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Summary:

As more authors choose to do an end-run around the traditional book industry, publishers are going to have to try harder to defend their continued existence — self-published author J.A. Konrath says that most are tied to a “broken, outdated and increasingly irrelevant business model.”

As more authors choose to do an end-run around the traditional book business by going the self-publishing route, traditional publishers are finding it harder and harder to justify their existence. While some have risen to the industry’s defence — arguing that a good publisher helps refine a book, or acts as a curator by filtering out the lower-quality content — others are ready to do away with them altogether. In the latter group are authors like entrepreneur James Altucher, who argues that everyone needs to become a self-publisher, and J.A. Konrath, who says publishers are tied to a “broken, outdated and increasingly irrelevant business model.”

Altucher, who has been a financial analyst, a stock trader and founded several technology companies over the years, says that anyone who is in business or is a writer of any kind — including bloggers — should publish their own books. E-books are “the new business card,” he says. And why self-publish? Among other things, Altucher argues that the marketing value publishers provide is virtually wortheless, that writers have more control over their books and keep more of the revenue when they self-publish, and that author advances are going to zero as margins in the publishing industry come under pressure.

Konrath, meanwhile, hits many of the same points in his recent comments about the lack of value that publishers provide — especially for authors who already have an audience and are willing to design and promote their own books. Konrath made his comments in response to a profile of his former publisher, who he said were “dedicated, talented professionals” working in a broken and outdated industry.

Services publishers provide are increasingly unnecessary

Authors who have defended their publishers, including one we wrote about recently who made the decision not to self-publish her novel, argue that good publishers provide a number of services both for authors and for the book business in general — including the “curation” of new books, where publishers discard the dross and focus on the best. But Konrath says this is increasingly unnecessary:

Curation is no longer important. Readers are very capable of finding ebooks that interest them (the same way they can find YouTube videos, websites, and TV shows that interest them.) They no longer need to be told by a publisher, “This is worthy.” They can make that call on their own.

The author also notes that by acting as gatekeepers, publishers miss a lot of potentially good books — including his own. While his former publisher released one of his books in several countries, Konrath says they passed on two subsequent titles: the one that they promoted has made about $60,000 in three years, while the two that the publisher decided not to release have brought in four times that amount in just two years. Konrath and Altucher both note that traditional publishers still take a substantial proportion of the revenue from a book — over 50 percent in many cases — for doing relatively little. Says Konrath:

I understand Grand Central has overhead. But as an author, why should I care? I can hire out for editing, proofreading, formatting, and cover design, and those are fixed, sunk costs. Once those are paid, I can earn 70% on a self-pubbed ebook. Plus, I can set my own price. Lower prices sell more copies.

Publishers are still thinking like gatekeepers

Konrath also makes the point that many traditional publishers seem to spend most of their time trying to promote the sale of printed books, and as a result are distorting or not taking advantage of the market for e-books — including pricing them too high, as we’ve pointed out in the past. This kind of behavior, he says, feels more like an industry that is trying to protect its existing business model at the expense of its authors:

Originally, the purpose of a publisher was to connect writers with readers. Lately, publishers are more concerned with selling as many pieces of paper as possible. Ebooks are priced high to protect paper sales. The agency model was forced on Amazon is to protect paper sales. Windowing is to protect paper sales. If publishers truly wanted to connect writers and readers, there is no better way to do it than digitally.

We’ve written a number of times about the disruption the publishing business is undergoing, much of which is coming from Amazon — both through its Kindle-based self-publishing features, and through its increasingly aggressive moves to bolster its own status as a publisher, by signing authors like Tim Ferriss. Every few months there seems to be a new self-publishing success story, whether it’s young-adult author Amanda Hocking with her $2 million in revenue or million-selling author John Locke.

The main point both Altucher and Konrath are making, I think, is that traditional publishers who want to remain in business are going to have to reconsider a lot of fundamental aspects of their current model — including their existing fee structure — and try harder to make the case to authors that they serve a purpose at all. As Konrath says: “Writers are essential. Readers are essential. Publishers are not.” And if you are no longer essential to the process, your job just got a lot harder.

Post and thumbnail photos courtesy of Flickr users David Daniels and Jeremy Mates

  1. Great article Mathew. Blurb has given people the blue print. Ask the photo community how much they love Blurb? A lot. Good stuff…

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  2. Speaking as a publisher, the main reason eBooks are only slightly less than printed books is because the largest cost to the publisher is generally the author advance (with a bigger name author). The cost of manufacturing a paperback book is only about $ .45 per copy. A hardcover runs about $ 1.50 per copy…..so the total manufacturing cost is a relatively small part of the cost of publishing a book. The other big costs are promotion; again depending on the level or the title.

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    1. God bless publisher’s. I will always opt for quality over quantity.

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      1. Cough. Apostrophe. Cough again.

        I honestly would not do this kind of grammar snarling if this comment weren’t extolling the virtues of quality over quantity.

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      2. You mean “money bless publishers” for sure, because publishing books is an industry and a business, as there are many, and publishers, editors and so on are just the midlle man who take profit from the author’s work.

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  3. But the publishers blame Amazon! If business is down, it’s because of big bad Amazon!

    Keep thinking like that, guys, and see how far it gets you.

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  4. I disagree on one point. I just purchased a self published book from Barnes and Noble and I have to say it was the most poorly written piece of junk ever! Without a publisher, the reader is left to fend for himself, weeding out the crap from the “I think I know it All” wannabee authors too cheap to hire an editor or even a proof reader. I agree the model needs revising, but to throw the “baby out with the bath water?” Bad idea.

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    1. Mike,

      That’s where reviews and citation come into play. It’s coming of age as we speak in regards to web content. It’s still in its early stages with regard to ebooks. I suggest giving it time. In the meantime I hope you skewered the author on the reviews section of his page on bn.com

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      1. don makoviney Friday, February 3, 2012

        I meant “curation” not citation…

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  5. Choosing to go the traditional publishing route is just a bad business model. No way around it. As Konrath said in another place, “What happens when there are many ereaders as there are mp3 players?” He’s right. You’d have to be crazy to be locked into a deal with an old-school publisher right now.

    Digital books are the future, and self-publishing will create new opportunities for talent just like YouTube did for comedians, actors and musicians.

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  6. Yes, this is something that transcends books to music and movies and more. The problem is, we have industries and their cohorts unable to figure out how to promote themselves, and authors, especially those who feel they above it, simply aren’t willing to share the risk of self promotion. The games have changed and lots of excellent work will never see the light of day because artists often are ill equipped to do the work needed to get the coverage.

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  7. Dani Fankhauser Friday, February 3, 2012

    Being a gatekeeper and only allowing quality pieces through worked when books needed to be mass produced to make any money. Since that is passed, not every book needs to be a blockbuster (just like music, movie) plus, it’s more and more about relevance rather than quality. Many people will read a highly relevant book because it covers something that interests them and it doesn’t have to be the greatest piece of literature. That’s why they’ll go for self-publishing.

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  8. It sounds like Altucher never worked with a talented editor. Most writers have valuable knowledge or terrific stories but cannot “write.” Brilliant editors make them stars.

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    1. Peter Winkler Monday, February 6, 2012

      What a bunch of bloody nonsense. If most writers can’t write and the editors are the real ggeniuses, why not dispense with writers entirely and just let those supposedly fantastic editors write the books?

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      1. Because different people bring different things to the table. Editors might not be great researchers or creative enough to create fictional worlds, but they can see where writers need to be pushed or held back or encouraged or told to move on so that their vision can be better communicated to a reader. Even great writers need great editors. (Written as someone who has worked professionally as both an editor and a writer.)

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  9. “Publishing” isn’t a monolithic entity. There are so many nooks and crannies in the world of “publishing” that ANY generalization about the entire ecosystem is bound to be incomplete and thus inaccurate. Having said that, I’ll make a generalization of my own: it’s crazy to assert that “curation” is no longer important. Readers cannot and will not find their way to emerging writers and thinkers without *some* form of curation / advocacy. Maybe it’ll take some other form than the current model, but there are too many writers & thinkers out there who have something valuable to say, or whose manner of expressing what they say is sublime, who nonetheless cannot play the part of self-promoter, as folks such as Konrath, Godin, or Ferris can. Maybe they can’t do it because they’re introverts, or simply because they’re not great public speakers. So, in order to be noticed, and to be read by a wide audience, some sort of advocacy of their work by others will need to happen. And while fan-base fervor sometimes rises to the challenge, more often a publicly-known entity or person making the case is the push that’s needed to transform that work from a worthy-but-forgotten effort to a widely-read and appreciated book.

    And I’m sorry, but any writer who dismisses the value of a good editor so cavalierly has obviously never worked with a good editor. Too bad for him/her, but that doesn’t justify throwing the entire profession under the proverbial bus.

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    1. Peter Winkler Monday, February 6, 2012

      Publishers only promote the small number of books that they acquire with six-figure advances. The other titles they publish receive little or no promotion or advertising and are left to flounder. Publishers expect the writer to promote themselves, which they are unable to do. So, publishers do nothing to bring most of their titles to the attention of the reader who might enjoy them. Therefore, all but a handful of authors may as well self-publish.

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  10. Great post. So true. When are the publishing companies going to get off of their ivory throne and realize that the winds of change are blowin’.

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