Saturday, December 31, 2016

2017 Book Industry Predictions: Intrigue and Angst amid Boundless Opportunity

If you could see into the future, what would you do to change it?

Each year I polish off my imaginary crystal ball and attempt to divine how the boiling crosscurrents of technology, competitive intrigue, author aspirations, and reader tastes will shape the opportunities facing authors, publishers and retailers for the year ahead.

As I caution each year, the prediction game is fraught with folly.  No one really knows what will happen tomorrow, though there are plenty of clues.

Book publishing is in the grip of multiple long-term macro trends.  Like strong trade winds, these forces will fill the sails of those who can harness them while swamping those who don't.

2017 will mark a special milestone for the ebook industry.  It marks the ten year anniversary of the Kindle.  It’s also the ten year anniversary of Smashwords’ incorporation.  In early 2007, after three years of crafting our business plan, I hired our first programmer and began active development on the Smashwords platform which we launched in early 2008.

Although my prediction track record has been pretty good over the years (see the end of this post for a complete list of my past predictions), my overarching objective is not to be correct.  Instead, these predictions are meant to spark conversation and contemplation. 
From conversation comes insight.  From insight comes the opportunity for all of us to make course corrections to our publishing strategies so we can take full advantage of the exciting opportunities of tomorrow.

YOU are the captain of this wonderful industry’s destiny.  Your decisions and actions matter, because it’s the collective publishing decisions of today’s authors and publishers that will shape the future of publishing.

We either seize control of our futures with deliberate action or we allow ourselves to become victims of others’ agendas.

Predictions provide a framework around which we can all strive to better understand the opportunities faced by the indie authors, publishers, retailers, libraries, and by association, the dear readers for whom we all work to serve.

Your reactions and comments – whether in agreement or disagreement – are an integral leg in our collective journey toward greater understanding.  Please consider my predictions the start of the discussion, not the end.  I’m handing you the ball and I want you to run with it.

As you read the predictions, I encourage you to consider how each prediction makes you feel.  And then as you plot your publishing strategy for the years ahead, take actions that support the outcomes you desire, and resist the forces that run counter to your long-term interests.

Ten Years of Indie Publishing in Review

Before we get into my ten predictions for 2017, let’s take a moment to review the amazing transformational change over the last decade, and celebrate how far the indie author movement has come in such a short period of time.

Ten years ago traditional publishers controlled the means of book production, distribution and sales.  It was a print-centric world where print books accounted for 99.8% of book sales, and where publishers were the bouncers at the pearly gates of authordom.

Publishers controlled which writers graduated to become published authors, which books readers could read, which authors remained in print, and which authors would be allowed to publish another book.

Ten years ago, the biggest challenge faced by published and aspiring authors alike was access to readers at retail.  Most writers were shut out of the game.

But it’s not like publishers were sitting idly on their hands conspiring to suffocate the dreams of millions of writers, nor did they seek to exercise authoritarian control over what readers were allowed to read.  Publishers were wrestling with the challenges not all that dissimilar to the challenges every indie author faces today, such how can I make my books more discoverable and more desirable to readers so I can grow my publishing business?

Ten years ago trade publishers were releasing about 300,000 new titles per year.  Even back then, for readers and publishers alike it felt like there were too many great books and not enough time to read them.

Brick and mortar book retailers of yesteryear applied further constraint on writer opportunities, but it was not out of malice or disrespect for authors. Retailers faced their own challenges.  They couldn’t stock every book given the high cost of operating physical stores.  Shelf space is expensive.

Successful retailers managed their inventory with an iron fist.  Small indie retailers could only stock maybe a couple thousand titles, while the large box retailers could stock maybe 50,000 to 80,000.

Distribution to booksellers has always mattered.  If your book isn’t in stores, readers won’t find it.

It’s easy for us indie authors to fall into the common trap of thinking that victims of this distribution dilemma were unpublished and rejected authors.

Yet even for published authors, life was not a bed of roses.

With hundreds of thousands of new books published each year and millions of previously published books competing for precious retail shelf space, thousands of great traditionally published books and authors couldn’t achieve or maintain the retail distribution they needed or deserved.

The most successful books and authors achieved the broadest distribution, which further perpetuated their sales success.

Poor and moderate sellers faced the antithesis - a negative self-reinforcing cycle where weak sales would lead retailers to return books to publishers for a full refund within weeks of publication.  This caused the weak sellers to lose shelf space, which caused sales to drop further.  Often the first printing was the last.

If ten years ago the primary challenge facing writers was access to retail distribution, then the rise of ebooks solved that problem.

Ebooks transformed the distribution landscape by making it cost effective for online retailers to digitally stock every ebook.

Smashwords played a role in partnership with leading retailers to break down these prior distribution barriers.  When I approached retailers in 2009 about opening their stores to our authors’ self-published ebooks, I expected reticence.  After all, there was a stigma back then about self-published books.  To my pleasant surprise, they wanted to stock all our ebooks.  Barnes & Noble, Sony, Kobo and Apple were the first to sign on with us, and the rest is history.

The indie author revolution of the last decade could not have happened were it not for the visionary commitment shown to self-published authors by the major retailers.

Today indie ebooks form an essential and increasingly important part of every retailer’s inventory.

Retailers recognized then, as they do now, that their customers appreciate the greatest possible selection of books.  These retailers correctly recognized that indie authors would inject a new vibrancy to publishing by enabling new voices to serve readers with an amazing diversity of works.

In the last ten years ebooks took off.  Ebooks today account for maybe 25% of book sales, up from essentially nothing a decade ago.  In genres like romance, the percentage is much higher.

When I look back at the rise of the indie author movement the last ten years, romance authors and their readers have always led at the tip of the spear.  They were first to embrace the indie ebook publishing, the first to achieve significant commercial success as indies, and the first to pioneer many of today’s best practices for ebook publishing and promotion.

Romance authors – predominantly women – are the some of the smartest players in this business, and their readers are the most coveted and voracious.  These are the readers who often read a book a day.

Romance authors are the canaries in the coal mine.  Romance authors were first to benefit from the rise of ebooks and the first to experience the deleterious effects when the market became saturated.  They’ve also been the first to fall prey to some of the more troubling developments in the industry now affecting writers and publishers in every category.

In the last decade, hundreds of thousands of writers have joined the indie author movement, drawn by the advantages of self-publishing ebooks.  What are these advantages?  In a nutshell, indie authors enjoy faster time to market, greater global distribution, complete creative control, greater pricing and promotion flexibility, greater opportunity to serve their readers with high-quality low-cost ebooks, and the opportunity to earn royalty rates up to five times higher than what the traditional publishers pay.

Whereas the print publishing landscape remains tilted to the traditional publisher’s advantage because publishers maintain a stranglehold on print book distribution to brick and mortar stores, the ebook marketplace is tilted to the advantage of indie authors and small indie presses.

Indie authors are now a major force in publishing, and I expect indie influence to increase in the years ahead.  Today, all writers have the freedom to decide when, where and how they publish.  For this reason, in my view all authors are now indie authors, even if they don’t yet recognize themselves as such.

While many of us have celebrated the rise of the independent author, there are strong forces at play that seek to limit the power of writers, limit their distribution, and strip them of their newfound independence.

You have the power to do something about this.  Don’t be a victim.  Be a leader.

For long time followers of this blog and my annual predictions, you’ll recognize some recurrent themes below.

At this stage of the industry’s maturity, much of the industry’s developments are propelled by longer-term trends set in motion decades ago.  On the surface, the trends of 2017 are not radically different than those of 2016 or 2015, although as these trends unfold their affects will become more pronounced.

There’s inertia to some of these trends.  Like a large ocean liner, directional changes are usually slow and incremental.  It can take years for some trends to play out.  Occasionally there are shocks to the system that can cause abrupt trend reversals.

It’s impossible for anyone to discuss the future of publishing without discussing Amazon.  The industry has been locked in a contentious battle with Amazon, and the industry is losing.  Amazon plays by different rules.  Publishers are showing up for gunfights with butter knifes.

Okay, on with the party.

Ten Publishing Predictions for 2017


1.  Indie authors will continue to capture greater ebook market share in 2017 

Indies will capture a greater share of digital reading in 2017.  Factors driving this include:
  • Each year the indie author community raises its game to become more sophisticated and more professional.  Indies are learning to implement – and in many cases pioneering – the best practices that motivate readers to choose one ebook over another.
     
  • Indie ebook authors combine quality with lower prices, providing readers tremendous reading value.
     
  • Even though indie ebooks are already low-priced, indie authors have greater flexibility to lower prices further than do the large publishers.  This is a mixed blessing.  This also means indies are vulnerable to some of the greatest devaluation pressures because indies don’t wield the collective bargaining power of large publishers.

2.  The glut will grow more pronounced

Over the last few years here at the Smashwords blog I’ve talked a lot about how there’s a glut of high-quality low-cost ebooks.  These ebooks are immortal and will never go out of print.  Thanks to low-cost virtual shelf space, retailers can stock these ebooks forever – even if the books don’t sell.  Although it’s great that your book will forever occupy the shelf, and forever be discoverable and purchasable by new readers, it also means that the virtual shelves are becoming more overcrowded every day.   The major ebook retailers each stock millions of ebook titles in their online stores, with Amazon fast approaching five million titles.  Every day from yesterday forward it will become more challenging to stand out, which leads me to my third prediction.

3.  Ebooks will face greater commoditization pressures in 2017

Any time the supply of a product outstrips demand, retailers and producers differentiate their product by lowering the price.  When one product is priced less than another, the lower priced product will usually – but not always – be viewed as more desirable to the consumer.  Are $3.99 ebooks to expensive?  How about 99 cents?  How about free?  How about authors paying readers to read books, the subject of my April Fools satire on Kindle Power Bucks which is starting to become all too real?

Most authors and publishers will vehemently argue that their books are unique objects and therefore not commodities.  After all, commodities like corn or soybeans are by definition similar products, largely undifferentiated in form or quality.  Books are the unique product of author creativity, right?  The answer isn’t so black and white.

Why books are vulnerable to commoditization

If we look at why readers read books, it’s because they aspire to receive knowledge, entertainment or escapism, or all the above.  We can boil it down to “reading pleasure.”  The product of the reading experience – the pleasure – is the commodity because there are so many media forms competing to satisfy the same aspirations for pleasure – from Facebook to news outlets, to blogs, television, YouTube, Snapchat, video games, movies, theater, museums, a walk in the park, and even Wikipedia.  So while no two books are ever the same, all books strive to provide pleasure to the reader.  If there are two books of equal perceived quality, equal cover design, equally compelling product descriptions and equally trusted author brand, those two books will look quite similar to the prospective customer.  With all other things equal, price becomes the trigger for consumer action.

You’re selling a product that is ripe for commoditization.  Further exacerbating the book’s vulnerability to commoditization is the innate desperation of writers to reach readers.   Most writers write to be read.  Every writer – even New York Times bestselling authors – fret about how they’re going to reach their next reader.  They fret about how they’re going to make their next book sell as well or better than the last.

Added to this mix is a single retailer that controls about 70% of the global ebook market, and this retailer’s business model is entirely predicated upon offering its customers the greatest possible selection at the lowest possible prices.  Stop for a moment and contemplate that.  The only way for Amazon to survive is to continually lower prices, and continually attract the greatest possible selection.

To offer lower prices, a retailer must force its suppliers to constantly accept lower prices and lower margins.  This is why Amazon always opposed agency pricing, which allows authors and publishers to set their own prices. 

As one former Amazon executive told me eight years ago, “We think we’re smarter at setting book prices than publishers.”

But Amazon’s interests aren’t necessarily aligned with those of the author.  Amazon is driving ebook commodization because in commodity markets, individual sellers become powerless to set prices.

But you’re not selling a mouse-trap.  You can’t outsource your production to China.  You can’t put food on your family’s table if you become powerless to earn a fair price for your work.

There are voices that argue low prices are universally good, because lower prices increase consumption.  At best, this is not entirely true, and at worst, it’s disingenuous.  Low prices come at a cost.

If every book in the world was priced at free, there’s a limit to how many more books readers could or would read.

How do authors earn a living for the long-term when the dominant marketplace controlling access to the most readers has the power to limit your readership if you refuse to concede to their terms?

4.  The publishing industry will begin to recognize KDP Select as the cancer that it is

On December 8, 2011, Amazon announced KDP Select, an ebook self-publishing option that invited indie authors to make their ebooks exclusive to Amazon in exchange for preferential access to readers.  Most in the publishing industry failed to understand the significance of KDP Select when it launched in 2011 because most in the industry don’t even understand the difference between KDP and KDP Select.  For the past six years when I’ve had conversations with publishers, retailers, industry watchers, media, and authors outside of Smashwords, I’m often dumbstruck by the industry’s inability to parse the long term implications for every player in the industry.

Maybe I’m the wrong messenger.

I sense attitudes are shifting on KDP Select.  Authors, traditional publishers and retailers are starting to personally experience KDP Select’s effects on their bottom line.

KDP Select participants – including many former defenders – are starting to have second thoughts.  KDP Select itself has become glutted and has become rife with scammers.  Authors have witnessed how KDP Select gives Amazon the power to arbitrarily change the terms of the program at any time without notice, because they have done so on multiple occasions.

The big question is whether KDP Select has already done irreparable damage to the author opportunities.  Indie authors enabled the rise of KDP Select because the catalog is almost entirely supplied by indies.  Now many of these authors find themselves trapped in it.   Yes, they can opt out when their next three-month term expires, but for many of these authors it’ll take years to rebuild readership at other retailers.  Some of those retailers have already disappeared , and we can see KDP Select’s fingerprint as one of many contributors at the scene.  This week, for example, All Romance eBooks announced it was closing.  KDP Select didn’t kill ARe, but it was a factor.  Any ecosystem or business can only suffer so much before it collapses.

KDP Select was constructed for Amazon’s benefit.  It gave Amazon exclusive inventory, which then undermined competing ebook retailers’ ability to serve millions of customers who wanted to read these books.  Many of those customers were forced to migrate their purchase behavior and e-reading devices to Amazon, even if their favorite retailer/device combo was with Barnes & Noble, Kobo, iBooks or some other.

Many authors who moved books to KDP Select have found themselves locked into a Hotel California where they can check out but never leave.  They’ve become dependent upon Amazon.

After suffering decades living under the yoke of an inflexible and calcified traditional publishing regime before finally being liberated by the indie author revolution, should we care if authors lose their independence again?

Should you care if the dominant retailer demands exclusivity simply to make your book visible in their store?

Should we care if Amazon’s retail competitors fail, or if there are fewer strong retailers competing for the privilege to sell your books?

Should you care if all your earnings are coming from one sales outlet?

Should you or can you sleep easy if your next mortgage or rent payment is 100% dependent on your Amazon sales every month?

If you believe Amazon is a benevolent retailer whose interests are aligned with your own, then going exclusive with Amazon is the path for you.

As I’ve argued before, by any measure Amazon is not a benevolent player.  To ask Amazon to suddenly change their stripes is like asking a cheetah to become a vegetarian.

Meanwhile, every new book enrolled in KDP Select is another vote to put all the other retailers out of business.

Never mind that these other retailers through their policies and actions have shown they’re much more benevolent than Amazon.  None of the other retailers hold a gun to your head and essentially say, “Go exclusive and we’ll make your book more visible and more desirable to our customers.  Refuse exclusivity and we’ll make your book less visible and less desirable.”  None of the other retailers send authors browbeating nastygram emails threatening to kick them out of their publishing programs for the most minor of reasons, as Amazon does when currency fluctuations collide with their arbitrary pricing rules.  Heck, I even got an email from Amazon last week demanding that a New York Times bestselling author we distribute to Amazon must remove “New York Times bestseller” from her keywords, otherwise they’ll unpublish her book.

Boiling Frogs

Amazon has rolled out a continuous cavalcade of small incremental tweaks to KDP Select over the last six years, most of which have conspired to tighten the screws on author earnings and author independence.  When the program first launched, authors were paid $1.40 each time their book was read past the first 10%, regardless of the book’s list price.  For a lot of authors, that $1.40 represented a 50% pay cut or more compared to a single-copy sale.

When Amazon opened up sales to India, Mexico and Brazil, Amazon required authors to enroll in KDP Select if they wanted to earn 70% for their single-copy ebook sales in those small markets.  Otherwise, KDP authors only earn 35% list. Then Amazon changed the payment to about ½ cent per page read, and then later Amazon redefined their definition of a page, which pressured author earnings further.

In 2014, Amazon announced Kindle Unlimited, a subscription service that caused significant devaluation of books, both in terms of what readers think a book should cost, and also in terms of what authors will be paid for those books.

In 2016 Amazon announced that because some markets outside the US, such as India, can’t afford KU’s $9.99/month subscription fee, that Amazon would lower authors’ already-paltry ½ cent per page royalty.  So whereas a book read in the US might earn ½ cent per page (USD $.005), the same book read within KU in India might earn about 1/3 that, or about two-tenths of a cent per page.  By way of example, at two-tenths of a cent per page, a reader would have to read about five pages for the author to earn one penny.  A 200-page-book regularly priced at $3.99 might normally earn the author about $2.75 for a single copy sale.  The same book might earn only about 40 cents in India.  A 100-page novella normally priced at $2.99 would earn 20 cents in India.  Woohoo, 20 cents!

This is what happens when you hand a commodity retailer sole control over the price of your book and your royalty rate.  And there’s nothing stopping Amazon from tightening the screws further.  In fact, you can count upon such further downward pressures because it’s the only way Amazon can stay in business.

To understand what Amazon is doing, we need to think beyond conventional measures of reading such as pages read or books purchased.  Instead, start thinking in terms of units of reading pleasure, where one unit might equal one hour of reading time.  Amazon is on a tear to commoditize the units of reading pleasure so it's cheaper to read at Amazon than anywhere else.

KDP Select is metastasizing.  It’s wreaking the havoc I predicted six years ago and more. 

It’s fair to say KDP Select has its hand in several of the biggest trends shaping the future of publishing.  KDP Select’s exclusive club itself is now glutted and overcrowded, which means the program is ripe for further commoditization.

We can expect Amazon to impose additional tolls on authors in 2017 under the guise of marketing opportunities.  Amazon’s recently announced Kindle Ads which fit that fare.  You can now pay Amazon to advertise your book.  It’s another way for Amazon to extract margin from your sale, while disadvantaging those authors and publishers who refuse to surrender more blood.

I’m tired of talking about Amazon, but we can’t have a serious discussion about the biggest trends facing publishing without talking about the largest, smartest and most fascinating player in the room.

I know some people who’ve followed my writings over the last few years think I hate Amazon.  I don’t.  I respect their smarts and I admire the amazing contributions they’ve made to self-publishing.

6.   Large ebook retailers pushed to the brink

Over the last three years, ebook sales have been flat to down at most major retailers.  As I look at the early sales results in the first several days post-Christmas - usually the high water mark of the year - it's shaping up to be one of the weakest post-holiday ebook sales periods in several years.  B&N and Kobo will face increased pressure in 2017 as two of the highest profile and last remaining pure-play online booksellers.  By “pure-play,” I mean these two companies depend upon book sales to earn a profit and stay in business.  Amazon, iBooks and Google, however, don't need to earn a profit in the book business to remain in the ebook business.  For them, ebooks are a small but strategically important component of a content ecosystem supporting much larger profitable non-book businesses.  For Amazon, it's about selling anything to anyone.  For Apple, it's about enriching the experience of their devices.  For Google, it's about helping people find whatever they're looking for.

Over one million ebooks are now exclusive to Amazon thanks to KDP Select.  That’s over one million reasons for tens of millions of customers to stop shopping at Amazon's competitors, and a million reasons for Kindle Unlimited subscribers to never purchase another single copy ebook again.  This leads me to the next prediction.

7.  Kindle Unlimited will continue to harm single copy ebook sales in 2017

Amazon controls close to 70% of the global ebook market.  With Kindle Unlimited they’re training the world’s largest community of ebook buyers to consume books for what feels like free.  When a customer visits the book page of any book enrolled in KDP Select, they’re offered the opportunity to read the book for free as part of a Kindle Unlimited subscription, or as part of their Amazon Prime subscription.  Kindle Unlimited makes the purchase of even a 99-cent book look prohibitively expensive to readers.  How’s that for devaluation?

The Kindle Unlimited party train is leading authors over a cliff.

Whereas ebook subscription services Scribd and the dearly departed Oyster offered author-friendly subscription services where the author earned the same royalty for a subscription reader as a retail sale, Kindle Unlimited is less author friendly.

Bottom line, Amazon is encouraging its customers to read books via subscription where list price is irrelevant and it can pay the author less.

It works against Amazon’s best interests to promote the sale of single copy books, since every Kindle Unlimited subscriber represents one more nail in the coffins of Amazon’s retail competitors.  Not only will most authors see their single-copy sales diminish at Amazon in 2017, they’ll also see their sales challenged at other retailers as the power-reader customers of other retailers are drawn to Amazon’s greater selection (enabled by those almost one million+ exclusive books in KDP Select), and the ability to enjoy more units of reading pleasure per dollar at Kindle Unlimited.

8.  Many indies will quit or scale back production

I’m in daily contact with indie authors.  Over the last couple years I’ve heard from current and former bestsellers that times are tough and getting tougher.  Many are considering scaling back production or even quitting altogether.  This was one of the trends I mentioned in last year’s predictions, and my sense is that author anxiety will only increase in the year ahead.  A lot of talented authors out there are hurting and feeling discouraged.  I've heard some authors say, "let the quitters quit - it'll mean more readers for me," yet this is fallacious thinking.  Every single indie author is enriched by the participation of fellow indie authors, because every author has the power to bring more readers to the market.

9.  Industry consolidation will hit self-publishing


Self publishing has become big business.  Everyone and their dog has hung out a shingle in a gold rush to monetize writers’ desire for publication and visibility.  As self-publishers, indies assume responsibility for all the publishing roles once fulfilled by traditional publishers.  Great publishers assist authors with editing, print and digital production, translation, pre and post-publication sales, distribution to retailers, back office accounts receivables and payments, promotion, tax compliance, sales reporting and analysis, merchandising support, and more.

Thousands of service providers have popped up over the last ten years to provide these important services to self-published authors.   Retailers and distributors are service providers too. The good news about this trend is that authors can retain incredible talent for reasonable prices.  But if you’re a service provider, it’s another story.  Today the market is glutted with service providers competing for the favors of writers.  Too many cover designers, and too many cover models, editors, ebook formatters, and book publicists.  As an author, if some of these service providers drop out it will only harm you because it takes a village to publish a book.

In most industries, there are natural Darwinian forces that come to play to bring ecosystems back to a sustainable balance, and indie book publishing is not immune to these natural forces either.

In 2017 we’re likely to see increased merger and acquisition activity as large publishers, retailers, distributors and larger service providers recognize an opportunity to take advantage of the glut to strengthen their indie author portfolio and grow their businesses.  If you believe as I believe that indie authors are the future of publishing, then it starts to become clear that some form of consolidation is inevitable because the business opportunity to serve readers by serving authors and readers is so enormous.  Last year I predicted WattPad would be acquired.  I was wrong!  Or I was early.

10.   Amazon to face anti-trust scrutiny for unfair business practices

This is a long shot, but in the spirit of prediction folly I’m going to go out on a limb here.  In anti-trust law, there’s nothing illegal about operating a monopoly (where you have exclusive control over a commodity and can manipulate prices) or a monopsony (when there’s only one major buyer).  What’s illegal however, is when a company exploits their monopoly or monopsony for unfair business advantage that makes it impossible for other competitors to compete on a level playing field.

Amazon defenders will argue that Amazon is a brilliant competitor and innovator, and that those who think Amazon plays unfair should stop whining and start innovating.  But this argument rings hollow.  The other retailers have innovated, and continue to innovate.  I work with them.  I see it.  This specious argument by Amazon defenders confuses market share for commitment.  If Kobo earns authors 1/10th of what they earn at Amazon, it’s not necessarily a failing of Kobo, it’s a function of market share.  If you decide to open an indie ebook store specializing in personalized recommendations for cookbooks, the fact that you can't grow sales to billions of dollars overnight is not a failure to innovate.

One industry watcher explained Amazon’s anti-competitive business practices to me with an analogy about trains, which I’ll paraphrase and expand upon:

Let’s say you own the railroad network that connects farms to the largest marketplace (which your railroad also owns) 1,000 miles away where 70% of corn is bought and sold; and your railroad also owns some corn fields along the rail lines.  If the railroad operator decides to give its own corn first priority on shipments, then their corn will reach the market first while the corn of other producers spoils or is late to market.  If the railroad also gives its own corn preferential display in the marketplace, or if it denies other producers the option to sell under favorable terms in their marketplace, or gives them poor placement within the marketplace, then what are the other farmers to do?  Shame on the other farmers for not buying their own railroad or operating their own marketplace!
Bringing this back to Amazon, Amazon operates the world’s largest ebook retailer providing access to 70% of the world’s ebook readers.  They operate their own publishing imprints.  This means Amazon has the ability to give its exclusive titles first class priority on the train and in the marketplace, and they do.  They operate the Kindle store where all books are allowed but exclusive KDP Select books and Amazon-imprint books are given preferential store placement.  They operate marketplaces such as Kindle Unlimited where only exclusive books are available and non-exclusive books are shut out.  Shame on you Mr. Retailer or Ms. Author for failing to innovate.

This is anti-competitive and unfair, and these facts have led some anti-trust experts to conclude that the only way to solve this problem is for Amazon to be broken up into smaller, independent companies that operate at arms length.

Amazon has so far been able to skirt anti-trust scrutiny by arguing that the network they operate benefits consumers because of Amazon’s track record of lowering consumer prices for ebooks, and this is very true.

But what about the producers?  Do they have any rights?  You’re a producer, you tell me.


WHOA, Where to from Here?


Okay, so I’ve painted a stark picture for 2017.  What are you going to do about it?

First, remember that you are not powerless, despite the efforts of those who seek to beat you down and take your power.

Recognize that the collective actions of authors and publishers like you will determine the course of this industry.  If you have strong feelings about a particular future you’d like to see realized, it’s incumbent upon you and everyone you know to take a stand, organize with fellow authors and put words to action.

I realize some authors are unable take a public stand.  I’ve spoken with many of them – including many big name NY Times bestsellers – who've privately thanked me for speaking out for them, and they've encouraging me to continue speaking out.  Some of these authors have confided to me they’re unable to speak publicly for themselves.  They’re afraid of recrimination from Amazon; they’re afraid of recrimination from their friends; or they’re afraid of seeing their books carpet-bombed with one-star reviews from Amazon partisans.  If you must remain silent, I respect that.  But if you have the ability to share your concerns with your readers and author friends, whether publicly or privately, please do.  Do it for you.

Despite the challenges writers and publishers face, I continue to believe as I’ve believed for the last decade that there’s never been a better time to be a writer.  There’s never been a more exciting time to be involved in publishing.

Yes, times are challenging for writers, retailers and the rest, but they’ve always been challenging.  Keep in perspective that your opportunities today are significantly better than they were even ten years ago back in the dark ages of publishing when ebooks accounted for less than one percent of the market, and back when publisher overlords were the gatekeepers standing between you and your prospective readers.

You have the freedom, knowledge and tools to chart your own course in this industry.  You have the power to support those players that are working for you, and you have the power to resist those who are working against you.

Even in a flat or declining market, there’s ample opportunity for sales growth.  The global market for books is measured in the tens of billions of dollars.   There are millions of readers around the world ready to discover their next great read.  And thanks to the amazing free tools you have at the ready that didn't exist a mere ten years ago, you have a shot of reaching some of these readers.

How do you reach them?  It’s all about implementing best practices.  Best practices are what make your books more discoverable and more desirable to readers.  If you’re new to publishing, or if you’d enjoy a refresher on what differentiates bestselling ebook authors from poor-selling ebook authors, I invite you to check out my free ebook, The Secrets to Ebook Publishing Success.

Thanks for reading.  I welcome your comments below.

Summary of prior publishing prediction posts by Mark Coker:

2016 Predictions (Published December 31, 2015)

2015 Predictions (Published December 31, 2014)

2014 Predictions (Published December 30, 2013) and Huffington Post (Published January 7, 2014)

2013 Predictions (Published Dec 21, 2012)

2011 Predictions at GalleyCat (published Dec 28, 2010)

10-Year Predictions at GalleyCat (published Jan 4, 2010)


Check out my Smashwords Year in Review post which includes a summary of plans for 2017.  We're moving to monthly payments in February!!

45 comments:

Carly Fall said...

Thanks, Mark. I was hoping for happier predictions, but an interesting read nonetheless. Of course, you've been spot on in your earlier predictions.

As far as ARe is concerned, it looks like it was the owners own doing:

http://blogcritics.org/court-documents-regarding-all-romance-e-books-disturbing-business-practices-surface/

http://blogcritics.org/publisher-all-romance-ebooks-closing-hits-new-low-in-stealing-from-authors/

They've also turned off any way for an author to delete their own books from their site.

This one is going to get ugly.

Vivian Lane said...

When people complain about a lack of innovation, at other retailers, there are valid points:

Kobo's search engines suck. Everybody says no one can find a book there unless they know the title or the author's name.

B&N isn't much better. B&N's website is also built based on the database that was internal for employees - directly from someone I know that used to work there. That big influx of cash they were given could've been put into website improvement and they didn't do it.

And Apple no longer has interest in expanding iBooks even though they have the resources to compete. For authors that prefer to upload directly, they have a picky and cumbersome system that requires a Mac computer.

And then there's Google Play, that has blocked indies from joining further and buries the indie books that are there in favor of traditional publishers.

Everyone's still shooting themselves in the foot in comparison to Amazon.

Now, one thing Amazon is failing at is clearing out the dreck of scam, poorly-written, and plagiarized books. I've been told that readers are so disgusted with the search algorithms being flooded with this crap that they're resorting to only buying directly from authors and publishers they trust because they can't find a good book to read just by searching common keywords that used to provide good genre results.

Authors are also leaving Select because of the Page Flip issue that Amazon refuses to fix. Amazon says pages are working as intended despite evidence shown to the contrary. So authors are finally going wide. Yay.

But.......while publishing has never been easy to find success in, it is the hardest it's ever been to maintain a specific income level - whatever that level you're seeking is. Someone I know put out 6 books in 2016 and nothing but a set of previously-published books in 2015. 2015 MADE HER MORE MONEY. There's no GOOD excuse for releasing 6 books in a year and making less money, but that's the world we now live in. If you don't get a BookBub ad twice a year, you're screwed, and how long before Bookbub is no longer effective?

Kevin Waldroup said...

Blaster Books sales and download

1> smahwords stores
2> Amazom Stores





Kevin Waldroup said...

hi Mark I love to be Interview for blog.

Leenna said...

Hi Mark

Thanks for another thought-provoking yearly prediction.

While I don't make many sales on any platform, I have noticed that my books are slowly becoming more visible on B&N and iTunes. It may be the accumulation of 'runs' and 'spots' of downloads over the past three years and it does confirm my belief that establishing yourself as a long-term author is a long-term thing... So thanks for the reminder on reviewing the long-term thinking for this year.

I also have a prediction to add. I think indie and small presses are going to invest more in print-runs and work more closely with independent bookstores.
I see this as a welcome and growing trend in South Africa, and I hope it's one that is growing globally. I think eBook and print sales should go hand in hand to secure the presence of an author to readers.
After all, you read print books and eBooks at different times and in different settings.

And if you have a magic lamp to rub for 2017, would you please consider wishing Ingram Spark to partner Smashwords, and so make print runs and POD more affordable for those in Africa, Oceania and South America.

Thanks once again, and a happy 2017 to you.

Pamela Cummins said...

Thank you, Mark, for another year of predictions. You will get criticized for what you wrote about Amazon because truth tellers are often put down. To illustrate your point, for my latest nonfiction book in their unlimited program I would need almost ten people to read every page (much more in India or if the page flip isn’t working properly) to make what I make for one eBook sale at 70%. Another way to put it is they are paying me about 7.5% profit per full book read in their unlimited program, which is a long way from 70%! Isn’t that what publishers pay authors who don’t have to pay for editing, book covers, formatting… This is why I won’t go exclusively to what is known in my household as “the dark side.”

David VanDyke said...

"This week, for example, All Romance eBooks announced it was closing. KDP Select didn’t kill ARe, but it was a factor."

I have to hoist the BS flag on this one. ARe closed because of the probably unlawful and certainly inept business practices of one person. You can read about it here:

http://blogcritics.org/court-documents-regarding-all-romance-e-books-disturbing-business-practices-surface/

Saying KDP Select was a factor is like saying any other challenge is a factor: technically true, but irrelevant, because there are dozens of intersecting pressures on any business. Singling out Select in this instance falsely implies Select was more at fault than other pressures.

In fact, there are many successful small presses that use Select. The main differentiation in ARe was bad management.

Jill James said...

I enjoy reading the predictions every year. Thank you. For me, 2017 is going to be the year of looking for ROI. ARe is now gone and I'll be pulling my books from Google Play this year as well. It is too much work to go to some places for what I make at them. This is just for me personally. I love that I can get places via Smashwords that I can't on my own or it would be too difficult. My time and effort has to count as a cost of doing business as well. Thanks for Smashwords and all it does.

Nirmala said...

Hi Mark,

I just wanted to point out that in the US, anti-trust laws are designed to protect the consumer and not the producer. This is different than in the EU where they also try to protect producers. But as a result, it is unlikely that Amazon will ever face much scrutiny under anti-trust laws because as you say in your post, they have lowered prices for consumers and so under US anti-trust law, they are not doing anything wrong.

David VanDyke said...

The number one thing I'd like to see for 2017 (more sales aside) is Smashwords (or someone) allowing co-author or multi-author royalty split management. None of the major retailers will do it, but an aggregator like Smashwords could.

Even an inflexible system that splits royalties equally among all authors of the same book (whether two or three or ten) woudl be superior to not having any such option at all, which is the current state of play. A flexible system that allows the publishing account to split by percentage (e.g., 40% for the author, 60% for the illustrator, or 40% for the publisher and 20% for each of three authors) might be a huge draw.

In my own case, I'd jump on board whomever came up with such a system, because I have many co-authored projects and the accounting is quite annoying and, indirectly, costly. I'd be happy to pay the 15% commission to have someone handle it.

BillSmithBooks said...

Mark:

I know you get an enormous amount of blowback on your criticisms of Amazon because you're not a neutral party but rather a competitor ... but I believe your analysis of Amazon KDP Select is spot on.

Amazon is using this program to not only deprive competitors of books but also to make member authors dependent upon Amazon since they are the only allowed source of income for authors who enroll. All or nothing, no outside revenue.

The fact that Amazon refuses to disclose exactly how authors are paid (we pay from a pot ... that we decide upon ... and never tell you how we make these decisions), the ongoing "whack-a-scammer" problems where Amazon can't seem to control scammers who taking more than their fair share of the pot and thus decreasing the payouts to legitimate authors, plus the ongoing arguments by many, many authors that page counts are not being recorded properly in KDP Select make for a very one-sided agreement where the author is entirely in the dark and not aware of what is going on.

However, KDP Select will continue to succeed as long as authors are willing to enroll in the program ... they are the one who have to be convinced to go back to traditional sales. And I suspect that there are many, many new authors willing to replace those who drop out ... the question is will readers find these replacement authors worth their monthly subscription payment?

Richard Finney said...


Mark,

I’ve written comments in the past that might not have left the impression I respect what smashwords has achieved in the publishing industry (which I believe is monumental), and how you, specifically have been a thoughtful publishing figure, and an innovator, operating in a profoundly difficult area of entertainment which combines art, craft and commerce.

With the above said, I still have problems with your most recent post, and the way you are approaching the presentation of your thoughts, which I hope are not at all symptomatic of someone that spends too much time “in the trenches” and therefore is perhaps not objectively interpreting all the data, intel, pattern shifts that come across your unique radar in a way that best serves any successful fight against oppression.

I will take more time to collate everything you’ve written and respond in a more detailed way about issues you raise, but chime in now on one point specifically because I believe it is the most obvious problem in what you’ve written – your use of metaphors to make your points. I will tackle only one flawed metaphor, though I believe what you’ve written is littered with the use of metaphors that have problems on many levels. Perhaps this is a sign of the difficulty in being the one who feels it is necessary that your call to action will fall on deaf ears unless your words not only educate but inspire.
Specifically you headline one of your points -- "The publishing industry will begin to recognize KDP Select as the cancer that it is."

Calling anything associated with amazon as a cancer does not do your points/arguments you seek to make (whether they are sound or not) any favors. Cancer is a disease that takes over a host body and eventually ends the life of the host body. Anything associated with amazon cannot be accurately (and a metaphor that is inaccurate, means it fails the comparison test with the subject it is meant to illuminate in an insightful way, so the reader can see the subject at a different, or even deeper angle) associated with cancer in that nothing amazon does has the goal of killing the host body. This is true even if we were to agree that certain entities such as publishing or writing in general would be the substitute for the host body in a cancer metaphor.
I think it’s obvious, using the word “Cancer” gets everyone’s attention, but the provocative use of the word negates your message on many other levels, the most important being the desire to connect with your reader by using a metaphor as a communication bridge. Of course "cancer" might work if smashwords were the substitute for "host body," but I don't believe that's at all what you intended at the consious or sub-conscious level.
If there is a metaphor to be employed to describe amazon, I suggest a more intellectually productive metaphor would be — “empire.” This metaphor comes with a more accurate way of describing what amazon is attempting to achieve, but allows for a more complicated discussion about the reality in what and how amazon is operating in the current marketplace.
When the Romans expanded their “empire” they did so often with brutality, and overwhelming forces. But the more historically controversial/nuanced/complicated/mitigating aspects of their expansion occur after the conquest. Note that the Romans rarely killed everyone in the “host country,” they conquered. Their goal was to bring the surving people to their knees and make them productive cogs of their empire. Eventually, the Roman empire opened up avenues that a conquered people could rise and rank within the powerful elite of the empire.
Again, I want to point out, in even stronger terms than I began — I’m a fan, Mark. As an author, (who proudly has books with smashwords), I continue to appreciate all of your public/social networking efforts at author outreach over these many years (just one of the numerous reasons I believe you are truly an innovator in the publishing sector).

Sylvia Says -- the blog said...

Hi Mark,

Only one question: Is Smashwords going to distribute to Google Books?

I looked into sending my books to Google Books but didn't want to deal with another publisher/retailer. Besides, they've very user-unfriendly when it comes to submitting ebook content. I've asked some of my indie colleagues if they were on Google books; not many were, but those who did try it did not think much of it.

Anyway, it would be good if Smashwords could distribute to Google books so we can maintain a one-stop publishing service.

Happy New Year!
Sylvia

Grace Brannigan Romance Author said...

Every year I hope the surprise is you'll get into print books. :-)

Joel Puga said...

Hello,

My biggest wish for 2017 is that Smashwords finally gives authors the ability to set prices in different currencies. I think the weird prices that we get on Kobo (and all the smaller retailers that get their books through Kobo) on any currency that isn't US dollars really impacts sales, especially for those writing in other languages.

Google Play, for example, allows this and I get one or two hundred downloads of my Spanish books every day. I think this comes, in part, from the ability I have to tailor my prices to every single South American currency Google Play supports.

For now, I'm resisting temptation of going direct to Kobo, but if Smashwords doesn't implement this feature I might have to because I think it's making me leave money on the table.

Vanessa Finaughty said...

Thanks for taking the time to share your predictions, Mark, and most of of all, thank you for always looking out for indie authors!

Eliseo Mauas Pinto said...

Hi Mark, awesome predictions indeed... For sure the only one who take benefit from KDP Select are the readers, but it shall keep on going as long as authors are willing to enroll in this program...nevertheless, is it not that we authors need to enlarge our list of readers ?... I agree with you that Amazon is not a benevolent player, and that every new book enrolled in KDP Select is another vote to put all the other retailers out of business. But ironically in this unpredictable indie-world we all independent authors live at... Amazon KDP has been the only site able to level up my sales.

Shane Thomas said...

A KDP Select Indie Author’s reaction (part 1)

I earned an undergrad degree in business administration prior to publishing three titles under Amazon’s KDP select program, so I feel that my reactions may be different from those of other indie authors whose education focused on English, Science, Liberal Arts, Pop Culture shows, or Dungeons and Dragons. I am by no one’s standards making a living by my creative writing, though my Amazon royalties for a year could make a mortgage payment with a couple hundred bucks to spare.

Coker’s primary message is that indie publishing remains the best opportunity writers have historically had at finding an audience. The majority of the message also focuses around the observation that Amazon dominates the market with seventy percent of the total revenue of book sales. He asserts that KDP Select, an exclusivity program that puts an author’s titles before author’s whose ebooks are available at multiple booksellers, is inhibitive to author independence.

I agree with both, however I question how and why author independence in relevant. Here is some simple math that I used when determining that I should stay with KDP Select. I will base it upon the arbitrary amount of $100 in kindle single copy sales, and the personal observation I have made based upon my personal, singular, and perhaps non-universal experience that the payout from Kindle Unlimited reads matches dollar for dollar my single copy royalty amounts ( if I sell $100 in single units in January, I’ll get paid $200, thanks to the additional $100 in KU pay).

KDP Select- 70% of market doubled by KU payout would net me $200.00

KDP & Smashwords, B&N, Kobo, etc. (the other 30% of the market) would net me $130.00

I’m wildly oversimplifying the math. Guess why… I like words better than numbers, perhaps that’s why I write. Things that didn’t factor into my simpleton calculation? Well there is the extra work it would take me to put my books on other platforms; that would either take away from writing, editing, or reviewing books. Those are things I enjoy. Learning and using publishing software is what I endure. Second, my $100 base number of single units sold may actually also be diminished by retailing with the underdogs because Amazon would rank my title below KDP Select titles under that scenario.

Shane Thomas said...

A KDP Select Indie Author’s reaction (part 2)

Is that biased? Of course, but so is Mr. Coker. No human alive who has formed context to understand this or Coker’s article is without bias. A bias simply implies that I come into this conversation with preconceived notions. Mr. Coker and I are both thinking about an indie author’s best interests (I’m making an assumption as I can never know what’s in someone else’s head).

Could I better stand out in a smaller marketplace offsetting the differences I cited above? Absolutely, I know and respect some authors that operate under that strategy. I bet some authors can even make a living excluding their titles from Amazon entirely. Some but not most.

In my humble opinion, Mr. Coker’s predictions are all centered around Product Life Cycle. PLC is a concept in the science of business (yes the study of business is a science, it is both quantifiable and predictable. It is also an older and more established science than many “brainier” sciences like astrophysics and human nutrition). Here is the Wikipedia article on the subject: https://en.wikipedia.org/wiki/Product_life-cycle_management_(marketing) .

I think Coker asserted that ebooks, as a product, are nearing the end of the Maturity stage. However, instead of maintaining product maturity, his anecdotes of successful authors quitting or scaling back production of ebooks might imply that the industry is approaching saturation or decline. I don’t think that is what he is implying, but I think many could interpret his prediction #8 in that light. People get discouraged and stop writing all the time.

Suz said...

I agree with your comments about Amazon and anti-trust. It's past time for the DoJ to take an interest in this, but with pro-business Trump in the White House, that's not likely to happen--unless Trump, who hates Bezos and the WAPO, decides to take vengeance on Amazon through an anti-trust action via the DoJ.

Just as worrisome is the tightening noose Amazon has on freedom of thought due to its dominance in the book market. Amazon can highlight certain books, and just as easily bury others. They've already consigned erotica to someplace in the nether reaches of Amazonian hell. What books or genres will Amazon choose to bury next?

However, I believe that Amazon is profit-driven and will continue to guide authors away from offering books for free.

But I'm beyond annoyed that Amazon won't allow advertising for ebooks that aren't Amazon-exclusive. NO OTHER PRODUCT FACES THIS DISCRIMINATION. And books, bu their nature, should be more freely available, not less.

Cryselle said...

It would help a great deal if Amazon's bookselling competitors could provide a shopping experience even half as good as Amazon's. This IS 2017, there is no excuse for what amounts to a lack of a search engine. Kobo thinks it's good enough that buyers can find something they search for **exactly. Misremember how to spell something, or have only a subject to go on, and you'll never find it there. B&N creaks along, and their version of DRM is so intrusive as to require a valid credit card on file in order to access books you can no longer download to your own system. I can't find what I want at one, I can't utilize the other (had to abandon an entire library when a card expired and nothing worked to update-there's an experience that makes me want to shop there again--NOT).

Frankly, it's as if they really don't want to be in the book business. Either they wise up to the realities of accommodating the customers, or the future will oblige them. I don't want to be locked into one retailer, but if the others can't act like they want to sell me some books, I'm not going to beat my head on the wall to shop there. I buy 2-3 books a week and only one big retailer acts like there's any value to this.

Robert Nagle said...

Always great to read your end of year predictions.

To be fair to Amazon, KDP authors can set whatever price they want, and I don't think writers seriously think the Amazon offers any real marketing advantages through search results or ads. I don't go to Amazon to browse through titles; I go there because I am looking for a certain thing and I know that purchasing it will let me read it on several platforms. Actually there is a third reason I go to Amazon -- to download sample chapters.

David Rothman at Teleread has mentioned that indie ebook blogs are not doing well either . That's a problem because the more established culture/review blogs review are overlooking indie stuff in favor of titles from Amazon Vine and Net Galley. I still don't see a lot of critical attention given to indie ebooks -- something I'll try to be working on over the next year. ( SW is way ahead of Amazon by letting you produce coupon codes for reviewers, so you don't have to pay for Amazon Vine or Netgalley).

Robert Nagle, Personville Press .

pj reece said...

Good to catch up with what's happening. My next book I'm targeting to a local readership (British Columbia). If it does well, it may spread across the country. So, this is my strategy -- to focus on a tangible audience whom I know. Perhaps our mistake is to think that world readers will flock to our books from the four cardinal directions. When it has become so easy to produce a quality book inexpensively, why not work toward making it a hit in the home town and let word of mouth work its magic. That's my strategy this year with a collection of short stories. Wish me luck. ~ PJ Reece

Maria said...

Happy New Year, Mark. Great post. I do think that Amazon Select/KU was detrimental to ARe. Granted, the owner was pulling shenanigans, but I did notice a fall off in sales that started about a year and a half ago. KU has gained popularity and I see more requests looking specifically for KU recommendations. Even at my own blog, I had about 5 requests that I start marking reviews KU or not.
Readers always need reviews and sorting mechanisms and KU has become popular enough that readers want specific recs for that service.

I hope that blogs regain some popularity this year because facebook just isn't an effective way to reach readers. It's too random.

It is harder to continue writing. The money has gotten so small that just about any job makes more money--and there is no season anymore that can be counted on.

Let's hope the new year brings some positive changes, some luck and some good deeds.

Maria Schneider
BearMountainBooks.com

Maria said...

Also to Sylvia--I'm on Google Play and it's worth it--if you can get on there. I don't think they are allowing any new authors at the moment. The interface is a bit clunky, but usable. Their reporting is very clunky and quite annoying, but it's a good retailer.

Maria Schneider
www.BearMountainBooks.com

Sylvia Says -- the blog said...

Hi Maria, thank you for the heads-up. I will investigate this later in the year. Strange they're not allowing new authors at present seeing as the books are in digital format. Anyway, it would be great if Smashwords could make a deal to distribute on our behalf, but if not I'll look into it when I finish my current novel. It's good to get feedback about Google books, other authors I talked to were not getting many sales through them.

Kind regards,
Sylvia Massara
Author

Charl Durand said...

Books are entertainment, and the broad trend in entertainment is pay for streaming a la Netflix, and away from standalone products. That's why KU is a success and isn't going to disappear - it's going to grow in leaps and bounds. For better or worse ebooks are going to be commodified much like music and movies. It's perhaps a good idea to keep an eye on those industries to see where the trends are. Certainly, KU is 80% of my income and I don't see that changing anytime soon. Also, a MAJOR trend for authors that is a common discussion on Facebook groups is the importance of creating your own backend platform outside of Amazon. As the number of ebooks grow, finding them through search engines of any kind will become more and more difficult. But your own mailing list of 10 000 readers (or 200 000 as I see some top authors have) will in future probably become the main source of sales, through Amazon or other platforms. To understand real trends in reading you have to look much, much broader than Amazon, which is simply a platform... and a very good one at that, and many commentators above intimated. Readers read books at a much faster pace than they can be produced, and supported by an insatiable appetite for knowledge, it's a good time to be an author.

Pamela Cummins said...

Charl Durand, eBooks are going the way of Netflix and music because authors "allow it." Not every movie, TV show, or musician will allow discounts, for example "The Big Bang theory." Many authors are getting fed up with KU and I even heard readers complain that they have trouble finding quality eBooks in the unlimited program. In fact I just read this blog today http://www.randallwoodauthor.com/no-longer-in-ku/

BillSmithBooks said...

Pamela Cummins, I agree that books are being commodified because authors allow it ... but the decision each author has to make on their own is "Do I get more than I give up by being in KU." As long as the answer is yes, authors will sign up.

Now that there are a lot of questions as the program matures (and as Amazon rolls back the payouts ... from a flat roughly $1.35 to half a penny per page to now far less in some markets ... and the ongoing questions as to whether pages are even being counted correctly), I get the sense on Kboards and other sites that many authors, especially well established ones, are really starting to question the value of KU. KU will always be a quick jumpstart for a new author ...

The question is how whether/how much KU will reduce traditional book sales -- KU only have value to readers when they can find what they want to read. As long as lots and lots of highly desired authors are not on KU, that is going to diminish the value of the program to many customers.

K.C. Taylor said...

@BillSmithBooks

The page read problem and Amazon's refusal to even admit there's a problem has caused a big exodus in my circles. I think KU is going to become the land of newbies and scammers and most established and experience authors won't touch it anymore because Amazon can't be trusted to report correctly if you're in KU. Readers are already frustrated with the dreck flooding Amazon in the past year and sticking to authors they know and trust instead of searching for new reads.

Angela & Selene said...

Mark, you make me feel guilty for becoming KU Subscriber. But I still buy paper book in my local bookstore. I hope that's help.

www.sharing55tories.blogspot.com

Allen F said...

Could you by chance 'name' some those 'anti-trust experts' of yours so I can go see what they're actually saying?

The way you seem to be saying it, the restaurant I visit not offering me a Coke but rather a Pepsi or other cola clone should be illegal and 'anti-trust'. The big5 'not' publishing every book every writer offers them would be 'anti-trust' by those standards (and since Amazon lets 'any' writer 'sell' their e/p/a/books on Amazon it actually makes Amazon less of an 'anti-trust' issue than your regular publishers that do that gatekeeping stuff.

FYI, I'm not in KU, but see nothing wrong with it. Writers can use it (and play/get paid by the KU rules) or they can take their story and post it wherever they like (including non-KU Amazon) at whatever prices they'd like.

Nirmala said...

Just to clarify something said above, Amazon now does allow KDP authors to advertise books that are NOT enrolled in KDP Select. It used to be that you could not do so unless your book was in Select, but they recently opened up the advertising to any book on KDP.

I also think it is unfair to characterize the offering of advertising opportunities as something nefarious on Amazon's part. If that was so, everyone offering advertising on their site would be running some kind of scam. It is a business opportunity like any other, and each author needs to decide for themselves if it is a worthwhile opportunity. My wife and I have found that our ads on Amazon more than pay for themselves, and they also help us achieve higher ranks on Amazon, so the benefits are multiplied. We do not feel victimized in the least by Amazon when I have to "surrender more blood" to advertise on their site, just as I do not feel victimized by Facebook or Bookbub when I have to pay them to advertise on their websites. I can of course freely choose not to pay for ads and therefore not receive the benefits they might offer, but it is not a case of Amazon harming me by offering this service.

Mark Coker said...

Thanks for your thoughtful comments and perspectives, everyone. I'm on vacation so have been slow to reply. Some brief replies...

@Leenna, that's a great prediction. Yes, I think you'll see more efforts there. B&N took steps in that direction in 2016 (anyone here have experience and feedback on B&N's program to get indie author print books in stores?). Re: Ingram Spark, we like the folks at Ingram a lot so we'll see. Do they serve Africa, Oceania and South America. Educate me a bit here - what are the most common POD options for you, and how does their cost compare to the costs for Americans?

@David, it was a significant factor but not the only one. I sometimes find it helpful to view competitive dynamics through the lens of biological ecosystems where multiple players are competing for limited resources. In times of plenty (like the 2008-2013 exponetial rise in ebook consumption), virtually everyone finds success just by participating. Even companies with weak management teams, poor business plans and weak offerings (or mediocre writers) found success. It's often only after slowdowns that weaknesses in management, business models or product offerings are fully exposed. A biological system can only face so many stressors before it collapses. People are the same - you can only smoke so many cigarettes, drink so much alcohol or eat so many burgers before your body collapses as well. Amazon is brilliant at creating artificial stressors designed to limit their competitors and limit their manoeverability. In this case, by causing 1 million + books to be pulled from (or denied to) other retailers, it makes it difficult for these smaller retailers to compete and innovate without the inventory which makes it difficult if not impossible to preserve or grow their custom base.

@Jill, thanks!

@Nirmala. Viewing US anti-trust policy over a long period of time, it's clear it's like a pendulum that over the decades as swung from protecting producers to protecting consumers. What remains to be seen is if the pendulum swings back to considering how monopolies or monopsonies affect producers. Think fair trade for authors. The Darwinian capitalist will say that if a single retailer can drive commoditization to the point where fewer authors can earn a living, or earn anything, then yay for the authors who can earn a living and shame on those to can't.

Mark Coker said...

@BillSmithbooks, yes, I agree: KDP Select will continue to succeed as long as authors are willing to enroll in the program. There are many authors who will say no to ever-more onerous terms, yet there are always others waiting in the line behind them who will happily earn less for the privilege of reaching readers.

And to your question, will readers find these replacement authors acceptable? Good question. I think they will. Let's say KDP Select/KU has one million books (though it's likely much higher). Even if the reader would consider only 1/2 of one percent of them super-appealing, that's 5,000 great books they can read. Even if the reader can read a book a day, that's 14 years worth of reading.

@ Richard. Thanks for your thoughtful disagreement and reasoning for why you believe "cancer" is an inappropriate descriptor. I think the metaphor is apt. As you state, cancer is a disease that takes over a host body and eventually ends the life of the host body. The host body that KDP-S may eventually end is the dynamic ecosystem of multiple profitable retailers serving authors and readers. I believe its in authors' best interest to have more retailers not fewer. The more retail professional focusing their every day on connecting readers to books the better. If indie authors are the future of publishing as I believe, and if indie authors are destined to continue taking increasing market share, then these retailers cannot survive over the long term without the books from indie authors. Readers want books, and if a retailer doesn't have the book they want, they'll eventually migrate their purchasing, library and device choice to that of the retailer with the greatest inventory. We're now enough years into this that my original warnings from 2011 about the long term implications to the competitive ecosystem are no longer speculative, they're real.

If a single retailer controls access to 70, 80 or 90% of future readers for a long period of time, the other retailers will collapse and indie authors will be powerless to say no. Look at how Amazon gutted royalty rates at Audible and stripped authors of pricing control. Audiobook authors can scream and complain about it, but they're powerless.

@Sylvia - That will be up to Google. We like the folks at Google and would love to work with them but at present they're unable to work with us on terms our authors expect.

@Joel - thanks for that prompt. As mentioned in my other post on our priorities for 2017, I think you'll be pleased with the direction we're heading. In the meantime, if you contact our support team we can help you configure the prices you want in any currency. It's a manual process at present.

@Shane - as a fellow business school graduate, thank you for your perspective and for introducing product lifecycle into the discussion. Interesting. I actually do believe that all of book publishing is facing saturation and slow decline, though as I mentioned the market is still so huge that there's incredible opportunity for authors even in a declining market.

Mark Coker said...

@Robert, thanks for stopping by! FWIW everyone, Robert was previously an active contributor to the Teleread blog, which for me was a primary source for market research when I was composing the Smashwords business plan between 2005 and 2007. I owe a debt of gratitude to him and David Rothman for their work promoting the early rise of ebooks. He's also the one who urged us to create the Style Guide in 2008!

@Allen F, check out the New America symposium that examined the question of Amazon's business practices.

@ Nirmalla II - regarding whether Kindle Ads are nefarious, it's simply another toll on the road from a retailer adept at extracting pricing, coop and other concessions from their suppliers. By creating a marketplace where authors can compete against one another for added exposure, they've created yet another level to the caste system they operate. So while it's great it gives you more controll over visibility, it's not so great if it becomes the only way to succeed there. Similar to other ad bidding platforms, the prices will be bid up to the point where the marginal benefit for every dollar spent will decline over time. I'm glad it's working for you. I might experiment with it myself. I expect it'll be one of those things that works best in the early days.

Sylvia Says -- the blog said...

Thanks, Mark. I hope SW negotiates a deal with Google Books at some stage. Happy New Year to you and your family. Btw, I moved to the Blue Mountains now (not sure if you've been up here when you were in Sydney). If you ever find yourself in Sydney again, be sure to contact me and I'll give you a tour of the mountains. It's great up here and not too far from the "big smoke"!

Amber Polo said...

Mark, has anyone asked this question?
If ebooks on Amazon (or Smashwords) never go away, what happens when the "owner" dies or closes the bank account on record? Then if an ebook sells where does the money go?

Ruth Ann Nordin said...

Amber Polo,

I found this blog post about what happens when an author dies. It's long, but I think it's good. http://www.thepassivevoice.com/2011/09/what-happens-when-an-author-dies/

This is a tricky subject, and to be honest, I still haven't figured out all the ins and outs of it. Right now, I just have a binder with my passwords, instructions to hand over all books to a small press, and all my book files with covers in a USB drive. That is a start to what is a more complicated process.

Travis Luedke said...

I love Smashwords. I love what it represents. I love Mark Coker's idealism. I was sold on it from day one (2012). I drank the koolaid and sang praises of wide dist. for several years.

Then came Kindle Unlimited.

Unfortunately, the harsh realities of Indie publishing and book discovery do not coincide with the bright, shiny ideals of wide distribution.

Here's the hard fact: Amazon has created an ebook discovery search engine for shoppers that is far superior to any other ebook retailer. They created promotional tools for authors and publishers to increase visibility exponentially.

Kobo, B&N, and Itunes have done nothing that remotely compares to Amazon KDP and the Amazon search engine and book buying culture.

Another hard fact: Unless you are already a major Indie with huge fan mailing lists, catalogs of 30-40 books or more, or one of the rare Indie breakout successes, you can't get exposure or visibility in any retailer but Amazon.

Sure, you can go to a third party like Bookbub. That boosts wide dist. sales and visibility for approximately one month. One month. The other eleven months of the year, non-Amazon retailer sales and visibility are a joke compared to Amazon. A fraction.

The only Indies who can afford the idealism of wide distribution are the ones who are already a household name. Authors like Eve Langlais. Eve can afford to take the hit of thousands of dollars lost by not being available in Kindle Unlimited. She has a massive fan base and a massive catalog. Itunes and Kobo know Eve's name. They collaborate with her to market her books.

Nobody at Nook, Itunes, or Kobo even knows I exist. In fact, Kobo removed one of my books involuntarily and never put it back on their shelf. Perhaps it was too sexy for their sexy filter-the same filter that keeps cramming 50 Shades of crap down my throat every time I look at their website.

Thanks Kobo, you can go suck a big one.

I have no fear of telling Kobo where to stick it, because they have never given my books the time of day. They've done nothing for me. Not without me spending money on a third party to drive traffic to their craptastic search engine.

Since 2012, I've had numerous Bookbub promos. Each of them using wide dist. discounted $.99 books available in Kobo, Itunes, and Nook. I can't get any of the non-Amazon retailers to spend an ounce of effort promoting my books apart from my Bookbub promo. Yet, on Amazon, my Bookbub promo creates several months worth of sales boost, a whole load of new alsoboughts, new reviews, new fans, and followup sales of other series books. And a handful of newsletter subscribers.

Is Amazon doing that for me? Or is it a function of the awesome design of their ebook discovery machine?

The ugly truth: Unless you are already a known quantity achieving six figure+ publishing success, you don't have the luxury of idealism. Only the highly successful Indies can afford to remove their books from Kindle Unlimited. The rest of us desperately need that fan base because its the only discovery tool worth a damn. Kindle Unlimited is the most voracious Indie ereading audience ever compiled.

Idealism makes great barbecue conversation, but it doesn't sell books (or pay per pagesread).

Where is Nook and Itunes and Kobo's great discovery tool kit? Where is their voracious Indie ereading audience? Do they even care to allow Indies a path to access this audience? Doesn't seem like it from where I'm standing.

There is no conversation to be had on the idealism of wide dist., not if you intend to make a living as an Indie author.

Catch me in another five years, when my catalog is over 30-40 books. Then I might be able to have that discussion, then I might be able to afford the luxury of idealism.

David VanDyke said...

I have to generally agree with Travis, though perhaps not quite so vehemently. I was making a living "wide," without KU, with a fan base I grew up over several years, and I'm not a "big" indie--I was a midlister, barely cracking 6 figures of gross, but earning a lot less net because it takes money as business expense in order to make money.

Then came KU. I stayed away at first, but eventually joined in--and doubled my income nearly overnight. This was after doing everything I could to make it on the other sites, including wide BookBubs and promos. I even got fair traction out of Kobo, unlike Travis, and was really happy when they introduced their own in-house promo system. I even got invited to Google Play, and the GP rep promised all sorts of pie-in-the-sky advantages from boarding the Google train.

But I plateaued on all the sites, and I had to try something else. That something was Select/KU, and it exploded for me. I had little choice, really, than to go with it. Frankly, KU took me from paying the bills to putting away IRA money. It paid for modest vacations and helped put a kid through college. It meant that (because I didn't upgrade my lifestyle, but continued to "live small") I never had to worry about being short of money.

As Travis says, or at least implies, unless KU crashes or its yields fall below what I know I can make by going wide again, I'll stay with KU.

***One caveat: my bread and butter is science fiction. I have some mystery-thrillers under a pen name that make more money wide, out of KU, than in. Authors of short works or nonfiction will probably do better wide than in KU. Your mileage may vary.

Pamela Cummins said...

David VanDyke and Travis Luedke, I can understand your reasons for going into KU. Yet, beware because many issues are going on with KU and authors are being thrown out of Amazon because their algorithms are receiving false information. One author books were taken off during a promotion he was in collaboration with other authors, although he was able to get them back on “after” losing sales. This is happening to more and more and here is one blog among many http://www.authorjmpoole.com/?p=2351 Just remember if you are one of the authors who happens to get thrown out of Amazon for some bogus reason, Smashwords will be there for you.

Travis Luedke said...

Pamela, yes, I read the horror story. There's been a couple other authors with similar problems. Thats like .0000001% of the authors in KDP who were wrongly snagged in Amazon's KU scammer crackdown.

I think that on the whole, the other 99.999999% of the genuine authors in the KDP Select program are safe from the autobot dragnet. Unless you're a scammer, and you deserve to be tagged and taken down.

It is a risk, but so is stepping out your door... a dangerous business (couldn't resist the Tolkien reference).

For now, I'll avoid the 'sky-is-falling' alarmist mindset and focus on the KU paycheck, until, as David VanDyke stated, "KU crashes or its yields fall below what I know I can make by going wide again..."

I understand how you feel Pamela. I understand every aspect of Mark Coker's arguments, and I agree with everything he's said. I totally get the 'going wide' concept, the control KU has over authors and competing ebook retailers, and the glut of content being produced and handed exclusively to Amazon. I get it. It sucks. We're all frogs gradually boiling in the KU pot. It blows.

But this is about money and readers. Amazon provides both in abundance.

Until one or more of the ebook retailers can figure out how to build a discovery machine that caters to me, hands me money and readers like Amazon does...

My books will go where the money is (where the readers are). The math is simple.

I love Smashwords and Mark Coker. But I need to get paid for what I write. Borrows, pagereads, sales, whatever's clever. Its about the $$$.

This isn't Mark's fault. His hands are tied by the inept marketing systems of Itunes, Nook, Kobo, and that thing that's supposed to put ebooks in libraries, but doesn't really put ebooks in libraries. I think its called Overdrive? Yeah. I think I sold 1 book to Overdrive last year.

As someone else has stated here (don't recall who it was), trying to navigate the quagmire of non-Amazon ebook stores, it's like they don't even want to sell books.

:)

Travis Luedke said...

Oh and here's another horror story Pamela. Do you recall when Kobo deleted every single self-published book from their catalog? http://the-digital-reader.com/2013/10/14/kobo-now-removing-self-published-uk-ebookstore/

I remember that vividly.

Compare the removal of several million books, to the removal of a single author's books (mistakenly).

You don't see Amazon throwing out the baby with the bathwater. Kobo didn't hesitate, and it took them a lot longer than 24 hours turnaround to fix the problem.

:)


chandra bhushan said...

Happy new year 2018 wishes are the best images that you can use to send as greetings to your near and dear ones to send a special message of happiness and prosperity that you wish for all your friends and relatives.

Happy New Year 2018 Messages Wishes in Albanian

Happy New Year 2019 Vintage Images

Happy new year whatsapp and facebook 2018 message

Download New Year Images 2018 in Full HD

Download latest HD Desktop Wallpapers for Happy new year 2018


New Year 2018 Hd Wallpapers


New Year 2018 Short Text Messages