[ubuntu-uk] The economics of books
Mark at ascentium.co.uk
Thu Nov 11 13:30:48 GMT 2010
I ought to point out here that I am an author.
My original thing - a non-fiction, non-IT, 4-CD audiobook has NEVER been
available as a printed book, since my publisher only does CDs (50 years ago
tapes, and these days, MP3s as well as CDs, with tapes having finally gone
about 5 years ago.)
My second thing was conceived as a book, and I took the decision early on to
self-publish. The reasons for this were:
- It's aimed at a very small niche, and was never going to attract shelf
space in the likes of Waterstones
- The audio-book, and heavy publicity for that had allowed me (with the
approval of, and indeed encouragement from, my publisher) to set up my own
website with an opt-in mailing list for future announcements. This currently
stands at about 3,000 names.
- With the likes of Lulu.com, I could do everything as a PDF, but get a
proper ISBN number, and have them do the deals with Amazon and WHSmiths
(both of whom list my book on-line, but WHS don't carry in-store), in a way
that gave me a far higher revenue share than I would have done had I used a
- The cost of hiring my own editor to work with me over the space of about
six months, was about £5,000. I had to pay for that out of pocket.
- Lulu, like a few other publishers, have "server space and printing
facilities" inside Amazon's UK warehouse. This means that Amazon don't
actually store copies of my book in any way other than on a fileserver. If
you ordered today, for delivery tomorrow, it would be printed in-house
on-demand. THIS is the key technology piece, by the way, that has
transformed the backend of publishing for nice products.
- AND THIS IS IMPORTANT. The revenue stream to me is NOT primarily about
selling books. It's about the consultancy work and training courses I run,
for which my book has been instrumental in establishing credibility and
getting clients. (It's, as I've said before, very, very, niche.)
However, the price at which I choose to have my publisher sell the book is
entirely down to me. I have a cost price per print, but could, if I wanted,
set a sale price of one penny above the cost price.... if I believed that
I also sell my book as a (non-DRM) PDF, from my website. I price that PDF to
maximise my profit.
It turns out that the price point that does that is about DOUBLE the price
of the paperback version the same customer could get from Amazon. The
difference is - they get the PDF by return email, the moment Paypal's
servers confirm payment to mine (which is, in round terms, in real time as
far as the customer is concerned.)
As you might imagine, the website to do this (which runs on DAPPER, which
gives you an idea of how long that server has been sitting there!) costs me,
in round terms NOTHING. It has been up and running for several years, and
sits on my home ADSL line (which has a static IP block, so I guess I do pay
a bit more for my ADSL than a standard contract would be.) It runs on a
Via-500 box, so equivalent to a Celeron 500, with an old hard disk.
Here is where things get truly bizarre. I sell about twice as many ebook
copies as I do paper copies, despite the difference in price...
... arguably, I sell more BECAUSE of the difference in price. The big cost
is in AdWords. Yes, marketing is about 90% of the ongoing budget, with the
"production costs" having been paid off about three years ago. The other 10%
is a rough and ready allowance for the marginal cost of my book-keeper
importing the transactions into our accounts software :-)
So, why did I insist on zero-DRM.
1: Because I don't like DRM. I think that the e-version of something should
be BETTER than the physical.
2: Because of how I make my money... it's not about book sales, it's about
spin-off business that that generates. This is increasingly true for fiction
authors as well, where book-signing and conference-slot fees can be big, if
you can write a best-seller. It's ALWAYS been true for non-fiction, as far
as I can tell.
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