The Business Rusch: Midlist Writers & Big Publishing
(Changing Times Part Fourteen)
Kristine Kathryn Rusch
Me and cliffhangers. It seems to be the only way I can write this mini-series on publishing. I feel like I’m verging on the good part, and then I run out of time and tell y’all to come back next week.
Which is what I did last week. I promised to tell you why so many midlist writers are asking why they should ever publish a book with Big Publishing again. To understand how I got to this point, what I mean by Big Publishing and midlist writers, please start with this post. If you’re new to the series, please check out the introductory post, so you can see where I’m coming from.
In last week’s post, we discussed the benefits midlist writers will get out of the changes in publishing. By those changes, I mean the rise of e-books and print-on-demand. I stated that established midlist writers with series books that Big Publishing has given up on would be able to publish those books electronically and in a nice print-on-demand edition. Those series books would eventually make as much (or more) money as any Big Publisher would pay, the series would stay in print forever if the writer chose, and the writer could write what she wanted. That last part, writing what you want, has (quite honestly) become a luxury in midlist publishing. It doesn’t happen nearly as much as it used to.
Clearly, any established midlist writer with a discontinued series should be reprinting the initial books in that series herself. Then she should write the remaining books and publish them herself.
I am making an assumption here, and it’s a rather large one. I’m assuming that the writer will want to do the work herself. I’ll get to that assumption in next week’s post.
For now, let’s talk about the established midlist writer who doesn’t have a discontinued series. What she does have is a name, a solid career, and a reputation. Is it worth her while to go to Big Publishing?
Yes—and no—and yes. How’s that for confusing? Because from this post on, the decisions do become personal and they do get confusing.
If this established midlist writer has books that are out of print and the rights have reverted to her, then she should publish those books herself. She does have to make sure the rights are in the clear (which isn’t that complicated a process, but it’s complicated enough that I’m not going to deal with it here). Then she should reprint the book(s) electronically and in print-on-demand.
Note that the cover and the interior design of the book which was published by a Big Publishing Company are copyrighted to that publisher. In other words, the midlist writer can’t scan the book and its cover, and just put that up. She has to design a new cover and a new interior (font and all). That’s a relatively simple process. Then she needs to get the book(s) out into the world. No publicity necessary unless she wants to. No need to have a true publishing schedule.
Readers who love her current books will want to read her backlist and rather than go to every used bookstore on the planet in hopes of finding a dog-earred copy, they can now order either an electronic copy or a shiny new POD copy via Amazon or Barnes & Noble and(or) the author’s website.
Even if the writer has books coming out of a Big Publishing company, she should do this. Actually, I should say, especially if she has books coming out of a Big Publishing company, she should do this. Her fan base is active, and her readers will be seeking her work, even if it’s not in a series.
So…on backlist, it’s a no-brainer. The established midlist author should make sure everything she ever wrote is in print via electronic and print-on-demand.
But what about a new book? I’ve heard dozens of midlist writers wonder what Big Publishing brings to the table for the latest book in an ongoing series or the newest book by a well-known midlist writer. Should that book go directly to e-book and print-on-demand?
Here’s where the decisions become personal, and where they get dicey. Because there are a lot of factors involved.
Let’s discuss the financial factors first.
Writers need money—and midlist writers, in particular, always need funds. (Which is why I have a donate button at the end of this article; when I write these posts, they take time away from my fiction writing, time I would get paid for. So I appreciate any money you add to my coffers to encourage me to write more of these business blogs.)
Sometimes midlist writers need large sums of money to keep the lights on and to pay the rent. Big Publishing pays a large lump sum up front in the form of an advance. A midlist writer with an on-going Big Publishing career can sell a book (depending upon genre) for anywhere from $5000 to $50,000, and get a third or a half of that up front. Of course, that advance is probably all the writer will earn on that book—and if the writer sells the book in 2011, getting the rights reverted a few years after the book gets published will probably be dicey. (Big Publishing has also figured out that e-books don’t have to go out of print, so Big Publishing will make it harder and harder for writers to get their rights back. It’s good business practice on the part of Big Publishing, and it’s something writers should expect in future negotiations.)
If the midlist writer self-publishes the book, then the money will trickle in. As I mentioned in last week’s post, that book might sell 1,000 copies per year or less. Let’s go with the 1000 copies sold number, and assume that at the retail price of about $4.99, the writer makes around $3 (easier math for me than last week’s numbers). So the writer looks at $3,000 on that book paid in average monthly installments of $250. For a writer used to getting a lump sum of $25,000 for her writing, $250 will seem paltry at best.
But that $25,000 novel will stop earning almost right away (or it will earn a little bit starting five years after publication). The $250 per month will continue and maybe even grow for the lifetime of the book—which is probably the lifetime of the author.
Let’s just look 10 years out, however. Let’s give that writer a $25,000 advance, which is high for a midlist writer in today’s market in any genre, and say she got paid in two lump sums of $12,500 each minus an agent’s commission of 15% (since most midlist writers have agents), which brings the lump sum down to $21,250 or two $10,625 payments.
Now let’s assume that the book sells to its advance, as most novels do. That means the publisher published enough copies that, in a world of high velocity sales, the book sells enough to earn back the advance and nothing more. The book goes out of print in the paper format, but the e-book continues. It will take three years (on average) for that to happen. The last of the paper royalties will show up on the royalty statement in year four. (I know, I know, I’m deliberately not dealing with reserves. Let’s not get too technical here.)
Starting in year five, the book will earn actual money that will go in checks to the author, but that money will only be on the e-books. If the writer has a standard e-book agreement in her contract, that book will earn either 25% of gross or 15% of net. Both of those royalty rates are moving targets, since what, exactly, is gross? And how does the publishing company determine net? (That’s why a percentage of the retail price is better.) Let’s assume that the e-book is priced at $9.99—and because we don’t know the magic formula, we’re going to assume that 25% of gross is $2. (All I know is that 25% gross is less than 25% of the retail price, with discount sales, etc.)
Let’s assume also that the e-book will sell 1,000 copies per year. That’s $2,000 per year, funneled through bi-annual royalty statement, minus 15% to the agent. So the writer will get two lump sum payments, starting in year five, of $850 each.
By year ten, the writer will have made on that Big Publishing version of the book, $29,750. The self-published version of the book will have made $30,000. So not a lot of difference there, except for the monthly check.
But now, let’s revisit the math with a standard midlist writer advance of $10,000 instead. The writer will have earned, minus agent’s commissions, $8500. Then, in year five, the writer will start getting her $1700 per year. So by year ten, she will have earned $17,000 on her Big Publishing book—and $30,000 if she published the book herself.
Note that I’ve made a lot of assumptions here. I’m assuming that she would actually make $2 per e-book sold through Big Publishing. (I think that figure is high.) I’m also assuming that the book will sell 1,000 copies per year. I think that figure is high for the Big Publishing e-book and low for the self-publishing e-book.
The other assumption? I have the self-published e-book priced differently than the Big Publishing e-book. Let’s match prices for the sake of argument.
First, let’s price the self-published book at $9.99. The writer will make 70% of that or $6.99. At one thousand copies sold per year, the writer will make $6990, which, over ten years will be $69,900. Let’s be nice and give the writer the larger Big Publishing advance. At a $9.99 e-book price with 1000 sales and a $25,000 advance, that writer through a Big Publisher will still make $29,750. By self publishing, the writer will earn $40,000 more over ten years.
Now, let’s price that Big Publishing e-book at $4.99. Since that’s roughly half price of the $9.99 e-book, I’ll cut the 25% of gross earnings in half. The writer now earns $1 per e-book sold. That’s $1000 per year over five years or $5000, minus the agent’s commission of 15% equals $4250. Add to that the wonderful $25,000 advance ($21,250 with the commission), and suddenly the midlist writer with the very nice advance has only earned $25,500 over ten years. If the writer got a Big Publishing advance of $10,000 ($8500 with commission), then all she earned in ten years at the $4.99 e-book price is $12,750.
The self published midlist writer with the $4.99 e-book has earned $30,000 in that same period of time.
And here’s the other assumption: even though I mention print-on-demand as a viable way to satisfy fans, I haven’t added any print-on-demand numbers into our self-publishing equation. So the $30,000 that the writer earns over ten years is on the e-book alone.
So, strictly on money earned alone, it makes no sense for an established midlist author to have her books published out of a Big Publishing company. Yet a variety of us who know the math are still selling books to Big Publishers. Why?
Many writers write for reasons other than money. Some write because they can’t do anything else, but others write because their dream is to see their work published by Big Publishing.
Right now—and I’m going to stress right now because, remember, everything is changing—Big Publishing is the best way to get a novel into a wide variety of bookstores all over the country, all at the same time. The book will go on the stands in Barnes & Noble and the local independent bookseller (like Powell’s) in the same week. The book has a chance of getting into grocery stores and Wal-Mart, which it cannot do (at the moment) via the print-on-demand route. It’ll also hit libraries at that time as well.
Writers who don’t understand publishing often say that Big Publishing does not promote their books. Those writers couldn’t be more wrong. Even if the Big Publisher doesn’t buy a single advertisement in any of the trade journals or send out review copies, the Big Publisher will still advertise the book to their bookstore accounts via the catalogue and through the sales force.
Remember that old distribution model:
Writers provide content (product) to Publishers.
Publishers distribute that content to Distributors.
Distributors distribute books to Bookstores.
Bookstores distribute that content to Readers.
Now, recall that 90% of all books purchased still funnel through that system. Writers should want to have their books promoted to the primary market—which (at the moment) booksellers. So even if the writer never sees an ad targeted at readers, she should know that her Big Publishing novel will get advertised to the people who are on the front line of book selling—the bookstores.
Is that worth a loss of $15,000 over ten years? I think that depends on the writer, the stage she’s at in her career, and the decision she makes about her books.
Let me get personal for a minute. Why am I doing new books through Big Publishing and books on my own? (Technically, they’re not entirely on my own, but I’ll get to that next week.) Here’s why:
1. I write a lot. I can write two or three books per year for Big Publishing and write two or three books for me. This is an important point.
2. Big Publishing keeps my name in advertising channels that I can’t reach on my own.
3. Even if I could reach those channels on my own, I like the idea of being marketed through a variety of sources. I learn from every single publisher I’ve ever worked with. I see how they promote the work to accounts, what channels they distribute to, what’s effective and what isn’t. I have followed this pattern in my short fiction career—going with big publishers and small ones—and it keeps my name in front of audiences that I wouldn’t normally reach.
4. Going to a variety of markets grows my readership. Those readers will—I hope—come to my individually published books as well as my books through Big Publishing.
5. The fact that Big Publishing does its promotion on the velocity/produce model means that they’ll target their ads and everything in the space of a few months. That sudden burst of advertising brings new readers to my individually published books, readers who might not have come otherwise.
6. I see no reason to ignore 90% of the business because I’m making good money in 10% of the business. That doesn’t seem wise to me.
7. Right now, Big Publishing is the best way to have a New York Times bestseller. If a writer wants her book to sell hundreds of thousands of copies, then Big Publishing is set up to achieve that. Will that happen in e-book publishing and print-on-demand? Of course. But will it happen without the support of Big Publishing? That remains to be seen. I only know of one self-published writer right now whose books are selling at New York Times bestseller rates. And while one is nice, it’s not a statistic to rely on. Honestly, I don’t expect my Big Publishing novels to become New York Times bestsellers. Those books were sold at midlist advances, so they’ll have midlist numbers. But if I ever thought I had a book that could have the legs to sell at half a million copies right off the bat, I’d take it to Big Publishers first and if they said no or didn’t offer enough money to support the book as a bestseller, then I would publish it myself.
My personal calculations are based primarily on marketing, not money. I have a large backlist much of which has not been in print for ten years or more. I want Big Publishing to keep my name out there, to promote some of my front list, so that readers will come to my extensive backlist.
However, if I was a slow writer, we might be having a different discussion here. As a slow writer, I might want to maximize income, so I might jettison Big Publishing altogether. Or as a slow writer, I might want to see my books in major bookstores on the shelf, which means that I would partner with Big Publishing.
Will I make the same decisions five years from now? I have no idea. This world is changing so quickly, I might not be happy with my decisions a year from now. I made a choice in November of 2009 which was right for the time, but which is not a decision I would make in January of 2011. Things are changing that quickly.
The decisions on whether or not to self-publish or go with Big Publishing also vary as to who the writer is, what she wants from her career, how much money she needs to earn, how fast she needs to earn it, and how she would feel if the book sells well and doesn’t make her a lot of money. She has to decide how she wants to pursue her work—and her dreams.
I think the toughest part of this changing publishing environment is this: There are no clear-cut paths. Just because Writer A has made the decision to part with Big Publishing altogether doesn’t make that the right decision for Writer B. Writers have to figure out on their own what’s best for them. But they must do so armed with facts and with a clear eye as to what they want.
There’s one other very important point for midlist writers, and that’s workload. How much of the self-publishing work does an already established midlist writer want to do herself? What can she do to minimize the self-publishing workload? Should she ask her agent to do the self publishing for her? Should she go with a small start-up? Should she do all the work herself? Should she skip self-publishing altogether?
The answer to those questions should seem simple, but it’s not. And looking in my crystal ball, I worry that the writers who will get scammed, who will lose actual fortunes, won’t be the beginners or the bestsellers. It’ll be the established midlist writer.
And I’ll tell you why next week.
Weirdly enough, whenever I talk about money in my weekly post, my donations dry up. I hope that doesn’t happen this week. As always, please share this post with folks who might be interested. And thanks ever so much for the letters, comments, and donations. I appreciate each and every one of them.
“The Business Rusch: Midlist Writers & Big Publishing” copyright 2011 by Kristine Kathryn Rusch.