Raven’s Aerie

(Note: this post assumes the quoted figures are correct. They may not be. But as they match, or are very similar to, what I have heard from other authors over the years, I am not hesitant to use them or assume they are correct.)

This is why I’m saying publishers and distributors are lying to their authors and to one another. Via a comment by Charles Stross:

…in general, the author gets 10% of the cover price of a hardback. The publisher makes 10% of the cover price in profit. The publisher spends another 10% of the cover price on editing, production, printing, marketing, and so on. The distribution chain eats 60-70% of the cover price — typically 30-40% at the bookshop and 30-40% at the wholesaler. Amazon is both bookshop and distributor, but passes around 20-30% of the cover price on to the customer, thus taking about twice as much money per book sold as the author and publisher combined.

I don’t care about the Amazon bits right now, they can get their own post some other time (or you can infer what I’m going to say from the arguments and data below); instead, I direct you to the idea that 60-70% of the cover price is eaten up by the distribution chain.

This would be the very same broken distribution chain we indie publishers in the hobby gaming field rejected about ten years back, and were jeered at for by big industry names who told us “You have to do it this way! You can’t succeed otherwise! You need us and them! You can’t profit doing that!”, and then were finally told by the very same folks, “Er, um, so you guys were kind of right about all that stuff…so, uh, how do we go about this again?”

Yet the publishing houses in the mainstream continue to use this broken, aging, greedy, overly-costly system to move their wares to the public. I’m not being mean about that, it really is all of those, and it’s not specifically due any one person or company inside that mess, either.

There’s no singular bad guy to blame, though some of the actions of certain players are bad. For example, all levels of the three-tier system lie to one another, and especially to the authors, about why — if an ebook costs more than a paperback — the author isn’t making much more on the ebook than on a paperback or hardback book where the publisher is not incurring most of that 60%-70% expense.

Lying?

…one piece…stated outright that there were no big distribution/wholesaler costs for e-books as there are for print books, because there is no need for warehousing/storage. WRONG! – Absolutely, utterly, 100% wrong. The distribution and warehousing charges for e-books are absolutely as high as they are for print books. For example, the biggest book warehouser in the country, Gardners, who distribute our e-books, charge exactly the same as they do for print books – an average whopping 50% of retail price. Why? Because they argue that there are still large costs associated with the production and maintenance of e-books: they’re just different ones. They relate to building, managing and keeping secure e-warehouses, among other things.

This is from Two Ravens Press, an indie publisher. Yes, lying. The piece being referred to is 100% right, not wrong, and Gardeners is flat-out scamming Two Ravens if they are making that claim, because the costs involved in “building, managing and keeping secure e-warehouses, among other things” are simply not nearly as high as they are for physical books.

The warehouser — and this shouldn’t be a big surprise — just wants the cut they’re used to. It’s about profit — not fairness, not costs. (If anyone in business claims otherwise: you have your proof positive they’re lying right there. If you believed them, stop having thoughts about business because I have a bridge to sell you.)

The truth for authors is: ebooks should not (and do not) cost more than physical books, and authors should be getting paid more for them.

How do I know this?

Well, I sell books in this market, too, as an independent in the hobby gaming field.

Excepting my distributor gives me around a ~85% cut of sales and takes ~15% for salaries, sales, promotion, warehousing, & shipping costs. I use that 85% to pay for printing, shipping to my distributor’s warehouse, and promotion — also for art and editing and so forth for the next book in the pipeline — and hopefully for salary. I also sell ebooks of those products through them, and I get the same deal.

However, retailers who order the title from my distributor demand a 45% discount off the cover price. I know the retailer does this so they can make a profit, given that not every title they purchase will sell, giving them room to maneuver the price around without losing the money they’ve already spent on the book (if you’ve ever wondered and don’t know: that’s how 1/2-price bargain book bins work — they still make the retailer a very small profit so the book isn’t a total loss).

But with the ebook copy of my product, there are no printing, warehousing, or shipping costs for me or anyone else involved. My costs are: art, editing, layout, promotion — which I have to pay for exactly once. For a retailer offering my ebook for sale, it is nothing but pure profit…because a retailer doesn’t have to purchase even one copy of the book and thus risk spending money on a physical inventory item they might not profit on: they have free infinite copies. If the book doesn’t sell, they don’t lose money. If the retailer sells it for 10% of the suggested price, they don’t lose money…they still make a profit.

This is because storing and transmitting an ebook costs next to free, especially when you’re doing a lot of it. Even taking into account the costs of tech support and running the server and tracking sales, it costs next to nothing compared with all the costs involved in dealing with the distribution and sale of a physical book for a retailer. And yet, for some reason, the publishing houses and the distributor chain want authors, and one another, to believe otherwise, and will keep repeating falsehoods to the public, to each other, and to their authors because, generally, no one seems to know better.

So, authors, think about it:

If 60%-70% of the costs of one of your books is suddenly freed up due to e-distribution, which doesn’t rely on those channels or their costs, why are your publishers claiming they need to sell ebooks at costs well-above a threshold that doesn’t include pricing for those costs? Because “or else nobody will make anything”? That you’ll LOSE money if you sell ebooks cheaply? That if you sell a book as an ebook for 70%-off the cover price of the physical book, off 70% of the hardcover price, it will be the end of the world and their (and your) financial stability forever?

Let’s look at some numbers: say your hardback sells for $20. You get (10% or) $2 out of this, the publisher gets $4 (20%). Wholesalers take $7, and then retailers take another $7.

Now let’s say your publisher sells your hardback as an ebook, and also prices it at $20, and you’re still only getting $2 out of the sale…

Someone needs to explain where the money they could be shoveling into your pockets is actually going and why. A whole $14 of extra money, perhaps more like an extra $15, because while the publisher still has the same editing and promotional costs for an ebook, they do not have printing or shipping and related production costs.

And, hell, I’m being generous by not cutting that even more. The amounts spent to print and ship the book over its lifetime are going to outweigh the early costs spent on editing and promotion — yes, I know publishers claim the opposite. Their numbers are well-cooked by the time you see them.

Now, even if you’re giving the retailer their usual cut (around $7), that leaves $8 of that $15 unaccounted for (the costs that would have gone into the distribution chain to the wholesaler and for printing/production) that someone — or someones — is pocketing as pure profit (and it sure the hell isn’t you, dear author).

It is clear — and you may not want to believe this because someone you trust who wears a suit or not and is really business smart said otherwise — that someone is scamming the shit out of you as an author, or as a publisher, or maybe as a retailer even, especially if they are telling you that lowering the prices on the books will cost YOU and THEM money.

Let’s say you drop the price of your ebook to 40% off the hardback price, to $12, but not all the way down to $6 (70% off). What happens?

Amazingly, you still get your $2 cut, dear author! Your publisher gets their ~$3 cut, too, and the retailer gets their ~$7 cut (for the expensive notion of having a hyperlink and processing a monetary transaction on a product they literally can’t lose any money on, because they didn’t spend any to buy/ship/store/display it, unlike a physical book).

Here’s the magic if you didn’t quite follow: you dropped the price on the book and are now getting a 17% cut, instead of 10%. The publisher is getting a 25% cut, instead of 20%. The retailer is getting a 58% cut, instead of 40%. Everyone is actually making more money per unit…and you dropped the price. Ta-DA.

Under the ebook system, retailers have negligible costs to list the item. Maybe they should get $1 or $2 of the profits to be more fair, but hell, we’re being charitable and giving them the usual cut, for just keeping the thing in their electronic library, which is nothing remotely like buying and keeping a physical book on their shelf.

The retailer is getting almost 60% of the profit on a product they don’t have to spend money to get — in terms of stocking and shipping and storing and etc. — and can’t lose money on just for having it, unlike a physical book. They aren’t taking anywhere near the same amount of risk as they are with a physical book…in fact, they aren’t taking a risk at all.

Really, maybe you should be getting 30%…40%…50%? Because your friend the publisher’s costs are still well-covered, and the retailer selling your books to a hungry market is still making a tidy profit per sale, even at a reduced cut.

Yes, I keep repeating this: and you dropped the price for the consumer, and everyone is making as much or more than they were at the higher price for the physical book.

You could, in fact, all split that ~35% the wholesaler isn’t taking out of the pie amongst yourselves rather than giving it all to the retailer, which is bonus profit for everyone.

But here’s the other thing: we’ve been talking about hardbacks above, but most of your books and sales are $7 paperbacks. Keep in mind: the lower the cost, the higher the volume. But you know that already: people don’t buy even close to as many hardbacks as they do paperbacks, there’s often a ten-fold difference, because most of your readers wait for the cheaper book.

So, do you want to sell twenty-thousand books at $20…or two-hundred thousand at $7 (or $5? or $3)? Do the math.

Even with smaller sales, would you rather make, say, 20% on $7 or 10%? Would you rather make 20% on $3 or 10%? Really, you’re not dumb, you know the answer: cheaper ebooks are not only better for the consumer, they are vastly more profitable for you, because while they cost less, they generate more.

It is thus ridiculous for publishers to argue that making the books cheaper will impact their profits on hardcovers. Cutting out the retailer completely, your publisher could sell $6 ebooks and make the same or nearly the same amount as they do on a hardcover sale (so will you), except they will make MORE sales at that same profit-per-item level (meaning more profit total) than they would if those were hardcovers, because cheaper is higher volume.

No doubt they have told you and will tell you otherwise (Macmillan certainly has already).

They’re lying.

Wait…$6? Yes, that’s about 30% of the cover price for our $20 hardback — or rather, what’s left when you take out the 70% of the cover price for the distribution chain. The $6 the publisher and author live on anyways from a hardcover sale, right now. Because normally the publisher gets $4 and you get $2 from each $20 hardback. Your publisher could sell an ebook from their own site at $6 and make as much as you would both make on a hardback sale normally.

Here’s some more magic: your publisher could sell an ebook at $2 — $.10 less than the $6 paperback with the 70% taken by the distribution chain removed from the pricing — and make almost as much as you would both make on the equivalent sale of a $6 paperback. Normally, you’re only getting $.60 and your publisher is pulling $1.80 on a paperback — your largest volume seller — and $2.10 is going to the wholesaler and another $2.10 to the retailer.

A $2 ebook will net you $.50 and your publisher $1.50.

If you want to include the retailer in this, and there are good reasons to do so (see below), you could sell at $6 and get 30%, giving the publisher and retailer 35% each. Absolutely no one loses. Everybody involved makes MORE money, or at least no less, than they would on equivalent paperback sales. $1.80 for you, and $2.10 for the publisher and for the retailer per sale.

(And this is if you’re being nice to the retailer because it isn’t as if he is laying out money per book and needs a 35% share to cover his costs and a reasonable profit.)

However you work the numbers, the reality blows all the arguments — about not selling the ebook of a hardcover right away because they’ll eat up the needed profits from the hardcover sales, and not selling them cheaply because it will cost everyone money — not just out of the water, but out of the damn solar system.

And all that is without looking at whether or not the two markets even compete, ala concerns about hardback sales being lost to ebook sales. Many of the successful indie game companies have themselves discovered over the last ten years, after numerous worries, it is foolish to treat physical book sales as competitors to electronic book sales: they’re two entirely different markets. They are not competitive; they are at best complimentary, and at worst blind to one another.

Like the markets for toasters and butter.

So I suggest the publishers, et al. are making those arguments not simply out of fear of the new market, but because their accountants and CEOs aren’t stupid and they want to make (way) more money than they are now while convincing you they (and thus you) will actually make less money than now if they sell those hardcovers and ebooks at the same time and sell them for less.

And they want you enraged and scared and blindly backing them up on this because they told you it was so. And you, as authors, have powerful voices.

It’s about greed. They want to pocket that ~70% the distribution chain would have eaten and juggle it around into other altogether-too-convenient new costs that do not match the real costs of digital business.

But selling $6 ebooks…is nothing but a money-maker for everyone involved. As long as everyone is being honest. (And let’s face it, they aren’t.)

The only people getting hurt here are authors and readers.

The truth is ebooks completely change the market for everyone involved; they have the potential to turn any so-inclined publishers into the e-retailers/e-distribution points, since there’s no need, on the web, for them not be and just pull those profits for their authors and themselves directly.

At least there is no need other than sharing a centralized information and distribution node everyone knows and uses (like Amazon) to get yourself virtual shelf-space in a large market (which is the real value of Amazon or other digital direct-to-customer distribution nodes in the digital age).

Even so, it is also easy to just “be” that node for your “brand”, especially if you are a publisher name readers know (frex: Tor, Baen, Del Rey); but if you use other nodes to reach your public, it is fair and reasonable to give those e-retailers a small cut for the use of their electronic distribution network.

Oh, and if you’re an author with a following, and you own the rights to your work, and you have a bit of technical know-how: you can also be your own node (though also getting a deal with one of the central nodes is never a bad idea). Really, how many $2 or $4 ebook sales a year do you need to make a living?

Or to at least cover your bills between royalties?

Why am I doing this?

Blogging, that is.

This site isn’t popular, it’s Just Another Blog on the internet, and like the vast majority of blogs, rarely visited, rarely read, without fame or regular readership. I am probably the only one who recalls its existence.

So why do it?

We’d all like to think our blogging is serving some purpose, getting our voices out there, making us heard, providing a lone voice of reason in the wilderness. Well, as my acquaintance Vincent Baker says, we’re all the heroes of our own blogs.

The center of our own revolving universes, often blinded to the private nature of that universe and the spinning realities likewise all around us. So the truth is our collective individual voices aren’t anywhere remotely as meaningful or effective as we’d like them to be.

At best, we’re the noise in the signal. Lost in transmission…heck, lost before the transmission ever begins. We’re throwing signals into the darkness amid the stars, hoping someone, somewhere, who may not even exist, hears us and it ushers in an age of intergalactic communication and scientific discovery.

We’re quite full of ourselves in our fancies.

For the most part, we could write in a private journal instead, to the same effect, though perhaps not with the same fervor. The public nature of blogs gives us a kick and incentive — the idea that we might be grasping at stardom — we’re exhibitionists and voyeurs of thought…at 4am on a deserted street.

Despite knowing this, this blog has mainly been my attempt to get the word out, to speak up on issues important to me, and to hope and pray they have an impact, that someone somewhere sees them and it changes their lives for the better in some small way. That’s a pretty big dream.

But as a goal, as a mission statement, it sucks. It is vague and its success is mostly untestable. Not to mention: ideas need a critical mass to make an impact, and in all the years of its history, this blog has never reached anywhere close to a critical mass.

So why keep doing it?

I was thinking about that today, and I realized I have a much better reason to keep doing it…but to stop doing it for invisible people I’ll never meet, and all the demands and stresses and hopes and desires that come with that.

Despite my ability with the written word, I am not so adept with the spoken, or in person. I am intensely private, to the point that even those closest to me rarely know what I am thinking or even what I believe, to the point most of the time I don’t put myself out there and talk to my wife or kids about things or issues that are important to me.

When my children grow up, I want a record for them to look back on to come to understand who I was, what I believed in, what I reasoned was important or worth fighting for. This is a portion of that record. And if random individuals out there on the internet find it of some value, too, cool.

Along with many others, I’ve been watching the right-wing for a long time, especially with the erosion of civil liberties and legalization of prejudice that took place during the previous eight years, and the long-hinted at and recently revealed extremist religious views that were at the very base of the decision to start the war in Iraq.

I’m saying you need to read this because despite Democrats winning control of Congress and wresting back control of our government from corporate and extremist interests in the Republican party, there is a looming danger rising precisely because of those interests loss of power.

We might think that we’re finally safe because the people said “Enough!”, but it’s worse now, because we have dangerous and unstable people who had eight years of political power suddenly finding themselves removed from power, angry about it, and convinced they SHOULD still be in charge. Worse, that anyone who isn’t with them absolutely is a dangerous enemy and the cause moral decay and looming destruction of America and its values.

An essay on Orcinus states we are now heading towards the rise of a strong fascist power in our country. We aren’t there yet, it might NOT happen, but expert historians and sociologists state that all the signs are there.

If that article seems far-fetched, consider the facts.

The left-wing doesn’t resort to violence, thuggery, and threats as part of its politics, but that all across the country, right-wing extremists are disrupting congressional town-hall meetings with those very sorts of tactics, sadly glorified by slanted media (such as the usual names of Fox News):

• In Tampa, Florida, a town hall meeting erupted into violence, with the police being called to break up fist fights and shoving matches.
• A Texas Democrat was shouted down by right-wing hecklers, many of whom admitted they didn’t even live in his district.
• One North Carolina representative announced he wouldn’t be holding any town-hall meetings after his office began receiving death threats.
• In Maryland, protesters hung a Democratic congressman in effigy to oppose health-care reform.

And more of the same. Not to mention, these sorts of disruptions are being organized and encouraged by conservative groups that speak directly to their party’s base.

None of which are happening in isolation.

There are reasons the Homeland Security agency released a memo this year warning about the need to watch right-wing violence and domestic terrorism. Membership in right-wing hate groups has risen over 40% since the election. There were an unprecedented thirteen acts of domestic terrorism within six months committed by right-wing ideologues, whom stated their acts were born from the hate talk broadcast on national airwaves (from the man who shot three police officers and stated it was because he was terrified of “Obama concentration camps”, to the one who opened fire in a Church because “liberals are destroying the country”).

There is fertile ground for the emergence and political ascendancy of hate-groups, especially when they have been encouraged and enabled by public voices who should know better — but who appear too committed to the ideology and just-so stories they’ve been pushing for decades to realize or admit exactly what they’ve created by playing politics with the media.

But those same conservative voices refuse to talk about these incidents, instead turning around and claiming the current administration is resorting to thuggery to silence them. For example, Rush Limbaugh recently claimed:

“…this is Mussolini-type stuff. This is the President of the United States — who cannot deal with opposition, there will not be any, he is going to silence it — sending his union thugs out to physically assault, and in some cases to, in all cases, intimidate average Americans who just want some answers.”

Aside from the historical inaccuracy (Mussolini sent thugs out to BREAK UP unions), and the fact that the “beat-down” situation he’s referring to was faked and and the victim wasn’t, there is the issue that he remains completely silent on or outright supportive of well-reported events of actual political thuggery and intimidation — that powerful and dangerous elements of the extremist right actually have been setting up and encouraging disruptions of town hall discussions, threatening legally elected officials with violence and death.

Or that he himself — along with others like Glenn Beck — have been openly stating people should rise up in armed revolution, that the currently elected government is illegal, and so-on-and-so-forth.

He ignores how his own political group is doing, in fact, all the things he claims “the President” is guilty of, and which his own party did over the prior eight years, when liberals who disagreed with the President or Congress or the war were shouted down, threatened, called cowards, unpatriotic, and traitors everywhere in the media.

You should be worried because they continue to raise the tired conspiracy mantra we have heard since before the election: that Obama is going to strip us of our rights (but the Patriot Act, etc, didn’t?), put us in our concentration camps, terrorize us, and force us to obey. And with these empty claims encourage these extreme and growing right-wing elements to even further violence, paranoid hatred, and disruption of the democratic process.

You should be worried that this group is not only using violence, threats of violence, and violence-by-proxy, but is broadcasting news reports of fake injuries inflicted upon them and fake threats made by their “evil socialist” enemies, while “jokingly” encouraging assassination, murder, and armed rebellion in the national media.

Because if that sounds familiar that was how the National Socialists rose to power in Germany, and how Mussolini gained his power in Italy.

All of that is why it is important to read that article and realize it isn’t just political hot air or overblown hand-wringing: because, again, none of these are events in isolation.

This isn’t just politics as usual. This is a very dangerous sort of politics to everyone in this country: Democrat, Republican, or otherwise. This isn’t “everyone is doing it” — everyone isn’t.

Look at the facts, not the spin.

A pattern has been established and recognized by expert historians and sociologists, a pattern we’ve seen before and that is playing out right now, whether we want to believe it or not. Nor if we wish to accept that in this case it is not just “everybody has differences of opinion” but that some of those differences are actively hostile to the democratic process, social progress and stability, equality and liberty, despite claiming to stand for them, and can not be treated as acceptable, equal, or hand-waved away.

We have to recognize these elements by their actions, not their claims — except in how well their claims match to, distort, or ignore the facts — and not allow those who engage in such actions to take power or let such methods be given a voice of propriety or equality.

Like I said, I don’t normally do this, but our whole system is in a dangerous spot right now that more people need to recognize and make sure they inform themselves about. The extremist right, through certain powerful media voices, are playing the citizens of our country, feeding its constituents fury and fear with endless waves of disinformation.

One of the best ways to ensure these individuals do not gain any more political power is to get the truth out about the misinformation they’re spreading, using non-partisan news and information clearinghouses; check sites like FactCheck and PolitiFact — especially when well-known pundits, conspiracy theorists, and/or repeatedly outed liars start talking — and to decry violence (or “joke” violence) against elected officials, immigrants, citizens, blacks, whites, communists, capitalists, liberals, conservatives and pretty much any person or group as absolutely unacceptable in our national media.

We should be demanding media accountability: something we have absolutely lost over the last decade, and that certain rich media networks more interested in political power than news would hate to see revived.

None of which is to say there isn’t plenty of political spin and nonsense to go around on both sides, but this time things have gotten increasingly, disturbingly worse on the far right. To the point it is worrying people whom we should be worried that they are, because the violence, disruptions, and bias aren’t just dirty politics as usual at this point, and we should all be aware of that.

From Mother Jones, We Bring Fear:

Here is what a wise man knows: that certain people—the cartel leaders, the corrupt police, the corrupt military—these things cannot be written about at all. That other people should be mentioned favorably unless they are caught in circumstances so extreme that the news cannot be suppressed. Then, the blow is softened as much as possible. Nor are investigations favored. If someone is murdered, you call the proper authorities and you print exactly what they tell you. But you don’t poke around in such matters.

…When top military officials say if there are any rapes and robberies they will be the fault of narcotraficantes masquerading as soldiers, well, that is the way it will be reported.

He will obey those instructions for a very simple reason. For three years, Emilio has been afraid he will be murdered by the Mexican Army. He has, to his horror, committed an error. And nothing he has done in the past three years has made up for this mistake. He has ceased reporting on the Army completely. He has focused on safe things such as fighting the creation of a toxic waste facility in the town. He has apologized to various military officers and endured their tongue-lashings. Still, this cloud hangs over him.

…

Monday morning he drives north very fast. He takes all his legal papers so that he can prove who he is. He expects asylum from the government of the United States.

WHAT HE GETS is this: He is immediately jailed, as is his son. They are separated. He is taken to El Paso and placed in a US Immigration and Customs Enforcement detention center run by Deco, Inc. He is deloused, given a blue jumpsuit, and set to work scrubbing floors for a dollar a day. He is denied bond, and no hearing is scheduled.

What really frightens is that the same sort of situation could have easily developed here over the last eight years, with the complacent blessing of the “never question the our State” right-wing…and still could, even with the power-shift in Washington.

And I mention that latter bit because I can’t, or rather don’t want to, imagine what a true conservative government would look like, with people like Limbaugh running it. People who, for eight years insulted, bullied, and threatened liberals who spoke out against the government, telling them to get out if they didn’t like it, calling them traitors and terrorists — and then when the tables were turned, immediately began to speak out against the government without a second thought to their previously presented ideals of “America, love it or leave it!” and “Our President, right or wrong!”

I mention it because there are people who are already quietly suggesting armed revolution (Limbaugh, on Thursday, stating “And if we had any good luck, Honduras would send some people here and help us get our government back.”) and stirring the “liberals are less than human” hate-pot regularly. Who rub liberal noses in their eight years of success in democratic elections, then decry that very same democracy when it fails to serve their interests and even declare it should be (rather un-democratically) overthrown.

Do you foresee much of a shift from calling people traitors and terrorists, to cutting off their heads or shooting them for dissenting? If our history had continued down the course it was progressing just a few years more? If such a revolution were to occur and such people were to be put in power?

I really don’t. Because there isn’t.

Man has never needed much to move him from civil disagreement to bloodthirsty self-righteousness. A little bit of Othering, a little bit of hate, a little bit of power, and you can get men to destroy each other in a vicious, bestial, fanatical froth backed by airy justification, because at least one side will not see the others as even human any longer. As “deserving” of the violence they seek to do or have done.