Expert publishing blog opinions are solely those of the blogger and not necessarily endorsed by DBW.
One of the most confusing things to me about the Amazon-Hachette contract dispute saga is why do so many indie authors want so passionately for Hachette, a competitor, to lower its prices?
Isn’t it against their self-interest?
Don’t indie authors, who generally price their books lower than traditionally published books are priced, benefit from a positive price comparison?
If big publishers reduced their prices sharply, the key marketing distinction that fostered the discovery of such writers as Amanda Hocking and John Locke would be eliminated. On the comment stream of a blogpost I read on this subject (can’t find it so can’t link it), one person posted a string of suggestions for major publisher survival strategies that included “cut all your prices to $2.99.” Why? Because it would eliminate all the competition from the self-published riff-raff that is using price as a marketing tool. So not only would the publishers and branded authors make less money, the aspirants would find their path to success cut off as well.
(This suggestion actually makes the point that self-publishers who scream “big publishers are stupid and they should cut their prices like us” should be very careful what they wish for.)
He repeats the sentiment in a blog post from this past weekend:
One other aspect of this whole discussion which is mystifying (or revealing) is Amazon’s success getting indie authors to cheer them on as they pound the publishers to lower prices. (The new Amazon statement is made in a letter sent to KDP authors.) This is absolutely indisputably against the interests of the self-published authors themselves, who are much better off if the branded books have higher prices and leave the lower price tiers to them.
Mark Coker, the CEO of Smashwords, one of the largest distributors of self-published ebooks in the world, said as much recently, too.
The idea behind the argument is that if I see a book by a big-publisher author I don’t know in a genre I like for $12.99 and see another book, perhaps self-published, by another author I don’t know in a genre I like for $4.99, I may decide to buy the $4.99 book instead because of the price difference. If that big publisher book were instead priced at $4.99 or somewhere near there, I’m just as likely to choose that book as the other — based on price. This makes sense to me.
Yet — and this is what I’m confused about — prominent self-published authors like Hugh Howey, J.A. Konrath, Barry Eisler and so many others (just read the comments on this popular indie author blog) have consistently argued that Hachette should give in to Amazon’s demands and lower its ebook prices.
(Let’s also not forget that indie authors and, indeed, all of Hachette’s competitors — other publishers, too — benefit in the short term from the dispute between Amazon and Hachette. Lost Hachette sales could go to indie authors or other publishers, especially for genre fiction books that may seem similar to readers outside of price.)
I’ve reached out to some of these folks to see if they can tell me why they want one of their competitors to lower its prices. Apologies to them and to you, readers, if I’ve missed where they’ve already written it up. (So far, I haven’t heard back. If I do, I will let you know and update this post.*)
Eisler, however, recently blogged about this. I don’t quite buy his argument (below) but it’s the only one I’ve heard that makes any sense, so, here it is:
It’s certainly possible that high legacy prices create an opportunity for indie authors to sell their books for less. But there is another possibility — that more readers will spend more money on all books overall if more individual books cost less.
To put it another way: if I had a choice between selling my books at $5.00 into a market where all other books were priced at $15.00, on the one hand, and selling my books at $5.00 into a market where all other books were priced at $5.00, on the other hand, I would prefer the second market because it would be so much bigger.
One other way of looking at it: among people who go into a bookstore thinking to buy one $20 hardback, and discover the store is having a three-for-the-price-of-two sale, how many wind up spending $40 and leaving with three books?
The point is, you can grow a market with low prices in such a way that individual sellers make more money in the bigger low-price market than they would have made undercutting prices in the smaller, high-priced market. When perceived value goes up, consumers spend more money. The market thereby grows, and individual sellers, even if the percentage of their slice of that market remains constant, make more money.
I’ve done no empirical studies on the book market and have only my own experience in the world as a guide (and my own pricing experiments with my own books). So I could be wrong about the book market generally — but as a matter of logic, it seems a mistake to to treat as an axiom the assumption that lower across-the-board book prices must necessarily hurt indie authors’ bottom lines.
Among his compatriots, Eisler, in my opinion, has consistently offered the most sober-minded thoughts, even if I don’t agree with them.
While I don’t buy this argument and haven’t seen any others, I’m always willing to admit where I was wrong. What do you think? Should indie authors want Hachette to lower its prices? If so, why?
If you’ve seen good arguments about this elsewhere, please let me know.
* Hugh Howey has posted on his blog in response to my question to him. His argument is essentially that he is selflessly advocating benefits for all authors and that to question such a motivation makes me “weird” and that I have a “sad” way of looking at the world. Well, questioning people’s motivations, especially when they say they’re altruistic, is basic journalism. When someone claims they’re doing something only for someone else, that’s the best time to question them. It’s basic critical thinking. Also, I really don’t buy the selfless argument here. I think the real reasons are probably a lot deeper. Here’s just one basic argument that I like a lot better that probably applies better to Howey than many other indie authors: If indie authors are able to get companies like Hachette to change their practices in terms of how they relate to authors, then if Howey were to be picked up by one of them, he would benefit from that change (this of course doesn’t necessarily apply to ebook pricing, unless you believe that lower prices for ebooks would make Hachette authors more money; it’s much more applicable to something like author royalties on ebooks or contract terms). I’m not sure this follows logically, but it rings a lot truer than Howey’s “don’t question my motivations” nonsense.