The Principle of Digital Abundance – thoughts on author earnings

Hugh Howey has caused a brand new stir in the writing and publishing world with the Author Earnings report. If you don’t know, Howey is one of the most significant breakout “indie authors” of recent years. Now he’s disrupting the industry in a much more direct way with Author Earnings. Both Amazon and the Big 5 publishers are obscure about ebook sales. Author Earnings jumps through a few hoops (which no doubt data analysts will pick apart) to arrive at some…interesting…ebook sales figures for the Kindle platform.

Traditional authors being screwed by their publishers.

First, let’s be clear. This data is pretty shonky. There’s no real way to tell how accurate it is. But, in the absence of transparency from the industry itself (either Amazon of the Big 5) it’s the best data we writers have access to. And the story it tells is shocking. Many people like myself who have closely observed the rise of the indie revolution in ebooks suspected this story, but it’s never been so starkly drawn as in this report’s bar graphs and pie charts.

The headline of the Author Earnings report should be something like “INDIE AUTHORS BEATING MAJOR PUBLISHERS BLOODY IN GENRE E-BOOK SALES” with the sub-heading “Traditional authors being screwed by their publishers.” That’s the story Howey sketches out, with some illuminating stats in support. 39% of daily unit sales in ebook genre bestsellers are indie published. THIRTY FUCKING NINE PERCENT. Before ebooks and Kindle, that figure for books as a whole would have been effectively 0%. If you had told any professional in publishing that 39% of any of its markets would be taken over by self-published writers, they would have laughed at you. Can you imagine if TESCO and Sainsbury’s (UK supermarket chains) lost 39% of their market share to people selling groceries from a table at the end of their garden? That is effectively what has happened to publishers in ebooks. Even more revealing, statistics suggest that publishers make twice as much on every ebook sold than the author does. Maybe publishers merit that level of renumeration. But the growing numbers of writers choosing the indie publishing route suggests that many writers don’t feel that is the case.

I do part company with Howey’s interpretation of the Author Earnings data in many places. Most significantly, I think Howey is guilty of wishful thinking in his narrative for why ebook sales are so strong in the established commercial genres like Mystery and Sci-Fi.

“What this chart shows is that indie and small-publisher titles dominate the bestselling genres on Amazon. We can clearly see that the demand from readers for more of these works is not being fully met by traditional publishing. Among the advice given to aspiring writers, you’ll often hear: “Write in the correct genre.” And here we see the sales-potential of that advice.”

via The Report – Author Earnings.

Howey believes that there is a vast demand for these genres among readers. And while I’m certainly not questioning the popularity of genre fiction, I think this is a simplistic mis-reading of the real changes afoot in ebooks.

What I believe is happening is better explained by the “principle of digital abundance“. When you take a physical product – a book for instance – and make it digital, you fundamentally change the economics of that product. Physical books are scarce. Even in the era of mass-paperbacks, their availability is limited. Digital books are abundant. They are unlimited. And the economics of abundance simply does not play by the same rules as the economics of scarcity.

The potential readership of ebooks is also abundant. Not unlimited, but in such large numbers it can almost be considered as such. Ebooks sell through smartphones and tablets, computers and the internet. Integrating ebooks in to the digital marketplaces of Amazon, Apple and Google has made them a mass consumer item in a way they simply weren’t through bookshops. And the lower prices of ebooks at £1-£3 makes them impulse buys. Pull this together and you have a vastly increased book buying public measured, not in millions, but billions of people. The digital market for ebooks is a massive boomtown. And it’s also something of a jungle, that magnifies the commercial pressures of the pre-existing print market.

Genres work as a marketing tool in print because they hook buyers who aren’t experts on books. This effect is vastly magnified in ebooks because so much of the expanded audience are only occasional readers. They’re people browsing the Amazon store on their iPad and impulse purchasing, not just books but many things. “oh a book about Atlantis for 99p…buy!” And with literally billions of people doing this, it’s hardly surprising that a lot of writers as selling a lot of books. What’s notable about the books that sell in digital markets isn’t so much genre as …bluntness. These are books that “do what it says on the tin”. And the tin is very clearly labelled. The inexpert approach of indie writers is actually a massive advantage to the current wave succeeding with ebooks, because they see this market much as their inexpert readers do, and write books to suit.

As the ebook market matures, it will have to steadily rise in quality or collapse.

Ebooks are currently a very immature marketplace. And another untold story from Hugh Howey’s report is that it might also be a very short lived one, unless it can tackle its quality control crisis. Howey’s explanation for the high demand for genre books suggests a huge number of very satisfied readers finally getting the books they had hungered for. My alternate explanation suggests a lot of new, inexperienced readers in a marketplace flooded with shoddily written, knock-offs of better books, churned out at a ridiculous speed by writers with little skill or insight to share. What Chuck Wendig calls the “Shit Volcano” of self-publishing. We’re in a phase where contributing to the “Shit Volcano” can make you some cash. It would be very naive to interpret this data as meaning that will always be the case. As the ebook market matures, it will have to steadily rise in quality or collapse. If the Author Earnings report data isn’t all solid fact, the need for quality certainly is.

Published by Damien Walter

Writer and storyteller. Contributor to The Guardian, Independent, BBC, Wired, Buzzfeed and Aeon magazine. Special forces librarian (retired). Teaches the Rhetoric of Story to over 35,000 students worldwide.

15 thoughts on “The Principle of Digital Abundance – thoughts on author earnings

  1. Never have I thought to divide the world into “expert” and “inexpert” readers. If I must be put in a category, I hope to always be an “inexpert” reader. The other one sounds boring.


  2. Reblogged this on Johann Thorsson and commented:
    Your required reading of the day. Damien Walter’s analysis of Hugh Howey’s Author Earnings report (which you will want to read as well).
    There are certainly reasons to be optimistic about self-publishing, but will it last?


  3. Quality is key, but what’s missing here is a discussion of freelance editing. What you should think as an editor in looking at that data is that self – published authors are an under served market.

    Same if you’re a cover artist. Or an agent.

    Savvy writers will realize that with a revenue stream, perhaps from a back catalog or break out success, they can afford to hire a good editor. Or cover artist, proofreader, etc. And that each stage of textual polishing adds value and correspondingly sales to thier future revenue streams.

    A good agent will realize there’s a market to connect promising authors with promising editors, proofreaders, cover artists etc. and figure out contract vehicles other than fee up front for those services.

    The revenue stream has fundamentally changed, and eventually all the value added services in the publishing industry will need to figure out how to tap into that revenue stream.


  4. Very insightful. A lot of people are not looking/thinking beyond the headline in the Author Earnings Report story – there are many other factors at play than evil publishers and heroic self-publishing authors. The nature of the book product has changed. The production cycle and costs have changed. The means of distribution has changed. The pricing model has changed and even the customer has changed drastically from the traditional publishing model. All of these factors need to be taken in to account before drawing conclusions about the future of self-published ebooks.



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