Home » Amazon, Big Publishing, The Business of Writing » The Disastrous Decline in Author Incomes Isn’t Just Amazon’s Fault

The Disastrous Decline in Author Incomes Isn’t Just Amazon’s Fault

20 January 2019

From Electric Lit:

[T]he Authors Guild published its 2018 Author Income Survey.

. . . .

This was the largest survey ever conducted of writing-related earnings by American authors. It tallied the responses of 5,067 authors, including those who are traditionally, hybrid, and self-published, and found that the median income from writing has dropped 42% from 2009, landing at a paltry $6,080. The other findings are similarly bleak: revenue from books has dropped an additional 21%, to $3,100, meaning it’s impossible to make a living from writing books alone.

. . . .

The Authors Guild has a pretty clear idea of what’s behind this disturbing trend, namely the rise of Amazon, which severely cuts publishers’ margins on book sales. Authors ultimately shoulder the cost because publishers offset their losses by giving out smaller author advances and royalties. The platform’s resale market also means that, within months of publication, books are being resold as “like new” or “lightly used,” a scenario in which no new money goes to the actual author of the book. The Authors Guild acknowledges that Amazon isn’t the only place where authors are losing out, but the culprits are of a kind: electronic platforms like Google Books and Open Library claim fair use rights in order to offer classrooms products without paying authors royalties. This is problematic because those royalties, a kind of pay-to-play model of compensation, are how artists have made their money ever since it went out of fashion to have a patron who could support your entire career.

. . . .

This year’s Authors Guild Survey is right to focus on the harm Amazon does to working writers; personally, I’ve made my 2019 resolution to put my money where my mouth is and buy all my books at local, independent bookstores. But the survey results made me wonder if that would be enough—if it’s possible, in the age of the Internet, to reverse the belief that content should mostly be free. By content I do mean to encompass all ends of the artistic spectrum, that ill-defined mass of high and low entertainment and art and news that rubs up against each other on the web in a way that makes it more difficult to separate out, and perhaps less meaningful to do so. Basically, people are insatiable for this panoply of words and images; they want mass input. If you do a Google search for “apple pie recipe,” for example, the top results include both Pillsbury’s website and the personal blog of a home cook. The point isn’t that there is anything wrong with the latter, it’s that discernment has taken a backseat to access; we want all the apple pie recipes, all the videos and photographs and articles and books. We are here now. Entertain us.

. . . .

People have always felt a sort of ownership over art, and that’s actually good. It’s why you keep a book on your shelf and return to it, it’s why you hang a picture on your wall that speaks to you. But when this gets out of hand and you mistake access or a personal connection with your rights, as happens so often in our Internet age, it leads to a dangerous sense of entitlement. That’s why readers feel empowered to complain, directly to the creator, that a book or show doesn’t have absolutely everything they want: the romantic pairing they’d hoped for, the language they find most friendly, the ending they desired. And it’s also why, for instance, the last Harry Potter book leaked on the internet before it was officially published: fans saw the book as something they were owed, not the product of labor that deserved compensation. Not that J.K. Rowling needs more money—but she, and all authors, deserve to have their work recognized as work.

. . . .

Consumers hold a pernicious power, so this trend towards free content won’t reverse itself unless we want it to. This is a sad thing, and we will all be much worse off if we can only hear stories from people who can afford to write. Nicholas Weinstock, a Guild Council member, said: “Reducing the monetary incentive for potential book authors even to enter the field means that there will be less for future generations to read: fewer voices, fewer stories, less representation of the kind of human expression than runs deeper and requires and rewards more brain power than the nearest bingeable series on Netflix or Amazon or GIF on your phone.” Maybe we will all get what we think we’re entitled to — free art — but what kind of art will that be?

Link to the rest at Electric Lit

While we will never know for certain, PG suggests that the rise of Amazon has increased the number of books sold in the United States (and maybe elsewhere) by a substantial margin. Absent Amazon, fewer people would be reading books today.

Not everyone enjoyed the trips to the bookstore in pre-Amazonian days. If a reader’s interests were much out of the mainstream, there weren’t many books available. If finances were a little tight, a shopper might not be in the mood to pay.

PG just checked the Top 10 Hardcover Fiction Bestsellers at Barnes & Noble. The average suggested retail price for the Top 10 was $25.59.

For some visitors to TPV, paying almost $26.00 for a novel would seem reasonable. For others, it might not.

Let’s assume we have an avid reader of fiction who reads four books per week. Even PG can do the math in his head.

Over $100 per month for books. Almost $6,000 per year for books.

Who knows more about pricing anything to maximize sales, the CEO of a New York publisher or Amazon?

Who knows more about pricing anything to maximize profits, the CEO of a New York publisher or Amazon?

Traditional publishers try to cultivate a particular image of books as a unique product, unlike any other. (Corinthian leather!)

Like it or not, books are a mass-market product that competes for consumer dollars. Books don’t just compete with other books. Books compete with every other product a consumer might be thinking about purchasing.

If you want to price for the carriage trade, open an art gallery. The New York book business doesn’t work without lots of titles that sell in the tens of thousands or hundreds of thousands. That’s a mass market.

PG suggests that “Amazon is causing the sky to fall on the book business” is erroneous. If the traditional book business is to be saved from its own management over the next ten years, Amazon will do the saving. A book business that sells an electronic version of its principal product for $3.00-7.00 has a better future than one which appears to prefer selling a physical copy of its principal product for $28.00.

 

Amazon, Big Publishing, The Business of Writing

54 Comments to “The Disastrous Decline in Author Incomes Isn’t Just Amazon’s Fault”

  1. A meandering pile of thoughtless stupid.

    1. The AG survey was in no way scientific in that they blasted it out and then added up results from whoever responded. Apparently English majors just can’t be bothered to learn anything about statistical validity.

    2. “It’s impossible to make a living from writing books alone.” — there is always going to be a cutoff below which writers are unable to make a living from what they do. There are a LOT of “writers”, far more than the market can fully support. So what?

    3. “Amazon, which severely cuts publishers’ margins on book sales.” — Amazon gets quantity discounts and permission to POD for many backlist titles, but where does this “severe cut to margins” stuff come from?

    4. “The platform’s resale market also means that, within months of publication, books are being resold as “like new” or “lightly used,” — used books are a fact of life. Most consumers factor resale value into the cost of purchasing a new book. If you’re going to spend $26 on a hardcover you have every right to try to get $13 back in the resale market. Suck it up, sweetheart.

    5. If you do a Google search for “apple pie recipe,” for example, the top results include both Pillsbury’s website and the personal blog of a home cook. The point isn’t that there is anything wrong with the latter, it’s that discernment has taken a backseat to access; we want all the apple pie recipes — the mournful cry of the gatekeeper. The blog is not kept separate from the brand name. (and by implication, the self-pub is not kept separate from the big-pub.) If we fail to curate, all is lost!!!

    Twaddle.

    • As to number 4: the higher the price of the product, the greater the incentive to resell or buy used. Or borrow; hence the increasing demand for library ebooks.

      Agency: the gift that keeps on giving.

    • > Apparently English majors just can’t be bothered to learn anything about statistical validity.

      Come on, be fair. “Climatologists” and waaay too many of the “science!” crowd seem to have only a nodding familiarity with the concept.

    • >Amazon, which severely cuts publishers’ margins on book sales.

      I suspect their whine would be better directed at the “deep discount” clause the trad pubs are using in their contracts. One teaser rate up front, and then deeper in the contract, the rate authors actually get if the book is sold through a giant retailer such as Costco, Walmart, or, Amazon. I wonder if B&N is also included in that group?

      • Before Amazon grew large, the common complaint was that Barnes & Noble cut publishers’ margins on book sales.

        • All the while hiding the fact that volume discounts favoring the biggest retailers result in bigger net profits to the publishers. The BPHs are in the bulk sales business, as Amazon demonstrated during the 2014 catfight with Hachette by only ordering books after they’d been sold.

  2. Consumers hold a pernicious power,

    They do indeed. They hold dollars, and they don’t care if authors want their dollars. They care no more about authors’ incomes than authors care about cowboys’ incomes.

    Think authors are concerned that all the guys who want to make a living as cowboys can’t do it?

    • Good point, T.

      If you describe your customers, the people upon whom you ultimately rely for your living, as pernicious, I wonder if you are destined for happiness in your current occupation as an author.

      I also wonder who else the author might prefer as the holder of such pernicious power.

  3. Breathtakingly ignorant but what we have come to expect from these sources. Amazon, or more specifically the Indie book market is indeed largely responsible for the sky falling in on traditional publishers. And tradpub authors, the vast majority of whom were treated poorly anyway are now treated even worse. But in both cases they have only themselves to blame. Tradpub is focussed on selling print and refuses to price its ebooks competitively. Suffering tradpub authors refuse to go Indie. Articles like this treat the huge and growing Indie market as if it does not exist. ADS is alive and well.

  4. I really liked the authors delusional belief that they were going to help authors by directing their money to particular intermediaries:

    I’ve made my 2019 resolution to put my money where my mouth is and buy all my books at local, independent bookstores.

    Apparently caring about author’s income does not extend to actually thinking about how your purchase choices will determine what proportion of your book budget will actually reach the author.

    • Yes. One could be forgiven for suffering under the delusion that buying an ebook from Amazon from a self-published author would usually result in the author getting 70%. Many times what the author gets from a traditional sale.

  5. “Most consumers factor resale value into the cost of purchasing a new book.”
    Um, evidence of this?

    2)While it’s true hardbacks are pricey, that was the purpose of paperbacks, offering the same book cheap.

    • A single data point: I’ve never thought about resale value when buying a book.

      I do think about value which is why there are books I’d like to but don’t own and is one of the reasons why my paper fiction collection is almost all mass market paperbacks. Another is that most of the older SF I bought never had hb editions (plus shelf space …)

      New fiction hardbacks were for presents for my wife or authors for whom I couldn’t bear to wait until the pb was out (and I could count these on the fingers of one hand).

    • Evidence?
      The abundance of two-fer bookstores and the growth of used books sales. Those used books showing up on Amazon, especially eBay, ABE Books, etc, all near mint, have to come from somewhere.

      It’s not even a new phenomenon. Check this from 2003:

      https://www.finebooksmagazine.com/issue/0204/used_books.phtml

      The growth in used book sales parallels the rise in average book price for new books due to the phase out of MassMarket. Not everybody has migrated to Indies.

      • Felix, this may be evidence for some consumers but does not justify most, plus how many of the multitude of used books on sale were actually bought for resale? I can’t speak for the USA but in the UK a hell of a lot of the fiction is picked up for free from charity donations and the like (with anything not rare or in good condition going to paper recycling/landfill).

        • Those are the penny books. A recent phenomenon.
          That’s why I went with a fifteen year old, pre-Kindle report.
          And, sure, it’s not everybody that cares about pricing.
          But the patrons of the two-fer stores (do you have those in the UK?) are legion. Meanwhile, hoarders and rereaders are smaller subsets of the market.

          • Flea market/library sale books are hardly recent. I was picking up great bargains fifteen years ago.
            I don’t dispute there’s a trade in used books. There always has been. But saying resale value is a primary question is another matter.

            • That’s the part I’m skeptical about, too. I don’t think anyone who buys books thinks about what they can get if they re-sell it. I had a friend introduce me to a second-hand bookstore, and she never once mentioned buying brand new books with the resale value in mind. That would likely be a question for people who buy collectible books (think Subterranean Press) that they keep shrinkwrapped or in slipcases and so on. For paperbacks in general? Doubt it. And college students learn pretty fast that the system is rigged to prevent reselling their over-expensive textbooks.

              • Plenty of people do this, and I’m surprised that you and Mike are unfamiliar with the practice. Many of my relatives who like to read in print buy new releases as soon as they are out, read them quickly and carefully (no eating) and then sell them for half, or even more, of their cover price.

                Look at “Becoming” by Michelle Obama. At this time (1/21) it is available in hardcover for $19.50. However, there are plenty of used good condition copies available from the same listing for $15.00 – or more, the reason being that cheaper good condition copies get snatched up by cost-conscious buyers, and added by readers who have learned to use the “have one to sell?” button, also on the listing. If you can buy it for $20 and sell it for $12, you are making a big dent in the cost of reading print best-sellers.

                Obviously this isn’t the case for just any old book – it really only works for today’s hot book, but still, just because you haven’t heard of it doesn’t mean it isn’t a thing.

                • You: Obviously this isn’t the case for just any old book

                  Me: For paperbacks in general? Doubt it.

                  It appears you agree there. I don’t know if you noticed, but the resale shops are chock full of paperbacks, which is the kind I’m doubting people are buying for their resale value. The kind I think they are buying for the resale value are the Subterrannean Press books, which actually are the hot new thing, which you can see if you should happen to look them up. Seriously, they had Howey’s “Wool” series back when it was new.

                  The friends who shop at resale shops just aren’t buying the books to resell them, they’re either buying used to start with because they’re frugal, or they’re buying cheap(er) paperbacks because they’re frugal.

                  You seem to be describing a “book flipper,” except unlike with houses, they don’t add any value, they just refrain from subtracting them (I think it’s very nice of them not to get food on the books).

                • There’s a big enough market that Amazon’s gotten into it with Abe Books. Before I went completely Kindle, I’d buy used copies of current best sellers there for half-price or less.

            • Textbooks are a major portion of the book business.
              Don’t forget about them.
              Resale value is why print trumps digital on that side.

              • Felix, I’ll give you that textbooks are different: high prices combined with often only needing them for a short time (and student poverty) definitely increases the importance of resale value. It also pushes publishers to minimise that value by doing frequent new additions with just enough changes to make the old version almost unusable.

          • I can’t say I’ve noticed two-fer stores in my part of the UK. What are ubiquitous are the charity shops with a few shelves or boxes of cheap books. The source is normally the same as the penny books but the prices are higher (often £0.50 round our way) and they comprise the better quality volumes that they didn’t pass onto the Amazon marketeers. The savvy charities try to pick out the valuable items for sale in their specialised book shops.

            • In my old neck of the woods pretty much every suburb in the metro area had a two-for-one shop. A couple dozen. More than new book stores. They outlived Borders, too. Typically they’re family owned, operate in strip malls and are less than 1000 square feet. The nearly universal formula is you buy the book at half the cover price or trade two of your own books for credits at a two-for-one rate. They also carry a handful of new top top sellers.

              And then there’s HALF-PRICE BOOKS, a regional chain that has added an online arm. They have 127 stores in 17 states. Same formula but larger stores and a broader focus: they also buy and sell used DVDs and other media. They even have a publishing arm, like Amazon and B&N.

              https://www.hpb.com/home

              You don’t hear much of them or BOOKS-A-MILLION because neither operates in Manhattan.

        • I always factored in resale value, and I think most consumers do. I used zero for hardbacks, and zero for paper backs. But, if I picked the book up on the bargain table I used zero.

      • Never forget, if someone does it, then everyone does it.

        • Everybody thinks they are normal, no matter how far they might be from the mainstream. Fortunately, numbers highlight reality.
          And the numbers say a whole honking lot of people buy/trade used books.

  6. “Amazon, which severely cuts publishers’ margins on book sales.”

    I thought they were complaining about author earnings, not publisher revenues. I swear the members of the Authors Guild have Stockholm Syndrome.

    • If you check their history you’ll find they’ve always back the publishers over the writers. (Which is why the strong ADS, Amazon is the biggest way to skip the whole trad-pub mess.)

    • Fully half the members of Author’s Guild are agents. I don’t have a link to the article I read (some years ago), but someone who had the members list checked all the names.

      Agents exert a huge level of control over the policy of the Guild.That is why the Guild always backs the publishers.

  7. Smart Debut Author

    The Authors Guild advocates for authors the way the Democratic People’s Republic of Korea advocates for democracy, and the way the Ministry of Plenty advocates for feeding children.

  8. Funny, it seemed Amazon and other ebook sellers ‘increased’ what writers were making per copy sold – that is if the writer in question skipped the agent/publisher middlemen and went indie.

    How many Amazon millionaires are writers? It seems to be more than trad-pub writer millionaires – and the Amazon ones still have all their rights!

    Me thinks ‘Electric Lit’ be banging on the wrong drum!

  9. Did the writer of the article ever consider the possibility that part of the reason for the decline in median income for writers is that more people are being published, most of whom would not have been published back in the old days?
    If you have a group of people where the median income is x, and then you combine it with another group of people whose median income is less than x, the median income of the overall group will decline whether or not anyone is actually worse off.

    Also, side note, what’s wrong with a home cooks blog being on the same plane as Pillsbury? Big corporate recipes are usually safe and kind of bland–with a home cooking blog you might get something interesting.

    • “Did the writer of the article ever consider the possibility that part of the reason for the decline in median income for writers is that more people are being published, most of whom would not have been published back in the old days?”

      Like all of these silly articles, they also ignore all those writers/books that received only a rejection slip – each of those should have been averaged into the system as ‘writer made $0.00 on their book’.

  10. I’ll never understand the big publishers or groups like the Authors Guild who seem to think that Amazon is the big bad for them. It’s the biggest book store out there and sells millions of books. Without Amazon their sales would be MUCH lower. Would they prefer to sell nothing in remote areas without access to book stores or sell something through Amazon?

    Was Crown Books hurting author revenue when they discounted books or were they providing a vehicle for people to discover authors without bankruptcy resulting?

    They don’t seem to grasp that the dilution of money is due to the sheer volume of product out there. So sorry that you can no longer own a lock on the market only allowing your books to be sold.

    • Well, that last sentence is what guilds usually end up turning into–a monopsony that deliberately tries to keep membership low.

  11. I saw notes from a proposal from the Author’s Guild where they were planning to go after library pricing. They feel they don’t get the full compensation for the many borrows of their books. So you take a financially starved system like libraries, who already pay much more for books then I do because they are going to be borrowed multiple times and you jack up the price even more??
    Seems like the Guild is taking on everyone but Traditional publishing who holds their lousy contracts.

  12. Many people miss the point that the economics of publishing has completely changed. Publishing a digital book costs nothing. Producing a digital book has all the costs producing a book ever had. The writing, editing, designing and promotion costs are the same, but there’s no printing, warehousing, or shipping costs. Digital book sellers have no inventory costs. Publishers have to realize that indies can distribute digital books as well as they can, which means they have to offer better editing, design, and promotion than an indie can generate; booksellers have to figure out how to use their retail space against digital sellers. These are hard problems, but hey! A lot of folks well-being depends on figuring this stuff out, so they will.

    In software, which has been ahead of the book publishing curve, the vendors quit selling software and started selling services. (Your monthly or yearly subscription to Msft Office is an example.)

    The trend is to pay programmers, the equivalent of authors, to produce free software which the vendors offer as a service. If you want to maintain your own Apache web server, go ahead, it’s free, but if you can’t maintain it yourself, you have to pay a service to keep it popping. The software media you used to buy at the software store are things of the past.

    Something similarly radical will happen to books, but I don’t know what it will be.

    • With software, the product keeps changing, growing, and improving. Books? Even the digital readers ape the format of 100 years ago. There isn’t anything new.

      For story telling, video games are certainly new and improving, but are not books. Perhaps books will just be the old way of telling stories. The stories remain, but the ways of expressing them change.

      Books are a delivery system. They are not the story.

  13. @Democritus. Something already has happened to books, in the form of ebooks and internet distribution of them. Many still love their print books, but from what I have looked at it seems print on demand versions retail for about the same price as many traditionally printed books. I can’t see a magic solution for the Big 5 popping out of the air. You can still buy a buggy whip, but it is very much a niche market compared to the days when the horse was the King of transport. I think there will always be brick and mortar book shops and paper books, but I expect they will eventually become very much a niche market. The economics are likely to be increasingly dictated by ebooks, with print books increasingly print on demand, especially as that technology improves and the price comes down.

    • I agree that digital books and distribution have become a market force. But I still expect big changes in reading consumption, publication, and the role of authors. I don’t expect big traditional publishers to as they are now because I see no scale magic in editing, design, and promotion.

      However, the current indie practice in which authors contract out editing, design, and promotion (or do it themselves) only works for exceptionally versatile authors. I don’t think writers like Dashiell Hammett or Raymond Chandler would succeed, or even try, as indies today. Both failed miserably as entrepreneurs.

      Still, I think overwhelming talent and diligence like theirs would prevail because the market and the audience would find a way to consume their work and sustain them. Exactly how, I have no clue.

      • We really don’t know how unusual their overwhelming talent and diligence is. Access to the market was extremely limited.

        Nor do we know how exceptional it is for someone to have be able to write a good a story and also contract out other tasks.

        The big change might be fiction dominated by people who can write and contract using future developments in block chain and encryption to be independent of any big distributor. A world that doesn’t need publishers, bookstores or Amazon.

        • Kindle has been around ten years now and the volume of indie published works is large. If Chandler’s talent were not rare, I would expect to see at least one mystery writer of his equal to appear. I have not. The absence of talents like Chandler in either indie or trad publishing doesn’t say much for the present system.

          I’ve read every biography of Chandler I could find and all his published letters and notebooks. The man was intelligent and insightful, but he couldn’t manage anything to save his life. His career in the oil industry was a train wreck. I am sure he would have drank himself to death even sooner if he had been trying to make it in indie publishing today.

          Lest anyone misunderstand, I do not say that traditional publishing works today. Rather, what we have today, both traditional and indie, is failing. The proof is that I look at the lives of great writers of the past and do not see that many of them would be likely to succeed today. I hope economic factors will force a better model to emerge. We have the ingredients.

          • I would expect to see at least one mystery writer of his equal to appear. I have not.

            How would we know? And how would we judge? Not too long ago many told us independent authors could produce nothing of quality. Stewards of our literary heritage sniffed at the notion that the great unvetted could produce anything.

            I don’t think what any of us sees is proof of anything. A huge challenge that has not been met is discovery. Did people in 1935 buy Chandler because he was such a great writer, or because he was the best they could find in the limited offerings?

            Perhaps great writers of the past could not succeed today. I don’t know. I suspect other great writers of the past never got through limited selection gate, and settled for a career in oil.

            Contracting is not that big a challenge. Maybe Chandler wouldn’t have been any good at it. OK.

            • All I can say is I have read a lot of complete books and samples of indie writing. Some is quite good by my standards, much is utter drek, but I haven’t seen any that compares to Chandler. I’ve also read a lot of 20s, 30s, and 40s mysteries, thanks to boxes of old books and magazines I inherited from my parents and grandparents. Gutenberg is also a great source of old mysteries. Most are drek that don’t compare to Chandler, Hammett, or a few others. Indie drek is about the same as the old drek.

              Chandler went into writing when he failed as an oil executive. (Fired for repeated drunkenness.) He and his wife almost starved, but he wrote steadily for seven years before his first published novel, The Big Sleep, appeared and his finances began to stabilize. Some of his very early writing is available. It’s bad but he kept at, pounding the pulps for pennies until he hit his stride.

              I theorize that the pulps of the 30s were something like indie publishing today. Publishing and distribution costs were down due to new cheap printing and distribution channels. The new audience was ravenous. Editors were not picky about what they published. Chandler upped his game because he was a perfectionist, not because the pulps were a great school. It is also apparent from his letters that his publishers, Knopf in the US and Hammish Hamilton in Britain, managed editing, design, and promotion, probably more than trad publishers today.

              • All I can say is I have read a lot of complete books and samples of indie writing. Some is quite good by my standards, much is utter drek, but I haven’t seen any that compares to Chandler.

                Sure. We all have individual tastes and preferences.

                The path a consumer takes today to satisfying his demand is very different from what it was in 1935. He has many more options today. In 1935, it was much more likely that consumer attention would coalesce around any given book. They had fewer options and outlets.

                Today, consumers can find what they consider great books by taking individual paths. They may never see the same selection of books. Yet they are satisfied.

                My speculation is that the days of having an author generally considered great are gone. There won’t be enough people reading the same book. Blessed with incredible supply, attention diffuses.

                So, Chandler’s place is safe, and fortunate consumers today may even stumble across him in their travels, compare him to their personal modern favorites, and decide for themselves.

  14. The proper statistic is not the percentage of writers making a decent living (whatever your definition of “decent living” is). The correct number to look at is how many writers are making a decent living.

    Although numbers are hard to pin down, my impression is that there are more writers making a decent living in 2019 than there were in 2009. Thanks to Amazon, which will publish (almost) anything, giving far more writers the chance to become published writers. You make zero dollars if you are not published – which was the vast majority of writers when trad pub was the only legitimate game in town.

    • Yes, it’s funny how the Author Guild’s average earnings per writer never include the zero income for all the writers who didn’t get published in “the good old days”.

  15. […] Passive Voice posted The Disastrous Decline in Author Incomes Isn’t Just Amazon’s Fault. It states that The Authors Guild published its 2018 Author Income Survey and it shows that the […]

  16. I had quite a hard time reading the article, because as soon as i see the words “Authors’s Guild”, my eyes roll into the back of my head.

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