A Google Settlement I Could Support

September 28th, 2009

So, the original Google Settlement is dead, dead (spell that D-O-J: dead). As frequent readers of this blog may remember, I wasn’t too enthused about it, and I won’t be grieving.

I do, however, hope that some version does come to fruition. I think it has the potential to make enormous sums for most small and micro-presses, and to keep authors’ work alive for a far longer time.

It might even help reverse the steady decline in book reading that has afflicted this country.

What would I like to see in that agreement?

1. Compensation for the infringements to date going not to rightsholders, but to the formation of the rights registry. The proposed compensation in the old agreement was so small per title as to be utterly useless, but in the aggregate, it could move many mountains. That registry could benefit all of us in much larger ways, and forcing Google to pay for it will ensure that no other corporate behemoth gets the idea that they can infringe with impunity.

Part of the cost of establishing this registry would include widespread advertising in the US and elsewhere covering how the works can be claimed, or registered if not yet scanned, and where. It should also be possible to try to port the LOC rightsholder database over to the new registry.

2. All non-search uses on an opt-in basis ONLY during the life of copyright. This is critical, because anything less eviscerates all of copyright. It’s a precedent we cannot allow.

3. Search results displaying a reasonable amount (half a page? A whole page?) on an opt-out basis for all book length works. This is an exact parallel to web search (which has already been tested and found to be fair use), and is critical to growing our knowledge base. To do this, Google will get the right to scan anything not excluded by the rights holder. Google can monetize this with ad display, as is currently done for web sites.

4. Opt-in only licensing to libraries. A reasonable split would pro rate the licensing fees by the length of the file covering each work, payable to all rights holders as long as the work is in copyright.

5. Opt-in only licensing of the right to sell ebook, POD and other versions of the works in the database. I liked the 65/35 split between Google and the rights-holders. It seems reasonable.

So where do those enormous sums come in?

6. Every time someone clicks on a book search link, the page should include a free ad for the book. And if the book is available through their site or a major on-line source, it should include links to those sellers. Affiliate links, perhaps, so that Google gets a commission, but links nonetheless. I suspect that this will greatly increase book sales, especially for small presses and self-published authors.

I’m sure I missed some important points. What would you like to add?

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Marion’s Rules of Publishing

September 25th, 2009

This isn’t complete, and I’ll try to keep adding to them, but here are a few of my favorite rules:

1. You may get what you pay for, but you rarely get much more.
Great, cheap alternatives usually have a catch.

2. Crunch your numbers.
If you’re making a decision that can have a major impact on your results, always test the alternatives, and compare the changes in your bottom line. (If you don’t know how, read the rest of my blog, take a seminar I offer at one of the publishing conferences near you or ask a question in the comments!)

3. It depends.
You’ll hear a lot of general rules pronounced (including this list). Most of them are true for at least some circumstances. But all of them have exceptions. Look at the situation in front of you, and think it through, rather than relying upon a rule.

4. There are NO shortcuts in this business.
There are, however, a large number of very attractive routes leading to heartbreak.

4A. Those dinosaurs, the “big NYC publishers,” are run by some very smart people.
If they’re not doing something that seems simple and obvious to you, the chances are pretty good that you’re missing something.

5. Success at self-publishing is harder than getting published by a mainstream house.
(IF you define success in terms of exposure, fame or profit.)

6. I repeat: crunch your numbers!

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Estimating Sales, Part IV: Using Public Databases

September 24th, 2009

It’s important to do more than one estimate of your titles’ sales. Why? Because each set of data you use will give you a different number, and all of them will be wrong in different ways. If you average them, you get a better chance of a good prediction. Of course, if you could pick the best estimate from the bunch, you’d be closer, but which one is it? I don’t know, and you probably don’t either.

The previous 3 parts of this series dealt with the use of experience, marketing plans, and Amazon data on comparable titles to predict the sales of either that comp or of your book. Part V will discuss using sales of comps to predict sales of your title, and then combining all of the various predictions into an overall prediction of sales for your title.

This part of the series covers projecting the sales of comparable titles from other sources of data, and combining all the various projections of comparables’ sales. The best sources of data besides Amazon are Bookscan, Ingram, and perhaps the data your friends inside other publishing companies are willing to share. (That last is an old industry tradition that is fading slowly as the industry expands and changes.)

So, you have a list of carefully chosen comparable titles. They’re all from companies that are distributed in similar ways, and they all have similar marketing muscle behind them. They’re all aimed at the same audience, and are intended to fill similar needs.

Now what? Well, Ingram has the iPage facility. Use it to get a good idea of what Ingram’s volume has been for each of those comparables over the past few months or a year. Bookscan also offers good data on sales.

Ingram is, of course, the primary wholesaler to the book trade. You should know roughly what fraction of this type of book’s sales will go through them. For many trade books, it will be something like 50%, but for others, it will be much more or much less.

Bookscan records approximately 70% of the sales by general bookstores. Obviously, the publisher will be selling more to the bookstore than the store has moved out of the doors, but this is still a solid number. It may not be very helpful to you, though, if you’re doing books that don’t move through bookstores and similar retailers.

If you have those numbers for a “bookstore book,” or even for one that will sell a significant share of the total through stores, you can make a pretty good estimate of the total sales for that comparable title.

To go from the fraction that went through a channel, say Ingram, to the total sold, is simple. Divide the sales by the fraction. For example, let’s say that half of your books generally go through Ingram. And that you know your comparable title sold 1,000 copies through Ingram. Divide that 1,000 by 1/2, and you get 2,000. That’s your estimate of how many copies that comparable title sold — based upon the Ingram data.

For Bookscan, it’s only slightly more complex. You divide Bookscan’s report by .7 to arrive at the estimated bookstore sales, and then divide that result by the fraction that you expect to distribute through bookstores. That result is the Bookscan-based estimate of your comparable title’s total sales.

If you have an estimate of the sales through Amazon (from Part III), you can gross that up to an estimate of total sales for that title, by again dividing by the fraction of total sales that you expect to make through Amazon. (For trade books from a mid-sized publisher, that might be .15, for example. For niche non-fiction from a micro-publisher, that number might be as high as 75 or 80%.)

To make ANY estimate better, you can combine a number of different versions that are based upon different data sources. If you average them, you should help remove any random error. Here, you’d take all three estimates of total sales for each comp (based on Ingram, Bookscan and Amazon numbers), add them together, and divide by 3. [Yes, I know you know how to average. Just being complete.]

CAVEAT: This doesn’t always work. If Murphy is out to get you, all the errors will be in the same direction, perhaps because of some underlying and confounding variable that’s not properly understood.

My response to this issue: if my judgment says that the results don’t make sense, I either dig further to find the problem, or ignore the estimates. Do NOT, NOT EVER, ignore that little voice in your head that says something’s wrong.

Any questions out there? Come on, ‘fess up. I’m pretty sure my writing isn’t so incredibly lucid that everyone is still with me.

For that matter, does anyone have a better way?

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E-book Pricing

August 9th, 2009

We all know the basic theory for finding the right price: figure out how many your readers will buy at each price, and how much it will cost you to produce each copy at each volume, and then look for the price/volume combination that yields the greatest total margin.

We all also know that this is easier said than done for print books, even with the advent of databases like Nielsen Bookscan, but it’s practically impossible for ebooks. So far. Bookscan doesn’t measure sales for ebooks. You can’t call Ingram and get sales numbers for them, either.

And no one knows what the Amazon ranks for ebooks mean — not to mention, that those volumes for a given rank would change wildly in the future, as ebooks become more popular. So, we can’t really predict the volume for a given price.

What can we do? We can say that for certain types of books, certain price expectations are becoming common. For example, Amazon has made $9.99 the norm for a trade book currently in hardback. And the ebooks of titles currently available in mass market paperbacks tends to range between $3.99 and $6.39, with the upper end representing current and high-volume books, and the lower end representing backlist.

And yes, Virginia, there is a backlist for mmp in ebooks. Who knew that this was possible?? Of course, it wasn’t for print books, because of the economics of producing, storing, shipping and selling the physical object, but ebooks make it work.

In short, we’re going to have to fall back upon the old standard: find your books’ competitive titles, and price your book to meet that competition.

Will that offer you enough revenue to cover your costs? Or even, wonder of wonders, make a profit?? That is, indeed, the question. And what costs should you consider?

1. Royalties. Authors deserve to get an amount similar to the amount they get for the sale of a print copy, in my opinion. Not a similar rate, but a similar total. That may well mean that the rate is double or triple the royalty rate for print, given the smaller list prices. And publishers should consider setting the breakpoints so that we’re splitting the proceeds evenly with authors after our investments have been recovered.

2. Marketing: getting the message out to your readers is pretty much the same thing, whether you’re selling a print book or an ebook. Same types of people, same reasons to want the book, same selling points in the book. (Currently a smaller total pool of potential buyers, but that will change, I suspect.)

3. Plant costs (that’s publishing jargon for the fixed costs of preparing the manuscript for publication): the only one you don’t have, for the Kindle and some other types, and for now!, is compostion/text design. All of the editing still needs to be done (structural/ developmental, line, and copy-editing are all important to the quality of the final book). Cover images are still necessary. Etc, etc.

If the ebook is just an extra dab of icing on top of the cake of a book you’d do anyway, then the plant costs are almost irrelevant, but that’s obviously not going to be the case for very long.

4. Distribution: yes, you don’t need to ship the physical object, but you DO still need to pay those who own the channels through which you reach your reader. That may be Amazon or Fictionwise, or whoever, but it’s still a very large chunk of the revenue, if not most of it.

5. Cannibalization of Print Sales: whether through piracy, or because you believe that your readers would buy print if and only if they didn’t buy an ebook, it is possible that ebook sales will cut into your pbook sales. It doesn’t seem as if this happens yet for most types of titles, but it’s something that every publisher should consider.

In the end, only you can tell if the projected sales revenue will exceed the costs for a given title. And the only way to do that is to run your numbers, just as you did for a print book.

Some things never change.

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Can Authors Copy the Digital Music Model?

July 31st, 2009

Like most questions in this business, the right answer is “It depends.”

And, since ebooks and digital reading are still embryonic, at less than 1/2 of 1% of the total industry, I’m sure that the answer will change.

In the music world, an enormous amount of the digital music is freeware — legitimately given away by the rightsholders, with the hope that it will be passed on to others. Some people think that the book world should follow suit. I have some thoughts on the issue. (Surprised? I thought not!)

What models are there, so far?

1. Advertising. (This includes sponsorships, product placement and overt ads.) This hasn’t worked even for magazines and newspapers on the Web, and it’s a lot less likely to work for books. Books aren’t timely, there aren’t circulation figures that you can reliably pitch to sponsors, and so on and so forth. I’m not even going to class this as an “It depends” unless you’re selling the umpteenth installment in a successful series.

2. Selling ancillary products. Musicians do shows. Authors? Not so much. There are consultants who use books as expensive calling cards, and high-profile speakers who are able to follow this model, but there aren’t many of them. If you are among them, grand. Giving away copies of a book virally in order to add energy to another career is a great idea, but it’s not going to work for most of us.

3. Electronic ARCs or galleys. This really does work for most of us. The model is the same as the ARC on paper: give away some copies in order to build buzz for the rest. It could be that you’re giving away your current book, or it could be something from the deep backlist, but make sure that you help people understand the limits on the permitted sharing. That can be accomplished by DRM (as in the giveaways on the Kindle) or by actually asking recipients to limit their sharing, but it needs to be made overt in some way.

4. Giving up on compensation entirely. Many musicians and other artists create for the emotional rewards, knowing that they’re highly unlikely to ever make a living at it. This does work for many authors, but most of us want to make a living. And books tend to take longer to create than songs, or most other artforms.

So, what models did I miss?

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Plagiarism, Piracy and You

July 16th, 2009

Most people misunderstand the limits on their rights to use someone else’s work. I’m not talking about hardcore pirates here, but ordinary folks who wouldn’t dream of taking something belonging to someone else — and who do it unintentionally.

Copyright and plagiarism
Many people believe that if you give credit to the original author, you can use whatever you want from someone else’s book, photography or music. If you give credit, you’re not a plagiarist, but you may be violating copyright or a trademark.

You can’t use someone else’s world, characters or other major elements of their creative work without permission (which usually costs money), unless the work is no longer under copyright. Fortunately, it’s usually extremely easy to get permission, especially if the work isn’t going to be sold commercially. (It may take some time, though, so start early.)

Works published before 1923 are usually in the public domain, as are those created by people who died before 1939. (Life plus 70 years is the term in US law.)

Accidental Plagiarism
It’s actually quite easy to use someone else’s words, or the way they structured their work, without meaning to do so. For example, consider the author in the library doing research and taking notes. The cell phone rings, and our author hurries out to answer it, forgetting to jot down whether the note is a copy of someone else’s work, or their own summation of an important thought. A year later, going through those notes, the unattributed words make their way into the book, and a scandal is born.

When you’re doing research, it might be a good idea to save copies of the pages you’re quoting, and make sure that the bibliographic info is on them.

It’s on the Web
The Web may make it easy to use someone’s work without permission, but that doesn’t make it right. It is emphatically not true that everyone who puts their words on the web will be thrilled that you’re sending them to other users. Not even if you give credit for it.

Some people put their work out here, and make it freely available, because they want fame. Some do it because they want to help the world. Some are trying to show potential customers what they have to offer, and some are trying to hunt up potential clients, and get them to register in order to get the free stuff.

Whatever their motivation, the work is theirs, and the decision about whether or not you can use it belongs to them. As does the right to make the judgment about whether your use will bring them more business, or not.

Fair Use
This is a defense, should you be sued, not a term clearly defined in the law. Basically, you can use small parts of another person’s work, if it fits the fair use criteria.

There are four:
1. Why are you using it? If you will be using it in a classroom, it may be fair use (although copying worksheets, or language tapes, or what all, usually is NOT). If you’re selling it for profit, that’s usually not fair use.

If you’re altering the work substantially, that also tends to lend legitimacy to your use.

2. The type of work you’re using
If it’s just for fun, you have less latitude than if it’s designed to save lives.

3. The amount and centrality of the portion you use.
If it’s a song or a poem, a tiny snippet can be a violation — unless you’re using only the title, and you use it as a title.

If you take the most important bits, it’s not fair use. And, yes, that’s a very fuzzy line, isn’t it? It’s a whole lot cheaper to get permission than to pay a lawyer if the owner of the work thinks you’ve crossed it.

4. Impact on profitability
If your use will reduce the rightsholder’s ability to profit from the work, you’re probably in trouble. And you’re not the one who gets to make that call. The rightsholder gets to decide if they want to sue you, and the judge and/or jury get to make the final call. Oh, and if it’s a registered copyright, there are statutory minimum penalties that make suing worthwhile, even if the damage is hard to establish, or small.

What examples have all of you found of these phenomena?

Is there anything here I got wrong? I’m neither a lawyer nor a writer, so I’m not invested in my own words. Go ahead and suggest something.

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Friday at BEA 2009

May 29th, 2009

This was my first day at BEA instead of the Publishing University seminar series. I expected your basic gloom and doom, but was again pleasantly surprised by the positive energy.

One innovation is the Blog Signing sponsored by the people who brought you Net Galleys. I was able to attend the blog signing of Kassia Krozier of Booksquare. I promised to tell you that she does indeed have a glowing smile. It’s always fun to meet someone in person that you’ve been reading on-line for a while.

The Espresso Book Machine was in operation on the floor. It’s an interesting gadget, but I still think it’s a so-so solution to a problem we won’t have for much longer. And their numbers still don’t work for most of the situations being bruited about — in my never humble opinion. That much vaunted 1 cent per page cost doesn’t include labor (non-trivial) or worse, the amortization of the $90,000 required to pay for the machine. There may be other charges that aren’t included, too.

I just don’t see this as something that’s going to beat the prices of LSI and the other digital printers, and I don’t see customers being willing to stand around that long to get their books printed.

As for news, well, I attended the BISG Trends event. It was informative (as it always is). I’m sure you’ve heard by now that sales for the industry are up by 1%, but that trade sales are down by 4. But, since adult and juvenile trade sales were only about 36% of the total, the solid years turned in by other segments overwhelmed that bad performance.

Outsell and BISG are actively recruiting small presses for their survey next year. I urge all of you to sign up for it at the BISG site. I doubt that there’s a link, but send an email to their contact address. (Consider also downloading a copy of the slides from the presentation next week. There more than a few interesting numbers.)

On a less important note, I also saw a Cool-er at their booth, and it is indeed lighter, but the controls aren’t as intuitive for me as the Kindle. I’m not in love.

The number of galleys given away seemed to be much smaller than last year, and very muc smaller than prior years. And the floor was a lot smaller. I don’t know if that was a blip, or a sign of things to come, but it saddened me.

Oh, and last but not least, I found the stage where I’m speaking tomorrow. It’s at the edge of the main floor, on the 34th Street side. The African Pavilion and the Indie Press section share it. The whole speaker series is being arranged by Victoria Sutherland (of Foreword, etc.) and Leah Schnelbach of the NY Center for Independent Publishing.

I’ll be there at 2 pm, and the topic is Healthy Businesses in Tough Times.

If you happen to wander by, do grab a chair and tune in for a bit. I’ll try to make my topics interesting enough to woo you away from the siren calls on the floor.

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Healthy Businesses in Tough Times

May 28th, 2009

I’m doing a talk with that title on Saturday, at 2, at BEA in the Independent’s Lounge. It’s on the third floor, on the 34th street side of the Javits, or so I’m told.

I’ll also be on the floor of the conference for most of Friday, Saturday and Sunday. If you see me, stop me and say hi!

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The Publishing University 2009

May 28th, 2009

For the last two days, I have been at the Publishing University, a seminar series that happens every year right before BEA. You may have heard it called PMA-U, or this year, IBPA-U.

I expected that this year attendance and the quality of the presentations would be worse than they have been in the past. After all the gloom and doom about BEA and the industry’s changes it seemed logical.

I’m happy to report that it was, instead, busy and productive, with a lot of positive energy surging around.

I started Wednesday by giving an Ask the Expert session from 7 a.m. to 8:15. Given that a lot of the people attending had traveled from the West Coast, and felt like it was 4 a.m., I was stunned at the number of people in the room. And none of them appeared to be zombies. The free coffee may have helped.

By 10:30, I had launched into one of my favorite courses: Building a Better Budget. It is part of my mission in life to help people understand exactly what that mass of numbers means, and how to USE one as the powerful strategic tool it is, rather than the dusty and intimidating mass of numbers that ends up sitting in a file somewhere. Again, the energy was wonderful (people were even laughing at my jokes! Without being paid to do so!)

Lunch brought a presentation by one of Google’s minions executives. Obviously, questions about the Settlement were not allowed, as it’s still in litigation, but he did lay out quite clearly how Google wants publishers to see its plans for our part of the information ecology.

I was more than a little skeptical of the frequent protestations that Google’s headlong rush to secure the ability to index all of our content was likely to be the best thing ever to happen to us, and the assertion that Google wants all of its revenue to be from ads, and isn’t interested in ever selling our books in any format.

Today, I attended a marketing course where the presenters were all senior folks who emphasized evaluating your efforts for profit potential, including the COGS for any sales generated, before you decide to engage in that kind of promotion. Loved it — 3 guys all speaking my language. I also had the marvelous experience of hearing someone lavish praise upon the list moderators of the Yahoo Self-Publishing group, and upon the group as a whole. That’s wonderful because I’m one of those moderators, and she had no idea I was in the back of the room at the time. Always nice to be appreciated! (Thanks Norma!)

The lunch time presentation on ebooks had the potential to be exciting, but I’m afraid I thought it to be a bit of a re-hash of stuff we’re all already well aware of.

What else was notable there? What did you like, if you were there?

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BEA

May 20th, 2009

How many of you will be at BEA next week? And how many will be going to IBPA-U, the big seminar series before it? (Remember, PMA changed its name last year to IBPA.)

For those who are interested in the things I say:

–I’ll be teaching a class at IBPA-U called Building A Better Budget (Wed. morning) and an Ask The Expert table at 7 am. (Much coffee will be consumed. Also tea.)

–I’ll be doing a brief seminar on profitability in tough times on the floor of BEA Saturday afternoon, in the Independents’ Lounge run by Foreword Magazine and the NY Center for Independent Publishing.

–I’m open to having my brains picked almost any time you catch me — buy me a cup of coffee and my mind is yours for a good long time!

I hope to see some of you there. If you see my name on a tag — introduce yourself!

I’ve been doing more speaking lately (Denver and Sacramento in April, NYCIP in March, and these). I must admit, I’ve always enjoyed teaching and speaking. (Shameless promo: if your group is looking for a speaker on my type of topic, I’m very inexpensive!)

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