PG’s Thoughts (such as they are)

How to Fight Amazon (before you turn 29)

16 June 2018

From The Atlantic:

Shortly after I met Lina Khan, her cellphone rang. The call was from a representative of a national organization, regarding a speech it had asked her to give. Khan was courteous on the phone, but she winced momentarily after hanging up. “That was the American Bar Association,” she confessed. “I don’t know if I’ve passed the bar yet.”

This feeling—that Khan’s ideas are in high demand slightly before her time—has characterized much of her life lately. In the past year, the 29-year-old legal scholar’s work has been cited approvingly by the lefty, rabble-rousing congressman Keith Ellison and by a Trump-appointed assistant attorney general, Makan Delrahim. She has been interviewed by NPR and written op-eds for The New York Times.

She has done it neither by focusing on a hot-button issue nor by cultivating a telegenic demeanor. She is just a young adult—one of many, I would learn—interested in an old topic: antitrust law, that musty corner of American jurisprudence aimed at curtailing monopoly power.

. . . .

For the past few decades of American life, the specter of monopoly was generally raised only regarding companies that seemed custom-designed to rip off consumers—airlines, cable providers, Big Pharma. These were businesses that pulled from the long-standing monopolist’s bag of tricks: They seemed to keep prices artificially high, or they formed an unspoken cartel with other industry titans. Typically, consumers worried most about how monopolies would pinch their wallet.
For Khan and her colleagues at the Open Markets Institute, an anti-monopoly think tank based in Washington, D.C., monopoly power includes all of that. But it goes further. Even when monopolies appear to benefit consumers by offering free services or low prices, Khan contends that they can still be deeply harmful. Among the group’s frequent targets are some of the most popular companies in America: Google, Facebook, and the one to which Khan has committed much of her published work, Amazon. She tells a comprehensive story about how these companies make Americans less free.. . . .“There’s a whole line of critique about Amazon that’s culture-based, about how they’re wrecking the experience of bookstores,” Khan told me as we surveyed Neil deGrasse Tyson’s latest tome. “I personally am less focused on that element.”

Instead, she argues that Amazon has denuded America’s book-buying landscape in other ways. “Amazon has massively—and I’m trying not to use this particular word, but I can’t not use it here—disrupted the business model in publishing,” she told me. “Publishers used to be able to take risks with heavier books that might not be as popular, and they used to be able to subsidize them with best sellers.” But Amazon’s demand for discounts has made it harder to cross-subsidize this way, leading to consolidation among book publishers and reduced diversity.

This is a typically Khanian analysis. In her telling, monopolies don’t just exploit consumers and workers in their part of the economy. Even when they offer low prices to consumers, their influence propagates through the entire system. If one part of an industry consolidates, then all the other parts of the industry will feel pressure to consolidate too.

. . . .

[I]n January 2017, she published the result of that study, “Amazon’s Antitrust Paradox,” in the Yale Law Journal. It went viral—or at least as viral as dense legal scholarship can go. Its driving question is simple: How did Amazon get so big?

The answers are nearly as straightforward. First, Khan says, Amazon has been willing “to sustain losses and invest aggressively at the expense of profits.” This isn’t a controversial assertion: Amazon has posted an annual profit for only 13 of the past 21 years, according to The New York Times. Historically, it has plowed any profits right back into cheaper prices and R&D into everything from robotics to image recognition. Second, Amazon is integrated vertically, across business lines. In addition to selling stuff online, Amazon now publishes books, extends credit, sells online ads, designs clothes, and produces movies and TV shows. It is also one of the world’s largest providers of cloud storage and computing power, renting server space to Netflix, Adobe, Airbnb, and NASA.

. . . .

[Judge Robert] Bork’s views become interesting in light of Amazon. Bork thought vertical integration was fine: Since he believed markets were perfectly efficient, he assumed that a lower-cost competitor would always butt in and fight off a would-be monopolist. And predatory pricing? It is “a phenomenon that probably does not exist,” he wrote. The Chicago school, he said, had proved that companies would always pursue short-term profits over long-term growth.

Amazon’s history seems to belie this claim. For more than a decade, Wall Street allowed the company to plow any profits into price discounts. Partly as a result, Amazon has grown so large that it can undercut other companies just by announcing that it will soon compete with them. When Amazon purchased Whole Foods, its market cap rose by $15.6 billion—some $2 billion more than it paid for the chain. Meanwhile, the rest of the grocery industry immediately lost $37 billion in market value. (Amazon protests that it has no control over how investors value its competitors.)
When a company has such power, Khan believes, it will almost inevitably wield that power far and wide, distorting not just the market itself, but the whole of American life. With sufficient power, companies can commission studies, rewrite regulations, bulldoze neighborhoods, and impoverish education and welfare systems by securing billions in sweetheart tax cuts. When a company comes to monopolize a market—when it grows so big that it can threaten other industries just by entering them—it ceases to be merely a company. It becomes an institution so powerful that it can rule over people like a government.

Link to the rest at The Atlantic

PG suggests Ms. Kahn, as an “expert” in antitrust law, is remarkably ignorant about American publishers. Publishers are a classic example of a shared monopoly, offering identical royalty rates and nearly identical contract terms to authors and attacking competitors who don’t join the cartel.

Additionally, there is the inconvenient fact that most of the largest American publishers have already plead guilty to conspiring to fix book prices, a classic antitrust violation, in order to keep Amazon from lowering book prices for consumers. Publishers are, by their own admissions, violators of antitrust laws.

It is possible for an organization to violate antitrust laws by lowering prices to drive competitors out of business, then raising prices once it obtains the monopoly power to do so.

However, lowering prices by itself is a benefit to consumers, not a detriment, and speculation that, at some time in the future, Amazon is going to use monopoly power to raise prices is just that, speculation, without any facts to back it up.

“Predatory pricing” is a characteristic of this type of monopoly activity – cutting prices to drive competitors out of business, then raising prices to capture monopoly profits.

When Amazon starts taking advantage of its market position to force unconscionable price increases on consumers, PG will be happy to condemn the company, but amateur mind-readers who claim this is Amazon’s business plan are simply speculating for purposes that likely aren’t connected to the welfare of consumers at all.

Looking into a crystal ball and perceiving an evil Amazon that will be going into the price-gouging business is a bizarre practice that is often funded by Amazon’s competitors who find Amazon’s consistent price-cutting business strategy offensive because Amazon takes sales away from them or disturbs their way of doing business in their particular fiefdoms.

If we are to speculate, let us speculate about the state of the book business had Jeff Bezos started the company selling something other than books online and stayed out of the book business because he didn’t ever want to upset people like the author of the OP. For the purposes of our speculation, we’ll assume no Bezos clone stepped in to do what Bezos has done.

Would readers be purchasing more or fewer books today? Would the price of books be higher or lower today? (remember that Steve Jobs wanted publishers to fix the retail price of ebooks so there would be no price competition) Would authors be earning more or less than they do today? Would there be a wider or a narrower selection of books offered to readers today? Would more or fewer authors be publishing their own books than do that today?

For any Amazonians who happen to stumble across this post, PG suggests that it might be a good idea for Amazon to consider publicizing how much money they pay directly to individual indie authors each year through KDP and similar programs, bypassing the Big Publishing and small publishing middlemen and middlewomen.

Learned Helplessness

14 June 2018

From Kristine Kathryn Rusch:

I was in the middle of a long blog post about writers licensing the rights to their work when the news broke about Donadio & Olson embezzling from their clients. I stopped what I was working on and wrote a different post, because I finally had public proof of something I’d been saying for years: that important, well-known literary agents mismanage and/or embezzle the monies they receive for their clients. This has gone on for decades. It’s not something new.

. . . .

Then another reader wrote an answer post, taking me to task about telling writers not to hire agents.

He’s argued, calmly and politely, with my advice on agents before, so that wasn’t new. We disagree. He has his reasons for keeping an agent. I think those reasons are mired in the 20th century. But that’s his choice. He seems to be making an informed decision, and is taking a calculated risk. I don’t agree with the risk, but it’s his career, not mine. (I do hope he audits his agent regularly. He monitors the payments he knows are coming, but there’s no way to monitor the surprise payments.)

Then…weirdly…I started getting emails, direct messages, and notifications (from friends) of tweets taking me to task for advising that writers not have agents. I was called names. Well-known writers who have never met me wrote that I always give bad advice and that it figures because I’m …pick your hated POV here. (According to the posts, tweets, and emails {depending on who is upset with me}, I’m either bigoted or too PC. I’m against all women or too feminist. I’m always on the wrong side of every issue, and I lie, lie, lie.)

. . . .

Because you can’t fight myths with logic. Even when the myth forces the people spouting those myths to act against their own (and their friends’) interest.

In addition to the tweet-storm, I got some fascinating emails. I can’t share some of them—especially the ones from long-time IP attorneys who told me about the fraud and embezzlement at big name agencies. One IP attorney reminded me of the Harper Lee mess with McIntosh & Otis.  Ironically, according to Vanity Fair,

The agency, known as M&O, was created by Otis and her friend Mavis McIntosh, who had both reportedly left another agency in the mid-1920s after they discovered it to be highly suspect in its practices.

As I said, this crap has gone on for a very, very long time.

I got a lot of sad emails from writers who lost money to fraud, lost major book deals to ineptitude, and have given up on their careers because of agent malfeasance.

. . . .

[A] New York Times bestseller posted on my personal Facebook page that she was surprised people were talking about this issue at all (she was defending the people who were defending agents—although she hadn’t seen the truly vituperative stuff), because no one talks about agents in her experience.

Her comment was followed by a new writer who worried that he couldn’t sell to traditional publishing without an agent. To date, I’ve gotten six public comments, five personal emails and three messages on Facebook just like that, asking the same thing.

I got to noodling all of this in my head—more proof, more stories, lots of us who say we do better without agents, that we can handle our own businesses, and then I went to lunch with a new friend who has worked in the arts for sixty years. She handles her own business affairs, still.

. . . .

Artists are supposed to be feather-brained. Artists are supposed to be bad at business. Artists who are good at business are anomalies or worse. Artists who are good at business are only in it for the money. Artists who are good at business don’t understand art.

Of course, the people who are defining what that art is are mostly professors, who were unable to succeed at the business side of the art, so they have to keep their day jobs.

Some of those professors are writers with big book deals and agents.

As I was noodling all of this, though, what bothered me the most were two things in combination: that comment from the New York Times bestseller about silence and the variety of plaintive messages from beginners who are still pursuing their dreams of being the kind of writer they grew up admiring. But how do you get to one of the big five publishers without an agent?  one of those writers wrote on Twitter this morning.

Well, that assumes that a savvy writer wants a contract with one of the big five. The fact that this guy wrote the question this way proves he’s not savvy. I wouldn’t let anyone go into that shark-fest without a lot of education, the ability to negotiate, and a tough-as-nails IP attorney on their side. And even then, I would hope the writer has a good reason for going traditional, because the best negotiator in the world won’t be able to get the kind of deal that we used to get as a matter of course in the 1980s.

It was the comment though about silence that really got me. Because the New York Times bestseller was right: writers rarely discuss the problems with their agents. Writers only brag about their agent’s successes.

The writers who have been screwed by their agents are either too embarrassed to write a blog post like Chuck Palahnuik’s or those writers have signed a non-disclosure agreement as part of a settlement with that agent. Only a few of us refused to sign NDAs, refused the settlements. And when we talk about what happened to us, we’re called crazy, delusional, and outliers. When we say we handle our own business affairs, we get dismissed because we’re successful so it’s easy for us. We are lucky. Or famous. Or have connections no one else does.

. . . .

Every person in the world who starts a small business—and that’s what writing is…it’s a small business—learns how to conduct the business part of the operation. If the small business owner doesn’t learn that, then they go out of business really fast.

Artists have safety nets that most small business owners don’t have. A professorship based on a few published books and stories (as well as an expensive PhD). Or an ability to get grants. Or an employed and tolerant spouse.

The myth is that artists can’t make money. And before I confuse some of you further, I’m going to stop using the term artist (for dancers, painters, musicians, writers), and hone down to writers alone. But this applies to all of the creative arts. Artists have safety nets.

You’ve all heard that writers can’t make money, so why even try? You’re writing for the love. You’re writing to create something lasting. You’re writing to become famous or well-reviewed or accepted in your own literary circle.

You’re not writing to make money.

Only fools and hacks write for the money. The more someone publishes, the worse their skill must be. The more financial success they have, the more their writing abilities go downhill as they “sell out.”

That’s counterintuitive to the way that humans operate. The more humans practice something, the more they refine their techniques, the closer those people get to the top of their game. Their game might not be as good as someone else’s, but writers—like everyone else—improve with practice.

. . . .

This myth that writers can’t make money plays right into the hands of embezzlers and con artists. Think about it: I’ll handle your negotiations, your paperwork, your money, so you don’t have to bother your pretty little head about it.

Money gets pocketed, writers need those teaching jobs, and the leech who made the offer benefits from the myth. The writer sure doesn’t.

And then there’s the silence.

Silence is the hallmark of abuse.

Link to the rest at Kristine Kathryn Rusch and thanks to Colleen for the tip.

Here’s a link to Kris Rusch’s books. If you like the thoughts Kris shares, you can show your appreciation by checking out her books.

As usual, Kris gets to the heart of the matter in a way very few others do.

PG can’t go into any details because of client confidentiality issues, but today he finished reviewing an agency agreement from a large literary agency for a client.

It required more time than it has in the past. Not because the agreement was longer or more complex than the many others PG has reviewed.

It was the CYA paragraphs.

When lawyers are asked to review a contract, in addition to other subjects, clients want to understand what can go wrong if they enter into the contract, what their downsides might be if the whole thing goes south. It took PG a while to work his way through the potential downsides for the client’s proposed agency agreement.

This lead him to think more about the agency and publishing business and why some common practices that would be considered illegal and immoral in other settings are “the way things are done” in publishing.

PG’s Rule #1 for contracts is, “Don’t do business with crooks.”

A client could hire a whole herd (flock? colony? troop?) of lawyers to prepare the finest contract known to humankind. If the counterparty is a crook, the likelihood of the finest contract working out well for the client is still not good.

Crooks gonna crook.

PG just trafficked in a stereotype about crooks.

As a general proposition, while making one’s way through life, it’s not a good idea to deal in stereotypes. Every large group of people includes some that may fit a stereotype commonly associated with the group and others who are much different than the stereotype. In an effort to avoid wrongly stigmatizing those who differ from the group, society rightly takes a somewhat dim view of many varieties of stereotypes.

However, stereotypes can be quite useful and are utilized by most people in one form or another on a regular basis.

Who would you trust more, a drug dealer or an elementary school teacher?

There you go, stereotyping drug dealers.

Long ago, PG learned to be more careful about relying on the statements of a prospective client who was in prison than a prospective client who walked into his law office off the street. Are innocent people sometimes incarcerated? Absolutely. Are most people in prison innocent of a crime? Not really. Are most people really, really, really anxious to get out of prison and willing to do almost anything to achieve their goal? Pretty much.

Do common business standards and practices vary from occupation to occupation? Is an auctioneer expected to be more or less reliable when talking about the value of a piano being sold than a professional appraiser? Is there an unwritten code of conduct for auctioneers that affects their view of appropriate behavior when trying to sell something?

This is a long-winded introduction to PG’s concerns about agents and traditional publishers.

From a purely economic standpoint, an agent needs a good relationship with a handful of acquiring editors working at a small group of publisher much more than an agent needs a good relationship with an author who is mid-list or below in the publishing hierarchy.

Publishers who will pay a $100,000 advance for a science fiction novel are far rarer than science fiction authors are. This and other economic realities strongly influence the behavior of agents.

Looking at what’s really happening in an agent’s life, it would make more economic sense for the agent to work for and receive a commission from a publisher for locating a salable author than to pretend the agent works for the author and puts her interests first before the publisher’s.

This brings PG to customs of the trade.

Many years ago, PG learned about customs of the New York City garment industry while representing a client who manufactured and sold boatloads of inexpensive jackets. Some of the customs of the trade in the garment business were identical or similar to standard commercial law and others were much different. Those who regularly did business in the garment industry were far more concerned with applying the customs of the trade instead of anything the state legislature had ever written.

In this respect, the customs of the trade in New York City bore some resemblance to what was sometimes called “The Law of the Hills” in the Ozark Mountains of Southern Missouri and Northern Arkansas.

In some cases, juries were more influenced by the Law of the Hills than they were by The Revised Statutes of Missouri or anything the judge might say about the case. While the state law might look askance at a husband beating up his wife’s lover, the Law of the Hills permitted such actions as long as nobody was permanently crippled.

PG posits that the customs of the traditional publishing trade, including the customs of the literary agency trade have created an environment in which an agent can do far worse things than fail to forward payment the agent receives for royalties from Russian sales to an author. The author’s never going to know and such an action won’t harm the agent’s reputation with HarperCollins even if someone at HarperCollins finds out about it.

When faced with a choice between promptly paying every penny of royalties due to an author and keeping the doors of the agency open, the customs of the agency trade dictate that the survival of the agency is paramount. An agent will make the same decision once, twice, three times — as many times as it takes to survive.

Thus, an otherwise honest and honorable group of people can be lead down a path that ends in systematic and large criminal diversion of funds away from authors and into agents’ pockets. PG’s gut tells him that this has happened at a great many agencies, both small and large.

It’s a custom of the trade.

The Mystery Of The Missing Mystery Writer

12 June 2018

From author/editor Jim Thomsen in 2009:

To me, it was a mystery worthy of, well, a mystery novel.

A Seattle mystery author publishes three novels. All are reviewed reasonably well; all sell reasonably well. She’s under contract to write two more. But that fourth book never materializes. In fact, the author disappears … and is never heard from again. As an author, anyway.

Fourteen years later, had the trail grown too cold for the truth to emerge?

I decided to find out.

And the solution I found to this mystery is, to many I’m sure, a much greater mystery:

I found a writer who simply didn’t want to be a writer any more.

What — or who — killed her ambition?

Here’s my investigator’s report.

. . . .

In the spring of 1991, I was the Ellensburg correspondent for the Yakima Herald-Republic newspaper (central Washington cities, for those of you who don’t know the area).

I was also a voracious reader of mystery novels, in an era when Seattle-based mysteries were going through something of a golden era.

. . . .

And there was Janet L. Smith, the Seattle attorney whose 1990 debut novel, “Sea Of Troubles,” was a skillfully entertaining diversion. In fact, I bought that book at Jerrol’s Bookstore in Ellensburg, where, I learned shortly after, a caravan of six mystery authors would be making an afternoon stop. I don’t remember every name, but the tour included Sequim author Aaron Elkins, the author of several mysteries featuring anthropologist Gideon Oliver; children’s mystery author Willo Davis Roberts, and Emerson and Smith.

I happily flitted around Jerrol’s during the entire visit, schmoozing with as many of the authors as I could. (In fact, I wound up writing features on two, Emerson and Roberts, for the next day’s Herald-Republic.) The event was pretty sparsely attended, as far as I can recall, and I don’t think any of the six sold many books (other than the dozen or so I snapped up, of course). But everybody seemed to have a good time anyway, visiting with the few people who did drop by, and with each other.

I got Janet L. Smith to sign my copy of “Sea Of Troubles.”

. . . .

I got thinking about Janet a few months ago, when I was cleaning up my garage. I came across a box full of old paperbacks, and among them were Janet L. Smith’s three novels: “Sea Of Troubles,” (1990) with the author’s signature still there in faded ink on the inside page; “Practice To Deceive” (1993); and “A Vintage Murder” (1995).

I re-read each one. And I’ll say this: They’re not great, but they’re pretty good. They’re well-paced and well-plotted, authoritative on legal procedure, maybe a little light on character development and distinctive prose style. But I bought all three when they came out … and would have kept right on buying them if they had kept on coming out.

But, of course, they didn’t. And I set out to find out why.

Finding her wasn’t too difficult. A Google research revealed a Seattle law practice for Janet L. Smith. And, as big as Seattle is, I figured the odds of two Janet L. Smiths practicing law there were pretty long.

. . . .

We met Sept. 22 at a Starbucks on Aurora Avenue, not far from the Northgate-area office where she practices eldercare law. A smiling woman in her mid-fifties, Janet let me buy her a latte.

I jumped right in. So … what’s the deal? I asked. Why are you no longer a writer?

Janet smiled.

“When people me ask me that, I say, “Nobody asks someone why they didn’t write another Ph.D thesis.’”

That much fun, huh?

She then cautioned me, still smiling, against the assumption that she had failed.

Then she talked about introverts and extroverts. She was very much the latter, she said. Most authors don’t like being public figures, much preferring to hole up at home and write. That, Janet said, is not her.

“If I was doing writing 100 percent, without talking, I’d go stark raving out of my mind,” she said. But that, of course, is the discipline of novel writing, the one that doesn’t get talked about much. The reality is that writing a book is damned hard work, and requires a concentration that usually insists on isolation from all distraction. Some of us thrive on it. And some of us are like Janet.

Luckily, Janet didn’t have to worry about that, at first anyway, as she was juggling her part-time writing career with her legal work.

. . . .

[H]er fictional alter ego, Seattle attorney Annie MacPherson, solved complicated problems, too. And at the time Janet broke through, heroines like Annie MacPherson were just what the publishing industry was looking for. Mystery authors like Sue Grafton, Sharyn McCrumb and Sara Paretsky, with tough, sexy, self-sustaining heroines, were just completing their ascents into the sales stratosphere.

“I hit a moment in time where what I was selling was what they were looking for,” Janet said. “They wanted women protagonists, a strong regional flavor, nobody who was a cop or an FBI agent.”

That said, breaking in wasn’t a slam-dunk. Janet did what most aspiring authors did in the pre-Internet era, which was write dozens of letters to agents whose listings were found in the annual Writers Market reference books. “No luck,” she said.

. . . .

“I got encouraging rejection letters. That kept me going.”

And, at last, she broke through, with a small Bay Area press called Perseverance Press — an outfit so small, Janet said, that at the time it put out just one book a year. At the time, Janet was working in the state capital city of Olympia and recalls regularly visiting the small mystery bookshop there — Whodunit Books, which is still around — to babysit her book.

Then, mysterious good things happened. “Sea Of Troubles” got a positive review in The New York Times, even though it had never been submitted for one as far as Janet knew.

. . . .

That led to a new deal which saw her second Annie MacPherson book, “Practice To Deceive,” come out in hardcover as well as paperback. And led to her developing a public presence as an author. She attended the major mystery-writer conferences — Bouchercon, Malice Domestic and Left Coast Crime among them — and became active in the Sisters In Crime organization. She made friends among the Northwest writer community.

. . . .

That part was fun. The actual making-the-books part, not so much.

“For me,” she said, “the process of writing just isn’t fun.”

There were other factors, however, more beyond her control. After three books, her sales were steady but flat, trapping her in what she called “the comfortable midlist.” “Practice To Deceive” had done slightly better than “Sea Of Troubles,” and “A Vintage Murder” had done no worse than “Practice,” but neither represented the great leap forward that author and publisher both hoped for. That was being reflected in her publisher’s so-so support for the books; Janet’s regional tours to promote them were largely self-financed.

“Going from the midlist to something more probably wasn’t going to happen,” Janet said. “I probably wasn’t going to make that leap into Sue Grafton territory. My publisher didn’t see me having gold foil covers.” That’s the point, she said, where “they put you in a box and tell you where you belong.”

. . . .

And she’s left her days an author in the past, too. Well, mostly.

She laughed as she recalled a moment from earlier this year in which she caught her [law] practice’s office manager, during a slow day, reading one of her books — totally unaware that the author was her employer.

“I asked her what she was reading, and she was so embarrassed to be caught that she just said, ‘Oh, just some crap.’ I asked her who the author was, and she looked at the cover. It took her a moment to figure out that I was that Janet L. Smith.

‘I didn’t mean ‘crap!’” the office manager howled.

Janet teased her about it. “‘Not only are you reading on the job,” she recalled saying, “but you’re reading fluff!’ She had to tell everybody in the office about it.”

And that’s about the sum of her literary legacy, she said.

“It’s a trivia fact of my life,” she said. “Not much more than that.”

Link to the rest at Jim Thomsen and thanks to Dale for the tip.

PG says there are many ways in which an author may fail in the book business.

The OP describes a common reason for failure in the days prior to indie publishing – being categorized as “midlist”. Midlist books didn’t sell enough copies to support the physical bookstores, the distributor, the publisher and the author in the manner they desired to be supported.

An indie author in 2018 lives in a different world. Sales of ebooks in numbers that were formerly “midlist” can support an author and an author’s family, particularly when the author can release a book as soon as it is finished without the friction of dealing with various traditional publishing practices and processes.

Barnes & Noble may not have changed much, but Amazon understands that electrons on hard drives cost almost nothing, certainly way less than New York publicists and underpaid bookstore managers, so it needs very little money to support those hard drives and drop a few pennies into Jeff Bezos’ pocket from time to time.

Is there any dishonor in writing books that thousands of readers enjoy instead of books that millions of readers enjoy?

PG can’t remember when he last read a New York Times bestseller. He is not alone in appreciating books that fall well outside of mass market popularity.

Speculating on how those studying the history of books and authors will look back on the period beginning in the early part of the 21st century, PG suggests that this time will be regarded as the beginning of a golden age for books and authors because of indie publishing. Employment and income statistics will show a substantial increase in the number of full-time authors and their average incomes and the number of books sold. Millions of books will be written and read that never would have existed under the Ancien Régime.

The Big Secret Why Behind Everything so Far

7 June 2018

From Chuck Palahnuick:

On the plus side I’m not crazy.  For several years my income has dwindled.  Piracy, some people told me.  Or the publishers were in crisis and slow to pay royalties, although the publishers insisted they’d sent the money.

More recently, the trickle of my income stopped.  Not that there wasn’t always a good excuse.  Someone’s mother was suffering from Alzheimer’s and needed constant looking after.  The bank’s wire transfer system wasn’t secure, and hackers were a new threat.  You don’t question someone who claims to be the caregiver for a mother with dementia.  You let it slide.  I let it slide.

That’s why my big shows on book tour stopped.  Because the payment for Fight Club 2 and the two coloring books and Adjustment Day never seemed to arrive.  Years of income.  Each of those big shows cost north of ten grand to stage.  Money I paid.  For the glowing beach balls, the severed arms, the $150 leather-bound books as prizes, not to mention the dog toys, the shipping, the candy.  So much candy.  For each event, shopping carts full of candy.  It was justified in my mind because most of my readers had never attended an author reading, and I wanted their first to be exceptional.  But when my income stopped, when I had to choose between health insurance and autographed rubber arms… the shows stopped.  There, I’ve said it.

In comics, you pay your own way.  Invitations arrived from Comic-Cons, Dragon Cons, Wizard Worlds, but my money for travel had dried up.  Instead of income, I got excuses.  But this entire time an idea nagged at me:  What if someone’s stealing?

But that, that was insanity.  I’ve worked with the same team of people since 1994.  To suspect anyone was stealing, I had to be crazy.

And then I wasn’t.  You may have read about this over the weekend in the New York Post.  All the royalties and advance monies and film option payments that had accumulated in my author’s account in New York, or had been delayed somewhere in the banking pipeline, it was gone.  Poof.  I can’t even guess how much income.  Someone confessed on video he’d been stealing.  I wasn’t crazy.

Link to the rest at Chuck Palahnuick’s blog

PG is interested to see a couple of articles describing the literary agency, Donadio & Olson, as a victim of the wholesale theft of client funds.

If a community bank closes because of financial improprieties that have continued for years, is the president of the bank regarded as an innocent bystander? Can he/she credibly point to a clerk and say, “It was all her fault! I had no idea this was happening over all these decades.”

In a criminal trial held in a court of law, the president is presumed innocent until proven guilty. In the court of public opinion, the president is presumed to be part of the scheme or too incompetent to be responsible for running a bank.

PG suggests that in the court of public opinion, the agents that own (and have owned) and operated Donadio & Olson during the lengthy period of time over which client funds were stolen from authors should be similarly judged.

In the  event of a bank failure or financial difficulties, typically, an aggressive federal agency swoops in late on a Friday afternoon and takes over the books and records and operations of the bank. All the bank’s employees walk out the  door while the government agency figures out what went wrong and who is entitled to how much money. The bank reopens on Monday morning under the direct management of the Federal Deposit Insurance Corporation. (Similar enforcement actions by other government agencies if a bank is not federally insured or a savings & loan has problems.)

It is PG’s impression that, like California, New York’s legislature has passed a law about nearly every subject imaginable. New York City prides itself as being the center of the traditional American publishing industry.

Where is the government regulation requiring that, if literary agencies are receiving and holding money that really belongs to someone else – authors – the literary agencies act like banks that receive and hold money belonging to other people and be treated as custodians of funds held to the highest standard of care?

If Big Publishing really cares about authors and doesn’t take them for granted, why don’t the standard terms of a traditional publishing contract include provisions that pay royalties directly to authors and agency fees directly to agents? Publishers will do this if asked by an attorney for the author. Why not make it the default?

As PG has stated before, nothing that is good for the author happens when an agency receives royalty payments to which the author is entitled. Passing funds through the agency bank account adds no value whatsoever and only provides an opportunity for something bad to happen to those royalties.

Charge of the write brigade: How to save the last American bookstore chain

6 June 2018

From The Bookseller:

In every great epic, there is the last stand: a waning of hope, a dutiful last charge, and a hopeful moment of deus ex machina.

It’s all too tempting to imagine American publishers in a boardroom today using similar literary tropes in a dramatic analogy involving besieged Barnes & Noble locations and a fight to the last man against Amazonian invaders. Our analogy isn’t far off. Right now, B&N faces death but bravely holds fast to stave off private takeovers and Amazon at the gates a little bit longer.

The death of the last major American bookstore chain is significant. It leaves publishers with few major bookselling channels outside of Amazon, hundreds of American communities reliant on e-commerce for books, and a beloved brand and store experience only a distant memory for readers.

. . . .

Financially, B&N is in dire straits. The stock is trading a hair above $5, less than a fifth of their 2006 price before ebooks and Amazon consumed the market. Since then, stores have seen 11 years of declining sales and dozens of closures. After Feb. 12 lay-offs of 1,800 full-time positions, many stores now have no full-time employees.

B&N’s online sales have been steadily declining more than 25% in the last two years, despite occasional odd attempts at building unique online experiences. Meanwhile, Amazon currently sells one out of every two books in the U.S., according to digital publishing consultants Mike Shatzkin and Hugh Howey. While the overall book market grows a healthy 3% a year, it “is solely due to Amazon’s fast-growing online print sales,” says Howey. Last year, “all other channels shrunk.”

Link to the rest at The Bookseller

PG says  the death of the  last American bookstore chain is primarily self-inflicted.

Ditto for the big publishers on life support, down-sizing their way to a brighter future.

Nowhere was it cast in stone that Amazon would dominate bookselling. Barnes & Noble was a household name when Amazon shipped its first book. And its thousandth book. So was Borders.

Each of the two big book chains (plus some other smaller chains) was ideally positioned in the minds of consumers to dominate online book sales. Who do you trust? Barnes & Noble, where you have purchased books for years or that Amazon web thing operating out of  some guy’s kitchen in Seattle that’s liable to take your money, go bankrupt and blame UPS when your book gets lost?

With their unerring ability to locate a sinking ship, publishers jumped on board the SS Queen of  the Livre Papier. Apple always sold its computers and other stuff at list price, so  publishers created an illegal conspiracy with Steve Jobs’ encouragement that had one principal objective – Sell at List Price – and a motto, Discounting is the Devil’s Playground! (except when Barnes & Noble does it)

Ebooks were an ideal product for publishers – no printing costs, no waiting for ships full of books from China, no warehousing charges, no slice of the pie for Ingram. Send some electrons to any online bookstore that wanted to sell them and watch the money roll in.

But no, that would be wrong because Paper!

Shakespeare used paper. So did Mark Twain. And Jane! Jane Austen never allowed a computer in Pemberley. Everybody knows they were geniuses so who are we to question their ways?

A Little Traveling

5 June 2018

PG has not been a paradigm of posting lately.

His reason (and he thinks it’s a good one) is that he’s been visiting some of his  offspring.

Following is Offspring Exhibit A:

Save Barnes & Noble!

7 May 2018

From The New York Times:

Barnes & Noble is in trouble. You hear that, in worried tones, when you talk to people in the book business. You feel it when you walk into one of the chain’s stores, a cluttered mix of gifts, games, DVDs (DVDs?) and books. And you really see the problems if you dig into the company’s financial statements.

Revenue from Nook, the company’s e-book device, has fallen more than 85 percent since 2012. Online sales of physical books have also plummeted. At the stores, where business was once holding up, it’s down about 10 percent over the past two years. Several stores — like my local one, in the Washington suburbs — have closed, and many have reduced staff.

The company’s leaders claim that they have a turnaround plan, based on smaller, more appealing stores focused on books, and I hope the plan works. It’s depressing to imagine that more than 600 Barnes & Noble stores might simply disappear — as already happened with Borders, in 2011. But the death of Barnes & Noble is now plausible.

. . . .

The full story revolves around government policy — in particular, Washington’s leniency, under both parties, toward technology giants that have come to resemble monopolies. These giants are popular, because they provide good products and service. But they have also become mighty enough to vanquish their competitors and create problems for society.

. . . .

For most of American history, the government viewed giant corporations of any kind as inherently problematic. Their size gave them too much power — to eliminate competition, raise prices, hold down wages and influence politics. So the government passed laws to restrain businesses and occasionally broke up the largest, like Standard Oil and AT&T.

In the 1970s, however, a new idea took hold: Size was not a problem so long as prices remained low. Bigness could even be good, because it promoted efficiency and thus lower prices. The legal scholar Robert Borkwas the most influential advocate for this view, and it soon guided the Supreme Court, the Reagan administration and pretty much every administration since.

But the theory has two huge flaws, as a new generation of scholars, like Lina Khan, is emphasizing. One, prices are not a broad enough measure of well-being. Wages, innovation and political power matter as well. If prices stay low but wages don’t grow — which is, roughly, what’s happened in recent decades — consumers aren’t better off. Two, regulators have focused on short-term prices, sometimes ignoring what can happen after a company drives out its rivals.

. . . .

The book business is looking like a case study. Amazon is taking over, yet has never run into antitrust scrutiny. It has reduced prices, after all. It sells many e-books for $9.99 and hardcover best sellers at a big discount. So what’s the problem?

Plenty. Amazon has been happy to lose money on books to build a loyal customer base, to which it can then sell everything else. “Amazon isn’t primarily concerned about books these days,” Oren Teicher, who runs an association of independent bookstores, told me. “They are far more focused on getting consumers into their ecosystem so they can sell them every other product under the sun.”

But the artificially low prices have created a raft of problems. Fewer books are commercially viable. Publishers are focusing on big-name writers. The number of professional authors has declined. The disappearance of Borders deprived dozens of communities of their only physical bookstore and led to a drop in book sales that looks permanent.

. . . .

“It’s in the interest of the book business,” Teicher says, “for Barnes & Noble not just to survive but to thrive.”

Link to the rest at The New York Times and thanks to Susan and others for the tip.

PG suggests the fundamental purpose of antitrust law is not to benefit the corporate losers in commercial competitions, but rather to benefit consumers by promoting competition in a variety of marketplaces.

These laws are not intended to punish successful competitors because of their size or to permit courts to choose winners and losers in the marketplace.

In an active marketplace, consumers will be benefited by the improvements in products or services and/or the lowering of prices that result when sellers are competing for the business of buyers. Each seller is focused on capturing and holding the loyalty of buyers by providing a more attractive product or service to those buyers. Buyers vote with their dollars, but no seller can assume that their customers today will be their customers tomorrow unless the sellers continue to attract and serve buyers with features the buyers desire tomorrow, whether they be price, selection, service, a better purchasing experience or whatever buyers value tomorrow.

Consumers are subject to the threat of substantial damage in a market that is not competitive because established sellers are relying on something other than the free choices of buyers to select the most attractive product or service by interfering with the competitive process.

How has Amazon beaten many of its competitors? Better prices, certainly, but also with better service (2-day delivery with Prime and real-time updates on delivery status, for example), a huge selection of goods, lots of customer reviews to provide additional information to prospective purchasers and easy returns and refunds if a product does not satisfy a customer.

As compared with physical stores like Barnes & Noble, an Amazon customer can choose from a far, far wider selection of books than any Barnes & Noble store carries. An Amazon customer can typically purchase books for lower prices than are offered at a Barnes & Noble store. An Amazon customer can purchase a book when a Barnes & Noble store is not open or not convenient to visit or staffed by sullen clerks working for little more than minimum wage.

An Amazon customer can purchase books from independent authors instead of large corporate publishers exercising monopoly power by offering authors substantially identical terms and compensation as other corporate publishers do. When an Amazon customer makes such a purchase, she can do so knowing that much more of the price she pays for the book will be received by the individual author than would be the case if a purchase was made from a corporate publisher. A savvy purchaser will know that she is not subsidizing the victimization of authors by corporate publishers as has occurred on several occasions during recent memory.

 

 

Every top New York Times best-seller this year has been about Trump

21 April 2018

From CNN:

Since January, each book at the top of The New York Times best-seller list has had one thing in common: President Trump.

James Comey’s book “A Higher Loyalty” will surely keep the streak alive. Comey’s high-profile launch is also highlighting Trump’s broader effects on book sales.

The No. 1 spot on The Times’ hardcover nonfiction list is incredibly coveted real estate in the publishing industry. Michael Wolff’s “Fire and Fury” landed there in mid-January thanks to explosive allegations and a full-throated presidential attack.

“Fury” held onto the No. 1 spot until Michael Isikoff and David Corn’s “Russian Roulette” came along in March. The book — subtitled “The Inside Story of Putin’s War on America and the Election of Donald Trump” — was on top for three weeks.

. . . .

There is a caveat about The Times list: Psychologist Jordan Peterson’s book “12 Rules For Life” has been a hot seller for months, and might have ranked No. 1, but because it is published by a Canadian company, it is not counted by the U.S. newspaper.

Link to the rest at CNN

By including this item, PG is not inviting a political war in the Comments section of TPV. There are many other (and better) online locations for those discussions.

Rather, he wonders what this says about Big Publishing and The New York Times bestseller lists.

Whatever his strengths and weaknesses, Mr. Trump did win the 2016 Presidential Election. He did so by winning 30 states with 306 pledged electors out of 538 total electors. The results were known on November 8, 2016, 529 days ago.

Like four previous US Presidents (1824: John Quincy Adams, 1876: Rutherford B. Hayes, 1888: Benjamin Harrison and 2000: George W. Bush) Mr. Trump did not win the country-wide popular vote.

On a state-by-state basis, Ms. Clinton won in the most populous state – California – but Mr. Trump won seven out of the ten most populous states: Texas (#2), Florida (#3), Pennsylvania (#5), Ohio (#7), Georgia (#8), North Carolina (#9) and Michigan (#10).

The large New York publishers behind the anti-Trump bestsellers have not, to PG’s knowledge (he’s happy to be corrected),  released any best-selling pro-Trump books or anti-Clinton books.

While it’s no surprise that the New York-based companies hire New York-based employees, the majority of whom quite probably did not vote for Mr. Trump, PG wonders if anyone in New York thought there might be a market for a pro-Trump or anti-Clinton book.

Even before Amazon released constantly-updated bestseller rankings, the methodology behind the New York Times bestseller lists (which is confidential and described only in the most general terms by the paper) was widely-questioned.

In fact, as reported on TPV and elsewhere, it was possible to game the NYT bestseller lists and shadowy companies could (for a fee) guarantee that a book would appear as an NYT bestseller the week it was released. Typically, they accomplished this by using a variety of people to purchase books from retail bookstores known or suspected to be consulted by the Times for its weekly bestseller lists.

The most recent report about such behavior that PG could locate with a quick search was from Vox in September, 2017. Here’s an excerpt:

On August 24, an unknown book by an unknown author from an unknown publisher rocketed its way to first place on the Times’s young adult hardcover best-seller list. But as a scrappy band of investigators who congregated in the YA Twitter community discovered, it wasn’t because a lot of people were reading the book. Handbook for Mortals by Lani Sarem bought its way onto the list, they concluded, with the publisher and author strategically ordering large numbers of the book from stores that report their sales to the New York Times. Shortly thereafter, the Times removed the book from its rankings.

And on September 4, Regnery Books — the conservative publishing imprint that publishes Ann Coulter and Dinesh D’Souza, among others — denounced the New York Times best-seller list as biased against conservatives. Why, it demanded, was D’Souza’s new book The Big Lie: Exposing the Nazi Roots of the American Left ranked as seventh on the Times’s hardcover nonfiction list when Nielsen BookScan’s data, per Regnery’s interpretation, suggested it should be first? Regnery concluded that the New York Times was actively conspiring against conservative titles, and announced that it would sever all ties with the Times.

. . . .

Becoming a New York Times best-seller has a measurable effect on a book’s sales, especially for books by debut authors. According to a 2004 study by economics professor Alan Sorensen, appearing on the New York Times’s best-seller list increased debut authors’ sales by 57 percent. On average, it increased sales by 13 or 14 percent.

Besides the list’s effect on sales, it offers prestige. If your book appears on the New York Times list — even just for a week in the last slot of the Advice, How-To & Miscellaneous category — you get to call yourself a New York Times best-seller for the rest of your life. You can put that honor on the cover of all of your other books.

. . . .

The author and publisher of Handbook for Mortals reportedly hoped that gaming the New York Times best-seller list would make it easier for them to sell the book’s film rights down the road, which is presumably why they were willing to spend the money to get the book onto the list.

. . . .

So all of the different best-seller lists have established their own methodologies to gather sales data — and once they’ve got it, they break it down differently. They put the break between one week and another in different spots (ending on Sunday versus Saturday, for example); they use different categories to sort the lists; they weigh digital and print titles differently.

. . . .

It’s widely rumored that independent bookstore sales are weighted more heavily than Walmart sales [by the NYT], for instance, but the Times has never confirmed this. Some observers have also suggested that it weights print sales from traditional publishers more heavily than it does digital sales from digital publishers or self-publishers, because books that do very well on Amazon’s in-house imprints seem to rarely show up on the Times list

Link to the rest at Vox

PG suspects the NYT bestseller list methodology is focused on generating bestselling books that the NYT believes its subscribers would buy (or should buy. Certain NYT bestsellers are notoriously never read. See below. ).

To be clear, PG says the NYT is absolutely free to do this, but might be a bit more upfront about its objectives.

As organizations comprised largely of people who see the world through the NYT, major US publishers are significantly impacted by the NYT. An editor at HarperCollins receives some sort of gold star if one of her books makes the NYT lists. If she consistently has a book or two that make the NYT lists each year, she gains more than a little job security.

On the other hand, even if our theoretical HC editor could credibly claim one of her authors was killing it in Houston, Miami, Cleveland and Charlotte, but, for some unknown reason, hadn’t made the NYT lists, she’s less likely to brag about it to her boss.

As far as NYT bestsellers that are never read, a long time ago, a NYT columnist even wrote about the phenomenon.

The tale of the emperor’s new clothes has been around a long time. But how about defining another category of mass delusion, the emperor’s new book: the insanely popular, often intellectually intimidating book that sells hundreds of thousands of copies (sometimes even millions) but that few people actually read.

The phenomenon of the unread best seller comes to mind because of the recent publication of ”Ravelstein,” Saul Bellow’s novel about the life and death of his friend Allan Bloom. In life, Bloom was a humanities professor well known only in the academy who gained international fame in 1987 after the surprising success of his dense treatise ”The Closing of the American Mind.” To this day, many consider it one of the prime examples of an emperor’s new book.

Another classic example also comes from the 1980’s: Stephen Hawking’s ”Brief History of Time” remains no doubt the most abstruse volume ever to sell nearly nine million copies around the world.

Figuring out which best sellers go unread is not easy, since most people don’t want to admit to the unfinished state of their reading. Much of the evidence is anecdotal. Bloom and Hawking, for instance, were the universal first responses when a small sampling of people in the book business were asked about unread best sellers. But a somewhat more solid indicator of unread books emerged in 1985 when Michael Kinsley, then of The New Republic, acted on his suspicions about reading habits in the nation’s capital.

Mr. Kinsley and a colleague put coupons redeemable for five dollars each in the back of 70 copies of selected books in Washington bookstores. Two of the books were ”Deadly Gambits: The Reagan Administration and the Stalemate in Nuclear Arms Control” by Strobe Talbott and ”The Good News Is the Bad News Is Wrong” by Ben J. Wattenberg. Though neither was a national best seller, they were chosen, Mr. Kinsley said, as the kinds of books Washingtonians were most likely to claim to have read. No one ever redeemed a coupon. The Kinsley report may be as scientific a study as there is.

. . . .

 Michael Willis was the marketing director at the Free Press in 1994, when the company published ”The Bell Curve” by Richard J. Herrnstein and Charles Murray.”We thought it was very much the case that both professionals and the general public bought it to have it and didn’t read it,” he says. ”We got the sense even from reviews that people basically read the first chapter and the last.”

Link to the rest at The New York Times

 

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