Five Big Trends that Will Rock the Future of Publishing

“ A message of hope for those who choose to hear it, and warning to those who do not” ~ Lyrics from Rosetta Stoned by Tool

Books are Precious
Long form content essential for
deep dive knowledge immersion
entertainment
Books are vessels for cultural preservation
Noah’s ark
Promotes cross-cultural understanding

BOOKS ARE ENDANGERED

WE MUST SAVE BOOKS

WE ARE CAUGHT IN THE TURBULENT CROSS CURRENTS OF MULTIPLE FORCES

TECHNOLOGY IS COLLIDING WITH PUBLISHING

Technology Represents the Means by Which Consumer Desires are Realized Things Touched by Technology Transformed to Something Faster, Smaller, Cheaper

Books are in Jeopardy
In a world of faster, smaller, cheaper, print books have lost ground
Expensive
Unaffordable to vast majority of world’s literate population
Unavailable, inaccessible to global market
Archaic rights practices limit distribution
Geographic limitations of print distribution

BIG PUBLISHERS ARE MAKING THE PROBLEM WORSE

They judge books on commercial merit

UNTIL RECENTLY, BIG PUBLISHERS HAD A MONOPOLY. THEY CONTROLLED THE PRINTING PRESS AND DISTRIBUTION TO BOOKSTORES

IT WAS A SWEET RACKET FOR PUBLISHERS Readers wanted books Publishers controlled the supply $ $ $ $ $ $ $ $ $

Publishers were the deciders
Publishers controlled:
Who got published
Who got distributed
What readers could read

Publishers were the bouncers at the pearly gates
Authors bowed subservient before the publishing gods, seeking
blessing
acceptance
validation
entry into the afterlife
“published author” on the tomb stone

Publishers controlled Heaven
Highway to Heaven
The book deal
The printing press
The distribution
The royalties
The respect
The readers
The fame

“ The world is full of kings and queens who blind your eyes and steal your dreams” ~ Lyrics from Heaven and Hell by Black Sabbath

BUT THEN THE INTERNET HAPPENED

… THE RULES CHANGED FOREVER

Is the age of Big Publishing over?
More difficult than ever to get an agent or book deal
Advances declining
Publishers want established platform
Lose rights
Most authors don’t earn out
Authors expected to do most marketing

ooh, pretty! Publishers Ill-Equiped for the New Realities

Publishers are too slow
12-18 month release cycles

… their expenses are too high

… they’re exposed to too much risk
Pay author advances
Can’t predict demand
many books fail and don’t earn out
Broken supply chain
30%+ of printed books returned to publisher unsold
Amazon is eating publishers for lunch
Vertically integrated from authors to readers

Publishers mitigate risk by giving bean counters increased influence

… bean counters make poor decisions in the name of risk mitigation
Adopt author-unfriendly policies
Acquire fewer books from unproven authors
Pay lower advances
Require authors to assume more editing, marketing responsibility
Adopt customer-unfriendly policies
Favor “commercial” & celebrity books
Scarcity tactics to maintain higher prices
Limit worldwide distribution

Against this backdrop, the world of publishing is changing

FIVE TRENDS TO ROCK OUR WORLD

TREND ONE: Reading Moving to Screens

Reading moving to screens

Ebooks to overtake print Print books Ebooks Today?

Ebooks as a percentage of US wholesale trade market Source: Association of American Publishers, publishers.org

Ebooks replacing print faster than most realize
On September 2, 2011, Random House announced ebooks accounted for 20% of first half 2011 revenues
Jan-May 2011 vs Jan-May 2010
E-Books increased by 160% while adult massmarket dropped 30% and adult hardcover dropped 23%, (Source: AAP press release, July 21, 2011)
Amazon announced May 19 they sell 105 Kindle books for every 100 print books
Indie ebook unit market share even higher
Some best-selling indies selling 1,000 e- for every p-

Why ebooks are hot
Screens offer better reading experience than paper
Changeable font size A A A A
Portable and compact
Screens will get better/faster/cheaper
Ebooks offer better purchasing experience
Lower cost than print
Convenient sampling and purchasing
Huge selection

TREND TWO Bookselling moving to the Web

Bookselling moves to the Web
Customer drivers:
Price
Convenience
Selection
Self-published books displayed side by side with traditional books
Big publishers lose primacy
If brick & mortar disappears, publishers lose key value proposition: exclusive access to distribution and readers

Percentage of book purchases made online vs B&M, P- and E- Brick & Mortar Web Today?

TREND THREE The Rise of Self-Publishing (a.k.a indie publishing)

Publishing and Distribution Tools Available to all
Free and low cost publishing tools empower every author to become their own publisher
Free printing press in the sky
Distribution to all major online bookstores

The Smashwords Example 140 6,000 28,500 73,000+ (9/17/11)

Number of books published indie vs. traditional Indie books Today? New trad. books

Indies Can Out-Publish Big Publishers
Asymmetric competition
field tilted in indie’s favor
Smaller indie authors/publishers
democratized distribution
instant access to global market
lower expenses
closer to customers
never go out of print
earn more per book

Indie ebook economics favor indies
Higher profits than traditional
Earn 60-100% list price for indie ebooks vs. 5-17% from traditional publishiers
Price ebooks for less yet still make more per copy than traditionally pubbed print authors
$8 mass market paperback earns author <$.40 trad MMP
$.99 indie ebook earns $.60 - $.70
Lower price = reach more readers = more sales at higher profits per sale
MMP=Mass market paperback, aka “pocket book” in some countries

TREND FOUR Content Explosion

Content explosion
Unlimited Internet content alternatives
Indie ebooks
Zombie books
Used books
OOP resurrected via ebooks and P.O.D
Out of copyright public domain ebooks

Content explosion Indie books Online alt content Today? Zombie books New trad. books

TREND FIVE Ebook Prices to Decline

Ebook Prices to Decline Today?

... driven by supply and demand
Explosion of content
Excess supply leads to price competition
Yet, readers will still pay for content
Your book is unique, a one of a kind
Lower prices make books affordable and accessible to broader market
More books will be sold than ever before

The Plan Forward

TO SAVE BOOKS, WE MUST CHANGE BOOKS AND CHANGE PUBLISHING

How to Save Books
To save books, we must harness technology to make books:
Smaller, faster, cheaper
More available
More discoverable
More accessible
More compelling than alternative content options

The Better Book is Here
It’s called an ebook
Same book, only better
Smaller, faster, cheaper
More available
More discoverable
More accessible
More functional

The Five Trends Create a Future Where Indies Can Out-Compete Big Publishers

You are the future of publishing

You are your own gatekeeper

YOU decide when you graduate from writer to PUBLISHED AUTHOR

Readers want great books

Give them great books

The Opportunity to Reach Readers Has Never Been Greater

Think Globally

In a Couple Years, the Market for Your Books Outside the US will Dwarf the US Market Already, ~50% of Smashwords Apple iBookstore Sales are Outside the US

You Have the Tools to Reach a Worldwide Market Today

Final Thoughts
Change brings opportunity
Power of publishing is shifting to authors
Readers determine your success
Indie vs. Traditional is not an either/or question. Many authors straddle both.
Opportunity to reach readers has never been greater
You represent the future of publishing
Go make us all proud

Thank you for listening! Q&A Connect with Mark Coker: Web: www.smashwords.com Blog: blog.smashwords.com HuffPo: huffingtonpost.com/mark-coker Twitter: @ markcoker

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Five Big Trends that Will Rock the Future of Publishing

by Smashwords, Inc. on Sep 18, 2011

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Five Big Trends that Will Rock the Future of Publishing Presentation Transcript