Expert publishing blog opinions are solely those of the blogger and not necessarily endorsed by DBW.
I was pretty sure Amazon and Hachette were in contract negotiations long before the announcement on May 9th when the New York Times broke the story. You see, on February 7th, the discounts for all my Riyria books listed on Amazon.com vanished, raising my ebooks from $8.59 – $8.89 to $9.99 and my print books from $11.41 – $13.80 to $16.00 or $17.00. What was even more disturbing, however, was the discounts on most of my fellow Orbit (the fantasy imprint of Hachette) author’s books disappeared as well. Even as I write this, I see the only paperbacks which are discounted are those in pre-release or books published in April or May. Also, the discounts are just 10% rather than the usual 25% – 30%. Even hardcover editions of front list titles such as Brian McClellan’s The Crimson Campaign (released May 6th), and James S.A. Cory’s latest book in The Expanse series (releasing June 17th) are currently full price.
The matter got worse in early March when I started seeing stocking issues. From March 9th until May 8th my wife, and business manager, was having constant emails and phone conversations with my editor, publisher, and Amazon over these issues. We were getting very mixed messages. On April 29th, during a phone call with Amazon’s Author Central, the Amazon representative indicated they had more than a dozen purchase orders placed from April 21st – 24th which had not yet shipped. At that time, Hachette was indicating ship dates of May 2nd – May 10th. Hachette has continually assured us all orders were shipping “in a timely manner” and Amazon was to blame for placing small orders. We’ve asked for copies of the purchase orders and confirmation of the shipment dates from my publisher but have been told, “It is not information we would like to be shared with any third party at the current time.” Hachette would be foolish to delay orders while simultaneously accusing Amazon of doing exactly that, but perhaps their definition of “in a timely manner” is not the same as it was before the dispute.
On May 7th I started alerting fellow Orbit authors about these issues. It didn’t take long for their agents to make their own inquiries. In an email sent to my wife on May 8th Orbit mentioned my communication with other authors and my frustrated wife responded with, “I have reached out to a few fellow Orbit authors, but I can’t help but wonder why you haven’t? … Do you plan on telling them now?” The next day, the news broke in the New York Times, and emails went out to all Hachette authors.
So how has this affected me as a Hachette author? Well, it’s difficult to know precisely as we only get royalty reports twice a year, and the royalties for January through June won’t arrive until October 2014. But Nielsen’s Bookscan system captures about 65% – 75% of the point-of-purchase print sales, including those bought at most bricks-and-mortar stores and the big online retailers like Amazon and BandN.com. From this data I’ve seen my print book sales drop to 54.8% of what they were before this all started. There could be many reasons for this, but I’m concerned the higher price of my books, and the lack of their availability, has led many fantasy readers to opt for a book from other authors that were cheaper and easier to get. It also seems to indicate a good portion of my particular readership buys print books from Amazon, as listings at other sites remained unchanged.
Impact to ebook sales (due to lack of discounting) is harder to judge, because I only have Amazon sales rankings to go by. In early February my sales ranks were running 5,000 – 8,000, nowadays I’m seeing 10,000 – 23,000. I don’t know exactly how many lost sales that equates to, but I do know my books are further down on the various best sellers lists and higher rankings mean I’m selling fewer books.
So where does this leave me? Well first off, it has me questioning the publishing path for my next series, The First Empire, which I just finished writing. This isn’t the first time, and won’t be the last, that publishers and suppliers have clashed. I felt bad for the authors at Macmillan, Simon & Schuster, and independent publishers distributed through IPG when they experienced similar issues. For a long time I’ve been concerned that I would find myself in a similar situation. The ironic thing is my self-published books (provided through print-on-demand) have always been available. Because I’m a hybrid author I could easily shift my next set of books to self rather than traditional.
Related: Understanding Hybrid Authors
Of course many people wisely point out that Amazon may apply similar pressure to self-published titles, and I have no illusions about the long term prospect of a 70% royalty. But even if Amazon cuts the self-publishing royalty rate in half, they would still be paying twice as much as I get under the current Hachette contract where ebook royalties are split 30% to Amazon, 52.5% to the publisher, and 17.5% to the author.
What do I think should happen? Well first off, publishers have to realize that getting $3 for every $1 that an author makes on ebooks just isn’t fair. Ironically, they are feeling the same pressure from Amazon that they apply to authors—requesting a higher share because they hold a strategic advantage. I’m sure both Amazon and authors look at the publisher’s 52.5% and can’t help but think more should come their way, but unlike Amazon authors are powerless. The big-five publishers are remarkably uniform in paying 25% of net on ebooks, so the author has to either accept that rate or go the route of self-publishing. If I could set the terms, I would suggest 30% to Amazon, 35% to the publishers, and 35% to the author.
What can authors do in such an environment? I suggest we each develop a direct sales channel with our readers. In my Hachette contract, I was able to negotiate the ability to sell signed copies of my print books from my website. Since I buy the books from my publisher at a discount similar to what they receive from bookstores, they get their share. I would love to sell my Hachette ebooks as well, and I would willingly pay my publisher their cut from any money I brought in. I’ve not been successful getting this provision from Hachette, but for my latest novel, Hollow World, I retained the ebook rights, so for that title I sell both ebook and print versions. The problem is readers don’t know I sell directly, but if this became more common, it would solve any disruptions when the publisher and retailer are battling.
Both Amazon and Hachette are huge multi-national, billion-dollar companies. It’s unfortunate that when they play hardball it’s the writers and readers that suffer the most. I know the stakes are high for Hachette, and all the other publishers, but no one has more risk than authors who are caught in the middle and wield no power to shift royalties toward us. At the end of the day, it’s the big boys that will get the lion’s share and we’ll have to be content with whatever is left over after their bickering is done. It’s a sad situation, as when it comes right down to it the only two absolutely essential people in the publishing ecosystem are the writer and the reader…the exact two that seem to be overlooked each time the titans clash.