From author and regular commenter Lily White LeFevre:
I was talking to my husband about publishing over dinner the other night, trying to explain to him why I’m not going to be pursuing a traditional publisher any time soon and what it would take for me to do so. He listened to my description of the rights grabs and the eternal shelf-life of digital and the low royalty rates, and said, “Well, when a business is failing from being outcompeted, sometimes it trims the fat and fixes the problem and sometimes it just grabs everything it can before it goes under.” Obviously big publishing is doing the latter.
I told him that what I would require to even consider a publisher is a 50% split on cover price for digital, and that even then the publisher would have to work to convince me they are worth 50% of my book forever. If they really focus on “distribution and promotion” as he called it, then maybe.
Anyway, I thought it might be fun to think about what the actual cost to a publisher would be to put an ebook together, therefore how many copies they would need to sell in order for the book to become profitable.
. . . .
A few key assumptions:
- There is no editorial tinkering involved–the editor acquired the manuscript as-is with just a few polishing and tightening edits.
- The author is a careful writer who has good grammar, a readable prose style, and didn’t leave a ton of typos.
- The book is 80-90K, so it will take an editor about four hours to read if they just read it.
- I am working with a no advance, 50% of cover price split for digital royalties.
- The entire cost of production is being put on the ebook, because the print book has become the ancillary format.
I know from my own editing work that I need about three passes after the initial read-through to make a substantive macro- and line-edit. We’ll double the amount of time to allow for marking up and making notes. So…4 hours for base read + 3 passes x 4 reading hours x 2 double the reading time for editing = 28 hours of editing before it gets sent back to me.
The next round of edits only needs 2 passes, so 2 x 4 x 2 = 16 hours.
Then a round with the copyeditor, 2 x 4 x 2 = 16 hours.
Then a round with a proofreader, 2 x 4 x 2 = 16 hours.
Then it goes to the formatter. For a novel-length ebook that will take about four hours (basing this on my experience of two hours for a novella, but only some of that time would be increased by a longer work) = 4 hours.
The copywriter spends an hour coming up with the back matter = 1 hour.
Upload to various sales channels = 1 hour.
That is 82 staff hours. We’ll assume they get $20 per hour on average (obviously the big editor gets more, but I bet the copyeditor, proofreader, and formatter all get less, so it averages out). I am using $40 as my multiplier to account for business taxes. The total cost in staff time needed to get my manuscript converted to an ebook and uploaded is therefore 82 x $40 = $3280.
The only other fixed expense is the cover art, which can probably be gotten for $300, but we’ll say they are really concerned and pay more. We’ll make it an even $1000 to add in the five minutes it takes somone to slap on the title and author.
Total bill is $4280.
Let’s round it up to an even $5000 for easy math.
. . . .
We’ll assume the publisher uses the mmpb price of $7.99 as their cover price.
Retailers take 30% of that, leaving $5.59 per copy coming back to the publisher. If they pay me 50% royalty on every copy sold, then we need to sell 1790 for the publisher to break even.
. . . .
My prediction is: this kind of split is how publishing houses have to go in order to survive the digital revolution. If they can add a legitimizing value to consumers who don’t want to have to vet for quality, only content, and can get immediate access to promotion avenues a self-publisher can’t or has to be very lucky to hit, then they might remain worthwhile business partners. But right now, an author demanding 50% of cover on digital would get laughed out the door, unless their last name is Rowling or Meyer or King or McCarthy…and possibly even then.
Link to the rest at Lily White LeFevre
Passive Guy will note that it’s never taken him anything close to four hours to format a manuscript for an ebook. If he did it every day, it would probably be less than 30 minutes.