Cheryl Angst, Writer

Writer of strange tales – because no one ever accused me of being normal.

The Future of Publishing? July 9, 2010

Randy Ingermanson is an author I’ve mentioned once or twice on my blog, mostly in relation to his Snowflake Model for writing a novel. I subscribe to a monthly e-zine of his, and this month one of his articles really made me think. It’s a long article, outlining his predictions for the publishing industry. Normally I would summarize things, but his thoughts are so interesting I want you to read them for yourself.

I’d love to hear your thoughts on these predictions – drop me a comment and we’ll see if we can’t get a discussion going!

The Future of Publishing

The world of publishing is currently going through
massive turmoil. Some people believe that the rise of
e-books is going to be the biggest single change in
publishing since Gutenberg’s invention of movable type.

I’m not a prophet nor a seer nor clairvoyant. But I do
have my eyes open, and in this column, I give you my
best predictions for the coming years. They may be
right. They may be wrong. Either way, one thing seems
certain: Huge changes are coming.

I offer these predictions to suggest ways you might
plan for your future. I’m using them to plan for mine.

Prediction #1: E-books Will Surpass P-books Soon

I define a “p-book” to be a book printed on paper. This
term includes books created by traditional
royalty-paying publishers (usually in large print runs
of thousands or tens of thousands). This term also
includes print-on-demand (“POD”) books.

P-books are very wasteful and inefficient. To create a
p-book, you must pay all of the following:

* The person who typesets the edited manuscript
* The person who cuts the trees to make the paper
* The person who turns the trees into paper
* The person who puts ink on the paper
* The person who binds the paper into books
* The person who puts the books in a box
* The person who drives the box to the store
* The person who unpacks the box in the store
* The person who puts the book on a shelf
* The person who rings up the sale at the counter
* The person who puts the unsold copies back in a box
* The person who drives the box back to the publisher
* The person who unpacks and shreds the returns

To create either an e-book or a p-book, you must pay
all of the following:

* The person who writes the book
* The person who edits the book
* The person who makes the cover art for the book
* The person who markets the book
* The person who enters the book info into the store computers

E-books require one other player who must be paid once
by each reader:

* The person who makes the e-book reader

I’ve left out a number of minor players in the above
cast of characters, but I think these are all the main
parts. The marginal cost to create an e-book is lower
than the marginal cost to create a p-book. You can
automate the sales process for an e-book and deliver it
anywhere in the world almost instantly at almost zero
cost.

The only obstacle here is the cost of those pesky
e-book readers. That cost is dropping rapidly.
Furthermore, many phones and other mobile devices now
include e-book reading as a standard feature, and
numerous software products allow you to read e-books on
your computer.

Apple’s new iPad marked a turning point, because Apple
promised to pay publishers a hefty 70% of the retail
price of each e-book. Shortly after the iPad’s
announcement, Amazon began changing their payment model
to be in line with Apple’s. This makes e-books very
profitable for publishers — and potentially for their
authors.

I believe that e-books will surpass p-books in market
share within five years.

If you want some specific reasons why, I suggest you
read the blog of Joe Konrath:
http://JAKonrath.blogspot.com

Read a few of Joe’s recent blogs and see if you’re not
astounded at how well e-books can do in the hands of a
competent marketer.

Prediction #2: E-books Will Become The “Minor Leagues”

A beginning writer faces a very long learning curve. It
typically takes a writer several years to develop the
skills and the contacts needed to sell a first novel to
a major publisher. It’s not uncommon to hear of a
writer who took “ten years of hard work to become an
overnight success.”

During that 3 or 5 or 10 or 20 years when a writer is
learning the craft of fiction, she earns nothing (or a
pittance if she can find a magazine to buy her short
stories). Typically, a writer writes several complete
novels before she sells her first to a publisher.

That will change in the coming years. The reason is
because we writers are an impatient lot, and we all
believe that our work is unalloyed gold and that those
philistine agents and publishers just can’t recognize
genius when it smacks them in the face.

I believed this before I got published. I believe it
still about a couple of my manuscripts that crashed and
burned before publication. You probably believe it too.
In many cases, we’re right.

In coming years, writers will simply short-circuit the
traditional route by e-publishing their first book. It
will probably sell a copy to Mom and to Aunt Mabel and
to a few friends.

If the writer gets any encouragement at all from this
first attempt, she’ll e-publish another, and another,
and another. As she improves, her books will sell to a
wider and wider audience, eventually going far beyond
her circle of family and friends.

When I outline this scenario to my writer friends,
they’re all horrified at the prospect of a market
“flooded with awful e-books.”

My response to that is simple: The market is smart.
Readers will ignore the “flood of awful e-books.”
They’ll gobble up the e-books that are good and will
recommend them to their friends. Those friends will do
likewise. The cream will rise to the top. The dregs
will not. It’s that simple.

For those who live in terror of the coming “flood of
awful e-books,” I’ll simply point out that the market
is already flooded with hundreds of thousands of
self-published e-books (and p-books). Did you notice?
Were you flooded out of your house? Are you drowning in
a sea of awful books?

No, no, and no.

The market chooses the quality books because the market
is composed of people who know what they like and who
talk about it. Word-of-mouth will sift the quality from
the quantity, just as it always has. Only a very few
people ever see any given “awful book.” Most readers
only come across a few “awful books.” Lots of people
see the really good books. The market efficiently finds
them.

E-books will be the minor leagues of publishing (to use
a baseball metaphor). This means that new authors will
try out their talents and rise to their own level.
Agents and publishers will no longer have to play the
role of gatekeepers who try to guess what the market
will buy. The market will decide what it wants to buy.

I know there are some authors who think it will be a
horrible prostitution of our art that the market should
actually get to decide what sells. Tragically, the
market has been deciding what sells for hundreds of
years. In the future, it will do so better and quicker
because the gatekeepers will vanish.

Prediction #3: Beginning Authors Will E-publish First

Beginning writers will e-publish their work long before
they p-publish it. They will do so because all the
other beginning writers are doing so. Nobody wants to
get left behind. Everybody wants to be discovered.
Everybody believes they are writing a heartbreaking
work of staggering genius.

Some writers are.

Yes, really. Some writers are exceptionally good. Those
writers will get discovered far quicker than they would
have in years past. They’ll earn money at their
writing. They’ll blog about their successes, making it
clear that their road to success led through e-books.

Many other writers will follow and soon the majority of
unpublished writers will be publishing their work first
as e-books.

The result of this is that agents and editors will buy
fewer and fewer unpublished novelists. Instead, they’ll
simply watch the e-market to see what sells. Then
they’ll acquire the p-book rights for those e-books
that are proven successful.

This is the smart thing for them to do. Publishers have
long joked that “The way to be profitable in this
business is to only publish the bestsellers.” In the
past, nobody had any idea how to predict the
bestsellers. In the coming e-future, it will be
obvious. Successful e-books will make successful
p-books.

I believe publishers will eventually refuse to take
chances on any unpublished writers. Those writers will
therefore be forced to publish themselves first as
e-books, whether they want to or not. This transition
will take time, but I expect that within five years,
the overwhelming majority of all first novels will be
published first as e-books.

Prediction #4: Mid-list Authors May Do Better

Mid-list authors have had a rough go during the last
few years. Publishers have been chafed by shrinking
profit margins. They’ve been willing to pay big bucks
to the sure-thing bestselling authors. They’ve been
willing to pay peanuts to new novelists in the hope of
finding gold and raking in huge bucks. But they’ve been
less willing to keep paying the mid-listers to write
book after book that just earns out its advance (or
doesn’t quite earn out but does still make a small
profit).

In the coming e-future, mid-list authors will try their
hand at e-books and discover that their fans love them
in e-format just as much as in p-format. Mid-listers
will decide that self-publishing an e-book for 70% of
the pie is better than working with a traditional
publisher for 7% of the pie.

This is rational behavior. Those mid-list authors who
can market themselves at least 10% as effectively as
their publishers would market them will decide to do
so. They’ll e-publish their own work and market it
themselves, no longer subject to the whims of their
publishers.

Some mid-listers will flourish in this e-culture.
They’ll connect to their fan base and grow it. And the
publishers will notice. The publishers are both smart
and rational. They’ll see which mid-list novels do best
as e-books and will bankroll them as p-books.

Some mid-listers will refuse this route. I believe
they’ll do less well as time goes on. They’ll find
their publishers increasingly fearful of publishing
their work and increasingly stingy with advances.

In this world, publishers will finally achieve their
goal — they’ll only publish the winners.

This may take longer than five years to sort out, since
mid-list authors appear at first glance to have the
most to lose. It will take them some time to see that
they can do well in an e-future. I believe they’ll see
it eventually, and the sooner they see it, the better
they’ll do.

Prediction #5: Bestselling Authors Will Profit Most

Bestselling authors always profit most. The reason is
because the market rewards best what it likes best. In
the coming e-future, the market will operate more
efficiently. That means it’ll reward the best
performers more quickly and more richly.

It’s hard for me to predict how one aspect of this will
play out. It may be that traditional publishers will
retain their top-performing authors in e-book format.
Or it may be that bestselling authors will e-publish on
their own first and rake in all the e-profits, and only
then sell the rights to the p-books. Right now, I can’t
foresee which way it’ll go.

I’m confident that p-books will live on and flourish. A
strong segment of the market wants p-books. If
publishers publish a p-book only after the novel has
already proven itself in the e-market, then they’ll
benefit from better information and will not lose their
shirts on wildly expensive gambles. Even if they
publish a novel in e-format and p-format
simultaneously, they’ll benefit from the improved
efficiencies in the e-market.

Prediction #6: Publishers Will No Longer Accept Returns

Currently, publishers allow bookstores to return unsold
books for full credit. This practice began in the Great
Depression, and it’s been a curse on the industry ever
since. Bookstores can order more copies than they
expect to sell, because there’s no risk. Anything they
don’t sell just goes back to the publisher.

What this has meant for the publisher is that returns
on a book can kill them. It might make great PR to tell
everyone they printed a million, but it’s not so pretty
if half a million come back as returns.

Returns are wasteful. E-books can’t be returned. In the
coming e-future, I suspect that publishers will decide
that p-books can’t be returned either.

This prediction is not a certainty. I don’t think it’s
quite as likely as most of my other predictions here.
But it seems rational to end the practice of accepting
returns. I suspect that as soon as one of the major
publishers makes this move, the others will follow.

Prediction #7: Agents Will Stop Reading Slush

In the old days of publishing, publishers received
enormous numbers of manuscripts from hopeful writers.
The manuscripts went into a large stack (called the
“slush pile”) and publishers hired staff to sift
through the slush looking for gold.

Few publishers these days will even open a manuscript
from a writer they don’t know. Instead, they rely on
agents to submit manuscripts. Effectively, publishers
have off-loaded their slush piles to the agents.

Agents were already overworked, and this has put a
massive strain on them. Their real job is to represent
their clients. Now they also have to sift through
mountains of slush, written by people whom they don’t
represent and most of whom they will never represent.

In the coming e-future, agents will stop reading the
slush pile because they’ll have a much more effective
method of finding new talent. They’ll ask to see sales
numbers on e-books by prospective clients. If a writer
can’t show a good enough track record for sales of
e-books, then the agent won’t even consider
representing the writer.

In effect, the agents will off-load the slush pile to
the market. The market won’t mind, because the market
is extremely efficient. The market will ignore writing
it doesn’t like and reward writing it does like.

Please note that I didn’t say “the market will ignore
bad writing and reward good writing.” I do believe
there is such a thing as good writing and bad writing.
The problem is that there isn’t any consensus on which
is which. I like one kind of writing. My wife likes
another. My best friend likes a third.

“Good” and “bad” are multi-dimensional concepts when
applied to writing. That makes it very difficult to
choose what to publish. It really is true that one
man’s meat is another man’s poison.

However, sales numbers are one-dimensional. There is a
world of difference between selling 10 copies and
selling 10,000.

The market efficiently translates its likes and
dislikes into hard sales numbers. In the future, I
believe that agents (and of course publishers) will do
their initial sifting simply by looking at those
numbers. Then, from the novels that have a good track
record in e-sales, they’ll select the ones they like.

If this prediction is correct (and I can’t prove that
it is, but it seems reasonable), the life of agents
will get a bit easier in the future.

However, I believe that fewer books will be p-published
in the future, and that probably means that fewer
agents will be needed. So I foresee a winnowing of
agents. Those who are currently successful will be more
successful or will have to work less hard. Those who
are currently marginal may well go out of business.

Prediction #8: Publishers Will Become More Profitable

I believe publishers will be more profitable, but
they’ll publish fewer titles.

They’ll be more profitable because they’ll publish only
those authors that have a strong track record in the
e-market (or an exceptional track record in sales of
past p-books). It’s got to be more profitable when you
only publish the winners. It’s got to be more
profitable when you have more information about
potential sales before you publish a book.

Publishers will publish fewer titles because not all
books are winners. Some books just don’t do well in the
market. In the past, publishers had to guess the
winners. In the future, publishers will read the
winners off the e-book charts. They’ll ignore the
losers on those same charts. That has to mean fewer
titles.

This does not mean the public will have less choice.
The public will have much, much, much more choice in
the e-market. It will have less choice in the p-market,
but those choices will have higher average quality.
That’s a net win for the public.

While I think it very likely that publishers will have
higher profit margins in the future, it’s an open
question whether they’ll earn more in gross revenues. I
make no prediction on that. Naively, it seems that they
would gross less. However, they might conceivably gross
more, depending on complex factors that I can’t
foresee.

Prediction #9: Some Will Do Better; Some Will Do Worse

I believe that talented authors will do somewhat better
in the e-future. I believe effective agents will do
better and so will most publishers.

I foresee a burgeoning market for freelance editors
(who can help writers polish their work before taking
it to e-market). Likewise for freelance graphic artists
(who can create great covers for e-books).

I foresee a larger, better array of choices for the
reading public.

However, not everybody will do better. Some people will
do worse. Let’s make a list of them. We already
discussed these people before, but let’s list them here
again:

* The person who typesets the edited manuscript
* The person who cuts the trees to make the paper
* The person who turns the trees into paper
* The person who puts ink on the paper
* The person who binds the paper into books
* The person who puts the books in a box
* The person who drives the box to the store
* The person who unpacks the box in the store
* The person who puts the book on a shelf
* The person who rings up the sale at the counter
* The person who puts the unsold copies back in a box
* The person who drives the box back to the publisher
* The person who unpacks and shreds the returns

None of these people contribute actual value to the
story. They only contribute value to the medium — the
handling of paper and ink. As the demand for paper and
ink shrinks, so will the demand for these folks. That
may be cruel and Darwinian, but it seems to me
inevitable.

In addition, I also think that brick-and-mortar
bookstores will become smaller (as measured in square
footage). It’s hard to say for sure if they’ll also
become fewer in number, but it’s a good bet that they
will. That’s been the trend for several years, and I
suspect it’ll continue. It’s possible that they’ll
become a bit more profitable, since they’ll be stocking
only p-books that are marketplace winners. But they may
face increasing pressure from the online merchants for
p-books, which can stock a much larger choice. I make
no prediction on their profitability.

Those are my predictions for the future. I can’t prove
that any of them will come true. But I’m making my own
plans based on this vision.

It’s not the gloomy-doomy future that many writers see
ahead of us. However, it’s a future that will require
serious adjustments from just about everybody in the
publishing industry.

In five years, we’ll know whether I’m right or wrong.

Award-winning novelist Randy Ingermanson, “the
Snowflake Guy,” publishes the Advanced Fiction Writing
E-zine, with more than 21,000 readers, every month. If
you want to learn the craft and marketing of fiction,
AND make your writing more valuable to editors, AND
have FUN doing it, visit
http://www.AdvancedFictionWriting.com.

Download your free Special Report on Tiger Marketing
and get a free 5-Day Course in How To Publish a Novel.

 

 
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