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Julie Barrett is a freelance writer and photographer based in Plano, TX.

More Amazon, More Fail

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I'm going to attempt to address a few concerns I've seen over at the Amazon Kindle forum, where the retailer released a rather odd statement of "capitulation" to Macmillan.

Many Kindle readers are up in arms because they think they were promised $9.99 e-books. No one promised a set price point. In fact, Amazon is losing money on those $9.99 best sellers. They see them as loss leaders: The theory is they get customers in the door (or to the site) and once there, they'll buy more items that help the retailer make their profit. There's absolutely nothing wrong with that. This is the way retail has worked for years.

What has me flummoxed is the Kindle owners screaming at the authors because we apparently can force the publishers to do something. No, we can't. We have to live with the contracts we've signed. As Jay Lake pointed out in the thread, it's something we can address in the next round. We don't choose publishers, publishers choose our manuscript. Yes, I can decide not to submit to a particular publisher, but as a D-list author, I don't have a lot of leverage in contract negotiations.

Yesterday I explained how I think ebook pricing and royalty structures ought to be. I'll not repeat myself here.

What a lot of readers don't realize is that our revenues (paychecks) are very much at the whim of the marketplace. Payment is generally on cover price. I'm not whining here. At the right price point, books sell and we all make money. As I said yesterday I believe that it's going to take a little time to find the right price point.

However, allow me to address an analogy that keeps going around there, in which the big, bad manufacturer sets the price. You go to the Ford dealer (nothing against Ford. In fact, they must be doing something right not to have to take bailout money, eh?) and negotiate the price of a car. Sticker price is $20,000. The dealer has some room to negotiate. You say, "I'd like that car for $10,000." They'll say, "I can't do it." You take your business elsewhere. Enough people do that, and the dealers go to Ford and say, "we need a lower price on the car." Ford comes back and says, "Well, we have fixed costs. The government mandates certain things. Let's see. We can go with cheaper materials, or we can pay our workers less. Oops. They're under a contract and we just renegotiated a lower wage." If they sell cars to dealers for less than it costs them to make them, it's bailout time. (Actually, if they do something that foolish they deserve to go under. It's bad business.)

Or, they can outsource it all to China. You get what you pay for.

Ford can tell the dealers they HAVE to sell that car for $20,000 and not a penny less. Consumers will vote with their wallets and go elsewhere.

Actually, if a product is something consumers want enough, they'll pay. One word: Apple.

Have you ever taken a pay cut to keep from being laid off? Then you know what this feels like. Except your employer can't cut your pay below minimum wage.

So, the readers cry: Publish yourself! That's not so easily done. First of all, a writer under contract can't just tell their publisher to get stuffed. It's sort of the opposite of that finance deal you signed on that new car (yep, you caved and bought it). You don't follow up on your end of the contract, they'll come take your car away and ruin your credit rating. If a writer doesn't follow up on their contract to deliver the next book they can get sued for breach of contract and the publisher can demand repayment of any advance paid. A writer can attempt to renegotiate, just like you can try to renegotiate that finance contract. Now you get it.

How many times have I said that self-publishing is a small business? When you run a small business you have to make money. Perhaps you have a loan to repay. You probably have a mortgage and bills of your own along with a family to support.

Go to your local used bookstore and seek out books from vanity presses. Flip through a few and you'll realize why you don't see them in quantity on the shelves of your local bookstore. They're overpriced and not edited well at all. If the book did get good editing, it's only because the author paid through the nose to have it done. You know what it costs to have good developmental editing from someone with decent creds? A minimum of $.30 a word.  For that 50,000 word NaNoWriMo novel (which is darned short) an author is looking at 15,000. Copyediting at a nickel or so a word? $2500. How many $10 ebooks do I have to sell to make that back? 5,000, if I don't pay myself or spend money on pesky things like marketing or commissions to resellers. Even if I find a decent editor willing to work at half those rates, I'm still losing out. Without proper marketing my sales figures will be in the hundreds, not the thousands.

This is why writers prefer to go with publishers. The economies work out much better for all of us, and we get paid!

So, do you want a badly-edited, badly formatted tome for $10, or do you want something that won't make you fling your Kindle across the room for a bit more? Or do you really care that I lose my shirt on that self-pubbed book because I wanted to present you with a good read?

I'd rather make a pittance than lose everything trying to do the job right myself.

Actually, I'd rather get paid what I'm worth. I'm a dreamer.

Tags: Writing Publishing Amazonfail

Filed under: Writing   Publishing   Amazonfail      
2/1/2010 10:02:31 AM
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