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Publishing Profits and E-books

Author Paolo Bacigalupi (The Windup Girl, Zombie Baseball Beatdown) has once again started a fascinating discussion on social media, this time on the merits (or demerits) of publisher’s profits on e-books.  He gives a fascinating insight into an industry that is a mystery to most of us, even though it impacts all of us bibliophiles […]

Author Paolo Bacigalupi (The Windup Girl, Zombie Baseball Beatdown) has once again started a fascinating discussion on social media, this time on the merits (or demerits) of publisher’s profits on e-books.  He gives a fascinating insight into an industry that is a mystery to most of us, even though it impacts all of us bibliophiles immensely.

Here is his initial post, which he uploaded on Thursday, February 13 on Facebook:

One of the things that’s interesting to me about the demonization of publisher’s profits on ebooks is the question of where those ebook profits then go. Hachette just posted rising profit this year partly based on its ebook income.

Would I like to have more of that money in my pocket instead of Hachette’s? Sure! Of course!

But interestingly, Hachette and its imprints are in the business of going out and buying and printing more books. One of the things that helped SHIP BREAKER get published and promoted at LBYR was that Stephenie Meyer was selling like crazy. Her success and profitability funded my success and profitability. LBYR had money to risk on me, because they succeeded with TWILIGHT. Right now, I’m guessing it’s James Patterson that helps write the checks that keep people like me and AS King and Malindo Lo, and a bunch of other LBYR authors writing.

I’d love to take home more than 25% of ebook royalties. I think it would be fair if there were royalty steps that allowed publishers to recoup risk and then share rising profits with their authors. But interestingly, I’m pretty sure I wouldn’t use the extra cash in my pocket to help fund another writer getting started.

I still want the money, but its worth pausing to also note that having publishers making money and making profits isn’t necessarily a bad thing for our story-telling ecosystem. Books like mine, risky books by other authors that don’t have a natural place in the genre hot sellers, all kinds of books benefit from profits that publishers get. I’m not saying publishers are all wise, or all benevolent, but they do move money from successful authors to help fund new authors.

Food for thought, when we think about writing ecosystems, gatekeepers, and the like.

Later, he added:

I’m not saying that it’s some direct thing, except that when SHIP BREAKER was purchased the entire bookselling universe was collapsing and editors were getting laid off, etc. Stephanie Meyer meant that LBYR was a stable rock in the economic storm, and, it turned out, a stable rock that I managed to land on, and then craft a career from. Did I get Meyer’s millions? No. Did she make it possible for LBYR to buy a book that doesn’t fit the mold of what sells massively for YA dystopias? Yes. Definitely.

There have been many well thought out and beautifully expressed responses to this thread.  Author Jake Bible gave this perspective:

Why is it that publishers are called greedy for making a profit when self-publishers are called entrepreneurs for doing the same thing? There are bad apples on both sides, but one side supports many jobs while the other supports themselves. I’m not judging either way since I self-publish and have contracts with two publishers. It’s just interesting that thousands of authors that have never seen a publishing contract condemn a business they know nothing about. I admit I was one of the condemners before I got some industry experience under my belt. But now I have perspective and realize comparing self-publishing to traditional publishing is not a fair comparison at all. Two different species living in the same jungle.

After Bacigalupi noted, “And yet publishing’s bottom line remains somewhat thin. It doesn’t look like publishing is cashing in bigtime and spending it’s ill-gotten gains on hookers and cuban cigars.”, author Robert J. Sawyer responded:

It’s also worth noting that publishing employees are massively underpaid, especially at the low end. I went through ten publicists in ten years at one publisher because no one — not even kids in their 20s, which is what most of them were — could make ends meet in or near NYC on what they were being paid. They had to seek greener pastures.

Aaron Brown of Denver, Colorado added:

The challenge is that publishers are beholden to the logic of financial markets that presently favor short term returns over the creation and maintenance of long term value. While the two objectives can coincide (and do in books like Ship Breaker), the short term objective tends to reward fads and sensations over slower, richer, lifelong career development that can come from those squeezed-out midlisters.

It’s a fascinating discussion.  If you are on Facebook and would like to follow along, access Paulo Bacigalupi’s profile; he’s a wonderfully accessible author.  Or chime in here, if you wish!  We’d love to know your thoughts!