This post, by JA Konrath, originally appeared on his A Newbie’s Guide to Publishing blog on 8/6/10.
Dorchester just announced it is cutting its mass market paperback line and focusing on ebooks.
A few months ago, Medallion announced the same thing.
I’ve heard, through sources who asked not to be named, that sell-through for paperbacks is as bad as 20%. In other words, out of ten printed, only two sell.
Now what’s going to happen if more publishers follow this business model?
Here’s a possible scenario.
1. Fewer paperbacks are published. Publishers either eliminate their paperback lines, or begin publishing more selectively, in smaller numbers, to cut costs and losses.
2. Bookstores have fewer books on their shelves, and sell fewer books as a result. Which means less money to the publishers.
3. Publishers downsize, since the ebook market, though growing, doesn’t bring in the same money as print does. In order to maintain positive cash flow, they bill their accounts to pay up.
4. Their accounts–bookstores and distributors–can’t pay up. They don’t have the money to pay for the books they’ve sold–which they bought on credit. So they begin returning other books on the shelves to get credit for those.
5. Now there are far fewer books on the shelves, which means far fewer sales.
So when publishers stop printing as many books as they are now, the delicate balance will shift.
What does this mean to you, the author?
The main reason we need publishers is for distribution. We can’t get into Wal-Mart or Borders on own own. They can. So we accept 8% royalties in order to sell a lot of books. But if publishers are no longer printing books, there is ZERO reason to sign with them, because they no longer have that advantage. Especially when we can earn 70% royalties on our own.
If you do sign with a publisher, make sure it contains a clause that states they MUST release it in print, or revert the rights back to you. Make sure there is specific wording for "out of print" that doesn’t include ebook sales.
But, if you do sign with a publisher, do you think you’ll ever get your rights back?
Let’s say I’m running a publishing company. I see ebooks are the future, and I’ve got three new authors coming out in print. I gave these authors healthy advances, and there’s no way they’ll earn out these advances with print sales.