It figures, maybe

Yesterday’s blog drew some comment on the blog and on FaceBook. Again, I emphasise that the statistics are not mine, but gleaned from a newspaper’s graphic. And the argument is against the big publishers, not the independents.

In my library I have a book printed in 1980, long before e-books, and it gives a breakdown on where the money went on a hardback novel then.  It makes interesting reading, even now.

 

 

BRITAIN

Author – 10%

Text printing and paper – 5.6%
Jacket printing and paper – 1.8%
Binding and freight – 2.6%
Bookseller – 41%
Publisher’s overheads – 20.6%
Publisher’s profit – 9.2%
Composition and plate making – 8.6%
Jacket design and artwork - .6%
 
USA

Author – 10%

Text printing and paper – 3.7%
Jacket printing and paper – 1.5%
Binding and freight – 4.7%
Bookseller – 47%
Publisher’s overheads – 23.9%
Publisher’s profit – 1.3%
Composition and plate making – 6.7%
Jacket design and artwork - 1.2%

The differences are accounted for, apparently, as the example is based on a print run of 5,000. The ‘British market is smaller; a sale of 5,000 copies in Britain is above average; in the US it is close to the norm.’

- Novels and Novelists, Editor Martin Seymour-Smith, 1980.

Now, I’ll just look at the British figures, as if enlightened by the e-book arrival:

Sure, figures have probably altered over 34 years – though not in the authors’ favour. And who said publishers react quickly? As John D MacDonald said, ‘If you would be thrilled by the galloping advance of a glacier, then you’d be ecstatic watching changes in publishing.' They were late to grasp the e-book nettle and then discovered they could profit hugely...

 

Anyway, back to the chase. If we exclude all the print associated overheads (say, 39.2%), we arrive at 60.8% of the cover price. So, at a rough-and-ready estimate, the e-book cover price should be at least 39% less than the print version. I suspect that is not the case for new e-books coming from the big 5 (or however few are left after the latest amalgamation, conglomeration, takeover).

 
Author – 10%
Bookseller – 41%
Publisher’s profit – 9.2%
Jacket design and artwork - .6%
Total percentage of cover price = 60.8%

[All of the following are probably associated with a print version, not e-book]
Publisher’s overheads – 20.6%
Text printing and paper – 5.6%
Jacket printing and paper – 1.8%
Binding and freight – 2.6%
Composition and plate making – 8.6%
Total percentage in this group – 39.2%
 
Mark Twain had something to say about statistics. I’m sure he had a view on percentages, as well. Even so, it’s plain as a pikestaff, to use an out-dated cliché, that certain publishers are attempting a form of profiteering where e-books are concerned.

(The earlier mid-16^th century phrase was ‘plain as a packstaff’, which alluded to the staff on which a pedlar carried his pack, which was in plain view. Amphitryon, III, Dryden.)

Tomorrow, back to a non-controversial subject, perhaps…

The e-book wars

Some of my books - poets' corner

 

The continuing skirmishing between Amazon and certain book publishers is in the news. There are opinions from those affected – authors, booksellers and publishers, yet there’s an elephant in the room that seems to get ignored.

The big publishers price their new e-books too high, doubtless knowing that the fans of the best-seller authors will buy regardless, thus boosting their profits.

The business model quoted in a Sunday paper gives us this example:

Printed book

40% of cover-price goes to the retailer, such as Amazon, or bookshop.

60% goes to the publisher (two-thirds of which goes on production (paper, printing, pulping unsold books, transport) [doesn’t mention warehousing], with 5-10% of the price going to the author.

E-book

30% to Amazon

70% to the publisher with 17.5% of the cover price going to the author.

That’s the simplified model, anyway.

Obviously, some of these percentages will differ, depending on the author and the publisher agreements. But the principle probably holds. Bottom line is that publishers and retailers are in a business and need to make a profit.

Producing a book has a lot of costs attached, though not mentioned specifically in the example above. For instance, editing, page format setting up (should be minimal in the digital age), cover design, marketing (if any).

So, let’s assume the publisher is justified in getting 40% (two-thirds of 60%) for print, which includes paper, printing, etc. That still means 20% is left over for – the author? No, the author gets 5-10%, if he or she is lucky. So some percentage (10-15%) is sort of floating somewhere… Maybe that’s the publisher’s profit? Hmm…

Now, for the e-book, there are no paper, print, delivery, warehousing, pulping, and transport costs. So why does the publisher get 70% of the cover price?  If the author gets that 17.5% (many don’t get nearly as much), that means the publisher gets 52.5% and Amazon gets 30%. If the publisher doesn’t spend on print, paper, printing etc for this version, then that 40% is ‘unclaimed’ by any process for the e-book model. Of course, subsumed within though not quoted must be the editing, layout, setting up, cover design, marketing… which is necessary for the print book anyway. So if, as is usual, the majority of books from the publisher are both print and e-book, those costs are already accounted for in the print model so shouldn’t be deducted from any percentage in the e-book model. Yes, setting up an e-book requires additional work, but it’s fairly basic and cannot account for that 40% slice. Whatever way you cut it, the costs of producing an e-book are negligible and don’t warrant the high price.

 
There is probably something else at work here. If the price of the e-book was lowered to a realistic level, then that might affect print sales. At present a new hardback and e-book are only about $5 apart in pricing (a hasty straw poll on the B&N site). People who prefer print books will be content to pay that extra; but they might baulk if the difference were greater. So it could be argued that the artificially high e-book price is to protect the sales of the hardbacks.

Whatever side of the fence we sit on, I suspect that authors – the originators, the people who effectively create the books – are unlikely to see percentages improve in royalties any time soon.

[This view concentrates on the big publishing conglomerates, not the independent presses who quickly grasped that e-books sell better if priced low. Certain assisted-publishers/vanity publishers tend to price their e-books as high as the big publishers’ model, thus denying their writers a viable outlet.]