I remember back in the "old days" of publishing when, on a yearly schedule, independent accountants from Pricewaterhouse Coopers or some similar organization would show up to audit our books, and I'd have to sit down with them to explain our largely inexplicable, industry-standard business model.
Really? they'd say. You publish x-thousand copies of a hardcover book. You ship them out to stores @ a 40% trade discount, essentially on a consignment basis. Since you are doing a consignment business, retailers can order insanely high quantities, and have you print them, without any risk on their part. On top of this, the larger chains also extort coop money from you for premium store placement. And stores can "pay" you for books that sell well with returns on the books that are dogs. Whatever units the retailers don't sell, they ship back to you and you have to eat them. And by eating them, you mean remaindering them at an astonishingly huge discount. (And by astonishingly huge, you mean often well below your original print, paper and bind cost, not even factoring in the cost of a hefty, non-refundable author royalty advance that has yet to earn out.) All of this, you say, is to avoid the storage costs and taxes for inventory that has proven to be unsaleable. Then you publish a paperback edition of the same book, and ship the paperback out to stores on the same terms as before. In turn, the paperback competes with the hardcover edition, the latter now to be found on remainder shelves just across the aisle, the hardcover priced well below the paperback. Have we got that right? Oh, and one more thing, you license book-club rights to Book of the Month Club or the Literary Guild, who print their own copies, sell [or sometimes even give] the books to their members, pay you a 10% royalty on heavily discounted member prices, and - like you - remainder whatever they don't sell?
Yup. Ever since Dick Simon (Carly's dad) invented the model, that's basically been the approach.
How do you make money? they'd ask, scratching their heads.
Here is where it got embarrassing. My response:
We publish a ton of books, knowing that only a few of them will "earn-out" their advance and sell in significant enough quantities to assure a strong profit for the firm, thus keeping us in the black. Our star authors are, of course, stars. We know we can safely promote them with everything we've got; and we do. As regards the rest of what we issue, we can tell fairly early on in the sales-cycle which books are catching on, and which aren't. So we throw our publicity and advertising resources behind whatever seems to be "sticking to the wall" (as the saying goes), and leave everything else to "wither on the vine" (as the saying goes). (Mixing metaphors is a hobby of mine, btw.) Concurrent with this, we also don't pay our staff very well. We rely on the cachet of "New York publishing" to be so enticing as to inspire highly literate college grads to live with two roommates in a small loft on the wrong end of Greenwich Village, eat on the cheap and carry food back to their ghetto digs every Sunday night from their parents' swanky home in Larchmont. Some of these kids figure things out pretty quick, quit, and go to med school. The rest stay, learn from their elders, move up the ranks, and hope to become the next Bob Giroux.
I recall back in 1981 Tom McCormick (then president of St. Martin's Press) telling me frankly that the bestsellers written by Yorkshire veterinarian James Herriot (All Creatures Great and Small) paid the rent on our offices in the Flatiron Building, and all our salaries. The rest of the publishing program tended to be "break-even" stuff at best, with the occasional "upside surprise," without which there wouldn't be a Christmas party. (He actually didn't add the quip about the Christmas party; that line is mine. Tom would have never canceled the Christmas party; it was one of the few times of year when the editorial assistants actually got to eat real food and drink any beer other than Black Label.)
As everyone knows, the dawn of new technologies - especially online shopping, eBooks and print-on-demand (POD) paper books - along with the correlative evolution in reader buying habits, have dramatically changed the publishing landscape in ways those who cling desperately to the old publishing paradigm [see above] find frightening.
Traditional bookstores are for the most part bust. The very last of the last indies find themselves on life-support, and even behemoth Barnes & Noble struggles. Go into any B&N today and you'll find a third of the store taken up with a coffee-bar, a third of the store given over to educational toys and games along with Nook devices, about 10% of the space dedicated to CDs and DVDs, and the small balance which remains allocated to books published by big houses operating on the traditional model. (And this is space still to this day bought with generous grants of coop money - the only model by which B&N can make its brick-and-mortar locations profitable.) At the same time, the Literary Guild is history; and BOMC/Bookspan is about to move to Oregon because of that state's liberal assisted-suicide laws for terminal cases.
For those authors published traditionally who are not Stephen King, Scott Turow or Danielle Steele - so-called midlist authors - the net result has been staggeringly slashed royalty advances and even less corporate publicity and advertising effort than before. For authors who do not bring their own well-developed brand to the table, the prospects in the traditional publishing realm are increasingly grim. There is only so much room on those few shelves at B&N; and both B&N and trad publishers are focused on making those shelves as profitable as possible. Blockbusters rule. There's no place here for the midlist writer.
Of course, it is solely due to the steady contraction of the "Big Five" publishers in the face of new digitally-driven competition that the midlist author finds him- or herself squeezed out of the traditional process, even though there is still spare change to be had from major houses for books by authors who are not names. (After all, a publisher has got to have a list, right? And there just aren't enough celebrities to go around. That's why, right at this moment as I type, scores of underpaid editorial assistants [this is the kind of assignment one gives to an underpaid editorial assistant] are fielding phone calls from horrified first-time novelists who can't understand why their newly published book - the culmination of years of heartfelt, dedicated effort - can't be found anywhere, not even in their own local B&N, and hasn't received attention from any major media. They have not yet realized that, so far as trad publishers are concerned, they and their books are window-dressing, and nothing more.)
But be of good cheer. The new technologies which have caused the great contraction in trad publishing are actually very good news for the typical midlist author. We now have an environment in which small upstart digital-native publishing firms (such as my own New Street) and indie authors find liberation. Cost of entry for small publishers, and for authors who wish to self-publish, has never been lower. The most important retail shelves (online shelves) are open to all. eBooks are cheaply produced and easily distributed. POD technologies allow for paper delivery of content without inventory issues. The book is sold before it is manufactured, and distribution is readily available in all the world's most important content markets.
That's the key word. Content. Content is king, and content (excellent content) is the one and only true value.
I find it weirdly entertaining to watch organizations such as the Authors Guild and Authors United rail against the very existence of the new publishing paradigm as embodied, specifically, by Amazon. (Joe Konrath's essay on this topic = "must" reading.) These organizations - their governing bodies dominated by established brand-name authors long-married to the trad publishing model - purport to represent the interests of all authors as a broad class. But they don't. They represent the interests of the 1% at the top of the heap.
For all the rest, the fact is that the new publishing landscape provides fertile ground just waiting for them to stake their claim. All you non-Scott Turows out there: Seize the day, either by self-publishing or by partnering with one of the many new digital-native entrepreneurs looking to strenuously publish first-rate material on fair terms - publishers whose profitability depends not on the occasional blockbuster, but on content of real value published respectfully and aggressively, each book as important as the next, and no midlist.
Art copyright The New Yorker.
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