It’s official, last week e-book sales surpassed those of paper based books for the first time.

The Financial Times (April 15, 2011 by Andrew Edgecliffe-Johnson) reported that in February 2011, e-books sales tripled reaching $90.3 million compared with adult paperback book sales of $81.2 million. That means 9.1 million more e-books were sold than paper back books.

The numbers also showed that in January and February, e-book sales increased 169% compared with a decrease of 24.8% in paper based book sales.

The trend looks firmly entrenched especially given the ever increasing types of devices that readers can now use to view e-books including new tablets as well as the Kindle, Nook and others. RIM just announced a new tablet to compete with the iPad and a Sony tablet.

These changes will ripple throughout the publishing industry and all book related organizations. Even libraries are struggling to keep up. My library just sold off their entire CD collection in a move to digital. One wonders if books are next and if so, how will libraries transform?

Any change is sure to be gradual. One road block is that Amazon allows only limited sharing of books on the Kindle. Thus libraries can’t share books for the Kindle currently.

Even if books are eventually primarily digital, I think libraries will survive because they are so much more than book lenders. My library, like many others, is a community hub. Students meet with tutors, citizens come to hear lectures by authors or attend computer training classes, or teens just hang out.

For authors these are roller coaster times. The challenge is to adapt to e-books. Yet still profit. Perhaps e-books can even improve profit for authors. Perhaps authors will simply be lost in a tsunami of content. It seems too early to tell. The exciting part is to be in early on change and hopefully to shape change into a helpful, rather than mischievous sprite.

If you earn money (or try to) as a freelance writer or blogger you may be frustrated by the generally low pay or even total lack of pay. Often writers are told, “You’re just starting out. This is an opportunity to get your name out there,” or “You’re building your platform.” However, the promised pay day never comes- there is no golden pot after months or years of toiling away. If you feel this way you’re not alone. And some of these writers and bloggers are now saying enough is enough and fighting the system.

Here are two news stories where writers are raising awareness of the pay (or lack of it):

http://news.yahoo.com/s/ap/20110412/ap_on_hi_te/us_aol_lawsuit

http://yhoo.it/h1z5jx

In the first link, a former Huffington Post blogger is suing the company for pay following the large amount reaped by the company in it’s recent sale. In the second link, a freelance writer started her own company to subcontract out writers at better pay.

If you want to be a professional (career) writer, pay is a must (being part of the base definition). Even the IRS distinguishes professionals from hobbyists by whether they are paid or at least attempt to find paying work. If you intend to write without pay, not only don’t you collect a paycheck to cover the bills but you won’t be able to take tax deductions either since you will be considered to be engaging in a hobby (ie: just messing around for fun).

Yikes! It’s been awhile since I have been able to post, nose to grindstone and all that. Here we are nearly at the end of winter. It’s been a real New England winter this year. Snow so high my mailbox was nearly buried. We may be at the end of it now. Today it’s pouring rain and found myself early in the morning mucking about in boots and a Gortex parka, sloshing through slush and mud to let the water company guy check the meter. He said, “It’s really coming down.” I nearly answered, “Ahyup.” But being in a weird bit of New England that glows with the silver glitz of New York City shining on the horizon, I bit that back and just said, “Sure is.”

I found a great blog post on how rampant e-book theft is. This is a serious concern since e-books are the biggest growth area in publishing. It seems to me that all creative entertainment types need to band together and figure out a way forward (from music to movies to written-word story-tellers- can’t call us book authors much longer, I guess). I’ve been studying up on Intellectual Property law for my other project (working on technology transfer). Copyright law is both robust (anyone qualifies who has created a unique, creative work, no need to actually apply for anything) and weak (it takes money and time to enforce and how many creative types have either of these to spare?) It seems to me that greater protection needs to be worked out somehow so that creators can be fairly compensated for their work. Otherwise, the whole sandcastle crumbles. How many of us can afford to devote our days and nights to work for free for our muse? Sadly, muses don’t pay mortgages or grocery bills and royal patrons have been few and far between for the last several hundred years.

Take a look at this blog for another writer’s take on e-book theft: http://ow.ly/44g9g

Enjoy!

Yes, it’s that time of year again…Banned Books Week. The Net is full of festivities. For example, visit the American Library Association for information, activities and souvenirs. http://www.ala.org/ala/issuesadvocacy/banned/bannedbooksweek/index.cfm

However, as a recent Wall St. Journal article reveals, banned books may be the least of our worries. With the slow dissolution of the current system for bringing worthy novels and books to the public’s notice, there may be few books to ban. Books will join the maelstrom of “news”. There is now so much “news” with much of it of dubious origin and veracity that one is overwhelmed and in the end pays little attention to most of it. With the upsurge of e-books, novels and non-fiction are headed in a similar direction. E-books allow for a huge quantity of books (even those posted directly by authors), however, many are likely to be unvetted by professionals and of unknown quality. Even for e-books of excellent quality, breaking through the noise of all these newly available books will be extraordinarily difficult.

That’s the initial view. In the long run, many authors may rethink their dedication to story-crafting when they realize the rewards may be slim to none. According to the WSJ, e-books offer authors half or less of the money they make from hardcover books. At a revenue of only a couple dollars per e-book, with sales of debut authors being only a few thousand copies, it’s easy to see that devoting a few years (say 5,000 to 10,000 hours) to crafting a great story could easily yield anywhere from a dollar or so to pennies on the hour. Federal minimum wage is $7.25 per hour so one can see writing, for debut or lesser known authors, could easily fall far below minimum wage.

The best solution is for authors to continue to press for fair prices for their work. Other more inventive solutions include moving to a low cost of living country or, sadly, ceasing to write. There’s the rub- with low wages, all books could essentially become banned as writers can no longer afford to write.

Not long ago I posted a summary of comments on the cost of book production by Lee Child.

Here’s another source showing how little it actually costs to produce a physical paper-based book (just in terms of printing).

“Printing a 9-by-9-inch, 334-page hardcover book in China costs about 44 to 45 cents now, with another 3 cents for shipping, says Goodwin. The same book costs 65 to 68 cents to make in the U.S.” He goes on to explain that US printing obviates the need for an additional 30 days of shipping time- plus the extra 3 cents cost.

http://news.yahoo.com/s/ap/20100708/ap_on_bi_ge/as_china_cheap_no_more

Thus, the cheapest cost for China is 47 cents versus the most expensive cost for the US 68 cents. Will an extra 50 to 70 cents more or less  prevent anyone from buying a paper book (over say an e-book version)? Because that ‘s the real cost difference unless vendors artificially lower e-book prices by cutting pay for writers or publishers or sell at a loss to themselves. In fact, the difference is likely even less because there is still a cost for programming to develop and maintain software allowing e-books to be uploaded and viewed.

These numbers further demonstrate that most of the cost of a book is content development (ie: the writer sitting in the chair fingers to keyboard for months or years and the editor polishing the text up) plus some marketing/sales costs so that readers can find and obtain a copy of a new book and don’t have to hunt the Internet for obscure web sites to buy a poorly or non-promoted book. Thus, most costs do not change regardless of whether the book is delivered in electronic or print format.

E-books are a great option, but keep the price honest.

I just love my local library. Our librarians put together a fantastic slate of authors every year. This year, they wrapped up the lectures with a bang by inviting Lee Child to speak. The substantial auditorium was jam packed, spilling out into the hall, so clearly our librarians made a good choice.

He was witty during his lecture about his publishing career. During the numerous questions, of which I’m sure he’d heard a few many times, he came across as honest and patient, giving thoughtful answers.

One topic that interested me considerably was e-books. The publishing industry has been in an uproar over e-books for the past couple years. Lee Child gave the clearest answer I’ve heard yet about what price e-books should have and why. First, he said consider that his standard hardcover sells for about $28. The cost of printing and shipping the hardcover is about $5. That means the value of the story (content only) is about $23 for those receiving it first (hardcovers come before paperbacks if there are paperbacks).The $23 covers the cost of all the publishing staff (editors, marketers, etc) plus the very important author- everyone who helped create the story and make it visible to it’s audience (I’m adding this bit, Lee Child didn’t go into this detail).

E-books, contrary to popular perception Mr Child said, do have a cost for creation and delivery. After all, someone had to create the computer program used to format and deliver the book. Estimate that cost at $1 per book. That means the e-book cost is $23 + $1= $24 (or the cost of the story plus the electronic formatting and delivery). Obviously at the much bandied price point of $9.99, someone is losing money.

There were many questions about Reacher, but I’m not going to go into all of them here. I do recommend that if you have a chance to hear Lee Child speak, you should take it.

The agency model for e-books is out of the gates and off and running as of yesterday. As many expected, there have been some bumps in the road. Some publishers are still working with Amazon. This is all to be expected given how quickly deals had to be put together.

My main concern is communication with customers. This morning I checked the Amazon Kindle blog and noticed a number of customers complaining about the price changes. Some felt that publishers were price-gouging, getting more because they could, etc. To quote one customer “I’m really tired of these publishers jerking me around. Ebooks are almost pure profit since they don’t have to pay anyone to print or ship…”

Very few customers posting recognized or understood that authors need to be paid fairly for their work. The focus was heavily on publishers and lawyers writing up contracts as well as the low costs of producing an e-book versus printing. The truth is that without authors sitting in a chair, fingers to keyboard for months or even years, pouring their heart and imagination out onto their hard drives, there would be no e-books (or any other form of books). The truth is that like other products (cars, jewelry, clothing) some products may have a higher intrinsic value than others.

I believe most people are willing to pay fairly for what they buy when they understand the value of what they’re buying. Few expect to buy a shiny new BMW car for the same price as a Kia.

Of course, why should readers realize or understand the monumental effort that goes into writing a book unless authors, publishers, agents and others in the community engage them in conversation? We are not explaining our side of the story. We’re letting Amazon and others put their side of the story out leaving readers feeling confused.

Yes, e-books are cheaper to produce. But they are part of the set of products an authors produces. In fact, an ever greater part. The pay (or salary, if you will) that an author receives in exchange for sitting at their computer for months and years is based on what all these products (e-books, hardcover, paperback, etc) earn. Artificially lowering the price of e-books to “one low price fits all” means that no matter how hard an author works, no matter how good they are in crafting a story, they’ll earn the same base amount.

Naturally, Amazon and other companies that make the hardware needed to read e-books want low priced content. They want to sell their hardware (e-book readers) for as much as they can. In order to do that, they need to offer customers a carrot. The carrot is low cost content. Their pitch to customers is, “yes, you’ll pay hundreds of dollars for this reader but after that you’ll hardly pay anything at all for using the device.” Fair valued-content brings up the total cost proposition of owning the e-reader. Some customers may then want to pay less for the reader.

E-readers and e-books need each other. Like any relationship, there are ups and downs as well as power-struggles. I believe the agency model is basically fair to both sides. Readers also win because they will keep getting fantastic stories to read in any format they like (print books or e-books).

A good marketer always wants to know the competition. For aspiring authors, how much competition is there? The numbers are closely held and hard to pin down. However, I decided to take a stab at it.

In 2004, one source gives the number of books published in the U.S. as 190,000. For 2006, another source (citing BEA statistics) gives the number of books published in the U.S. as 172,000. Sounds like stiff competition so far, right? In fact, out of the 172,000 books, 93% sell fewer than 1,000 copies. A successful book should sell at least 5,000 copies to earn out a modest advance.

More recently another source indicates that in 2007, about 62,000 fiction books were published. This seems to suggest that more than half the earlier totals were mostly nonfiction with some other categories.

The numbers suggest that the number of books published by traditional publishers probably hasn’t changed much or has even declined in the past 6 years.

Self-published books count for a large number of total books published. They haven’t been included in the above numbers, but offer some competition. Lulu claims it publishes 4,000 books a week, which comes to an astounding 208,000 books a year! That’s just for one self-publisher. The vast majority of self-published books only sell a hundred or two hundred copies to the author’s friends and family. For fiction, self-publishing is useful if all you want to do is see your name in print. Most people shouldn’t consider it a money making venture since self-publishing costs anywhere from $5,000 to $25,000 and up.

For more on self-publishing challenges, see http://reviews.cnet.com/self-publishing/

For new authors, these are sobering facts. I have seen estimates that between 700 and 1,000 people in the U.S. make their living as novelists. Some will write more than one novel per year. Let’s assume that 1,500 novels each year come from full-time novelists. That leaves 60,500 novels to be written by those not making their living as novelists. This is good news in that it means there’s some chance to break into the field. But not so good in terms of earnings or a long term career.

So where to go from here? I highly recommend any aspiring novelist join a writer’s association to learn about the industry. Also, think deeply on your writing goals.

After reading about the iPad for several weeks and (finally) watching the Apple demo, I can see that it doesn’t quite match my lofty expectations. It is a cool, new twist on a computer or iPhone (or something half-way in between really). As a multi-media device, it would be fun to play with.

My focus though was how is it as an e-book reader.  Here I believe the iPad doesn’t quite make it. The most glaring lack is that the screen is a standard type computer screen. As such, it’s subject to glare and hard on the eyes. It definitely doesn’t replicate reading on paper. The e-ink screen appears to me to better simulate the reading experience. Although of course it doesn’t yet provide color.

The other drawback I see is that the iPad appears delicate. Is this device going to survive being stuffed into a loaded backpack? What if it’s lying on your table and your kid comes home and dumps a pile of books on top of it? Or you’re reading it at the kitchen table when your spouse spills a cup of coffee? For now, my newspaper or paperback can survive all these scenarios (with a few dabs with a towel or blasts with a hair dryer after the coffee) better and it’s much, much cheaper.

Sorry Apple, I’m holding out for now. But thanks for working with the publishing houses to provide realistic pricing models on e-books.

Amazon’s recent anti-author stance is distressing. What they are saying in effect is “we think every author’s book is worth the same low price no matter how good it is.”

Well, here’s how they actually phrase it: “…we will want to offer them to you even at prices we believe are needlessly high for e-books. Amazon customers will at that point decide for themselves whether they believe it’s reasonable to pay $14.99 for a bestselling e-book”

Note the adjective bestselling. So for example if you want a “bestselling” or in other words desirable, luxury or similar descriptive, would you expect to pay the same as for an general, run of the mill car, diamond ring, etc. In other words, should a Tiffany diamond ring cost the same as a Zale’s diamond ring? Should a Mercedes cost the same as a Kia? Should a top brand author’s books be the same price as all other authors?

If Amazon wants to start selling all products for the same price regardless of brand, I’ll be the first one in line for the Apple MacBook Air at the same price as the Dell Inspiron. In fact, I’ll take three.