EBOOKS AND THE FUTURE OF PUBLISHING

Fremont Area Writers Conference

Mark Coker Founder, Smashwords

Twitter: @markcoker

My Backstory

We were repped by one of the top NY literary agencies

Publishers Said “No”

• Despite great efforts of our agent, every major publisher said NO (TWICE!)

I imagined hundreds of thousands of other writers just like us

Silenced

Is it possible our book sucked?

Do we suck?

Or is Traditional Publishing the problem?

The Problem with Traditional Publishing

1. Publishers control * the printing press* the distribution* the knowledge to professionally publish

2. Publishers reject most authors

3. Publishers judge books on perceived commercial merit

4. Publishers decide what readers can read

5. Slow production cycles (12-18 mo)

6. Print books too expensive

7. Books forced out of print early

8. Authors earn only 5-17% of list price

I Envisioned a More Democratic Form of Publishing

1. Authors gain access to:* the printing press* the distribution* the knowledge to professionally publish

2. Authors free to publish what they want

3. Instant publishing

4. Readers choose what they want to read

5. Immortal books, never go out of print

6. Low cost books increase affordability

7. Authors earn the lion’s share of the proceeds

My Answer: Smashwords

• FREE ebook publishing platform

• Ebook printing press

• Distribution to major ebook stores

• Best practices knowledge

How Smashwords Works

1. UPLOAD

• Upload a Microsoft Word file, formatted to our Smashwords Style Guide

• Ready for immediate sale online

2. DISTRIBUTE

• Distribution to major retailers

3. GET PAID

• Author receives 85% of net

0

50000

100000

150000

200000

2008 2009 2010 2011 2012

Indie ebooks published at Smashwords

1406,000

28,800

92,000

185,000 +(today)

Enough about me.

Let’s talk about your future as a writer.

Let’s bust a dangerous myth

What myth should we bust?

The Myth of Big Publishing

You were taught to bow subservient before the altar of Big Publishing

you weren’t an author until a publisher blessed you as such

… and unless you got a book deal, you were a failure

… and in a sense it was true

Publishers held all the power to connect you with readers

You were told to keep toiling and waiting.

And waiting…

Rejection would make you stronger

… and if you dared indulge in the carnal pleasures of self-publishing...

Publishers were the bouncers at the pearly gates of author heaven

• Promised Perks of the Afterlife

• editing

• printing press

• distribution

• marketing

• royalties

• fame and respect

• readers

• “published author” inscribedon your tombstone

You were told …

you’d get a deal when you perfected your craft like these other great published writers

…

Justin Bieber got a book deal

Snooki got a book deal

Kourtney, Kim and Khloe got a book deal

Stop

Don’t sell your soul

The old model of publishing is broken

It has become harmful

to writersto readersto books

Yet your future is brighter than ever

You have options today that didn’t exist back in

the dark ages of publishing (four years

ago)

Q:

WHAT WOULD HAPPEN IF WRITERS LOST FAITH IN THE MYTH OF BIG PUBLISHING?

“GOD IS DEAD” Friedrich Nietzsche

IS BIG PUBLISHING DEAD?

No, though it has lost its way

You will decide the fate of Big Publishing

YOU’RE IN CHARGE NOW

WE LIVE IN UNCERTAIN TIMES

BOOK PUBLISHING IS COLLIDING WITH MULTIPLE CONVERGING FORCES

Let’s examine the forces, and what these changes mean for your future

NINE TRENDS TO ROCK THE WORLD OF PUBLISHING

TREND ONE

Bookselling moving to the Web

Percentage of book purchases made online vs B&M, Print and E-

Brick &Mortar

Web

Today?

Bookselling moves to the Web

• The decline of brick and mortar

• Consumer drivers:• Price

• Convenience

• Selection

• Self-published books displayed side by side with traditional books

• Big publishers no longer control distribution

TREND TWO:

Reading Moving to Screens

Screens are the new paper

A blast from the past: Ebook market share in 2008

Source: Association of American Publishers, publishers.org.

0

0.2

0.4

0.6

0.8

1

1.2

2002 2003 2004 2005 2006 2007 2008

Ebooks as a percentage of US wholesale trade market

Source: Association of American Publishers, publishers.org. 2012 Smashwords estimate

0

5

10

15

20

25

30

2002 2004 2006 2008 2010 2012

Ebooks to overtake print

Print books

EbooksUnitsDollars

Print books

Ebooks

Why ebooks are hot

• Screens offer better reading experience than paper

•

Changeable font size A B C D• Portable and compact

• Screens will get better/faster/cheaper

• Ebooks offer better consumption experience

• Lower cost than print

• Convenient sampling and purchasing

• Huge selection

TREND THREE

The Rise of Ebook Self-Publishing (a.k.a indie ebook publishing)

Number of books published indie vs. traditional

Indie books

Today?

New trad. books

Indies are Now Out-Publishing Big Publishers

• Indie author advantages

• faster time to market

• greater creative control

• lower expenses

• better distribution to global market

• Immortal ebooks never go out of print

• lower prices to consumers

• earn more per book

Indies are Now Out-Publishing Big Publishers

• Indies scaling all the bestseller lists

• Four Smashwords authors hit August 5 NY Times Bestseller list.

• Every week, indie ebooks are in the bestseller lists of every retailer

• This month, Apple iBookstore AU/NZ launched “Breakout Author” promotion – Smashwords only

QUADRUPLE +

Indie Ebook Authors Earn Higher Percentage of List Price

• Indies earn more at lower prices

• Indies earn more selling a $.99 ebook ($.60-$.70) than a traditional $8.00 MMP ($.40)

• At $2.99, indies earn $1.80. Trad. author would have to sell at $10.25

• Lower price = reach more readers = more sales at higher profits per sale

60-80% 12-17%

Indie Traditional

TREND FOUR

Content Explosion Leads to Downward Pressure on Prices

Glut leads to ebook price competition

March 2012October 2010

$4.25

$3.15

Average price of Smashwords ebooks

... Impact of content explosion

• The glut will only become more pronounced

• Excess supply leads to price competition

• Lower prices increase affordability and accessibility

• More books will be read than ever before

• Readers will still pay for books

• Can publishers drop prices to $2.99-$3.99?

TREND FIVE

Publishers Losing Monopoly as Writers Gain Tools to Self-Publish

Big Publishers Have Lost Their Monopoly

• Printing press is free to all

• Distribution free to all

• Knowledge to publish, distribute and market high-quality, professional books is free to all

• Professional authors asking:

• “What can a publisher do for me that I can’t do for myself?”

• “Will a publisher actually limit my ability to reach readers?”

TREND SIX

Print is Dead for Most Self-Published Authors

(and will become less and less important to traditionally published

authors)

Print is Dead

• Brick and mortar bookstores disappearing

• Most self-pubbed authors don’t have access to brick and mortar distribution

• Customers choosing low cost ebooks over high-priced print books

• Exceptions:

• Face to face print sales will continue

• Some books are meant for print (for now)

• Specialty souvenir books sold in non-traditional outlets

TREND SEVEN

Ebooks are going global

The Global Ebook Opportunity

• Countries outside the US are entering the exponential phase of their ebook growth

• Ebook retailers going global

• Apple iBookstore (50), Amazon (10), Kobo (many), B&N (U.K.+)

• 46% of Smashwords/iBookstore sales global

TREND EIGHT

Big NY Publishers are in Trouble

Big Publisher Headwinds

• Hamstrung by legacy print business

• Print business in decline, slow to adopt ebooks

• High expense structures

• Ebooks sell for less, so revenues under pressure

• Consolidation

• Big 6 now Big 5, soon to be Big 3

Suffering Self-Inflicted Wounds

• Not serving writers

• Bumbled entry into self-publishing

• Pricing ebooks too high

• Writers are angry

• Let’s review a couple of these…

Authors Singing Twisted Sister’s “We’re Not Gonna Take it!”

• Publishers:

• Reject you

• Delay you

• Value your work on perceived commercial merit

• Strip you of your creative freedom

• Force you to do most of your own marketing

• Force you out of print too soon

• Pay you only 5-17% of list price

• Price your books too high

Publishers’ High eBook Prices Threaten Writer Careers

Why?

Book buyers are price sensitive

Authors Yield Two Benefits from Every Sale

1. Money from the sale

• Unit sales X royalty per unit = profit

2. Gain a fan

• Fans spread word of mouth, recruit new fans

• Fans eagerly await your next book

• Fans are less price sensitive

Pricing strategy essential to maximize both

How Price Impacts Units Sold

What Price Yields Highest Earnings?

Publishers’ bumbled entry into self-publishing will backfire

In July, the parent company of Penguin acquired Author Solutions

Author Solutions earns over 2/3 of its income selling over-priced services to authors

$25,000 publishing packages!

Blood sucking parasites

Writers DON’T need to pay a king’s ransom to self publish

Ebook self-publishing is fast, free and easy

Print self-publishing can be free or extremely low-cost

TREND NINE

The Previous Stigma of Self-Publishing is Disappearing

Stigmas to reverse

Aspire Traditional

Aspire Indie

Today?

Aspire Indie

Aspire Traditional

4 yrs ago Future?

The Plan Forward

The 9 Trends Create a Future that …

Benefits Indie Authors

Disadvantages Some Traditionally Published Authors

You have the right to publish

For the sake of humanity, you have an obligation to publish

Your words have value

You are your own gatekeeper

YOU decide when your manuscript graduates to PUBLISHED BOOK

Unleash your words upon the world

Honor your readers with your words

Give readers great books that are as good or better than those released by

Big Publishers

(and do it faster with lower prices)

The task before you is not easy.

It requires hard work.

yet…

The Opportunity to Reach Readers Has Never Been Greater

Welcome to the new world of publishing

You’re in charge now.You have options.

Who’s The Future of Publishing?

Look around you, that’s who.

YOU are the future of publishing!

Free Ebook Publishing Resources

• NEW! Secrets to Ebook Publishing Success (best practices of successful authors)

• Smashwords Book Marketing Guide (how to market any book)

• Smashwords Style Guide (how to format an ebook)

Thank you for considering the future!

Q&AConnect with Mark Coker and Smashwords:

Web: www.smashwords.com

Blog: blog.smashwords.com

LinkedIn: linkedin.com/in/markcoker

Facebook: facebook.com/markcoker

HuffPo: huffingtonpost.com/mark-coker

Twitter: @markcoker