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who argues that everyone needs to become a self-publisher, and J.A. Konrath, who says publishers are tied to a “broken, outdated and increasingly irrelevant business model.”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to a profile of his former publisher, who he said were “dedicated, talented professionals” working in a broken and outdated industry.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.