are a market in flux.  It is still way too early to nail down the market price.  Case in point: Back in March 9 out of the top 20 Amazon bestsellers were under $1.  As of this evening, only 1 out of the top 20.  A month from now it will probably be 15 out of 20.  Based upon the survey mentioned above, I'm not even sure readers know what an electronic book is worth to them.  While I'm pretty sure it isn't what a paper book is worth, I'm also pretty sure it isn't nothing.  (That's coming from a reader, not a writer.)
  • "I'd Buy That For A Dollar": Worth is highly subjective.  Some people wouldn't pay more than $30 for a meal, but would sell everything they own for a new Harry Potter book.  Others would pay thousands of $$$ for a bottle of wine but not pay anything for digital content they can pirate for free on the Internet.  As such, there will never be "an agreed upon" price for anything.  
  • Look To The Past, Not The Future: The music industry went through a similar shift not all that long ago.  People predicted horrible things when consumers were allowed to download their favorite tracks for .99c instead of being obligated to purchase an entire album for $15.  The same mantra of, "Pretty soon we'll be giving it away!" was shouted then.  (Actually, it is still being shouted by Jon Bon Jovi.  :)   Here's a news release from 2005 explaining how Apple and the Big Record Companies were butting heads over  the issue.  The reality is that the music industry for MUSICIANS and LISTENERS has never been better.   What about the Big Record Companies?  Not so much.  Draw what conclusions you will, but I for one think authors and readers will be fine. 
  • "A Hamburger Today ...": Fastfood restaurants have been waging the price war for years, yet I still have to pay .99c for a hamburger.  Shouldn't it be free already?   If piracy and price cutting were truly the ingredients for "free" I tend to think my next iTunes purchase would be $0 instead of $9.99.  There is a bottom line for everything, and that bottom line will be set by the people who make a living off of the goods and services being provided.  An author won't work for free so long as there are readers who covet their stories.  Why?  Because milk and eggs aren't free.   
At the end of the day I think that authors just need write good stories.  The money and accolades will come if there is justification for it. 

WHAT DO YOU THINK?  Are cheap eBooks going to devalue literature to the point that no one is willing to pay for it?  Are we headed toward a future where authors, like classical composers of old, are hired by private investors to craft stories that will be free to the public?

~EJW~
    

23 comments:

  1. I like the last question, because I worked many years in advertising and think that any large advertiser could shill out .99 cents per book cover, pay for my artist and help me produce my book that I could release for free. Hypothetically. Anyway, hope you're feeling okay.

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  2. Really interesting post! I sure hope that all books are never less than $1. I think people will always want to be published traditionally because it's far more rewarding, and far more successful than traditional publishing. The traditional publishers aren't going to be lowering book costs to $.99 any time soon, so I think that we shouldn't have too much to worry about. I don't think any story is worth $1. None.

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  3. The big corporations are going to make a stink because they have the mopst to lose. Books will be around, writers will write, but publishers will suffer and they will make a fuss about it all the way to the chopping block. it'll be a difficult transition no doubt, but I can't say I'm very worried about how things will turn out. Good books will still be here and I think people will be willing to pay for them.

    mood
    Moody Writing
    @mooderino

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  4. I think for some, maybe. But most people I know still love the old fashioned bound book.

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  5. Hmm... Good argument. I can't see why $0.99 is such a problem. Why would selling 4000 books worth $0.99 be worse than selling 20 worth $20?

    And... wouldn't it be ironic if we went back to a system of patronage? We'd be back on agency-like system all over again...

    Either way, time will tell...

    My argument on this topic?

    $0.99 books won't damage the industry. Books (regardless of price) that aren't up to high standards will damage the industry.

    I'm looking at you, publishers who publish big names without looking at the story quality.

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  6. Wow! That's a doozy of a post.

    I really think it's about quality. A major difference between the music revolution and the book revolution was that it was largely known artists offering music for 99c. Big name authors still don't go that low. (Aside: music still makes a large percentage on live events, which are negligible in books.)

    In fact 99c is either a temporary promotion from an established author or a self-publishing from an unknown. I think the quality factor will eventually even it out. I'm not willing to read bad books for free. Heck there are some books you couldn't pay me enough to read, and it's not even that they're bad. They're just not my thing.

    I figure when people get tired of the 99c gamble, they may make their way back up to the established model.

    But I think the price of traditionally published books, e- and otherwise will have to come down some.

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  7. I don't think it will have an effect, as you pointed out, it's not made a difference to how much a song/album costs on iTunes. People will always be willing to pay that little extra for something they like, and hey if it's only a pound then I'll buy four!

    A x

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  8. I know - this is a popular topic and one that I'm sure will alwasy be. There is something to be said that books (or anything) tht is retailed at a very low price give the impression that it's not of high quality. I think teh jury's still out on this one.

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  9. @ Claire: Good thoughts! The one thing I'd point out is that the big name authors don't have a choice to go that low. Most (if not all) belong to one of the major 5 or 6 publishing companies.

    I can't help but think many of them would prefer some of their books be priced at $0.99. Stephen King would dominate Kindle sales if they put The Stand on for that price.

    The big music companies tried to force the cost of music up (one of the links in the post will take you to an article about just that) once Apple started selling songs for $0.99, but Apple had too much control over the digital music consumer by that point. They tried to argue that a song by The Beatles (for instance) is worth more than the latest Miley Cyrus tune. Unfortunately for them, music (like art and books) is a highly subjective experience. So some consumers truly feel a Miley Cyrus song is worth as much as Can't Buy Me Love.

    Publishing companies took note and are trying to force Amazon and the like from controlling pricing by instituting "The Agency Model" where essentially retailers have to list one of their books for a certain price or they won't have the right to sell any of their books. Which, again, is a problem for retailers since 90% of all books come from less than 6 publishers. We'll see if it works.

    Thanks for stopping by and sharing your take. Always appreciated and enjoyed.

    EJ

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  11. I personally think that the majority of entertainers in our world make way too much money. There are authors out there too that make way too much money. Call me a socialist if you want (I don't care) but I think that everyone is entitled to a decent standard of living. That being said...the gross mega-million dollar book deals being brokered should be tapered down to multiple "read thousands of dollars" book deals instead and the price of books reflect this by being cheaper and more accessible. That's just my opinion. As a seguay Jennifer Lopez would curse me because her thighs and voice are clearly worth more than the $12 million per season she gets on American Idol (hence why she isn't going to come back). It takes a certain kind of ego to throw $12 million in someone's face and follow up by saying, "How dare you?! This paltry sum is insulting to my creative genius!"

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  12. Hey EJ! I agree that the future won't be full of free books for a few reasons: We've had libraries for years and years and people still buy books. No one will pay $10 for an indie author so they have to price low but plenty of people with pay $10 for a well known author. I avoid free books usually because I figure there's a reason they're free. Youtube has free content, all the free content I can stand, and Netflix is really cheap, but people still go to movies.

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  13. While I've only purchased one ninety-nine cent book (an author friend's book) I admit I'm not willing to go over ten dollars for an eBook, even from name authors. My favorite authors put out a new book earlier this year, and I decided not to get the $14.99 eBook. (Turns out it's really bad, so glad I didn't.) I think when the dust settles, we'll see a leveling of the prices.

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  14. I think ebooks are attractive simply because they're cheap--but if I really like a book, I'd definitely spend some money to buy the hardcover or paperback versions. :P
    Nutschell
    www.thewritingnut.com

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  15. I admit it. I don't like to buy ebooks more than $10. However, I didn't buy hardcover books either. I would wait until a book came out on paperback before buying most of the time (there are a few instances where I did not). So essentially, my buying patterns haven't changed much. If a new ebook comes out at 14.99, I'll wait for the price to drop before I buy it.

    Thought provoking post EJ.

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  16. Exactly. Thanks for being the voice of reason, EJ (and nice to meet you, btw).

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  17. I think Libby stated the situation very well. I don't think books will end up being free - like you said, people pay to escape. How much they'll pay will depend partly on how well the books are written. I do feel, though, that an electronic version of a book should be significantly lower than a paper copy. Authors should get their share, but publishers shouldn't end up making a ton more because they're still charging the same price but it's costing them way less to produce.

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  18. I saw a picture of a board room once. Those white sand beaches were just beautiful.

    It's true that I probably would sell everything I own for a new Harry Potter book. Everything except my Harry Potter books anyway...

    Really, a terrific post.

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  19. Like you said, people will always pay for things they want... and the higher the quality, the more they'll pay.

    Regarding free books--giving books away for free is a good marketing ploy when you have other books to offer. If the person likes your free book, they will be more willing to pay for your other books. They may not have given your books a go if one hadn't been free. Just a thought.

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  20. I'm not sure how I feel about this, but it is certainly an interesting discussion. I do not have an e-reader; I'm holding out until real books don't exist anymore. =) Are there any quality books for 99 cents being sold?

    Thanks for such an interesting post!

    -Miss GOP
    www.thewritingapprentice.com

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  21. Given that the traditional publishing industry is giving book contracts to illiterate knuckle dragging troglodytes from Jersey Shore, they've got reason to be afraid of the trend towards independent publishing.

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  22. Hey EJ, great post. Sorry I missed this two months ago when you wrote it! For all the reasons you mentioned, I don't think that books will ever be free. People have to live. What I do think is that we're going to see far fewer authors making it to the point where they can quit their day job, but this isn't just due to low e-book pricing. It's due to piracy and e-libraries and just the availability of books period. Nearly every week I see 5-10 new titles at my e-library that I had wanted to buy and only a few of those I hold out to actually buy the book (I know, I'm part of the problem, though I do try to promote the books that I think are worth it :)) I also don't expect that I will ever buy an e-book for 10$ as I don't like the thought of paying that much for something that I can't physically hold in my hands. And, I've been searching around for indie books (those priced .99 - 2.99) for an indie review site that I'm involved in. I've just started with this, but it's pretty clear from the sample pages which ones are worth my money and which aren't. In time, I think everything is going to work itself out, but again, authors are going to have a hard time doing what they love as an exclusive day job.

    Great post and discussion!

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