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The monetization paradox (or why Google is not my friend)

The continual plaint in newspapers around the world is that the news media are in big trouble. Au contraire: what's in trouble is their monetization model.

In a nutshell: when you buy a newspaper with a circulation of, say, one million copies, you are not paying a cover price equal to one millionth of their production costs. Far from it — you may well be paying less than 10% of the actual cost of the newspaper. It's not hard to see why. A paper with 64 pages of news coverage and editorial contains on the order of 60,000 words of text — maybe more. Paying people to write those words costs money. Even a harried journalist, cranking 'em out by regurgitating press releases (rather than pounding the pavement, talking to people) isn't going to be producing much more than five pieces a day, running 300-1000 words. It takes twenty writers to write the content of those pages, and another half-dozen editors to ensure the typos and solecisms and potentially libelous misstatements are spotted before it hits the typesetters (again: ever tried to lay out 64 pages in a hurry?) and then the press. That's about 30-40 staff, plus management, minimum — a more realistic figure would be 200 bodies (the word rate and editorial figures I pulled out of my ass are insanely intensive). Pay £0.50 per copy per day for 330 days a year, with a 1M circulation, and the paper would only net £180M a year, before printing and distribution costs for 330 million lumps of dead tree are taken into account.

The real profit centre in newspaper publishing isn't what you, the customer, are paying for; it's advertising revenue. I haven't worked on a newspaper. I have, however, written regularly for newsstand magazines. In the USA, to take advantage of bulk printed matter shipping rates mags and newspapers were required to have at least 20% editorial/non-advertising content by page count. The other 80% is ads. My rule of thumb when I was writing for Shopper was that they were getting around five times as much revenue from the advertisers as from their paying readers: when software and computer component advertising spend went online post-1998, it was a disaster.

These days, a lot of newspapers look to cut their overheads by reducing their actual journalist and editor head-count — after all, these folks aren't contributing much to the bottom line (which is advertising sales) — and running news straight off the syndicated wire feeds.

This is the kind of move that looks sensible on a balance sheet, to a bean-counter who's wondering where the profits have gone. By axing 80% of the journalists and 50% of the editors, our hypothetical 40-person newspaper can in principle save 30 payroll entries, or on the order of £900,000 a year. But in the long term, it's insane: it's the kind of move that cuts one or two percentage points off the bottom line, but pisses off the subscribers. Subscribers are the lifeblood of a periodical; the number of subscribers directly dictates how much money the advertising sales department can charge their customers. So a spiral of decline triggered by a loss of advertising sales frequently leads to cuts elsewhere — in editorial and other content — that drives away subscribers and causes further drops in advertising revenue. And with the internet competing for advertiser's marketing budgets, that's a recipe for catastrophic decline.

There's another side-effect of the internet, though. The internet is business-model neutral; it's like the postal service, or the telephone — all it does is put suppliers in touch with consumers. The revolutionary new quality it adds is that it cuts out middlemen — if a supplier can make their existence known to a consumer, there's no need for wholesaler warehouses, distributors, and a pavement-pounding sales force.

Enter Google.

(You knew I was going to say that name sooner or later, didn't you?)

Google's revenue stream is predicated on their success as an advertising company first and foremost. Remember DoubleClick? They're part of Google.

Google's business model is to monetize all internet content by slapping advertising on it and positioning themselves as the most convenient find-everything-at-your-fingertips gateway. The more high-quality content, the better; hence the drive towards free email, digitizing books, syndicating blogs via Google Reader, and so on. If all content is available over the internet via Google, then all content is monetizable. Content producers who expect to be paid by end-users for access to their content are inevitably going to come into conflict with Google, because this restricts the number of end-users who will see the content, and hence contribute to Google's revenue stream.

We all like free content. And we all like to be able to find things conveniently on the web. But I'm increasingly having a problem with the "information wants to be free" viewpoint — because it ain't necessarily so, depending on how you define "information" and "free". Bandwidth is in the process of becoming so cheap it might as well be free, at least by the standards of the 1990s, let alone any earlier decade. Information is another matter, though. Not all information is created equal, and the cost of compiling and producing something new is disproportionately high. I write books for a living, and take roughly 6-12 months per book. If I can't earn a living at it — if you wave a hypothetical magic wand and make all information free, thereby disintegrating the publishing, music, and commercial content industries overnight — I'd probably not stop writing fiction but I'd have to do something else to earn a living, and therefore I'd have less time to write fiction, and consequently you'd have fewer of my stories to download.

This doesn't really interest Google, of course. I've occasionally wondered what I'd say if someone at Google offered to hire me to write fiction and release it under a Creative Commons license; it's an attractive proposition from my side of the table — my two goals are to earn a living, and to reach as many readers as possible. There are only about 1000 full-time genre SF/F novelists, and the same number of part-timers; Google could in principle afford to pay every novelist currently active in the English language out of the petty cash. (Except maybe JKR and PTerry. And Dan Brown.) But it ain't going to happen. Google runs on quantifiable data, and the one bit of data I can offer them is that as a data source, including all overheads, I cost on the order of one US cent per byte. Given that the crappiest spam blog is as useful to Google as the greatest virtuoso symphony performance or the Nobel prize winning novel, if it generates the same number of advertising click-throughs, they'd do just as well to spend the money on automated spambots. They've got my backlist to draw eyeballs and advertising clicks (the Google Book Settlement is a crock: by opting out of it, all I'd achieve would be to reserve the right to sue Google — that's not a realistic option from where I stand). Even if I never write another word, my existing corpus is out there and much cheaper than 5.5 cents per word. So my profitability as an advertising host is minimal. Google isn't going to save content creators from the burning wreckage of their distribution industries.

So what's left?

Far be it from me to back Rupert Murdoch's all-out threat to pick a fight with Google over the News International paywall. I think he's onto a loser — it's hugely ironic to see the mogul who used to regularly phone Arthur C. Clarke for advice about the future of media clinging to an obsolete 20th century business model. Unless he radically reverses the trend towards syndicating content off the wires and hires a buttload more journalists, and starts providing content worth paying for, his policy doesn't stand a chance of working. Worse, in picking a fight with Google he's picking a fight with those news media who don't play by his rules. The BBC has a public-service remit and arguably can't set up a paywall around their news (hence Murdoch's recent overtures to the Conservative Party in the UK, who will likely form part of the next government and who are not friendly towards the BBC). The Guardian is run by a trust and has picked as its target the goal of becoming the planet's leading left-wing news portal; ideologically and practically they're Murdoch's direct opposite. As long as Google can leverage news sources like these, the Murdoch paywall is going to have an uphill struggle.

If they're smart, News International's managers might start to roll back the damage of 30 years of complacent lard-assed journalism — hire new investigators, train them to go for the throat and chase the scandals, and start raising hell. A combination of targeted micro-news coverage and turning over rocks to see what's underneath could pay off. The Daily Telegraph started an avalanche running in the UK last year with their series of explosive revelations on the subject of MP's expenses; there hasn't been anything like it in the USA this century, as the insider-culture of the Washington beltway has captured the journalistic corps. When the press cosy up to power, the result is a culture of collusion, and both news and open and accountable government suffer.

However, I don't expect them to do that — if nothing else, it's going against a generation of entrenched newsroom practice. And hiding behind a paywall isn't a workable solution for a jobbing novelist in the age of ubiquitous online copying, because I don't have the subscriber/advertiser dynamic that a news corporation can count on to pad out the bottom line. So, what to do?

Paper books are going to be around for a long time to come, but I'm betting on the ebook cannibalizing the mass-market paperback by 2020 at the latest — which is where half the paper book revenue stream comes from. Hardcovers pay much better than paperbacks, but far fewer people are willing to pay for them. Paperbacks pay the author roughly 7-10% of the cover price of a £7 or $8 book. But the ebook shift is potentially catastrophic: ebook royalties are typically in the 15-30% range, but the cost of e-goods in general is being deflated towards the $1.99 price point by the App Store model pushed by Apple and their competitors. Amazon aren't helping either — increasing the publisher's cut sounds good, until you realize that the proposed $9.99 cap on ebooks replaces the high-end $24 hardcover. Not only does it mean less royalties for the authors, it means less money for the publishers — or, more importantly, their marketing divisions.

Here's a hint: if I wanted to spend my time marketing my books I'd have gone into marketing. I'm a writer. Every hour spent on marketing activities is an hour spent not writing. Ditto editing, proofreading, commissioning cover art, and so on. This is what I have publishers for. It's called "division of labour", and it's why self-publishing — unless you're an instinctive sales/marketing genius — is a Really Bad Idea™ for most writers.

So I'm trying to figure out what constitutes a workable business model in the post-Google age for someone who wants to earn a living by writing.

I'm not much of a public speaker — unlike Cory Doctorow I find speaking exhausting, and worse, I can't write while I'm travelling. Maybe a hybrid business model would make sense for some writers: a full range of posable action figures based on the characters in their books, backed up by a manga serial and some themed casual gameplay. But I'm not convinced that's where I want to go, either. What I really need is some kind of subscription model that makes the disintermediating depradations of Google strictly irrelevant. So this leads me to ask what new business models exist that I can monetize and that aren't going to (a) be devalued by Google, (b) undercut by infinite free bandwidth, or (c) require an old dog to learn new skills (like cat-emulation, or screenwriting)?

Some data for your analysis: traditional industry estimates suggest that there are four readers for each book sold. Many of my readers overlap, so my best guess (which is a stab in the dark) is that I have an English-language audience of around 100,000-200,000 (of whom some read one book and won't be coming back, and some will read everything I produce ... via the library). Of course, I sell far fewer books than that. I do know that 3000 of you bought "Missile Gap" for $35 — a novella that cost 50% more than an undiscounted hardback — so we can use that as an approximation for the size of my dedicated fan base. Finally, if I aim to maintain quality, I can probably average 200,000 words of fiction per year. (250-300,000 in a good year, 150,000 in a challenging year.) That averages a single 600-700 page novel, or two 300 page novels, or six novellas. And I am not in the movie/TV/comic script business at this point in time.

Suggestions on the back of a postcard blog comment, please.

249 Comments

1:

Interesting post.

It is hard to see a short term solution for this. I think most media industries will go through a lot of hurting before something viable occurs. Good luck surviving through this mess (I promise I will do my part to keep you afloat by buying hardcovers of your books).

It will be interesting to see what the Apple Tablet brings. It won't be much of a solution for books as it won't be a strict e-book reader. But perhaps in apple you can find a partner. In the end they are interested in selling HW so are willing to take a much smaller chunk of the SW side.

The downside is that there is a clear run to the bottom on the phone app side. Perhaps things can work differently for the "book as an app" model? At least for more established authors. Other solution would be to publish books in novella sized chunks so that while you give away the first (few) chapters free, charge 0.99 for the reminder of the first act then charge $2.99 for each remaining act.

I guess my point is that the only solution I see is to cut out the distrubutors and rely on apple and/or amazon. Hire out of college marketing people to help market your books-as-app and then use tor.com and this side to draw people into reading your apps.

Ok. time to end my ramblings

/Robert

2:

I'm curious - doesn't the revenue stream continue growing as your body of work grows and your audience grows via word of mouth/publisher marketing?

How long a shelf life do your novels have?

3:

Perhaps it's impolite to ask, but what sort of income do you need to be a full time writer, including enough to save for uncertain times and retirement? Is 50,000 pounds a year (before taxes) in the ballpark?

For that kind of number, I could imagine that a "ransom the next book" approach might work, only releasing a new book when donations for the next year are high enough. But that would rely heavily on the hard-core fans, with most readers just picking up the googlized version when it inevitably hits the net.

Can you put advertisements in your books?

4:

I would say that the ACORN hits are pretty similar journalism to those explosive MP expense revelations, but I agree with you on the whole that journalists have fallen into complacency, and are going to need to regain the old scandal bloodhounding ability - and integrate that with the newer media models.

I'm sorry to say I don't know what business model can really save your trade. The only thing I can think of is that the advantage of the digital world is one of cheap distribution, so focus on a model of more consumers paying smaller amounts. You've painted yourself into a corner if you estimate your audience as fixed numbers, since all the other numbers seem to be in decline - you need to find a model where your customer base can increase and grow.

5:

Since you have established a rabid core fan base of at least 3000, that ought to be good for something.

Though you don't want to do all that publishing work, a self-published book might generate enough money to make it worthwhile. Maybe not enough to replace publishers in the near term, but it could be a valuable sideline to create a Missile Gap sized novella every year and publish it yourself. It wouldn't have to be super-involved. Get a simple non-painting cover design that you could reuse. Get some copyeditors from one of the freelance sites. Publish. Of course it wouldn't be that simple - but the process could be regularized enough that going forward, it might become simple.

I don't know how much you made on Missile Gap - but it seems likely you could make more per copy if you're not splitting the profits. If you get the same 3000 people to buy it, at $30 a pop, that could be a nice chunk of change. And you can promote it here, and maybe make them signed copies, or figure some way to make them more valuable to your devoted fans.

6:

Trevor: for a book published as a mass-market paperback original, the figure I've heard is that 80% of the sales occur in its first three months.

With hardcovers, there's a sawtooth -- again, 80% in the first three months in hardcover, and when the paperback comes out the hardcover typically drops into single-digit sales per month, but the paperback brings in a bunch of new readers who're already primed by word-of-mouth from hardcover buyers (but who wouldn't themselves buy a hardcover original).

There's a slightly different pattern for series works, too, whereby with the publication of each new book in a series the previous books experience an uptick.

The shelf-life of a mass-market paperback (note: not the same thing as a trade paperback) has been compared unfavourably with that of a pot of unrefrigerated yoghurt in a heat wave. That's because the mass market distribution channel runs on the same principle as magazine distribution, only with 90-day or 120-day credit. So after 90 days any unsold books get yanked off the shelves, covers stripped and returned for credit, and the book blocks pulped. Yes, this is insane and everyone knows in. Unfortunately, it's how the cheap MMPBs have been distributed in America since the 1930s. (This used to be the case in the UK until the mass market distribution chain imploded circa 1992; since then all British paperbacks have been pushed out as trade books on sale-or-return.)

Having said this, all my commercially published novels are still in print. (The collection "Toast" is sold out, but available as a free download in my fiction area. The novel "Scratch Monkey" never saw commercial publication.)

7:

To expand on the Apple Tablet idea..

How about a free Charles Stross app with in-program purchasing.

Free:

*) This blog and the ability to comment
*) I think one of your books are available as an e-book right?
*) Perhaps pieces you write for tor.com?
*) Guest posts

Pay:
*) Access to your ebooks
*) Exclusive ability to read your upcoming books in novella format 0.99 per act.

8:

One idea I've heard, which harkens back to the age of Dickens, is ransomware. "Dear audience, here is the first three chapters of a book. When, through contributions of the public, $X has been collected, I will release the next three chapters."

I'm not suggesting it as a cure, or even as a good idea. I just find it an interesting idea. The biggest problem, from an artistic standpoint, is that it forces the author to build stories in a more episodic format, focused on cliffhangers at sales-breaks. There are some authors that already write like this (Jim Butcher ends pretty much every chapter on a cliffhanger), and once I got past the bumpy opening, your Merchant Princes stuff picks up that page-turning feel. In any case, though, it does merge narrative and marketing in a way that limits the kinds of stories that can be told.

This is a model that opens space for a publisher to step in. One need not self-promote ransomware. But it's such a drastic change from the current publishing model that I don't think any publisher would ever consider it.

Let's cut to the quick: readers want to read. And nobody likes to pay. To balance these two drives, one must make sure the desire to read is so strong that people pay.

How is that done? Well, the current model is to perpetuate the scarcity model (printed books are of a finite supply) by slathering things with DRM. It's a technical dead end, and a consumer relations nightmare, and will hopefully go away.

The above suggested ransomware model changes the point of scarcity- the commodity doesn't exist, as far as the public is concerned, until a commission price has been met.

Once upon a time, tame artisans were kept on a leash through patronage. I think, today, the culture of the moneyed upper class doesn't truly support the arts, and I think it would be a massive cultural shift. Nobody really sees the value of saying, "Well, I, Theodore S.Q. Honeybottom, III, esq. paid $100,000 to get young Mr. Stross's latest novel published. Isn't it just darling?" Once upon a time, it was just another facet of conspicuous consumption.

But let's go back to scarcity. Another possibility is to tie novels with something that is a finite commodity. For example, I would pay a reasonable sum of money to have a collection of Laundry action figures. Perhaps it's a good time for publishing to start taking a lesson from cinema: Moichendising, moichendising, moichendising.

9:

Zamfir: I don't particularly want to put a cap on my income, but if you think in terms of "enough to support a married middle-aged couple living in a city centre, with some savings towards retirement, and a heavy travel habit" you won't be far off.

(I think back to what I could put up with in my early twenties and rub my eyes in disbelief.)

In-book advertising was the cause of some vicious lawsuits in the early 20th century -- to abolish them. I'm not going to allow advertising in my books without a struggle to avoid it. (One exception: I've got no problem with the inclusion of free samples of novels by other authors in my publisher's list who may be of interest to my readers.)

10:

Since you're making a living now and this isn't yet a practical problem for you, the only way to approach it is to change your thinking. You could challenge your own assumptions about paywalls, copy protection, and the internet. Start with this:

"The internet is business-model neutral; it's like the postal service, or the telephone — all it does is put suppliers in touch with consumers. The revolutionary new quality it adds is that it cuts out middlemen"

Neither the postal service or the telephone are model neutral - any medium encourages some models, is useless to others, and creates new models altogether. Direct mail and call centers cut out the middlemen. Maybe the 'revolution' of the internet is only one of degree.

11:

Jason: Interesting point!

12:

Jason: direct mail incurs printing and distribution costs that, say, spam doesn't have. (This is why the MX server for antipope.org has to filter out 20-60,000 spams a day.) Call centres still require human staff, for the most part -- unless you think robocalls are effective marketing or menu trees from hell are efficient at delivering aftersales care. Thus, both those earlier models imposed a significant cost of entry.

13:

The Ransom idea is interesting, and it could work to some extent for a well established author with a largish, loyal fan base.

Is there a hope in hell of making print on demand services work at some point? I can think of many times where I've stumbled onto an author in the middle of a series of novels, bought all the backlog paper backs, and then start buying the hardcovers as they hit shelves. At that point, what I'd really like to do, is buy the backlog in hardback, and have a really awesome set for my shelves. I could see how this could provide a nice boost to the author if the royalties could be made to work similarly to the initial run of hardcovers.

14:

With publisher support and marketing, the ransom model could, in theory, work for even new authors. Give the first chunk of the book away for free with a marketing push.

Now that I think on it, such a model would promote non-terminating serials with rapid feedback on success: if the serial doesn't get its next round of ransom, it's cancelled.

15:

I don't think the ransom model will work. Consumers want instant gratification (with free bandwith and all). This is why I rather buy books on my kindle then go to barnes and nobles.

I think the solution to getting paid is more the ease of use. This is why I keep bringing up Apple. We "all" already have iTunes accounts and are getting used to pay for songs, apps and (soon) in-app purchases. They have the user base to get at. The question to me is when they launch a tablet will it feed a working book-as-app business model or will it too have alimit of $0.99? I think looking at kindle's success that people are willing to pay more for e-books given a reasonable east way to pay for it. It's just that the business model currently set-up doesn't seem to work for anyone (apart from amazon?). Will apple's model be any better?

As a side note: My pet peeve with the kindle is that once I have downloaded a sample and decide to buy they don't simply fill in the remaining pages. They download a new book and I have to browse through it to find the page I was on in their sample... sigh...


16:

ben: the economics of print on demand aren't my department, but as I understand it, POD output is of inferior quality and disproportionately expensive compared to a press run. Modern industrial printers can take PDF or postscript page images and economically produce as few as a thousand book blocks, but given where hardcover sales go after a paperback release it'd take a decade to shift such a reprint run.

17:

It's not much help, but the gloomy outlook from your post suggests ultimately a return to a system of patronage: a rich fan paying you to write novels.

So, can we expect book N of the laundry novels to start featuring an incredibly handsome and rugged ex-KGB officer whose name isn't quite the same as a russian oligarch? Maybe owning a "pet author" would become the new equivilent of owning an english football club.

Just a thought.

Of course, being the "internet age", patronage becomes more possible via "microdonations", and when you think of it this is a model already used by a number of webcomics with their paypal buttons, or by some small independent games developers (Dwarf Fortress and Mount & Blade spring to mind).

It's questionable to me whether it could bring enough income to support a professional rather than amateur career, and how well that works with a less episodic format is no doubt a problem, although serializations have a long tradition.

In terms of e-books, I think there's a fundamental flaw in the whole model, that (nearly) all the costs of production are felt by the publisher rather than the distributer, this means that almost ANY sale is a profit for the distributer, no matter the price it's made at and if selling at a consistent 0.99 price-point helps them get market share and shift 200,000 more JK Rowlings, they don't care if the 200 extra Stross sales don't make up for the drop in price on your books - they're still making a profit on your books, and the fact that it's not as much of a profit as it could have been is made up for by the benefits of their marketing dept. being able to say "all our books cost 0.99". For the publisher however, well they've got the costs to meet, so the drop in price is catastrophic.

I don't see that situation changing, unless the publishers get together and found a consortium through which they all sell their ebooks, either direct to customer, or to get bargaining position when selling to the big name distributers. I can only begin to guess how likely such a thing would be though.

Taking a percentage cut of a price that you don't control, for a product where you're bearing the majority of the costs, is just business suicide though, margins get squeezed and if the people deciding how big a squeeze aren't the ones feeling the pain, they're just going to keep doing it until you're crushed: it isn't viable or sustainable and the only thing that keeps it going is how long the publishers are able to take the pain before going bust.

18:

It seems like some audiences are more willing to buy books than others - see Cory Doctorow and John Scalzi's recent success in the YA market for example - is there an audience you could target which has this property?

If you want to keep writing what you currently write, then maybe not. Out of curiosity, how much of a book's cover price goes to the author? How much is for the pulping and stamping of dead trees? How much goes to the publisher for editing and the agent for finding the publisher? Getting people to pay $5 for an ebook might be okay if $20 of the $25 cover price is getting eaten up by the price of the medium. Basically, different price points require different strategies, so what is the price point per book you need to match in order to keep up your lifestyle, assuming that these new "not-a-book" sales cannibalize old "actual paper book" sales 1-to-1?

19:

Charlie - Interesting that you should ask this question just as we're getting ready to launch a self-publishing platform that aims to answer your questions and bears the name of one of your characters.

I hear you on being a writer, not a marketer/editor/etc. And you're right, some people are good at some or all of that stuff as well as being good at writing. And that's why our model aims to let the author do as much or as of the other stuff as they want.

Our idea in a nutshell is that you set a financial goal. When you reach the goal, the ebook version is available to all for free. You earn money towards that goal by selling whatever you want - print versions (through POD), naming rights to a character in a future story (which I know you've done for charity - I wanted to bid but it got too expensive), a phone call to a fan on their birthday, whatever your fans would like to pay for and you're willing to share.

As an aside, I think you don't give yourself quite enough credit as a marketer. This blog is good marketing. And sharing some stuff online is, too. I read Accelerando for free online years ago, and now pre-order most of your books from Amazon. Not that it will totally replace the marketing that a publisher can do, but it's certainly not nothing.

20:

True enough, I'd say starting a catalog store is a little more expensive than setting up a store on the internet. Though the internet has it's own set of costs, like advertising, whereas a catalog in the mailbox is it's own advertisement. You need to attract people to an internet site, where with a catalog you are already giving them something they want - a lot of people like looking at them. That would be akin to sending out a full color print copy of the first chapter of one of your books for people to read in the bathroom or leave around beside the sofa - for their friends to find whether they are looking or not.

Also, with the internet you can't ask as much for something, because everything is commoditized, and in the end that includes labor, which is the problem.

So there definitely are differences but I still maintain that our 'revolution' is one of degree and not kind.

21:

As an established author with a bankable portfolio, I think that your future still lies with using a publishing house that can act as a middle man, but with clever ideas about the distribution of books in the 21st century. I would guess that includes substituting volume for revenue per book sold. You think you have a few thousand rabid fans that will pay full price for a book upon its release? That means there is a huge untapped market out there. Maybe your publisher pays for placement on Amazon's front page. Maybe they re-issue older novels with a "new updated introduction by the author and a candid interview with the author's favorite bar tender!" Maybe they tap into new international markets, like India, China or Russia (you could be huge in Japan!). Bottom line is, you know how to create valuable content, and you have proven that. You need to keep doing it. A good publishing house knows how to maximize revenue from the content, and they need to keep doing that.

22:

Peter Boothe: in general, the author gets 10% of the cover price of a hardback. The publisher makes 10% of the cover price in profit. The publisher spends another 10% of the cover price on editing, production, printing, marketing, and so on. The distribution chain eats 60-70% of the cover price -- typically 30-40% at the bookshop and 30-40% at the wholesaler. Amazon is both bookshop and distributor, but passes around 20-30% of the cover price on to the customer, thus taking about twice as much money per book sold as the author and publisher combined.

23:

3000 books at $35 a pop is $105,000 for a novella. The problem with your current model is that you're getting 5% of that. If you went self-published, you could see 95% of that money instead. At that point, you could fire your editors/publishers/proof-readers and make 6 figures a year (since you could easily sell novels at $35/pop) and not see your sales be cannibalized. John T Reed advocates that model because low sales and low costs still equals 6 figure salaries, while high sales and high costs apparently isn't enough for you.

24:

I agree with Robert Ekendahl @ 7.
Regardless of how the iTablet performs, the e-readers now emerging seem to lean towards web-browsing and mp3 playing in addition to just displaying text.

I, for one, would happily browse your blog, read Tor.com submissions for free, knowing that when you have a new book I'd have to pay to read it. Perhaps pricing would have to be looked at further though, I don't think I'd pay hardback prices for an new e-book.

Another bonus to getting into this straight away is subscriber numbers. With (for instance) Fuller Memorandum, you could track e-sales on a daily basis to see what percentage of your readers buy in this way.

Wonder how Cory is doing with his multi-format publishing experiment? That should generate some hard numbers.

25:

Slightly less drastic than the ransom model, but similar, is the subscription model, as practiced by the German avant-garde band Einstuerzende Neubauten. They've been going about 30 years now, and have a hard core of followers as well as a fuzzier halo of more casual listeners.

In 2002 they ditched the record companies and switched to subscriptions. The idea was, you subscribed to the next album, and thus paid for them to make it.

In return you got a special edition of the finished CD before the normal edition hit the shops, and access to freebie content on their website, e.g. interviews, live studio webcams, bonus tracks, outtakes etc. You also got the chance to go to supporters-only gigs and other events.

Since then they've released several albums and DVDs, and toured almost every year, playing in decent-sized venues like the Forum in London as well as much larger events like the All Tomorrow's Parties festival. So it must be working for them.

Perhaps authors with existing followings can work along similar lines?

(See: Wikipedia, and neubauten.org)

26:

Perhaps another part to question is the idea of a book itself?

Where does the 3-500 pages format come from? It must have something to do with the limitations/advatages of the printing process.

Perhaps online a different model is needed?

From what I've read in-game purchases works well for MMOs at least in ASIA and from what I can see it's starting to work in western games as well (for example BIOWARE's dragon age).

Perhaps in-book premium content is the way to go. Provide a base experience with the ability to learn more about key characters through in book purchases.. Perhaps whole chapters get downloaded differently if you have purchased the "premium" companion for our hero?

27:

I have some trouble understanding the economic situation of ebooks you describe, esp. compared to hardcovers. There is no inventory, no manufacturing, no distribution cost (marginally), so of course, it should cost only a fraction of the price of a hardcover.

And if the author gets less than for a hardcover, well something's gotta be very wrong indeed, because not having to pay for paper, printing, printers, warehouse, warehouse guards, truck drivers, gas, real estate for the shop, shopkeeper and cashier should be plenty enough to cover for hosting and card processing fees.

28:

I think existing multi-volume series by single authors would be a place to start. It's not an accident that successful writers take up whole shelves in bookstores with a slew of related titles.

An online strategy consistent with that would be repackaging older works into online 'subscriptions.' Right now, e.g., I've got a 'Pratchett pile' in my den and an 'Asimov pile' not far away. I think I'd pay something for access to all that online, and the option of getting rid of the old and slowly oxidizing dead-tree stuff.

29:

What about a subscription model, with something cheap, short but regular, including :
- high content blog post
- snippets from upcoming book (up to 30% of a book)
- short novelas, by chapter

Some things, like "The high frontier, redux" or a TFM preview, with a bit of overtime included can be very interesting.

And, for practicality, invite other authors to participate, in order to generate a short webzine biweekly or weekly easily can generate additional income without much work (the subscriber pay for the right to read in advance, not the exclusivity).

Not mainstream revenu, but a different source of monetization for your work (including this blog).

30:

niczar:

I agree with you that i don't understand why e-books would be bad for authors.

I think what's happening is that Amazon is bullying it's way right now as it basically has a monopoly on the e-book market at the moment. This will shortly change. I'm almost willing to bet next Wednesday but if not then within a couple of years.

Another issue is that the contract Charless Stross is under doesn't have good e-book rights. But as long as he stays with a traditional publisher that is unlikely to change drastically. The publisher are short sighted and try to compensate lost HW sales with SW profits.

That all said. I as a consumer is aware the the kindle is sucky for authors (the people I care about) and comes with an archic DRM, but I still use it. Why? 1) It's a nice experience reading on an e-book, 2) Today the kindle has the best delivery system (built-in) and 3) I don't care for barnes and noble and the like any more then I care for amazon.

I try to buy books from the local independent book store but I they don't stock a great Sci-Fi library and the instantness of the kindle is VERY tempting once you get used to it.

31:

niczar: a 500 page book costs $6.95 to print (on a print on demand printer, which is much costlier than a regular offset press). That hardcover sells for $25. Take 50% off that for the retailer (bookstore, amazon, etc). Now you're down to $12.50. It doesn't take much in the way of paying marketers, agents, editors, warehouses, invenetory, truck drivers, etc., before the author only sees $2.50.

32:

I'm not sure I understand your assertion that the $9.99 Kindle book replaces the $24 hardback. The advantages to me of buying a hardback are that I have a copy of the book that looks nice on the shelf, stays in good condition over time, can be lent to people, and may have some collector's value in the right circumstances. The Kindle book is almost the complete opposite. Personally, I buy both hardbacks and Kindle books, but the two don't compete for me. The closest replacement for a $9.99 Kindle book is a $5 second-hand paperback.

Another thing I've not seen you specifically deal with on e-books is that the average user potentially buys a lot more of them than they would physical books - I don't know if this is backed up by figures, but it certainly applies for me. Purchasing an e-book has fewer downsides: lower financial risk if I don't like it, no worries about where to store it, and I'll always have the book with me to dip into (which is good for books that you don't want to devote lots of attention to, but nevertheless want to sample). Combined with the instant gratification of electronic delivery, and we have a winner.

33:

niczar @27:
The problem is that under the physical book model, each step of the chain has its own associated costs: the writer writing the book costs X amount, the publisher editing and promoting the book costs X amount, printing the book costs X amount, having a bookshop and bookshelves to put the book on costs X amount.

"Broadly speaking" these things tend to scale similarly if you drop price to increase sales - at some point the increase in revenue from cutting price to gain customers doesn't result in an increase in profitability - for each company in the chain this happens at a different point, but in tradiational publishing this has settled down to some form of rough equibrium because the "sweet spot" is somewhat similar for each.

For ebooks however the distribution and printing and sales costs are dramatically reduced, while the costs of editing, promotion and writing are basically unchanged. This produces a situation where the retailer can drop the price massively further than before, but the publisher is still stuck with most of the old costs, and is basically screwed.

What makes good sense for the distributer (who is the one setting the price) is now at odds with what makes good sense for the publisher.

34:

Kevin Kelly figures you don't need 3000, but 1000 might do: http://www.kk.org/thetechnium/archives/2008/03/1000_true_fans.php

35:

The obvious answer to me, at least for some value of obvious, is micro-payments. That way you can sell e-books directly to the public and buy in the editing / marketing services you need.

If you sell an e-book for 70p, that’s 50p to cover your paperback equivalent income and 20p to pay your editor.

I would define a micro-payment as costing me enough effort to notice that I’ve paid it, but not enough effort to stop me casually paying; and you would have thought with the number of monetisation problems crying out for this and the number of motivated, technical people out there, someone could have solved the problem.

(Note that buying an IPhone app exactly fits this definition - why not buy an e-book as a 70p Iphone app?.)

As a "back of the fag packet" design:
A new type of link that, when clicked, triggers my ISP to put up a "confirm payment" dialog box for an amount in the range 05p to £1, I click OK, the ISP registers income to the link owner, sends a transaction code to the owner and puts the charge on my bill.

OK - rogue ISPs can confirm the payment without taking anything, but, I am a conscientious citizen and won't be search out rogue ISPs (I don't use a pirate Sky card)

36:

Regarding ransomware, Hal Duncan tried that, with mixed results. The first round went well, but not the second.

37:

I think consumers are still willing to pay top dollar for quality. Look at the two recent billion dollar money makers for the content industry: Avatar and CoD:MW2. They both made three to four times what they cost in just a few weeks each.
Google is also not going to happy with "automated spambots" making money for them because the end game there is that they lose relevance. So they do have reasons to promote quality content as well.
So, this leads me to believe that ebooks will not be the end of the book industry. Book publishers will need to get more nimble and better at marketing. They also need to start marketing worldwide and not have geographic restrictions.
As for monetization, Scalzi seems happy with his advisory role on SGU (not as a script writer). Maybe you could help out Doctor Who in the ideas department :). I would also love to see some new ideas in video games. The point here is that your customer is not the end consumer but someone else better able to pay for ideas and who also has a bigger marketing budget.

38:

So, on a hardcover with a cover price of $25, the author gets $2.50, the publisher makes $2.50 in profit and spends $2.50 on editorial and production costs. All the rest is printing and distribution costs (mostly distribution).

Make a non-DRMed version of that book available at a wholesale price of $9, and allow anyone reasonably reputable (Fictionwise, BooksOnBoard, Diesel, etc.) to sell it at whatever price they choose. Also sell it direct via the publisher's website for $10, to keep the other retailers honest. Give the author $3, spend $3 on editorial and production, and keep $3 as profit for the publisher. You're at the same price point as Kindle books, and anyone who wants to read it on a Kindle can just buy the Mobipocket version.

After six months, halve all the prices above -- you'll be doing a lot better than current paperback profit margins, at a lower retail price.

The author gets more, the publisher gets more, they probably make even more because they sell more books, and no one loses except the existing distribution chain for p-books.

The idea that an ebook retailer can take a 50% (or even 30%) cut should be laughable, and it's only the publishing industry's insistence on DRM and exclusive distribution deals that lets Amazon get away with it. 5% should be closer to the mark.

Note that Baen has been making money doing something very similar to this, for years.

39:

Piaw Na @23: see my immediate preceding comment for an actual cost breakdown. No, I am not getting 5% of the revenue from a book -- more like 10-15%. Furthermore, the publisher isn't taking the other 85-90% -- it's a multiway split. If I self-published I would, at best, double my profits -- but have to take on a shitload of extra work in fields at which I am not an expert.

Jacques Hughes: alas, Cory is not a generally applicable role model for midlist SF authors to follow.

robert @26: yes, the model of a book is dictated by current production and manufacturing constraints. However, I can't see how I could sell a "premium" edition of a novel without, implicitly, making a "crippleware" version and selling that as the default. Which in turn means that most readers would get a rather poor experience, and as word-of-mouth is the best marketing tool for fiction ...

Niczar @27: this earlier post may help explain things. Prepare for a good old *headdesk* experience ...

40:

Dave Bush: I think what you are asking for is what both amazon through kindle and apple through iTunes are trying to create.

Issue with Amazon is that they don't allow anyone to publish. They set or at least control the prices themselves (I think) and charge for the distribution cost.

Apple lets anyone publish and app (after approval process). The creator can set the price and apple will take 30% of the cut and eat the distribution cost. Currently this has meant a drive to the bottom but that is beacause most apps are useless and easy to repeat. A novel ( by Charles Stross) is neither so it could fetch a premium price.

If Stross had an iTablet app and found 3000 people that where willing to pay $50/year for access to his whole library plus 1 new book and 1-3 novellas/year then he could make a basic living ($100.000). Doesn't seem that far fetched.

Issue is that $50 upfront cost is too steep so instead he needs to get fancy and lower the upfront cost while making about $50 per customer/year... Not easy but perhaps not impossible.

If he on top of that could find a publisher that where willing to run the HW book without keeping rights to the SW book.... (good luck!)

/Robert

41:

Why use Amazon as the exclusive distributor? Set up your own ebook shop, negotiate a cut for your publisher so that they still provide you with all that you are used to (including money stream management from the shop) and try out different models there - in the shop.

In the simplest model you can provide all your books for sale (hardcover, paperbook, ...) at prices similar to those at the book store and get the 20-30% of the book store profits + most of the distribution chain profit (charge an exta fiver for s&h).

In the most advanced model: copy what was done by Radiohead for 'In Rainbows' - sell everyone an ebook for 'enter a price that you consider fair here' with a note that if you enter more than 20 pounds you will get as a bonus a paperback shipped to you as soon as it is available and if you enter 35 pounds or more you will get a hardcover version shipped to you next month as a bonus. And if you enter 100 pounds or more, it will be signed by the author.

I would really love to see you do something like this as an experiment and see how much money you could make this way (assuming that you get Slashdotted, handle all the traffic and accept money in all shapes and forms from all the countries in the world).

42:

can the net scale patronage?

I mean I'd like a Stross, but I can't afford one.
0.000333333333 Stross, maybe. (From the figure for Missile Gap, which I liked a lot)


Disintermediation should lead to some of the current distribution and marketing money being available for the author. at less cost to the reader. Mayybe I could manage two shares, or a slice of Macleod as well.

Futures trading???

43:

Figure out how much you want to make on a given book. Post the first chapter. Tell your audience that you will release the rest of the book when they've paid the advance you proposed. You have fans - the advance will be paid quickly if it isn't insane. Everybody who paid into the advance gets that much credit against the purchase price of the e-book.

Once the advance is paid, you market the e-book through the usual channels, which includes the site you're using to collect your advance. No DRM - you just trust people to be honorable. After all, you already have your advance.

The advance doesn't get anybody any rights to the book other than that you will release it and their investment will count toward the cover price of the book. If they pay more than the cover price, they don't get additional copies - they just get the book sooner, maybe.

If they pay less than the cover price, they have to pay the difference to get the book (although they may pirate it instead of paying--that's not something you should approve of, but it's part of the business model).

I would expect that you'd get your advance, and that you'd then see a reasonable trickle of additional income over time. You'd get pirated like crazy, too, and that would help you to get the advance on your next book quicker.

This is probably naive, but it seems to me that it would work. The only downside is that you pretty much have to have the book ready before you get your advance, which obviously is not the current preferred model of operation in the book industry.

Oh, I guess the other downside is that you don't get to leverage the existing book distribution chain to push a bestseller that will make you rich for life. But you don't seem to have factored that into your plan anyway, and it's not out of the question that you'd make a killing on the e-book revenue anyway.

I suppose a third downside is that unless a publisher sees a real demand for print copies of your book, you'd be e-book-only. For people who like to see their book in physical form, this would be kind of a bummer.

44:

Ycombinator posted an RFS (Request For Startups) about this subject a few months back:

RFS 1: The Future of Journalism

The best idea I came up with was inspired by your "Stop trying to give me money! No, really, stop it!" blog post. Top fans really want to support authors in a more direct manner than buying books, which, as you point out, can cannibalize book contracts. However, the presumption is that book contracts are going to disappear by 2020, so perhaps we can contemplate a direct fan-to-author channel.

How about a sort of mini-patron-ship for fans? Example: $100/year gets you early electronic access to all the author's publications and a little sticker saying "Patron of Charles Stross" to put on your ebook device (excellent for starting conversations with the cute guy sitting next to you). Perhaps you get to vote (a la your recent post) on what gets written next. Perhaps that simply happens automatically as you respond to subscribers.

It's a very National Public Radio model - the key is that while people are making a gift, they want to feel like they got something in return (t-shirt, wind-up radio, coffee mug). One of the greatest rewards for a gift is public acknowledgment. If in addition to immediate electronic access to published work, you then threw in my name on the official List of Patrons on Charles Stross' web site, I'd buy my $100/year patron-ship tomorrow. (I would then immediately smarmily link to it from my web page/blog/etc. - look how cool I am! Nyah!) If we're going with 3000 for rabid fan base, that's a fair chunk of change.

45:

Mike @38: Baen is an eight-person company, privately owned (33% by Tor), as I understand it. They're free to Do The Right Thing.

Let me introduce you to my publishers:

Tor is owned by St Martin which is owned by Von Holtzbrinck, who as of 2005 had annual turnover of €2.1Bn.

Ace is an imprint of Berkeley Publishing Group which in turn is part of Penguin Group, which is part of Pearson PLC, who also own the Financial Times and in 2008 had revenue of £4.8Bn.

Orbit (my UK publisher) is an imprint of Little, Brown, which in turn is owned by Hachette Livre, who have annual revenues of €1.975Bn. They're a minnow, in other words.

These organizations are vast, sprawling, and hidebound because they operate along lines thrashed out by boardroom consensus. And the board of a €1-5Bn turnover multinational is not going to gaily toss their existing business model out of the window in order to replace it with one based on unproven emerging technologies, as they see it.

The reason I am with these publishers is that, unlike J. Random Small Press, they can afford to (a) pay me a decent -- as in, I can live off it -- advance for hardcover and paperback rights to my books, and (b) market them systematically and get them into the sales channels they need to reach in order to recoup the investment.

ebooks still account for much less than 5% of all novels sold. That's why I'm currently trying to identify forward-looking business models, rather than panicking and jumping ship. When everyone else is fighting over lifebelts, I intend to have already sorted out a nice little yacht: but that time is some number of single- or even double-digit years in the future.

46:

Some possibly useless ramblings on the division of labour.

There's a parallel observation to "information wants to be free"; that is "given enough eyeballs, all bugs are shallow."

Could you make use of the eyeball effect to reduce some of the overhead? Rather than use paid resources (your publisher) to perform the activities you dislike, make use of free internet resources.

Based on your numbers, you make approx $1 per paperback, $2.50 per hardback. I'm not sure what the split is, but let's say you average out $1.50 per book. Selling at $5 in the iApp store (or as an Amazon seller, or whatever) would work ... if you have no other overheads and if the quantity of sales remained constant.

So, for example, a cadre of friends/fans/whatever to act as copy editors/proof readers working for free (or for a free copy of the finished work in ebook format). 20 trusted people with the right type of software to let merges occur (same change by 5 people gets approved?) could maybe replace some of the overhead.

Marketing? Now that I dunno so much about; clearly booths at a con wouldn't be sufficient (I'd expect the majority of your readers to have never been near a con). Could a variation of the eyeball effect be used here?

And so on. The internet is more than just tubes and wires; it's the people who use it. They (we; I!) want something for free or minimal cost; what can you get out of me to make up for it that is of value to you but of little value to me.

One obvious downside to this that I can see is that it may optimise towards short stories; you could probably write more of those for sale at $2 a time, rather than novels at $5 a time and get rather more sales as a result.

47:

A self publishing strategy similair to ransom, forgive me if someone's mentioned it already, would be to serialize a novel. Sell not just the first chapter but each chapter, one at time in electronic format - leading up to hardback publication. The print copy should have extra content like a 'directors cut'. You could advertise on fans sites periodically to try to build momentum and try to use antipope as the primary point of sale. You could craft the first chapter of a book to stand alone and sell it in paper form, illustrated or at least signed.

48:

Setting aside speculation about $0.99 books via itunes/amazon/etc for a moment, I'd be interested to know how the royalty system works right now with a seller such as diesel-books for example.

While most of your books there are listed at around $7.00 (indeed rather cheap), "The Jennifer Morgue" sells for $14.47 (10.25 euros). Now this is pretty close to the price of a paperback at your average bookstore here in Amsterdam (10.99 euros at www.abc.nl ).

Do the royalties from diesel-books specifically work in the same way as with normal paperbacks or are we looking at the rates you mentioned in your original post? "...7-10% of the cover price £7 or $8 book... ebook royalties are typically in the 15-30%..."

here are the links to the stores I mentioned by the way:

http://www.diesel-ebooks.com/cgi-bin/item/parent-9780441016716/The-Jennifer-Morgue-eBook.html

http://abc.nl/search/detailed.php?isbn=9780441018147&valuta=$&crumb=author&searchcrit=Stross%20Charles


49:

I don't claim to understand the publishing industry that well but I read this article earlier. Might it have an impact on your plans?

http://www.idealog.com/blog/apples-disruption-of-the-ebook-market-has-nothing-to-do-with-the-tablet

There's also signs of Amazon making significant changes to the way they operate.

http://www.mobileread.com/forums/showthread.php?t=70533

I read a while ago someone comparing the internet revolution we're currently going through as being like the time between the printing press appearing and the publishing industry we know and love(?) coming into being. In the middle of that period the old ways were crumbling and nobody knew what we'd be left with at the other end. All people can hope to do is try their best to find a model that works.

I hope you do ok Charlie. We need more writers like you.

50:

Stross:

But signing up with these traditional publisher you also signs away your e-book rights... right? (at least I did when I published with springer... but that was for a programming book looking at sales like 1000 copies....)

If you own your e-book rights then I think things could get interesting for you! I think there will very soon be a viable e-book platform that puts together the pieces you need and the kindle might in the end help you in that it made it acceptable to read e-books.

51:

You should push hard for a knighthood before it all goes to pot.

52:

Alas, the idea of a basic, unconditional income for everyone has not yet taken proper hold in politics. The idea is, that everyone is granted a certain amount of money per month, regardless of age/gender/income, replacing any other specialized social benefits. This amount of money should suffice for basic living needs. Whoever wants more can always try to earn money.

Sure, this would shake up the job market and society to no end. But many smart people reckon it would improve society for the better. Just think about the fact that getting fired is a much less dire prospect in such circumstances...

53:

Looking at the vurrent market some form of hybrid planning is probably called for so you aren't dependant on a single revenue stream. At the core is what techdirt.com calls CwF + RtB. The first part is to connect with fans, the second part is give them a reason to buy either with some form of scarce good. (T-shirts, access to you, early access to the books, or something similar) With your blog you are already doing a good job of connecting to fans, the tricky part will be figuring out the thing or things that people will be willing to pay for to ensure that you are able to keep writing as a profession.

Serial stories or susbscription short fiction might be a sustainable model, if your workflow and writing habits will support it. I understand that novel talent and short story talent are distincly different and may require different amounts of effort on your part. Catherynne M. Valente has had resonable sucess with subscription/serial writing this year.

I persoanlly am in favor of the baen books model with reasonably priced non-DRM e-books and higher priced ARCs for books where I don't want to wait for the actual publication date. Hopefully your publishers will look into it in the future as I would really like to buy electronic versions of the Laundry stories but will not pay for DRMd books.

54:

Charlie,

the premium book idea struck me differently than it did you.

Instead of seeing it as selling a crippled version of the story, I saw it as including bonus material, kind of like the extra/bonus material you gt with DVDs.

Include notes about main characters past. More on the backstory than you would ever include in a story.

As a wanna-be writer if you had another version with the above and with notes on the writing process for the story, I would be willing to pay a super premium price.

I also think that as video games get more immersive and complex story consulting is going to become more and more valuable.

55:

I think the self-publishing route is viable. Copy-editing: sell Advanced Reader Copies at a premium and your true fans will help with it. Marketing: you've got a blog read by every one of your true fans, who will pay full price for your book at $35/pop. Printing: any number of print on demand places (like Amazon) will give you at least 50% of the price of the book as royalties.

What else do you need? Distribution? Not if your fans read your blog. Publicity? Ditto. Now, if you were a photographer and wanted to sell photo books, then that wouldn't be an option. But that's not true in your case. Novels are just text.

56:

I really, really dislike the ransom-ware approach. On a related note, I find it intensely annoying to reach the 3/4 point of a novel and slowly realize that the author has no intention of resolving the plotlines in this book, and that I may be able to see where it is going in a year or two if I can still be bothered to pick up the sequel (which also may not conclude the story).

On the other hand, the patronage model is very interesting. The internet allows levels of connection and communication which have never existed before. I could certainly see a multi-tiered approach where level one gets a "Patron of Stross" sticker, level two a Cthulhu plushy? level three an autographed back-catalog (clearly on a non-linear scale here). This has, perhaps, the benefit of not messing with the conventional rights-models necessary to continue writing as you have.
Unfortunately, setting this up would be such an act of naked self-promotion that it might be difficult....

57:

I agree with Sam @ 17: bring back the notion of being a patron of the arts, which comes with bragging rights.

Create a corporation for the purpose. Have a web site where you set up a recurring monthly debit and pick your list of authors and artists for whom you wish to be a patron. (Have the suggested baseline level be $20 a month, allocated among your favorite n authors and artists, and an explicit percentage to keep the web site operating-- creators should always get the exact amount you specify for them, before taxes anyway...) The corporation then lists creators receiving money as employees, and at some threshold of money sent along, they become eligible for employee benefits (health insurance being an important one in the United States). The web site will host individual "Patron of the Arts: Your Name Here" web-bling images people can hotlink to show off that they're a Patron (and have various precious metals, real or fictional, available for different levels-- bronze, silver, gold, platinum, mithril/aurodium/whatevertheauthorpicks...), and provide whatever means that authors would like to use to interact with their fans (weblogs, Skype conference calls, mailing lists, etc.). Ebooks could trivially have a page or two tacked on listing the patrons at the various levels, and even physical publishers could probably manage a page or two for it. ("Charles Stross presents CASE NIGHTMARE GREEN with compliments to his patrons: Plutonium level: ... Platinum level: ...") The Creative Commons folks might have useful tweaks to their licensing to make sure that the patronage list is preserved.

58:

I'm self-published -- with all of the hassle and risk that entails, but they are costs I paid gladly. Brief discussion of the reasons here: http://bit.ly/5mnNsy

59:

Hopefully I will still manage to add some information here, as my suggestion is roughly the subscription model.

The starting point would be Mike Masnick's suggestion that when the marginal price of a product goes to near zero, you want to give away that product, and focus on selling scarce complementary products that are made more valuable by the free or cheap product.

In your case, a complete e-book or audiobook is the free or cheap product. In the current market, I would recommend making this cheap rather than free for new releases, priced at the above discussed "App Store" like prices. The goal here would be to increase revenue by another 10 to 30% over the revenue from scarce items listed below. Back catalog and first chapter sample e-books and audiobooks should be free to drive sales of current works.

What are the scarcities? New stories, access to the author, and physical artifacts.

New stories:
My idea here would be subscription early access to the novel before it is finished. What I am thinking of is very similar to Baen's WebScription.Net, though I was thinking of an individual author subscription at $2/month, whereas they charge $15/mo for a large pool of authors. If all 3,000 dedicated fans subscribe at $2/month, you could be talking about $72,000/year right there. Of course, I assume you would need to split this between author, editor, marketing, etc. so I don't think this alone would provide 100% funding, but perhaps 30 - 50% of it. The downside of this portion of the model is it directly impacts how you write the stories - you need to be able to finish earlier sections of the story first, whether individual chapters or acts. You might also have to make sure those portions end in a way that keeps people reading, although I think your writing style is page-turning enough on its own.

Access to the author:
You've excluded going and doing talks, but there are still other forms of access that dedicated fans might pay for. Some of these are probably better priced by auction than fixed price.

  • Birthday calls from you (you could limit this to N calls per day and then auction each day of the year off to the top N bidders.)
  • Choose a character name
  • Commission a story
  • Access to monthly conference call or live chat
  • Night out at a pub with you

Physical artifacts:

  • Specially bound limited edition books
  • Hand signed books
  • The pen you used to hand sign the books
  • The keyboard you typed a particular novel on.
  • Action figures
  • Miniatures
  • Until e-books take over, ordinary hardcover and paperback books.

Also, although knowing you you probably saw this already, see this article at Techdirt on Cory Doctorow's attempt at the CwF+RtB approach. (That's Connect with Fans and give them a Reason to Buy).

My suggestion would be to partner with a forward looking publisher that was willing to experiment with new models, rather than self-publish. I want you to spend more time writing new books, not selling them. ;)

--Kevin

60:

Well, you might have already burned your bridges with the movie cartel thanks to your blogging, so why not go straight to the Lego(R) people? Who wouldn't want a Lego version of the battleship from _Singularity Sky_? There are probably some good Lego projects in _The Jennifer Morgue_ too.

"Dominant Assurance Contract" isn't strictly speaking ransomware, but does require the author to put up seed money and would probably require the author to have an established reputation.

61:

You've pretty much articulated most of my feelings, but coming from someone generally considered 'friendly' towards the web, I think it has a little more power.

I find that most of the thinking in this area is wooly at best, because it is based around significant changes in social behaviour (i.e. similar flaws to communism, anarchism on the Left, and anarchism and free market fundamentalism on the Right - it's all based around 'if only people would change their behaviour, then society could be organised in this beneficial way).

Personally, I think the best hope is that consumers shift over towards (a) paid content a la iTunes - and there are signs that they are with music, (b) death of DRM and (c) hugely variable pricing - not 3 tier. Let publishers and authors and the market decide.

62:

I think ebooks are going to treat you just fine.

I found Accelerando for free through an auto-recommendation from another book on an e-book store (through the Stanza app on the iPhone).

Since I enjoyed it thoroughly, I have since bought a number of your books in digital formats (mostly through the Kindle app on the iPhone) almost all at $9.99.

I have yet to see a single bit of marketing or advertising for your books, so the money going there doesn't really seem to be doing much, but I still managed to find and buy many of your books (which I rarely find in hard or softcover on shelves at any of the major bookstores around me).

Thus not only did e-books expose me to your work in the first place, they provided the only means for me to purchase your work at all, and the only means in which I want to purchase that many books anyway.

That is not lost revenue compared to my purchasing a $24.99 hardcover, that is new revenue since I would never have heard about you otherwise.

I agree that Amazon should give you a larger percentage of book revenue, but it doesn't change the fact that you are getting more exposure and more readers due to e-books.

63:

Marketing to new readers is going to be "interesting" soon. I got into Charles' books about two years ago by finding a physical copy of Halting State in a physical bookshop (Borders, Glasgow) which has now disappeared and has no equivalent.
I was given a Book Token at Christmas and there isn't anywhere within a 30 mile radius of Glasgow (pop. c.1m) to spend it other than multiple WH Smiths (just no), Waterstones (half empty shelves, displays piled high with 50% off copies of "It Looks Like a Cock!" and celebrity biographies) or two tiny independents somehow surviving in the sticks which aren't easy for me to get to, one of which I don't like and one which I've never been to.
So although I am now a convert and am steadily buying and reading through all of Charles' back catalogue, where will new readers come from in the e-book era?
I bought a Sony Reader recently and it's nice (certainly better than phones or laptops for reading) but I still prefer paper books. Browsing an e-book website is no substitute for a physical bookshop for finding new books and authors.
p.s. I think Charlie is underestimating the size of his "dedicated fan base" - I'll certainly buy at least his next three hardbacks (knowing from this blog what the first two will be) and I certainly didn't buy Missile Gap (except as part of Wireless).

64:

Okay, so ebooks are 5% of books sold right now. That's not a predictive statistic. If the only way to read one of your books were online, that's how I would read it. I'm already planning on getting a Nook (or maybe an iPad, if that actually turns out not to be a completely crappy deal) because I'm tired of paying hardcover prices for new releases. I've been resisting for a while now, hoping for better technology, and I'd be *shocked* if this isn't the year I finally cave. So the fact that ebook sales were 5% of the total last year doesn't say anything about how many ebooks *you* would sell next year. Not that I blame you for being conservative, but I'm just saying...

And the ebook royalties you're describing are, frankly, for shit. Why sell through people who give you 15% of the take? That's completely out of line with their costs, or if it's not, they're losers and you shouldn't be doing business with them. On an ebook, the people who produce the book should be getting the lion's share of the royalties, not a tiny cut. That's you, your copy editor, and your layout person. There just isn't any 85% in the cost model for an ebook that's not those three people.

How many people read your blog, anyway?

OBTW, @53, no, sorry, I'm a dedicated fan, and I wait for the book to come out in paperback before I buy it. I just can't justify that kind of expenditure. Actually, I usually get the book from the library, or from my dad, who is willing to buy hardcovers. This is one of the reasons I'm so pro-ebook - you can price it to make money, and still price it low enough that I can buy it. Always assuming that you can make enough sales, and enough of a percentage of each sale.

65:

i don't really understand why you don't deal directly with amazon. wouldn't that mean 70% of books at around $8? that's around $5 a sale, which seems like it would work out about right, if you sell 10,000 copies a year.

i suspect this is what amazon wants too, and they udnerstand your problem, and will produce an interface that makes such a process fairly simple.

since this seems obvious i am sure i am missing something - sorry....

66:

I have always disliked the "information wants to be free" phrase. It's intended to mean something that is true, but almost nobody understands what this is. Here's a reasonably precise statement of what it's supposed to mean:

Information has a near-zero cost of copying, and since any copy can be used as a source of infinite duplicates, it is impossible to hold a monopoly on the production of copies. Hence, business models which are based on limiting the number of copies cannot work long-term; no matter what you do, the cost of a copy tends towards zero.

Of course, that's less punchy. (You're the brilliant writer, how about coming up with a better phrase?)

Anyway, this does clearly define the parameters that we're working with here. A viable near-future business model cannot at any point rely on limiting copies. That doesn't mean information has to be free, though. A few cases (not directly applicable to fiction):

  • Some people will pay for new information that is directly valuable to them. Some research is in this category. The ransomware idea is closely related.
  • Some will pay for the creation of customised information to their specifications. Examples: web page design, scriptwriting.
  • Some will pay for the distribution of information to people who would not otherwise seek to obtain copies, even when they are free. Examples: advertising, politics.

Fiction is harder because nobody seems willing to pay large amounts of money for it, without getting any back. However, people are willing to make small, regular donations towards things they think of as 'worthy causes'; perhaps this can be exploited in a variation on the 'patronage' idea. The basic form has been suggested before: you've got an estimated 3000 loyal fans, possibly more. £1.5/month from each of them, on an automatically recurring billing, gives you £54k/year - add a stipulation that all work be released for free in electronic form, plus the revenue from physical sales (which we expect to continue for some time, just not on the same scale as today). It might work. We need somebody brave enough to try it, so people can feel more confident about what to do and how well it works - anybody want to go suggest it to Cory?

Now to play the SF game and guess at how this sort of thing might develop: suppose you had a foundation, run on a not-for-profit basis, whose mission was "supporting the literary arts". This isn't hard to imagine as we have plenty of things like this already. Suppose they took (tax free) donations of £5/month from 1,000,000 people who thought science fiction was worth funding; that would pay for all the writers today, and allow the foundation to do some sort of allocation based on popularity, prizes, etc, plus small-sum outreach to new writers.

I don't know if it could be made to work. People would have to get over the idea of "you must not receive something you didn't pay for". We're not quite ready for it yet; the problem will have to become acute before you could get those kind of numbers interested. But I would like to live in a world where this did work.

67:

Well you have just earnt a booksale via this blog post, (Saturns Children via amazon.co.uk) from a new reader.

So I suppose the interesting point is how did I discover your works, hacker news has made this article popular so appeared in their tweet stream which I follow and clicked, it has probably attracted you a lot of potentially new sci fi readers, hopefully some of which will also purchase your back catalogue. No Google juice involved!

Even as a very early adopter of most tech I am yet to be convinced by ebooks replacing paper backs

Looking forward to reading your book!

68:

(sorry i am off by a factor of 2 because i mixed dollars and pounds; so you'd need to sell 20,000 copies - is that too much?)

69:

Would your 3000 rabid fans be willing to sponsor you at $1/m in exchange for some kind of precious items? Like a personal thank you note and access to all your books in ebook format the minute they're done?

That'd net you $3000/m, which is not a huge amount, but a start. And maybe you can get more than $3000, by asking for a floating donation - i.e. set the minimum to $1/m but let them specify an amount (some people would possibly be willing to donate up to $10 or even rarely $50/m to you if they really are rabid fans?)... or by increasing your fan base... If you can reach new markets and get, say, 10'000 rabid fans instead, or if you can convince people who are not quite rabid fans to sponsor you anyway, you could make a very comfortable revenue from this subscription model.

Ultimately, you are a "business" whose product is a flow of cool new books. The current model suggests that people pay for book that you've already written, but perhaps you need to turn it on its head and ask people to pay for the books that you're going to write. This would basically be a kind of micro-patronage.

70:

Mr. Stross
First of all, thank you for one of the most succinct examinations of this issue that I have ever seen. You fairly cover both sides of the issue as well as explaining the technical issues driving inevitable change in this field. I will probably point people to this post in the future for a good explanation of the issues involved.

A few comments. You may with to include your earning expectations in the main article. (your comment about supporting a married couple is probably good enough) It shows your expectations are very reasonable and not excessive. (there are still some people who think successful authors are rich, instead of struggling to make a middle class living like most do). I have SF books where the author got a government arts grant to write them. That raised an eyebrow for for me, but all things considered, I can't say its wrong.

Second, about the newspapers. You are assuming that newspapers will make their money by reporting news for the public good. What if you changed your assumption to newspapers (and mass media) as being the propaganda organ / circus maximus of the wealth party, existing to shape public opinion/keep the public too distracted to think about rebelling against the wealth. In this scenario, news media would bee a loss leader as the real benefit to its controllers is gained elsewhere. I think this view better fits the facts.

71:

I think an important fact here is that what you are doing is art, so even if the former commodification mode of your art fails you can look at other forms of art funding for inspiration.

The museum/zoo "classed donors wall" might work. Have several classes of donors with different costs, and have a web page on your site where their class is displayed in a tasteful manner. Possibly add minor swag or privileges. Possibly include the page in ebooks. It won't get moeny from a double digit % or your readers, but the ones who do will feel they get recognition.

Another possibility is allowing donors to influence your next project. Give donors a choice of available projects (including "It's all good") and encourage people's competitive and backseat driving impulses. The Laundry fans can compete with he MP fans can compete with the people wanting more Glasshouse. It's probably a good idea to make sure that all tagged money stays tagged for the project it was tagged for until it is used. It's also a given that strong firewalls need to be in place so that you are not forced to do hackwork you despise more than a non-writing job.

Cat stories. I don't understand why, but the internet seems to be full of people who really really want cat stories[1], and you have cats. This seems ideal for premium content that will not in any way decrease the value of your main product, yet give hardcore fans something that makes them feel special.


Product placement works for some media, but I doubt you're big enough. (Sorry.) However, you might allow people to buy cameos of some kind in your books. Perhaps a menu, with "name," "name and appearance of choice," and "name and appearance of choice and minor influence/action of author's choice." Perhaps auction these. "There are 15 type I, 5 type II, and 2 type III roles available in _Laundryhouse_. Bidding closes on the 23rd."

[1] This clause has been edited to remove the word "wackjobs."

72:

Charlie, hi

Great piece, thanks. I'm going to punt it out to assorted agents and publishers...

73:

Spookily Amazon suddenly, potentially, doubles authors' royalties:
http://www.theregister.co.uk/2010/01/20/amazon_royality/

74:

As a consumer of SciFi and especially 80s-90s cyberpunk the current system of book publishing seems hopelessly broken. Why can't I buy a nice new hardback copy of Brunner - The Sheep look up, Sterling - Islands in the Net, Laidlaw - Dad's Nuke or di Fillippo - Ciphers. This bothers me from a copyright point of view as well. Somebody, somewhere has the copyright-distribution rights to those artifacts and they're using that right to keep the artifact off the market. Now I know there are all sorts of process issues because those artifacts have a pleasing arrangement of atoms and creating and shipping real physical things is hard. I might as well ask why I can't buy a new Sinclair ZX81. Except, we're talking about the embodiment of words and thoughts here and the whole thing could be encoded in ascii (mod the stylish hardback cover). My hope is that POD gets good enough that Amazon can do it. But I'm not holding my breath.

So, just as we need a collective project to digitise the sum total of recorded audio and make it available, we also need a project to digitise and make available the sum total of the written word. Which all just leads us head long into your dilemma.

But I don't think it's restricted to book writers. There are several other artistic trades that are essential to a healthy society but in which the traditional business models are broken or breaking. There's not a lot of money these days in being a Philosopher in Residence, or a Zine editor (remember SciFi Eye "too much content for the money"?).

75:

A resourceful young woman called at my door last summer. She had written a book and wanted to self-publish. For a donation of £9, she would give me a receipt, take my details and promise to send the book out to me as soon as she'd raised enough for the minimum print run. If it was a scam, I figured, she was articulate, polite and hard-working. If it was real - well, maybe a book by such a person might be worth reading. So I gave her the tenner.

She called last week - the book is printing next month and she's raised enough from 3,000 people to print 6,000 copies. It's taken her well over nine months. Talk about dogged. If she can do it, why not you?

(I'm sorry, I don't have time to read all the comments, so apologies if this isn't original...) So why not simply get readers to pre-subscribe to books? Let's say your 3,000 hardcore fans pay $10 a piece to get you to a subsistence income level for the year, at which point you release the book. Subsequent readers can still buy the book - even on the ebook model, you'll earn a fair bit more for legit sales of a quality tome - or simply download it if they're cheap. The incentive for the fans is to "produce" another Stross. For everyone else, it's entertainment.

76:

There was just a study released saying that Kindle readers read/buy more than non-ebook readers. Let's go with that model for a moment.

What would happen if, for each ebook sold, you included 3 half-books (first half only)? One other of yours, and one from two other, related authors? You make it so easy to get the half and start reading that its almost frictionless. You have quite a bit of leverage if they like what they've read and its so easy to 'complete' the purchase and have it immediately.

Play to the ebook's strengths. Cost and immediacy. Giving away half a book is not like giving away half a pizza (people get full and don't want the other half) but its ALSO not like giving away half a car (completely useless). The problem with giving away a chapter is that it doesn't sound like much to the reader and is likely over before the reader makes the emotional commitment to the characters.

77:

Say a variant of the subscription/patronage and micropayments model

Subscribers get the content first in hardcopy

The bigger the level of subscription, the more "collectible" the hardcopy

Shortly after the release of the harcopy, electronic is released for a low cost ($1)

If you could make $5 a head off the 1000 patrons and sell $50,000 books a year, that would support a person

78:

Thinking about the subscription idea some more, it occurs to me that I sort of do that anyway, but not very efficiently. There are a few authors whose books I buy without question. Most of these authors come out with two or so books a year; so I'm spending about $50 each, a year, on maybe five or six authors.

But of the money I spend, the authors are getting about $5 each. My reading is drifting ever more into e-reader land, thanks to the convenience of the reading with an iPhone on the metro. I can also read while taking smoke breaks and not look like a weirdo reading by the loading dock.

I personally would rather my money go straight to Charlie, or at least the bulk of it. Earlier, I suggested (@5) using a self-published novella as an adjunct to the regular stream of publisher-supported books. A special thing, for special people who really like Charlie's stuff. I paid for Missile Gap, I'd pay for a novella, especially if I knew that Charlie would get half the cash I spend.

I'd also pay for the subscription. The things that have already been mentioned - DVD extras (interviews, story notes, backgrounder info, special introductions), early access to stories, access, subscriber get-togethers, whatever - these would all be enticements for the reader. A lot of bands are now doing this sort of thing, and there's no particular reason that it wouldn't work for authors. And the cool thing, from the author POV, is that it doesn't really involve anything different from what he's already doing - it's mostly writing, and occasionally drinking a beer with fans.

Just monetized.

I imagine the key thing would be electronic rights to the books. If those could be made available - and the publisher might allow it for a limited pool of subscribers - then all might be gravy. But even absent that, subscriptions could still work provided there was at least a couple short stories or a novella included. $25-50, for some text Charlie has probably written anyway, a t-shirt or mug, and exclusive access to a few short stories or one novella that might have trouble finding a home anyway given the magazine market? That sounds like a deal to me.

79:

One problem is that publishers haven't yet figured out is that they have no clue how to market ebooks. You say that the $9.99 price cap is the bane because it replaces a $24 hardback, but I'd counter that it also replaces a significant number of $8 paperbacks and $6 hardback remaindered copies, and wouldn't at all be surprised if it's not at least close to breakeven.

However, as a consumer of books, I can tell you flat out that I'm never paying more than $10 for an ebook that I'd normally have bought in paperback. I probably spend two grand a year or more on books. In the dark ages pre-Kindle I went to the local B&N once a week to look at the new books as they came out. I have a handful of authors that I bought hardbound editions for, but everyone else I'd see a new hardback and file it for reference, and then in a year I'd see the paperback come out and pick it up, if someone hadn't loaned me the hardback in the interim. So I have no problems with the concept of a tiered price over time in general.

However, the problem is that I never go to a dead tree edition store any more. So what happens is, the marketing machine will do its job and generate a page hit - I'll go look at a work. If it falls into the category that in the past I would have waited for the paperback, at this point, if it's $10, i go ahead and buy it because that's only a few bucks more than the eventual price I'd have paid. If it's, say, $16 for the electronic edition I'm not going to buy it right now.

So now the publisher has to fund a second PR cycle when the price drop happens, or the odds of me ever buying the book drop drastically, because they're no longer getting the free eyeballs on the product when I go to check out the other new stuff. Now, does this mean that I haven't saved money on some books that I'd have paid the $24 for a hardback on, and instead got it for $10? Of course not. But of the 30-odd books I paid $10 for on my kindle last year I think that the number I'd have bought in hardback instead of waiting on a paperback release was about 2. Anathem, and the non-Sword of Truth Terry Goodkind. That's it. So from me, the industry lost $28 in revenues, say, on the 2 hardbacks, and gained $56 on the extra bucks over the eventual paperback price. And that's not even counting the percentage that I'd have ended up reading without paying for them, either via a friend or a library.

80:

"So I'm trying to figure out what constitutes a workable business model in the post-Google age for someone who wants to earn a living by writing."

By continuing to write excellent material so that fan(atic)s like me continue to tell other people, etc., etc.

OR you can try* to dumb your work down to the point they make a movie out of it (also requires lots and lots of teenager characters, which in turn requires researching them by hanging out with them... suspect that's more difficult than the action figure option --- no offense kids!).

(* I know, of course, you can't actually do it. You'd never let your work suffer to sell a few more books just to get screwed by Hollywood because you are so awesome. Loved Scratch Monkey, BTW.)

81:

The Ransom model seems to have as many problems as it solves. It dictates limits to what you write (IE Cliffhangers etc.)

Didn't Steven King try a subscription model a few years ago? (Green Mile?) It did not seem to work for him and he has a really big market base.

I would like to see you get more than at present and would be prepared to consider some sort of pre-purchase or even subscription model.

Whatever keeps you comfortable and productive...

82:

Couple of thoughts from a reader who's been thinking about this from the opposite side:

  • Distributors win, as long as there is DRM.

  • Money is getting tighter, all the way 'round. As you state, ebooks should be the cheapest form of fiction available. They will sell. I might be reading them on my MacBook rather than an iTablet or dedicated device. But I will be reading them.

  • POD. See above.

  • Part of being a grown-up is conforming to societal norms. No society tolerates theft. In my opinion, piracy is coming to be seen as theft. I don't know anyone who prefers pirated movies, for instance, to Netflix. I know such people exist, but I think they decrease in numbers and effect.

  • I read a few suggestions that you (Charlie) should get other people to edit, proofread, etc. your works, for free. Apparently authors want to eat, but editors don't?

  • The Library may be your friend, or the demon chewing through your financial entrails. In an eBook world, there will be nigh-undeniable demand for the ability to simultaneously read the library's single, non-perishable copy of any work. For copyright to mean anything, that can't happen. Even if "1 to a customer" sticks, immediate transfer means I get the book minutes after the last guy. Scarcity is lessened. On the positive side, the library is where readers will "get a taste." I think this fight, more than any other, will determine compensation for works of art.

  • We are accustomed to thinking of the physical book as an item of scarcity. That is changing. I hear a lot of yelling to the effect that, because physical books aren't scarce, books aren't scarce, and thus must be free! Crap. Scarcity continues. The scarce item is the Story. Once the idiots are through yelling, the rest of us will deal. We want your stories. You (and your publishers, and your editors, and proofreaders, and distributors, etc.) want our money. OK. We paid $25, in the past, to get your product. We maybe won't pay that much in the future, especially if we can figure-out how to reduce "Amazon's" cut. But we will pay what you need. Because the alternative is that none of us gets what we want.

  • 83:

    Charlie, if you haven't read Kevin Kelly's "Better Than Free" I strongly recommend you do, to go along with the 1000 fans.

    Last week I started blogging about related topics to this post and Kelly's. I'll summarize here, but there's a lot more in the posts if you're interested (post_1, post_2 and post_3).

    On the scarcity side, you likely need to think about what you're selling in terms of things that can't be copied - what Kelly calls a generative. Generatives can't exist without content (in the digital world) or a product (in the real world), but:
    - the content is trivial to copy, and
    - humans equate value to rarity.
    The implication is that no one will be able to monetize content - not even Google, who monetized findability. We should still be able to monetize the experiences around the content.

    The company I work for has a tome of knowledge that cost a huge amount to create. We sell it today, but in the next few months we're going to post all the content online, freely accessible to anyone. We're a professional association, so we used lots of volunteers to handle most of the not-writing activities and a lot of the writing, and a few paid resources to do the rest. In our case, we're going to be selling embodiment, 'premium' study-guide versions and other scarce commodities associated with the content.

    In your case, could you crowdsource the editing and other non-writing? I know it's feasible with some kinds of business books (e.g. http://completewaveguide.com) but I'm not so sure about fiction. You might be able to sell immediacy by releasing a paid version of your books six months before the free version (same principle behind hardcovers, really).

    Don't give up!

    84:

    It's a tough situation. I certainly don't have a solution. When my publisher dropped my fantasy series (in the wake of restructuring that involved laying off my editor and the imprint itself being absorbed by another division), and no other publishers wanted to pick up the series, I started thinking about ways to get a concluding volume to the hardcore readership which is VERY dismayed about the cliffhanger ending in book 4.

    As a testing-the-waters measure (and also out of financial desperation when my wife was laid off and I lost some steady freelancing) I serialized a short prequel novel set in the same universe on my website, asking for donations -- I put up a new chapter every week regardless of how much money I received, though. It made in the neighborhood of $5,000, and small but welcome amounts of money still trickle in from the e-book and print versions I put together. Much less than I got for the novels I sold to a major publisher, of course, but enough to make it worth my time since I write fairly quickly. And it keeps the small number of devoted fans happy.

    I now plan to write the full-length concluding novel and release it in a similar way, though I'm still working out details. I might do a hostageware model where I release a new chapter only after reaching a certain threshold of donations for the previous chapter. Not sure yet. I wouldn't want to do this sort of thing for the rest of my working life -- I'd much rather sell books to publishers, for the precise divisions of labor you mention -- but for this particular special circumstance of having an unfinished series, it seems a reasonable way to go.

    86:

    I was going to mention Kevin Kelly's True Fans post, but someone beat me to it. I think the music industry has some interesting lessons for print media, but the way the finances are structured means that the two don't map neatly on top of each other.

    Record labels are notorious for shortchanging artists, but artists do have other ways of getting money from fans—concerts and tchotchkes. Moby is famous for having made all his money licensing songs for advertising. These aren't quite relevant to a writer: writers generally don't get adoring fans to cough up $5 to hear them give a reading at the soon-to-be-extinct bookstore (contrast with Van Morrison, whose recent concert in my town had tickets selling for US$350). I've never seen a Charlie Stross Inaction Figure or T-shirt. Witty paragraphs from Accelerando won't work as ad copy.

    IIRC, Todd Rundgren tried out a subscription model over 20 years ago: his true fans would pay, say, $20/year and get access to everything he did that year—studio outtakes, whatever. It's an interesting idea that obviously didn't take the world by storm. I think it actually might work better today, with remixing being so entrenched. Not sure how or if this might apply to writing, but the idea of "micro-patronage" seems like it might be viable.

    When you ask "what new business models exist that I can monetize and that aren't going to…require an old dog to learn new skills?" I don't think this brave new world is going to be kind to that.

    87:

    Stephen @49: That's very interesting. If true, the agency model basically rescues the publishers' collective nuts from the vice that Amazon has currently got them in.

    I could live with that, at least in the short term. It implies an effective continuation of business as usual on the new platform. There's still room for them to screw the pooch, but it no longer looks like a race to the bottom.

    robert @50: signing over e-book rights is mandatory if you want to extract a publishing contract from Hachette Livre these days. I'm not willing at this point to go to the mattress and test whether this also holds true for Holtzbrinck and Penguin Group, but I suspect it does. To retain ebook rights I'd probably have to switch to a small press model for publishing hardcovers.

    Don Martin @57: the first rule of $SEKRIT_MEDIA_PROJECT is, I do not talk about $SEKRIT_MEDIA_PROJECT in public. But, just sayin', you're wrong.

    cybergrue @66: there is an old saying, that the best way to make a small fortune in publishing is to start with a big one. This is especially true in news publishing. Propaganda organs of the rich they may be, but newspaper magnates are still beholden to the advertising sales force. If they ignore that bottom line, sooner or later they won't be newspaper magnates any more.

    Julian @70: being a zine editor is a good way to lose money ... unless you're Mark Frauenfelder. I still have some dead-tree backissues of BoingBoing, from back before it happily mutated into a blog. Which, I gather, employs quite a few full-time columnists these days.

    Skip @75: current ebook pricing is driven by publishers' desperate fears that cheap ebooks will cannibalize the sales of expensive hardcovers. So they try to sell ebooks for the undiscounted hardcover price. When that doesn't work, they insist on draconian DRM but slip the price by 15-20% ... ignoring Amazon.com offering the punters a 33% discount on the lump of dead tree. This Is No Good. But see Stephen @49's reference to this game-changer.

    Chris @76: Too late, I sold an option on the movie/TV rights to the Laundry novels to a Hollywood outfit. If they ever exercise the option, I entirely expect Bob to speak fluent Texan ...

    88:

    I agree with many of the posters here that the ransom or patron approaches would probably work best. In your specific case there is already a fan-base that is willing to pay for your books upfront (I know I would be) so it should be easy enough to setup.

    It might be difficult to have this as your only source of income. But I can't imagine that the income of most scifi writers is very stable even with the current publishing models, so you probably already supplement said income by giving talks, writing articles, going to cons, etc.

    These models would make it hard for starting writers to get funding though (since no one knows them). They would probably have to give their first stories away for free in order to build a fan-base before they're able to find some sort of sponsoring.

    89:

    I think I'll combine my two hobbies--writing and environmentalism for a sec.

    I'm still trying to get my head around the "bandwidth will increase infinitely." Every time someone says "the rules have changed this time," I smell a bubble in the making. To put it bluntly, I think you need to think sigmoid, not parabola, on the growth curve, and my bet is we've already passed the inflection point in your core marketing area.

    As an environmentalist, my take is that we're going to have to cut the average amount of energy per person to third world levels, unless something like fusion becomes reliable. If we want to nobly avoid global warming, this will have to happen within a decade. If we are forced to cut back by all the shit coming down the pipe, perhaps two generations--50 years at most. Probably less.

    Google and other big cloud operations work only because they have large server farms that currently draw the energy equivalent of small cities. First world cities. They're already siting new farms near reliable sources of huge amounts of energy, like new hydroelectric dams and off-shore wind farms, which means they're reaching the end of easily available energy with which to grow new farms.

    We can get into a good debate about whether a paper book or an ebook costs less energy/materials to publish, but the e-book model works only if there are new server farms going in constantly to make new content cheaply available. If that the farms stop going in, then what? That's where it gets interesting.

    So my suggestion is to revise your model on the assumption that bandwidth will be peaking in the not-to-distant future, that the cost of data will start following the cost of energy, and try another marketing forecast. You may also factor in the apparent fact that most first world countries have deficits right now, so huge investments to upgrade communications infrastructures anytime in our lifetimes are less likely.

    Books may be more viable, long term.

    In the shorter term, I'd suggest the HarperCollins trick of putting the first 50 pages of your new novels online free. It's a useful service: I don't read every word you write (sorry, Charlie), and when you're launching something new, I like to check it out and see if it's something I want to read before I buy it. It's akin to the ransomware approach, and quite honestly, I'd be happy with that too, especially if I could get the book shipped to me after I'd ransomed it from you.

    90:

    Adam @82: The "old dog learning new skills" thing is figurative. I've got most of the machinery in being to self-publish ebooks if I need to: a typesetter, sub-editor, and (importantly) a platform (this blog). I know where to go to commission cover artwork if necessary, or find a book designer. Sales and accounting are a bit more of a headache, but not insuperable. The reason I don't pull the trigger and start doing it is simply that it'd instantly suck down half my available working time, for a project (direct ebook sales) that would only reach about 10% of the market of a paperback, right now.

    No, what I meant by "learning new skills" was interpretative dance, or rap, or skydiving, or something.

    h @85: bandwidth will not increase infinitely. We've got hard limits imposed by physics -- about 2Tb/sec through air over wireless before you end up cooking your hapless users with X-rays. Fibre gives you a chunk more, and fibre feeding high-bandwidth picocells means you can put different stuff out in each 2-metre-radius room-sized 2Tb/sec cell, but it's still a limit.

    But 2Tb/sec is the entire Library of Congress in about five seconds. Oops. It may not be infinite bandwidth, but in the context of ebooks it walks like a duck and quacks like a duck.

    (You know about Iceland's bankruptcy-rescue scheme of turning themselves into a geothermally powered mid-Atlantic server farm, right?)


    91:

    A simple solution to your problem that has been successfully employed since the dawn of time is migration.

    If all else fails, migrate to a new market.

    BTW, I would love to see Accelerando getting the IMAX 3D treatment.

    92:

    FYI, Amazon just dramatically reduced the cut they're taking on some new Kindle books. The new program will pass along 70% of royalties off list price for covered ebook sales to the publisher (including, apparently, self-publishers). Here's a c|net story on it:

    http://news.cnet.com/8301-17938_105-10437897-1.html

    There are, of course, conditions: list price not to exceed $9.99, nor 80% of the price of the physical book, you can't turn off text-to-speech and must allow sales wherever you are legally permitted to do so, and they also don't want you underselling them through other distribution channels. (What happens if you give them all the same list price and they take different discounts is... not obvious.)

    This may be a preemptive response to Apple's rumored announcement of a similar program for whatever the heck they'll be showing next week in San Francisco.

    Speaking of which, while no one was looking, in-app purchases from Facebook and iPhone apps seems to have turned into the first micropayment market that is actually working for people. (I'm thinking of the Zynga model, which features games which offer real-cash purchase of in-game goods, and similar things on the iPhone --- a Farmville workalike called Tap Farm, etc.) So that also may be worth keeping an eye on...

    93:

    Hmm, 90 comments already, which I certainly can't be bothered to read at this point, but whatever. This is the web and there's a comment box, so I'm going to speak my mind again whether it's been said before or not.

    As a consumer, I feel that the most desirable end point of my interaction with the content companies would be tiered monthly subscriptions that provide me with the amount of content I want, for a price I'm prepared to pay. The obvious implication here is that I want as much content as I can eat, for a price that won't make me gag.
    I obviously don't just want to read Dan Brown and listen to the most recent winner of some talent show, so I'll be wanting everything from mainstream to esoteric content to be available.

    This means you have to slot yourself into some kind of giant content distribution conglomerate like everyone else, and take your share of whatever is sold.
    Interestingly the company most likely to achieve this model at the moment is Apple, so maybe you'll be working for Steve, or at least self-publishing through his book store, and we'll be marketing your works because we are being super enthusiastic about them with all of that bandwidth we have.

    94:

    I feel rather isolated among this band of forward thinkers; but I for one will never buy or read e-books - I hate the very idea of them. There, I've said it. I want paper books preferably hardback, on my shelves, not on a device, not in Google's or Amazon's or Apple's cloud, not even on a memory diamond.

    I hope I'm not alone in this and that there are enough Luddites like me around to sustain the current model at least in the medium term. If not, I wouldn't mind paying for those hardbacks through a yearly subscription rather than through bookshops/ Amazon - but I want a way to get them that isn't "e". If I can't do that I'm afraid I'll give up reading new books and spend the rest of my life assembling a fantastic collection from all the discarded second hand material that others will have thrown out.

    Sorry.

    95:

    It could be an interesting test for you once Steve's Tablet is out to produce a novella length piece and sell it through iTunes. Shouldn't cost that much more then your time (and perhaps some artwork). Sell it for a couple of bux, market it through here and any other free sites you can get around to and see what it brings.

    The upfront cost is low and it could give you a barometer on how well a self publish e-book could work. Perhaps something to repeat every now and then.

    I agree that you won't be able to sign any publisher and keeping the e-rights so this would have to be on the side. But it could serve as a back ground story between to novels perhaps...

    This year and next you probably won't see that many sales but if the tablet sells what Stevie want's then in a couple of year you might have a market. I know I'm getting my hand on one of them toys as soon as possible.

    96:

    To build a business based on your most loyal fans, you need their names and reliable contact info. Without that, you have no business. Start a mailing list; get them to sign up by promising them exclusive early access to forthcoming works.

    Release two new books a year in a US$50 limited hardcover edition of 2,000 copies. Outsource book design and print buying to any competent design house. (I'll do it!) Outsource warehousing and order fulfillment to Amazon Fulfillment. Send everyone who orders a signed and inscribed bookplate. Meanwhile, release the book as a free etext under a Creative Commons license. Post the torrent everywhere.

    You don't want to mess with self-publishing. I didn't like learning to type either.

    97:

    @89: Heh. So we're going to UV lasers as data relays in the wi-fi system. Shades of Flight of the Dragonfly. I'd like to see those signals running through 30 year-old glass fibers, which is where we're going to be in 20 years. The theoretical limits of bandwidth aren't going to be the first order approximation of what will kill the user, they're far more likely to be the slowest link in the aging infrastructure, as they are now.

    As for Iceland turning itself into a server farm? Fine. I'd *love* to have my data sitting on top of the Mid-atlantic Ridge. There's a reason why the Icelandic S&R team deployed so fast to Haiti. They need to stay in practice for the volcanoes, earthquakes, and jökulhlaups that they normally have to deal with. Plus, they'd have to recable the North Atlantic periodically to make it worth saving data there.

    Personally, I'd rather put my data in northern Ohio, and power it off the Lake Erie winds. There's a reason they have the lowest insurance rates in the country in that area. Maybe in Scalzi's basement?

    Regardless, the problem is you can't disentangle energy-hungry server farms from a looming energy crisis, and because of that, books might actually be a viable medium in the future.

    98:

    I think you're completely mistaken assuming that Google doesn't care what carries the advertising. They are in exactly the same situation as newspapers, in that a poor signal-to-noise ratio drives away the "eyeballs". Unlike newspapers, they are bright enough to see the problem, and they already do their damnedest to ban spam and procure good content - consider YouTube, where they are already paying artists per music video playback. So there might well be a future in the hired-by-Google business model.

    99:

    "I'm not much of a public speaker — unlike Cory Doctorow I find speaking exhausting, and worse, I can't write while I'm travelling. Maybe a hybrid business model would make sense for some writers: a full range of posable action figures based on the characters in their books, backed up by a manga serial and some themed casual gameplay. But I'm not convinced that's where I want to go, either."

    I can understand public speaking being exhausting, but having seen you speak at a couple cons I can say the claim that you're not much of a public speaker is rubbish.

    As for the latter part of that paragraph...oh please please please on the action figures, etc part. Even if you never have to worry about the other stuff, please with the action figures.

    /end fanboy plea

    100:

    Charlie:

    First, I want to thank you for articulating your views on the "Information wants to free." aphorism. I have had a problem with that phrase since I first heard it from Stewart Brand. Further research indicates that by "free" Brand may have been referring to freedom rather than cost. (See: http://www.rogerclarke.com/II/IWtbF.html. It repeats the full phrase).

    It seems to me that the laws of physics tell us that nothing is truly free. So do the most basic laws of economics.

    The problem is that, in spite of all the suggestions above, the models proposed so far, while superior to the clearly outdated models currently in use, do not seem to suffice. Particularly, as you say, in the news/journalism part of publishing.

    The Internet certainly eliminates the barriers to entry for distribution, but not for production. That's the part that most observers miss. Gathering and preparing the news for distribution is the heart of news publishing. Current models of digital distribution do not adequately account for that cost.

    Murdoch, as is his wont, is wrong headed. Yet, the problem the he is trying to cure remains; finding a way to pay the underlying expenses of news publishing. One of the biggest issues is that advertisers consistently undervalue web advertising. In the long run, that will change. Unfortunately, in the long run we and the news publishers will be dead.

    There is also a sociological problem created by the web. To wit, a whole generation of customers really think that all information/digital products are free.

    And, yes, Cory Doctorow is sui generis.

    101:

    Admittedly, this is based on a quotation that's a couple of years old, but here's some self-publishing numbers for a proper print run on a proper press using a company specializing in book printing.

    Quote was for 5,000 copies finished and delivered in a single consignment to one address, based on ~320pp and 4-col matt laminate cover. Press ready PDF supplied by me, although the printers would generate a barcode from an ISBN supplied by me and to be added to the artwork by them.

    ~£5200.

    So, basically, if you can sell ~1100 copies at £4.99 a piece, you've broken even and everything else is profit. :-)

    Better yet, if you VAT register, your product (the book) is zero-rated for VAT, so you're entitled to 17.5% of your print bill back from HMRC at the end of the financial year.

    However, producing a properly typeset, press-ready PDF is non-trivial (I'm a professional designer and typesetter, which is what started my train of thought on this matter), plus marketing activity, plus actually processing and fulfilling the orders.

    That said, you could probably get away with £6.99, which drops your breakeven to a mere 744 copies ... call it 867 copies if you assume an average postal cost of £0.99 per copy to send out.

    Cheers!

    Jim

    102:

    Adrian @42 - On net-scale patronage.

    Pulling the 50Kpounds figure from earlier in this discussion as the value of supporting a CharlieStrossUnit for a year, I agree that this is a little out of reach for those of us without the forethought to be multimillionaires.

    However, a CharlieHour would be much more affordable - with 8760 hours per year (8784 on leap years, but we'll skip that), a CharlieHour could be priced at a mere 5.71 pounds - barely more than a cup of (wildly overpriced) coffee.

    Of course, you'd need to set up the CharlieHours sales system to require an absolute minimum of overhead (otherwise the price would go up), and people would need to understand that they weren't actually going to _get_ anything directly for their purchase, but I'd be willing to cough up a fiver and a bit for the warm fuzzy feeling knowing that from 3-4am on 17th March 2011 I was financially supporting an author I like.

    103:

    You would be wrong to dismiss the premium/collectible market altogether. I paid very good money for limited editions of "Gardens of the Moon", "Lord of the Rings", "Return of the Crimson Guard", and yes, the Laundry omnibus edition "On Her Majesty's Occult Service". I'd pay handsomely for hardbound omnibus editions of the Earthsea cycle or Glen Cook's Black Company series.

    In the 19th Century, the famous explorer Richard F. Burton funded his expeditions by having the Burton Club publish lavish editions of his books. The Burton Club edition of his "Arabian Nights" is legendary.

    104:

    @38: While Baen is a model of e-publishing, you have to take a few things into consideration.

    Yes, their e-book publishing effort is profitable, in that it pays (very good, percentage-wise) royalties to the authors, pays the operating expenses for their Internet presence and a good living for the sysadmin responsible and contributes to the bottom line of the company.

    It is not profitable in the sense of paying a major part of the editing and other operating expenses of even a minor publisher. That still comes from the dead-tree publishing. I know at least Dave Drake views the e-book versions more as advertisements for the dead-tree books than as products themselves.

    @44: I think it's Tom Doherty _personally_ who owns a share in Baen books, not Tor.

    105:

    So, you say you're not into marketing? Well, you are wrong! You are great at marketing, and your blog is the best part of it. You have a big flock of readers of your blog, and we all know by now that you are smart and likeable, so we buy your books. That is how marketing works.

    But, when it comes to the future, I envision a world where books may really be free of charge, and we readers donate money to those who write them, if we find the books good. Today I pay for your books, and have to face the facts afterwards that the product I bought was sucky. It may not pay well, it may force you into part-time jobs, I don't know, but the overall number of books will just increase, since people just can't stop writing books, even if you never get paid. So, I see a bright future for literature, perhaps not so bright future for writers.

    In this way it is very similar to music - people will continue to create music, even if they'd never get paid, just because they love it, or because they have a faint hope for touring around and get laid by groupies.

    106:

    Of course what nobody is mentioning is the Gaming market.

    Part of what people get from books is to immerse themselves in it. When people "Are you going to write any more in the Iron Sunrise universe?", what they mean is "that creation is really cool I'd like to spend more time there" . They care less if you have story to tell in that universe and it matter less if it a well written gaming environment - people will enjoy hanging out it the universe.

    You already have some programming ability, so no seriously new skills are needed, just was a way to create such gaming worlds from written prose, then you can leverage bandwidth to deliver minimally customised words direct to your customers for a small subscription fee.

    The downside of course, is that I am describing MUDs, and short of Shades I'm not sure there has been much in the way of commercial MUDs let along successful commercial MUDs.

    But still it was a nice idea for the pico-second it lasted.

    107:

    This just popped up as I was reading the comments: http://daringfireball.net/linked/2010/01/20/kindle-amazon

    108:

    On newspaper subscriptions:

    The subscription is just to pay for distribution.

    A number of the techs at work had paper routes to supplement their State job, and all of the money went to them. We have homeless guys at intersections selling the paper, they get the full amount, so none of that money goes back to the paper.

    On making a living as a writer, patronage vs. commercial:

    Look at the answer to question two in the following interview.

    Neal Stephenson Responds With Wit and Humor
    http://interviews.slashdot.org/article.pl?sid=04/10/20/1518217

    [Begin Kibitz]

    Now is the time for pay-per-copy:

    Years ago Richard Curtis wrote a fun essay _Render my Statement, Tender my Check_, in his book, _Fool For An Agent_, where he talked about "pay-per-copy" rather than the current system of advances and royalties.

    Everyone forgets that the word "copyright" means being paid for each copy made. It doesn't mean buy-right, or sell-right, or print-a-bunch-of-copies-and-destroy-half-right, it means the "right to copy".

    Right now, each writer who signs a contract gives away his copyright, because they are not paid per copy made, they are paid per copy sold. You get paid of course, if and when the publisher actually decides that the copy really, really, really did sell; and if they have a "profit" to split with you. Until then, they hold onto your money for as many years as they want, and you may literally never see the full amount due you.

    Let's give the classic example of the standard system:

    Your book sells 100k copies, and the publisher pays you a royalty. The publisher is so happy with your sales that they will go all out on your next book: embossed, foil cover, the works. They sell 100k copies, the same as before. Suddenly your publisher is unhappy, the book did not earn out the advance. You not only don't get a royalty payment, they are cutting your next advance and print run since they are losing money on your books.

    Think about it. Both books sold to the same 100k people. You have an audience that will buy anything you write, yet because of the publishers stupidity in making the cost of printing more expensive, you don't get paid. Why should your money be held hostage by the publisher's stupidity.

    "Pay per copy" means:

    When the printer gets paid, for printing those 100k copies, the author gets paid. What the publisher does with those copies is their "business", not yours.

    The printer has his "unit cost" for printing copies, what is your "unit cost" for selling those copies to the publisher. Figure out what you ideally would be paid for each mass market, trade paperback, hardback, copy printed. That is the "unit cost" that you should charge the publisher for your book.

    Look at your statement, see how they list the number of "sales" not the number of copies made. For every copy that they claim to have sold, they will pulp one or two unsold copies. If you were actually paid for each copy that rolled off the printer, how much would that be. Could you live with that amount.

    Remember, the author is in the business of writing books. "Copyright" was set up to force the publisher to pay for copies they make, not copies they sell.

    Pricing on e-books:

    Based on the concept of pay-per-copy, e-books should cost 2 bucks at most, with 90% of that going straight to the author. The publisher can split the remaining 10% with the service provider and still make big bucks on all of the transactions they make.

    In conclusion:

    All the ideas listed in the thread, the stuff that Doctorow is doing, etc..., all are not dealing with the real problem, which is "copyright" and being paid for your copies. I think that pay-per-copy is the answer you are looking for, if you are willing to fight for it.

    It will take organization to make it happen. You will get resistance from publishers because they like to keep your money, but the the only way to change the system is to reclaim copyright as it was intended rather than have everyone simply sign their rights away.

    [End Kibitz]

    109:

    Wow, 103 posts in less than 6 hours. I suspect this topic is like teaching, we all have an opinion since we've all experienced being taught. (Never mind the quaity of the opionion though)

    There's a book whose title I can't recall just now, its well known, about the British media, it came out 2 or 3 years ago? ANyway, the author shows (possibly not to everyones satisfaction but it fits with my observations over the years) that the british newspapers started cutting reporters and useful staff in the 90's, under the influence of the maximise profits pressure of beancounters and greedy bastards.
    Therefore the observable quality of the british press was on a downwards trend by the late 90's, more wire stories, regurgitations of PR, fewer real stories etc, despite most of the papers still being very profitable!

    Or in other words, the downwards spiral began before the internet and can't be blamed on it. Arguably they would have been in better shape to weather the internet had they not given up the personnel intensive real life reporting which they dropped because it was expensive. Ok now mobile technology lets everyone be their own news reporter, but people still want single sources and gateways they feel they can trust.

    Also I was astounded by the google books settlement - why havn't they been sued to death for basically stealing out of print books? I personally am not so bothered once the author is dead, but to do it when the author is still alive and offer them derisory monetary compensation? Bah.

    The only other thing I can say is that I like some of the ideas of people above involving holding stories to ransom, and also e-books directly from you. However as an established star you have a fan base and a name, I have no idea how a new author is supposed to make it. I can see POD, e-books and the internet having a bad effect on the normal gatekeepers, ie the agents, thus increasing the amount of rubbish competing for peoples attention.
    On the other hand I don't see paper books disappearing any time soon. But how to make a profit from them, there's the rub.

    110:

    I have been pretty cool to the Kindle, because it didn’t seem to make economic sense for me. If my wife and I both get Kindles (so that we can share books with one another, like we do with paper books), that’s five hundred dollars spent. If the Kindle edition of each book we want to buy is $5 cheaper than the paper edition we would otherwise buy, we’d have to buy a hundred Kindle e-books just to recoup the cost of the readers, and since our book budget is (alas) not enough to get a hundred books in a year, we also have to think about the time value of money. And (click click click through my Amazon records...) it looks like the majority of books we’ve bought through Amazon don’t have Kindles available, and (click click click at the Kindle links for a few Stross titles...) the discount for the Kindle edition is sometimes even less than $5.

    But if publishers come under pressure to sell e-books at deep discounts from the paper editions, then e-book readers start looking more economically attractive to me.

    111:

    @ 108 - Flat Earth News by Nick Davies?

    112:

    Hampshireflyer - yes, thats the one.

    113:

    Roger Gammans @ 106: some of us still do dice-and-paper gaming, and I would certainly shell out for a sourcebook for the Eschaton or Laundry universes; it's not like Mr. Stross hasn't published gaming material before. (Chaosium might be quite interested in the latter, to go along with Delta Green.) The hitch is whether it would pay as well as putting the same time into writing another novel...

    114:

    I want a Charles Stross Inaction Figure (Malibu Dream Keyboard sold separately).

    The idea of 'distributed patronage' has some allure. Patrons kick in for one or more stross-hours per year. You get food, shelter, etc. We get to have world+Stross, as opposed to just world.

    I'd love to see a follow up post to this summarizing the ideas and giving your comments on them.

    115:

    Ultimately there are two problems?

    a) distribution: a place where readers can peruse and buy books, and marketers can entice readers

    b) replication

    Replication only becomes a serious problem when either digipaper commensurate with the optical ease of ink on paper becomes available or when an entire generation of readers learns to prefer backlit etext. No escaping this that I can see, although encryptologists are surely working to find a way around this.

    Distribution is ultimately a matter of buzz, and replication will ultimately hammer both macrophysical bookstores as well as microphysical bookstores like Amazon. (Sears Roebuck once ruled the world but not no moah.)

    IF... you generate buzz via your work, demand will accrue. How to prevent that buzz from being a pauperizing Napsterfest of free downloads?

    Dealing with known entities 1st (yo Occam; how's it hanging? razor accident? sorry to hear it), we have ransoming your work. This need NOT hinge on cliffhangers. Excuse my literary arrogance, but really good work needn't entrance a reader by cliffhangers. All it need do is bond a reader with its main premise or character or world in a way that a reader wants to experience more. Ransoming need not narrow commercial literature nor lower it to sensationalism. So ransoming will work without destroying the Age of Literature... but only to a point, unless the replication problem is solved.

    Replicability most likely cannot be stopped altogether, but it can be choked down to a survivable 'bootleg market'. Ephemerality, encryption, other methods will make it hard for all but only the more dedicated pirates to obtain a digitally transferable copy, and most fans won't take that trouble. Only freakish fanatics and venal pirates will. Freakish fanatics tend to repel rather than generate positive buzz, and pirates SELLING your work illegally are easily prosecutable, yes? (Unless they live in China, but that know will soon be untangled. China needs us as we need them.) Plus, pirates face the same challenges we're dealing with here.

    Unknown market models: I foresee 'investment pools' modeled on insurance companies/tax bases/etc. wherein bibliophiles plunk down, say, $20 a month, to peruse opening chapters, then opt to receive a copy, up to x copies per y, based on some balance of how many books the average bloke can read a month. Publishers will still serve as market gatekeepers, deciding what books will most likely keep those monthly subscription fees renewing.

    Also, members get to rate work (much as Amazon does), generating market buzz.

    Author royalties, of course, will accrue per copy sold, as always, and advances will always be necessary for most authors, although 'self-publishers' will have a better shot at the market by submitting free work. They will suffer, of course, from lack of promotion by the publisher, but much less so, since readers will have as much or more promotional muscle than publishers, whose main job will simply be to keep work for sale to a certain standard.

    In the process, publishers will also achieve an advertising platform of considerable power, perused/read books using the google model to present related ads to perusers.

    I'm tired, brain collapse.

    116:

    Frankly, I'm not willing to spring more than about $10 on an e-anything. I'm old-fashioned, and I like having something tangible that I can sell second-hand, or lend to a friend, or whatever.

    There's also the issue that you brought up about word processors: format compatibility. I have books that are over 100 years old, and they read quite nicely; I have e-documents that are less than 10 years old and I can't read them anymore. If I'd have printed them out, I could read them, but printing them would have cost me almost as much as buying the book in the first place (and that's just expendables like paper and ink, not including amortising my computer and printer…)

    One thing about ebook readers is that they really only make economic sense to people who read a lot. If you read 5 books a year, adding in the cost of a reader makes ebooks expensive even if they are given away.

    117:

    What about one of the models proposed for the music industry: make everything free at point of aquisition, tax everyone, monitor what people listen to, distribute tax income to artists accordingly.

    Or set up a tax-funded organisation like the BBC to commission work.

    Sorry, no good ideas for how to get there.

    When information is free, do we need socialism to pay for creating it?

    118:

    I think that somewhere in, on, or around Hugh MacLeod's "Gapingvoid" process, there might be a nugget of the core of the nutmeat of a concept. (http://gapingvoid.com/)

    His work has the advantages of being partly verbal and partly visual, of being short, of humor, and of being pithy. And now he's come out with a book based on his earlier work. Based on a long ago blog post (or series) no less.

    Obviously, this is the result of a long process, taking years, of near uniqueness, and of hitting the sweet spot of several swelling trends, but there has to be more than one niche for one person.

    And his celebrity, such as he has, will contribute to success. (If you have to have money to make money, then you have to have success to be successful. This I don't know how to do yet.)

    Brevity isn't everything (No More Bullet Points Covering The Ten Best Of!). Pithiness isn't, and it's too hard, all the time, in every situation. You can't hit the crest of a new trend if you don't know it's coming, and besides, it's mainly chance. But there are little islands here and there, little refuges, until the new world emerges.

    119:

    Tell me more about this "paper mills are really green and energy saving" theory. I'm laughing my arse off. Remember, the plan isn't actually to generate leftover artifacts to tell future archaeologists how great our culture was. It's to keep it going.

    Also, what's so wrong with the much mocked French solution? Tax data media, or big serverfarm sheds, and start an Arts Council publishing division. It works for the visual arts and the theatre. There are downsides, but it's not obvious that the Arts Council has been incredibly conservative.

    And pretty much every thing in germs, chips, materials, and aerospace works that way. It's really only software and hairdressing startups that are expected to be purely privately financed.

    120:

    I'm not sure that Google has anything to do with it. Google is riding the wave, but Google isn't the wave. The wave is created by Cisco and AT&T and DARPA and Microsoft, and if Google wasn't surfing it, nothing would be different. Hell, you write SF, you're one the best people in the world to come up with a surfboard, but you aren't doing yourself any good complaining about someone else's.

    Speaking of SF writers... what we're seeing, right now, is the future of Brunner's "Shockwave Rider". The wave doesn't look exactly like he predicted it, and the future he predicted was borth richer and poorer than the one we're in, and details of so much of what he wrote was laughably wrong even then. But it's an important roadmap to the present.

    121:

    A strong argument for socialism here is that you've got to make a start. It's fine for Cory, or Charlie, to think in terms of crowdsourcing; I reckon we could come up with a Stross Foundation fairly quickly. But if you're about to sail for the ocean of words, you don't have a significant readership by definition, still less one that skews towards highly paid highly practical geeks.

    Obviously, the analogous institution is a bank. Try that. Or a P2P lending market; but I can well see that. After the first 50 hardcore libertarian military SF fan service jobs fail horribly, a lot of the user elite among the lenders will have been burned and will quit.

    You need an institution. I guess there's a possibility for a risk-bearing association of mini-patrons, a Literary Society for the times - but that is quite like x million shares of Penguins. Perhaps it could be a sort of publishing co-op with both publisher and author members.

    122:

    As a programmer who actually likes to develop software instead of being a wage slave for a corporation, I developed the following solution:
    (1) work for a corporation and save as much as I can until I get to $1M net worth
    (2) learn to invest; investing takes very little time - probably less than 1 hr/week
    (3) develop open-source software without caring about being paid for it
    Probably something similar could be developed for your line of work.

    123:

    So far electronic distribution hasn't really affected book publishing. Music publishers had to look at ways to change their business model when pirated mp3s began to seriously affect sales. The rapid expansion of the legal download market followed. The thing is as a consumer experience reading an electronic book and a printed book are distinctly and obviously different while listening to a CD and a decent quality MP3 are effectively indistinguishable. With book publishing in the UK sales have increased virtually every year out of the last fifty years the only two in which sales fell were 1969 and 2008. Understandably as long as the existing business model is successful the publishers see little reason to change it.

    124:

    Overall an interesting post. Though there's one point that I think needs to be corrected:

    "Given that the crappiest spam blog is as useful to Google as the greatest virtuoso symphony performance or the Nobel prize winning novel, if it generates the same number of advertising click-throughs, they'd do just as well to spend the money on automated spambots."

    That's false. Google ad system relies running relevant ads against content people will be interested in. Otherwise advertisers wouldn't spend the money to run the ads. I agree that Google does make money off of the spam blogs. But I don't think Google sees them as one in terms of profit margin potential.

    Also, for your plan to find a way to develop a revenue stream that Google won't "spoil", my suggestion is the one thing you don't want to do: speak. People will pay for content and information that is in limited supply. The ideas that happen at a conference, or a speech, happen right then and there. People pay for the immediacy and the atmosphere. Google can't index or devalue a speech as it is happening because it hasn't hit the internet yet.

    125:

    I think that once ebooks become widespread a Science Fiction ebook subscription service may be viable as long as a significant number of major writers signed on.

    Readers would pay say $15/per month (the same as HBO) for all the Science Fiction on the sevice's list. (All the SF you can read.) The subscription service would publish authors they think would draw subscribers, taking a fixed percentage of the total subscription income (say 50%?). The remainder would go into the royalty pool. The royalty pool would be divided evenly amongst the total number of downloads, to find the individual payment/per download and each author would recieve payment proportional to the number of times his work was downloaded.

    There is an element of cross publicity in this arrangement as each author would bring his/her own fans, and it also encourages fans to try other authors on the service as there is no downside for the reader, aside from time wasted, to trying new authors.

    Marketing would also be an efficient arrangement as your marketing would, in effect, not so much be selling one SF author, but selling all the list SF authors at the same time.

    126:

    No point in rehashing the excellent posts above, so briefly:

    I'm one of the 3000; I'm going to buy everything you write. Give me an opportunity to pay an annual subscription and get all of your stuff in the formats of my choice, and maybe a few special shinies, and I'll send you my CC info. I doubt a scheme like this replaces the current model but it seems to have the potential to make up the difference in the long haul as the current model withers. Where do I sign up?

    127:

    Here's a variation of the ransomware sale that you might find useful.

    1. Put the first 50 pages online free--this is the equivalent to someone reading the book in the store. (I'm assuming this is a 200 page book)
    2. If someone wants to keep reading, they can purchase the next quarter of the book for the cost of 1/3 of the book.
    3. If they want to keep reading after that, they can purchase the next 1/4 of the book for another 1/3 book cost.
    4. However, if they buy the final 1/4 to find out how the story ends (At 1/3 book cost), they get shipped a physical copy of the book.

    Proportions have to be adjusted to make economic sense, and obviously, there's the option of buying the entire physical book at once and not goofing around.

    While this shuts out the ebook readers (sorry guys), the nice thing here is that everyone gets to sample free and see if they like it. Anyone who purchases the book gets their own copy. Additionally, if they think the book sucks, they don't lose the cost of the entire book, only as much as they invested in.

    Also, there's a simple form of copy protection here, because only the physical book has the entire manuscript. People can pirate the bits, but they have to physically scan and upload the ending to make it worthwhile, and that takes work.

    Finally, it gives the author some payment for the people who didn't like the book. Not as much as for someone who bought the entire thing and pitched it, but it is something.

    128:

    I wonder if the rental model is an option. The movie business seems to do ok on that, and a film, even a low-budget one, is generally a lot more expensive to produce than a novel. However, sales tend to be a lot higher for films, and being more work to make, there's less competition.

    I think, given the number of people that seem to be compelled to comment on your blog, you should charge for that. :-)

    129:

    "commissioning cover art"

    I mean this in the nicest possible way, but no one reads your books for their covers. Saturn's Children is already legendarily awful. But don't feel too bad; not even the aging and fabulously-powerful-and-well-to-do Robert Heinlein could drag his covers away from the soft porn world.

    I was given my first Charles Stross book; I happily bought the rest. But no amount of publisher's marketing was likely to get me to buy the first one.

    Also, I wouldn't underestimate the consumer's willingness to purchase the same content in multiple formats. I can think of one musical for which I own the VHS tape, the DVD, the CD soundtrack, the iTunes soundtrack, and the souvenir picture book. Who says that I wouldn't buy a dead-tree version of a free (or extremely inexpensive) e-book? Especially if they didn't bother to waste resources on hideous cover art.

    130:

    I don't currently have an ebook reader, but I imagine that I'll buy one sometime in the next five years. To me, a compelling up-sell would be credit toward a "collectors' edition" hardback. I could read the book for the first time without much monetary risk by purchasing the ebook. If I really liked the book, I could apply the cost of the ebook toward the collectors' edition. If the collectors' edition was in the neighborhood of 30 - 40 USD, I would certainly consider that for a significant subset of your books.

    One other thought -- as an alternative to subscriptions or pre-purchases of upcoming books, one could run each book as a company, replacing the publisher with investors. I could purchase shares in an upcoming book. You would use the money as your advance and to hire a marketing person on a contract basis. I would then receive a portion of the book's proceeds. Of course, the accounting for this might be a bit complex...

    131:

    I buy books. I buy paperbacks, hardbacks, you name it. I buy them as often as I see them in the shops, and I'll buy based on whether I know the author, whether I like the author, whether I'm just curious about the book from the vague browsing I've done, or just because it happened to have an interesting picture on the cover and I had the money this week. However, I don't often buy ebooks.

    This is partially because I don't own a dedicated ebook reader, so if I buy an ebook, I have to read it at the computer desk, at the computer, through the web browser. So it's very much tied to a single location and a single place, and ebooks are competing (on my computer desktop) with games, the wider internet, and all the blogs I follow. But the other reason I don't buy ebooks (or even own many ebooks) is because for me, reading is as much a tactile experience as an intellectual one. I like the weight of a book in my hands; I like the experience of reading in bed until I'm just about falling asleep. I like the experience of reading in the car or on the bus or train, while I'm going from A to B. I like reading indoors, or outdoors. I'm one of those strange people who is physically capable of reading as they're walking from one place to another. So far, I have not found a single electronic device which is capable of replicating the viewability of a simple plain paper page in standard daylight, much less the full-on glare of Australian summer sunlight.

    See, this is the other thing about plain paper books: I can read them even when I'm wearing my sunglasses to cut the ambient glare around me. The contrast between the text and the paper remains, and no electronic display I've run across so far is capable of replicating this. So I'll probably still be purchasing paper books for as long as possible, purely because I enjoy the experience of reading, and I like being able to do so all year round, in all kinds of weathers.

    Shorter version: Even if the rest of the world goes to e-books, I'll still be out combing the bookstores looking for my dead-tree copies.

    132:

    Mr. Stross:

    Let me start by saying that I greatly enjoy your writing, so much so that I buy your novels in hardback as soon as they appear. I look forward to your future work.

    That said, I'm a little disappointed by your tantrum here. Sure, I've read worse. You're a brilliant fellow, and you understand how things work and what's at stake better than 99% of your colleagues. If you eventually stop writing novels because you can't make money off them, I'll miss your voice.

    But there are plenty of other fine writers who will find ways to monetize their work and keep going. And I'll read them instead.

    133:

    Another data point: SF and fantasy author Lawrence Watt-Evans published three novels using ransom model. The Spriggan Mirror (2005), The Vondish Ambassador (2007), Realms of Light (2008). Basically, it seems to work for him.

    134:

    Well as one of the "three thousand" and as a now official hard core fan, I felt I had to comment. Full disclosure, I only bought the Missile Gap novella because I was on Amazon. I have several other very slim hard backs I bought on Amazon, because of my inability to check the page count and price. I would have passed if I had been in a bookshop, especially as its now part of the latest story collection. But I did really enjoy Missile Gap, please expand it one day and I ultimately didn't feel shortchanged.

    However, I do think I have practically everything You have ever written, back to my White Dwarf collection, so Yes I am a hard core fan, I would think in terms of revenue, I'm in the top 1%.

    As far as e books go, I will not buy one until buying an e book gives me the right to read that book in perpetuity. I actually love hardbacks but space issues mean that ebooks are becoming much more attractive, however after buying the video/DVD/BluRay issues, I want to buy the rights to work of art and pay the top up fees for a media shift, not the full price again.

    As far as the revenue model goes, its complicated for me to advise as in many ways I am the perfect reader of most of what You publish, I have actually read Deighton and Lovecraft and love the Laundry Books. I really liked Saturn's Children, even more on the reread but I was concerned that it was a great book aimed at me, ie someone who had read Friday, Asimov etc. I don't know how it would read to a 20 year old. So obviously one way you could maximise your revenue would be to make your books more generally reader friendly, I am not sure how well that would work, trying to guess what the people who don't normally buy books will buy is a mugs game.

    Finally, as previously suggested, something as silly as T shirts on the web site might make a lot of sense, there is a huge mark up there and it might make a useful revenue stream.

    Anyway been loving catching up on your blog and looking forward to the forthcoming releases

    Rex

    135:

    The Artistic Freedom Voucher: Internet Age Alternative to Copyrights



    Designed so that it can be gradually tested, implemented, or rejected, and can live alongside traditional copyright law.

    136:

    It's very easy to feel like an expert on media, and it's very easy to be very wrong.

    The troubles of newspapers began way before the internet, all the way back in the 1970s, and the google bit is only the SMALLEST part of it.

    Look into Bob McChesney and get yourself learned :)

    137:

    http://arstechnica.com/gadgets/news/2010/01/some-authors-still-split-on-amazons-70-royalty-offer.ars

    Haven't followed the whole discussion so sorry if this has been brought up, but I just saw this on Ars Technica and though it was relevant.

    138:

    The idea people keep calling here "ransoming" already has a better name: the storyteller's bowl.

    I have personally considered paying into three storyteller's bowl projects. Sharon Lee and Steve Miller's Fledgling and Saltation both earned quite rapidly enough to guarantee the online publication of both full novels (in first draft, in those projects). I participated in both for about the price of a hardcover. Dave Freer's Save the Dragons never appealed to me enough to participate, but it seems to have "earned out" as well. I have come across with a couple of other projects, but I never found them interesting enough to remember them now (or to participate).

    139:

    It might, and I hate to say this, be a good idea to read some economics here about public good problems -- you know, how does one provide lighthouses etc. (Information is surprising like a lighthouse economically.)

    You might find some interesting ideas about how other people facing similar problems -- i.e. getting the damn cash out of the customers -- have solved them.

    140:

    Kevin @59 Some have already gone this route, Best example I can think of is Howard Taylor over at SchlockMercenary. It's a webcomic/graphic novel model which is self published onto dead tree.

    But our host doesn't want to go this route, at the moment. for many reasons, and I don't blame him -the hassle factors enumerated by H Taylor would scare me silly if I had to do that.

    Blowed if I know what the answer is - short of a 'The Culture' economy, and there's no way we can get there from here in a reasonable timescale - we still need Morlocks to run the physical world, and they'll need some form of recompense/compensation otherwise why not sit back and let someone else do it?

    141:

    Charlie:
    You might be missing a lucrative little sideline here. While looking to purchase a copy of "Missile Gap", I noticed that a "Collectable" used copy of your book is selling for a whopping $225 on Amazon. Suppose, you were to exploit the "old wine" option? You contract with your publisher to receive 100 copies of your first edition hardcovers at cost. Say they charge you £5 per copy. You put those first-editions aside for a few years.

    Then, a couple of years after the hardcover goes out of print, start selling them off -- a couple per month. Autographed 1st edition, signed by you -- starting at £50-£75 -- they would be snapped up by collectors, as long as you didn't flood the market. As the years go by, you could charge more and more for pristine signed editions. But again you don't want to flood the market.

    Let's say you are able to average £100 per book over 100 copies sold off over 5 years -- and, if you publish 1 novel per year, you can keep 4 or 5 of your out-of-print novels cycling into the used book market. So you could pull in an extra £4K-£5K per year. Not an extravagant amount of money, but something that you would be able to feed your high-end laptop and travel habit with ;-).

    Probably more trouble than it's worth to you, though. But as a former used book scout, I'm shocked at the larceny in the hearts of current on-line booksellers! No reason you can't make your fair share...

    142:

    Charlie @39 wrote: 'However, I can't see how I could sell a "premium" edition of a novel without, implicitly, making a "crippleware" version and selling that as the default.'

    What if the "premium" version came with the equivalent of a DVD commentary track? Maybe some cleaned up character notes, some concepts that were discarded, etc? The normal version is then still the same thing people expect of books today, but the premium version comes with a lot more. For true fans, this might make it worth more. Yeah, you can argue that it might restrict you (like you accidentally reveal a character's flaw that is a crucial plot point in a sequel), but I think most people would still enjoy your work who already enjoy it.

    143:

    Newspapers are going to find that news doesn't pay for itself and never did. If they'd actually look at people reading a paper, they'd know that. Most people skim the hard news sections, then go off to sports or whatever interests them.

    Once TV provided news, they lost a chunk of readers. When cable TV provided weather channels, finance channels, headline news, they lost another chunk of readers. The internet is just the latest threat. It peeled off the classified ads, opinion and all the other non-news sections. They think they can charge $1 an issue for nothing but the front section. They are wrong.

    They are also missing an opportunity. There's plenty of free content out there now written by experts. If they'd just keep the editorial function, putting a quality paper together out of (edited) free source material, they could cut their costs and increase their quality. Most blog writers, even experts, would love to get the exposure of being featured in a major paper.

    Instead of doing that, newspapers are leaving that function to aggregator blogs like BoingBoing.

    144:

    Advertising is also changing, and I think will shrink as a revenue source.

    1. There are too many channels. TV advertising could support an entire industry when it was just a handful of broadcast channels. Now that it's hundreds of TV channels, and millions of blogs, it's just spread too thin to support anything but the big hits.

    2. The famous phrase is "half of all advertising is wasted, but I don't know which half." Now they know, since they can monitor click-thru. They know which ads work and which sites bring clicks. A newspaper or other big media presence can't just coast on their huge number of subscribers. If their readers don't click through, the site is worthless to advertisers.

    3. If I want to buy something like a new laptop, I go to a review site and get an expert review. If I want to compare a product with rivals, I go to their websites and get tons of detailed info. A broadcast "look at me, supermodels use me!" ad has no affect on my purchase at all. I don't even see most of that advertising. Which means more to a seller already, a casual glance at a TV ad, or a solid recommendation from a customer on Amazon? Going forwards, more money is probably on seller site quality, and building relationships with customers, and less on broadcast advertising.

    145:

    If you don't have the skills to market yourself, you need to find partners. If I said I wanted to write and publish my own software, but hated marketing, you'd just laugh at me.

    You are already not a solo act -- you rely on editors, publishers, etc. You should be able to find other authors who want to "just write" and share marketing expenses. Lawyers and doctors have small groups they work in, why not writers?

    If you can't get your current publisher to branch out to ebooks, write a couple of short stories and publish them yourself. Or write a short script concept for a game, or fan-made movie.

    You don't have to spend a year writing a book that you give away, just to test the waters.

    You can use your Tier-1 fans as editors. They will work for free to be part of the process. They will also advertise and distribute your work.

    The NetFlix model is the one that is working now, in a new-economy way. Put a lot of content in one spot, give users all-you-can-eat access, charge a monthly fee. The subscribers never drop out, because there's always new stuff coming along. (In fact, the less they watch, the higher the profit margin -- see the three DVD's sitting on my sister's desk for a month.)

    Pay authors based on number of hits, as a fraction of total revenue. This is equivalent to micropayments, without the hassle for users.

    BTW, I read only ebooks now. I'm getting old (51) and printed books give me eyestrain. I can read a monitor all day.


    146:

    Charlie, I urge you to reconsider your policy on "why there's no tipjar on this blog".

    I'm sure you're aware that Jerry Pournelle, whose blog IMO is no more interesting than yours, allows readers to subscribe on a "public radio" model — though as far as I can see it's a tipjar by another name.

    147:

    Here in the Uk on this mornings radio news there was a Professor of Journalism looking at the web based subscription/paywall for the news media.(the New York Times has apparently just opted to do this)

    Oh my aching head! he mixed Murdochs opinions with flakey statistics and a plea for 'professional journalists' to be the arbiters of information (well that's how it sounded to me - I started tuning him out when he conflated the Guardian's circulation (300,000) with the 30 million 'net users who could access the same content via the web and not pay the Guardian for this and equating that with lost revenue.

    Never mind the corporation boardroom, if Journalism school fixes these ideas in the journalists the entire media world is going to implode while they are whining about 'I don't understand why it doesn't work'

    148:

    A lot of people seem to be looking at the problem like this:
    Mr. Stross wants money. Mr. Stross writes books. The existing model for selling books doesn't work.
    And coming to conclusions of the form: Mr. Stross should do X instead of writing books (where X is something like: write, edit, and market books; write something else, sell something else).

    Well, okay, sure.

    But the problem is:
    Mr. Stross writes books. Mr. Stross would like enough money to live. The existing social/economic model doesn't provide the one given the other.

    Well, why should Mr. Stross get money for writing books? After all, most of the answers are pleased to assume that nobody *else* should get money for having a role in producing a book with "Charles Stross" on the cover. Why should Mr. Stross himself be any different?

    Because left alone, Mr. Stross will eventually produce *another* book; whereas left alone, Mr. Publisher will *not*. That's the point. Content producers are socially valuable because they produce content. Publishers are *personally* valuable because they give me access to the content.

    This suggests two naive solutions and (to me) no good ones:
    1) Some variation on public sponsorship, as suggested above (requires infrastructure; massively implausible)
    2) I should be willing to give Mr. Stross money so that he will continue to eat, breathe, and (I hope) produce interesting books. Not for any other reason, such as my name on a silly list, or because I get first access to something shiny, or whatever. (utopian?)

    I like (2), but there are some tricky points. Particularly: I absolutely do *not* get control or influence over what Mr. Stross writes. The whole point is that he is valuable because he comes up with good ideas. If I tell him what to write, then he writes my shit idea instead of his good one. That's dumb.

    149:

    Well, short of abolishing money and establishing world socialism, a workable model might be via the tax system, tax teh advertising revenue, and then set up, say, a writer's union with Athenian style prizes given out by a jury for works of substantial merit. Allow members of the writers union an academic style salary, et bob et ton oncle...

    150:

    Well, short of abolishing money and establishing world socialism, a workable model might be via the tax system, tax teh advertising revenue, and then set up, say, a writer's union with Athenian style prizes given out by a jury for works of substantial merit. Allow members of the writers union an academic style salary, et bob et ton oncle...

    It worked reasonably well for the BBC, which as far as I can tell isn't worse than other channel.

    151:

    Given the range of comments coming before, it's a bit daunting to write. I'm trying to review all of them in my head (and I did read them all) and make sure I have something to add.

    So, the publishing model is broken or might be, or might be getting less remunerative. Which is too bad, because you carved out a reasonable niche in the old one. You have some options right now, which don't seem too appealing to you:

    a) leverage the internet to recreate some older publishing system's setup, a-la ransomware, subscriptions, distributed patronage

    b) become your own publisher by hiring an editor, artist and marketing person and sell either online only or by just funding a print-run yourself.

    c) Keep on keeping on, hoping you can make it!

    A game theoretic approach would say that if you can trial a or b without jeopardizing your current situation that would work well. You mentioned the risks of managing people vs. writing, that seems like a real risk.

    What if you were to trial your next novella just on Amazon, (and Apple if they get it together) before selling it to a publishing house? If you can publish this blog you can self-publish a novella. I would imagine large sales of novella would equal greater publisher interest, not lesser.

    That might give you some insight into b). It's a little different than 'owning all your own songs' which the Stones and U2 have managed to do, but it does assert some significant control over the publisher relationship by saying "We both know this is publishable, and it will make money." I don't know if you can afford to take the risk with an entire book in terms of time, but a novella could work in terms of your risk capital.

    This might also lower your 'nuclear option' risk of switching publishers; I'm not sure how long you've been with your current one, or what it would be like for you to switch up editor, publisher, marketing, etc.

    Going all crazy capitalist on you, you could probably get readers to fund the novella writing time (crowd-sourced publishing money) in exchange for return of capital as you sell enovellas (angel funding publishing), or you could get your fans to pre-buy and wait to do your experiment until you've got enough purchases to go ahead and do the writing. (pre-sale). This latter is more efficient, since you'll only get a portion of sale money from Amazon sales.

    If you try it once and it works, you could either try it again, or use the proceeds from selling the Novella to be printed to fund your next round; essentially you'd be off to the races, or at least learning about some new options.

    I'm sure we'll be reading updates on what you decide to do eventually! I'm looking forward to it.

    152:

    Money can be made through selling T-shirts, action figures (of characters and the author), and lots of other trivia. I'm sure that once such things start there will be outsourcing companies to do this so the author can concentrate on writing and just approve the trivia items for sale. A popular novel is a brand, that brand can be associated with other products. You make X% on the sales of the dead-tree and e-book versions of the novel, then you can make 3*X% on the sales of the merchandise.

    http://mikeking.berkleemusicblogs.com/2009/06/23/how-an-indie-musician-can-make-19000-in-10-hours-using-twitter/

    3,000 fans who each want one item per year of merchandise at a 3 pound profit to you won't sustain you, but it will contribute a decent chunk to your living expenses. The advantage of this is that it takes little time. The above URL has the story of how Amanda Palmer made $11,000 in one night by selling T-shirts. That's a reasonable chunk of a year's salary! She spent a lot of time composing music, recording, and playing concerts, the fame derived from this allowed her to make a good chunk of money in a very small amount of time.

    Lectures etc can be profitable, but they do require taking time away from writing. I suspect that Cory Doctorow likes giving lectures and has the energy to do some writing after giving one, some authors will find themself unable to do any writing on the same day as a public lecture.

    For events that involve meeting fans, the ticket price would be inversely proportional to the audience size. I expect that an event where less than 10 fans have dinner with the author could involve ticket sales for a few hundred pounds each (or maybe more). 3,000 pounds for a few hours of hanging out with a select group of fans is reasonable pay, it's probably not viable to make an entire income from that but it would make a reasonable chunk of a worth-while income if you can do that a few times a year.

    As people have noted scarcity is one thing that people will pay for. Dinner with an author with no recording devices permitted is something that will remain scarce, the conversation that happens is ephemeral - a customer who wants more has to pay more.

    Government organisations that tax readers/listeners/etc and then share the profits are a really bad idea. They end up firstly spending a lot of money on management, they don't pay the small content creators at all, and they share the money among the bigger ones. Prizes are also a bad idea as an author can't count on such revenue and therefore it can't be taken into account when applying for a mortgage, etc.

    A well known author is trusted by their fans, if Charles says that a certain book is really good and that anyone who likes his books will probably like it then I'm quite likely to read that book. A newbie author could offer a referral scheme to have established authors create sales for them. Of course this would rely on some mechanism other than the famous author reading the heap of bad manuscripts that the typical publisher receives. Maybe some sort of crowd-sourcing system could work, if a bunch of people who have paid for Charles' work say that a book is worth considering then maybe he would read at least the first chapter.

    Regarding advertising, some of it is sales and some of it is marketting. Sure you can measure click-through on sales ads (Google only really does sales ads) but you can't measure it on marketting. Internet marketting is something that is only just starting.

    One final point for authors who aren't famous, fiction can be written from almost anywhere. an author has the option of living in some place that has a low cost of living. Reducing your living expenses makes the task of earning a living doing what you enjoy a lot easier.

    153:

    Personally I think publishers and authors should see the e-book development as a chance. As pointed out in some of the above comments e-books don't cause significant cost in distribution once the channel is set up.

    Publishers should see this as their chance to totally cut out the middleman and set up their own "e-book shop" as a non-profit joint venture (i.e. the shop only does take its comparatively minimal cost out of the revenue stream, incentives for employees to be based on sales regardless of publishers in a graduated model (hey, if I wasn't in the closing stages of my thesis such an incentive scheme alone would make a nice topic, let alone the whole business model). Basically they should use the webscription model (with better webdesign) but be as inclusive as possible to get all publishers under a single umbrella. Competition between publishers would be over the core value they produce not over the skill of their marketing departments to leverage the different distribution channels. It becomes far easier to search for and thus acquire an e-book in the correct and authentic form and the best file format than to invest the time to scan the hodgepodge of pirated offerings. This would be even more true if relational listings and a drop of what Amazon does would ease the user into finding similar content from new authors. The price for most titles could be so low (in the 3-5$ range) and still be profitable as to reduce the incentive for the acquisition of pirated copies so far that even in the absence of DRM pirating doesn't harm the business model. The only form of rights protection necessary would be to go against those sites and people who systematically ease access and search for pirated content. As long as the time and uncertainty costs of dl'ing pirated copies (first finding what you want and then the uncertainty over the file quality, i.e. with the e-book abridgments, layout, version etc.)for the greatest part of the customers there won't even be any real temptation to pirate even disregarding moral costs (and even here there would be a difference since in this business model all of the money goes to the people responsible for content creation you can't salve your conscience with the high percentages Amazon et al skim off of legitimate purchases).

    Backlists would in this business model become major sources of income because the constraints of the haptic distribution model go away. As already realized by the music records right holders the net-sale of backlist-files becomes suddenly highly profitable, all production costs have long been written off and distribution truly costs (I know Apple takes more of a cut and I think that's where Amazon wants to get in e-books) in the low tenths of a cent range, and thus 0.99$ for a song that barely made the top 100 in the 60's is nearly 100% profit. Even when the yearly dl's stay in the four digit range (probably much higher for most titles) this can equal real money, if timed by hundreds thousands of files, where there wasn't any profit before.

    For Amazon this would mean the loss of their Kindle based business model which might threaten the whole content producing chain as described above and thus be inviable in the long run anyhow but they'd survive, they make most of their money in the sale of haptic goods like electronics etc. IIRC.

    154:
    It may not be infinite bandwidth, but in the context of ebooks it walks like a duck and quacks like a duck.
    Even outside of the context of eBooks.

    Right now, my bandwidth is enough that one day suffices to gives me all the visual/audio entertainment I watch that day, all the text I read that day, and most of the interactive (read "gaming") I do that day.

    I could download more bytes, but I wouldn't have the time to do anything with them. That's an adequate definition of "infinite bandwidth". Right now, the amount of available bandwidth grows faster than the amount required for content delivery.

    Side note: proud member of the "3000" club. In fact, you're one of the few authors - most of which tend to be on that island beyond the channel - that I buy in hardcover. The problem with hardcovers isn't the cost (at least for me), it's the size. You can't fit the hardcover in your pocket for reading during daily commute, and it takes an inordinate amount of shelf space (if I purchased all hardcovers, I'd need to start by buying a new appartment first).

    155:

    I see two problems any new business model will need to solve: one, very obvious, is generating profits. The other, less obvious, is generating visibility, because tipjars, subscriptions, etc. all rely at least partially on the writer being reasonably well known in advance, but what about new guys no one knows? Short of desperately trying to find a wealthy patron, how could they enter the market? Sure, they could start giving their work for free, but to whom, and where? Internet has already got a serious problem with the signal-to-noise ratio and that problem is very probably going to become even worse in the future...

    The only idea I can think of is a bit similar to the system I have read Japanese manga use. I'm not an expert on the field, but supposedly the system relies on thick (several hundred pages) weekly or monthly magazines including small serialized installments of many different authors, articles, news and a lot of publicity too, conceived to be read and recycled. Those cheap magazines provide an steady source of income for all involved, but real money comes from selling higher quality compilations of the biggest hits everyone follows week after week (and for the really huge successes after that comes merchandising, TV series, games, etc... )

    Such a system should be easy to adapt to the Internet, and is eminently compatible with sponsors, patronage and product placement. I have my problems with this idea (for starters serialization imposes severe constraints, as anyone that has read Verne's novels should know, sponsors do have their own agenda and I would truly hate product placement) but something must be done, because the current business model is not viable in the long term, I'm afraid.

    156:

    Seth @109: Kindle is a platform, not a device. The Kindle reader is a stalking horse -- the real action is in the (free) Kindle app for iPhone/iPod Touch/PC and Mac (when the latter ships). At which point, you don't need to buy a Kindle -- you just run the software on your computing device of choice.

    kenmeer @115: pirates SELLING your work illegally are easily prosecutable, yes?

    Actually, no they're not. You tell me what the overheads are of going after a commercial pirate operating in a foreign country such as the United States, under a legal system you're personally unfamiliar with. Note that commercial pirates are unlikely to respond appropriately to a DMCA takedown notice. With replicability, you end up in a game of whack-a-mole, spending money to bring the hammer down on a succession of pop-up fronts.

    Right now if I detect a commercial pirate -- like the assholes who are currently charging $1.99 for "Accelerando" in the iTunes store -- I can throw their details at, say, Penguin Group's lawyers and wait for the hammer to descend. (As I have done: I don't mind folks giving "Accelerando" away for free, and I don't mind folks charging for "Accelerando", what I mind is folks charging for it and not paying me my tithe.) If I have to do it myself ... big can of worms.

    thomas @117: I'd love to see a performing rights model, possibly administered by an agency modeled on PLR. The devil is in the detail, and the need for international coordination -- 80% of my income comes from overseas sales.

    heteromeles @127: not gonna work. Firstly, delayed gratification is a huge turn-off in the entertainment industry in general -- fulfillment time for delivering a physical book is going to be a minimum of 12 hours, reasonably, right? Secondly, you'd be astonished how good duplex page scanners have become these days. (I have a Fujitsu ScanSnap on my desk. I use it for digitizing contracts and admin paperwork and storing them as PDFs. To digitize a book: razor inside the spine, feed to scanner, end of story. That's where a lot of the book warez on the net come from, and if you pull a deferred-gratification stunt on a preferred-ebook-reader sooner or later one of them will digitize the last quarter and hand it to all their friends, rationalizing it on the basis that you're getting paid for the first 75% anyway.)

    Ron @129: On cover art, read this (he says through clenched teeth). Authors normally get little or no input on the cover art, book design, and sometimes even the title of their work.


    157:

    bshock @132: you misunderstand. I'm not throwing a tantrum, I'm asking for ideas about how I can continue to support myself when the economic underpinnings of my profession change.

    Put it another way: if I end up giving up, you'll probably notice a steep decline in the quality of your reading matter at that point because by that point nobody will be making any money at the gig, which means the playing field will be sufficiently level to admit the obsessive-compulsive no-hopers. (Who you do not currently see, because the publishers pre-filter them from your input stream, but trust me, they're out there: in fact, 99.5% of the novels submitted for publication today fall into this category. I've seen the slushpiles, and they are truly horrifyingly bad.)

    beowulf888 @141: just because a rare book is listed at $225 it doesn't follow that (a) the book dealer has a copy, or (b) that is the genuine scarcity-dictated price. A lot of the listings on AbeBooks are cluttered up with cruft like this -- predatory dealers who list books they don't have at a stupid price, in the hope that someone gullible will come along and offer them the money (at which point they go and find a copy for $22.50). My personal suspicion? The second-hand rare books trade could in principle be a great way to conceal small-scale money-laundering -- you can take crap in and sell it for ten times its real value, and who's going to call you on it? (Note: I have never met a second-hand book dealer who was anything other than an honest but slightly obsessive bibliophile.)

    158:

    Isidro @154: What you're asking for exists, kinda-sorta: Asimov's SF Magazine runs a monthly ebook edition, as do F&SF and Analog. Alas, most of their potential readers have never heard of them and don't know they're available.

    NOTE: I see a lot of affiliate marketing spam has shown up overnight. Please note that those two words in sequence are now automatically destined for the spam bin.

    159:

    NB: for those of you who think public speaking is a feasible income supplement, I have a FAQ. The meat is in the fourth paragraph:

    "I live in Edinburgh, Scotland. This imposes certain logistical constraints on me. For example, if you want me to give an evening talk in London, it will chew three days out of my schedule — one day to prepare the talk, then a day to fly down to London (flying is the easiest/fastest/cheapest way to get there), deliver the talk, spend a night in a hotel, and then a day on which I fly home and deal with whatever correspondence has been piling up while I took time out. And the picture for speaking anywhere in North America is even harder. For example, to give a 30 minute presentation in Palo Alto takes me an absolute minimum of 3 days, even if I'm just repeating a talk I've already prepared."

    160:

    I'll buy your PDFs directly from you at double, make that triple the price of what a paper back costs in the store right now.

    I'm 100% serious about this, mail me if you want to take me up on it.

    And I promise solemnly not to upload them to the pirate bay or some place like it, provided that you keep on pushing, and release your stuff in public domain within 10 years after first publishing.

    That should satisfy all parties I think.

    You're the freshest wind in SF giving me inspiration for new directions to investigate, which is what I think good SF should do.

    Jules Verne, Clarke, Gibson.

    You're in good company there.

    161:

    I don't have any clear-cut answers. I do, however, have wild guesses, bases in something approaching "reality as I see it".

    First off - Paper books will be marginalised in the near-to-medium future. If they're 95% of the sales today, they'll be less than 20% of what people acquire for feeding a reading habit in "somewhere between 5 and 25 years".

    Second off - Bits in a file WILL get copied, no matter how much DRM is slapped on top. Worst case, transcribe what's displayed on the screen.

    Those two, taken together, leads to royalty income trending towards 0. I don't know how much of authorial income is royalties (for purposes of argument, I am classing the advance as something different right now), but for authors where this is significant, this will substantially change the amount of income.

    Third off - The "ideal" economy behind ebooks with decent production values are significantly different than for paper books. Paper books need a distribution chain, printers, warehouses, stores (brick or electronic). An ebook needs a store (electronic, maybe brick-based). They both need editing, however.

    This, to my mind, is close to the ideal setup for "ransom"/"street performer protocol" (and similar).

    In this set-up, I see the publisher also acting as the broker, saying "for the next book by Author Authorsen, we will need to collect $AMOUNT, no later than DATE, please donate". Once donations are met, a portion of the collected sum is handed over to the author, as an advance and writing commences. When the writing is finished, editing and (a fraction of) publisher running costs are deducted, ebooks produced and to the extent there's a market for paper books, a small print run is prepared for those who want a physical object. Then the remainder of the lump sum is handed to the author and it's all repeated for the next book.

    Royalties are still paid on anything actually sold, although I suspect (as mentioned above) that the amount of royalties generated will progressively shrink.

    There's also the issue that this model is MUCH less forgiving about missed deadlines than the current model, as there must be some sort of deadline where the initial donors are handed their money back if the work is not published. Thus the reason for the split advance.

    I honestly don't know if it is a workable model, but to my only-slightly-initiated eyes, it looks like a possible starting point for more thought.

    162:

    You write a new story about an SF author, who, in a bid to future-proof his career, starts selling futures options on revenue from digital editions of books he has yet to write. It works pretty well. The value of the underlying assets depends on his selling books, and his buyers prove to be a remarkably cunning and motivated sales force. They hype the work and cajole people into signing up for advance orders. They even invent a new term of social censure for people who read whole digital downloads without going on to buy premium digital editions or physical copies. It doesn't sound nearly as cool as "pirate."

    Other SF authors follow suit.

    Things take a turn for the weird when a market analyst notices that the spreads on the SF book futures provide a great indicator for future sales of high end consumer electronics, and starts a private fund that goes long or short on Apple, Sony, Intel etc. depending on what the SF futures are doing. Other funds adopt a similar strategy, using spreads in the growing Romantic Fiction futures market to predict sales in chocolate, sex toys and equestrian gear.

    An FT Weekend piece covering this new phenomenon of "Fictive Performance", marks the start of a new market fad. Broad-based genre fiction funds, along with specialised single-author acts, become the hot new financial product to have a stake in. Whilst the phenomenon is clearly observable, and whilst there have been a few speculations from the recently endowed Berkeley School of Literary Finance, there's no settled account of what the mechanics of it actually are.

    Nevertheless, writing is revolutionised as a profession. J K Rowling's upset, because it turns out that Harry Potter futures aren't good for predicting anything much more significant than October pumpkin prices, but everyone else feels like they've never had it so good.

    Initially, our hero's happy. He is, after all, credited with being the man who, more than simply saving professional writing as a profession, actually put authors in charge of their financial destinies. And Apple are suddenly very, very interested in making sure their products are designed to keep him going at maximum productivity.

    But the constant interest of market watchers starts to get pretty old pretty quick. Everything he says is suddenly taken as being of huge significance. A private comment in a pub about Nokia's new headsets being too clunky gets overheard, and suddenly he's receiving death threats from Helsinki. A private security team has to watch over him and his family 24 hours a day. Sure it's paid for by the FSA, but it's kind of a drag when he can't make it out to his local because someone's gone suspiciously short on his entire future output this week.

    And there's something not quite right about the custom Macbook that Steve Jobs presented to him...


    I'm not sure it'll help with your problem, but it'd be sooo meta!

    163:

    Several people have discussed similar ideas, but here's my take:

    A web site where authors offer their works directly to the readers, not in a time-consuming sale-by-sale basis, but in a one-time auction. You pick a price you would like and if the readers, collectively, can come up with the price, the deal is done. You get a single payment that you are happy with and the readers get their book to do with as they choose. Typically this would be to simply download an ebook copy, but it could also involve POD or larger print runs if the readers felt like paying for paper and ink. The auction would give your fans an incentive to spread the word to others that you have a new book available; the more readers joining in the bidding, the less each needs to bid to meet your reserve price.

    The advantages:
    - relatively few middlepersons, so most of the money goes straight from readers to authors
    - copying gets easier to do every day, so you get your money upfront and stop worrying who might be ripping you off
    - readers get a more direct (at least imagined) connection to the process of encouraging the spread of ideas they like, so they feel better at the end of the day
    - the auction could actually be fun with the right rules

    164:

    I think the first thing to remember here is that until next week and the iSlate launch we don't really know the true market place. My inkling is that while the Kindle may be this weeks winner the long term winner is probably sat hidden somewhere on Infinity Loop.

    Now one problem is that the current market is going to disappear. The UK is now left with one book chain and one stationary chain which also sells books. Both have centralized buying and unless your publisher is really investing in you, you don't have a chance. The short, short tail of the Top 20 is fine, anything else is sadly doomed.

    However Apple is not much of an improvement. At the moment the market works on popularity, the more downloads for an app the more likely it will appear in the top of search results... When Apple introduced in app payments back in November it immediately moved the market to a freenium situation (to succeed an app now needs to be initally free, you then try and convince the user to upgrade once he's installed the app). Its ransomware and while it works for applications I'm not sure how it would work with print.

    Hence I don't hold out much hope for a "New" market similar to the old one. I think we will end up looking back 100-150 years to find a suitable market that may succeed and it is going to be one where the editor is the star not the author.

    Personally I think the solution lies in the Gardner Dozois or similar of this world. Readers will pay Editors to filter the slush pile into a set of readable stories delivered on say a bi-weekly basis. Managed well the old pulp magazines are assured a rosy future in the new market as means of quality control.

    165:

    Having thought some more about the "ransom/patron/street performer" model, I'm wondering what happens when only a small percentage of the money needed is collected (not enough to pay for the book). Would the money be given back to the patrons or would the writer produce the book anyway but get paid less (probably not a good idea)?

    Another thing I'm wondering about is whether paper books are really as doomed as we're assuming here.

    I may not be your typical scifi reader due to the fact that I made the move to ebooks a long time ago (PalmPilot anyone?), and I may spend a higher percentage of my income on books than most people. However there are 7 other science fiction fans in my family and the same number in my immediate group of friends that do not enjoy reading on screens and are not planning on moving to an e-reader any time soon due to various reasons.

    Now, I usually give people books as birthday presents. I've often read the books I give to people (that means I also own a copy and want to plug my favorite authors to my friends and family), unless they specifically ask me for something else.

    So in my immediate social group there are around 7 to 10 people who are getting scifi books from me every year. Due to the cheapness of paperbacks here in Holland I also tend to give each person at least two books per birthday. I also get paper books from most of these people for my birthday (often paper versions of books I already own in a electronic format - I'm a collector, what can I say) so just in my little circle there's between 250 and 500 euros being spent on paper books (mostly scifi) every year on top of whatever it is we spend on magazines, comics, newspapers etc.

    Considering the fact that I'm 33 years old and barring some kind of social economic apocalypse in the next decades, I'll probably be buying books (paper and otherwise)for at least another 30 to 40 years. If you also consider that people that read ebooks are still (by far) a minority, I think that paper books will probably still be around for quite a while and that you don't really need to worry that much about your future income.

    166:

    Charles Stross' 3,000!

    Coming to a bookshop near you!
    A tale of words, books and money.

    167:

    I'm betting on the ebook cannibalizing the mass-market paperback by 2020 at the latest

    I'm not convinced. The only figures I can find
    http://www.literacytrust.org.uk/database/stats/readingstats.html
    say that most people read between 5 and 20 books a year. They don't have "oh, how will I fit 20 books into my luggage?" dilemmas. At that volume, there is no e-book discount high enough to cover the cost of a reader. And while some of them simply need the latest gadget, most of them don't.

    Even people reading over 20 books a year will not usually have luggage problems, unless they travel _a lot_. E-book prices would still have to go down to make a reader pay for itself. And people who read more are more likely to fetishise the printed object.

    Yes, there will always be people (some not far from here) who will buy everything that goes beep, and some conspicuous consumers. But not enough to destroy the paperback market.

    Music shuffling was an existing market - there was radio, there were mix-tapes. There was a demand for portable music players, as shown by the walkman (or portable record players 50 years ago) Books shuffling? No. And the other advantages people offer for e-readers are contradictory. E-ink is easier to read than backlit screens! But then no web browsing. Downloading magazines and newspapers! But then your standard Kindle screen isn't big enough.

    168:

    How's about something like Sellaband (sellaband.com) for books?
    People (readers/fans/friends/publishers!) pre-buy your next tome. Multiple copies perhaps opens the door to share profits?

    169:

    I wonder if serialization is a workable publishing method for fiction? It was quite common back in the 19th century, when it was difficult for authors to make a living and unauthorized copying was common (a huge problem with sheet-music writers too!).

    The internet and ebooks would actually make it easier and cheaper to accomplish too. You could give away the first chapters, so people could see if they are interested, then charge some additional fee for each (or allow people to subscribe). Say 50 cents a chapter, in a 25-chapter book with the first 5 free -- you'd make $10 for each subscriber. You could also sell short fiction individually, rather than in anthologies or magazines.

    Amazon and iTunes could probably implement something like this easily. It's already similar to how iTunes sells TV series in the US -- you can buy individual episodes or you can buy a whole season and download them as they air.

    Once the serial novel is complete, you could sell it as both a complete ebook and print it. Depending on the popularity it would be printed as mass market PB, trade PB, or HB/collectors editions.

    The other advantage of a serial release is that it keeps you in the minds of readers, and keeps them talking about you. Each week that a chapter is released is a chance for them to mention you to friends and point them to your free samples...

    170:

    The problem you seem to have is the same as musicians in that the deals you have are appallingly weighted against the content creator. I appreciate there is often little scope for signing deals outside the norm unless you are a massive seller but the whole thing seems designed to not encourage artists to think they can make a living. The money for digital downloads for music has been described as virtually criminal by more than one musician, your deals seem better, but not by much.

    I'm just baffled by the way that artists haven't got together to get better rates. Amazon might have a massive hold on the market, why can't a deal be done with Apple, or some other on-line retailer, to sell things for you at better rates for you? Why the hell don't publishers create their own on-line portal to sell ebooks etc? Hell you should be able to tell your publisher how to set one up with your background!

    171:

    I shouldn't have said 'easily' prosecutable, aye. But prosecutable. Their crime is criminal by established precedent. Given all the bandwidth and bots, Big Brother will in time prosecutorially whack a whole lotta illegal moles the way spam daily sends more mail than, I suspect, the human population of Terra.

    When things change, things change.

    172:

    "thereby disintegrating the publishing, music, and commercial content industries overnight — I'd probably not stop writing fiction but I'd have to do something else to earn a living, and therefore I'd have less time to write fiction, and consequently you'd have fewer of my stories to download."

    That's why we have a small movement for the "grundeinkommen" in germany and austria - where everybody get's enough money to support his own living. Because we as countries are simply filthy fucking rich enough to support it (and technological progress obsoletes ever more traditional jobs).

    173:

    I won't bother to go through the obvious, I think you realise the shape that the future is heading towards and that it is one of disintermediation. You'll have to get used to hiring support services like marketing, editing, etc. - or hiring someone to do that for you. The numbers mean the current inverted shape of the experience publishing industry cannot hold.

    Rather, I'd point up that the central axis around which things revolve is time. Specifically:
    * fans want and will pay for early access (hardbacks), but their number are limited.
    * if you have just read chapter 21 then you will be more willing to pay for chapter 22 there and then. Delays = discounts.
    * readers are becoming more time constrained, and therefore less likely to read at all. Rather than bemoaning the slice of this diminishing pie, you need to work out how to reinflate the size of pie with something that hits at the reality of their time limited world and interest.
    * your time is limited and writing takes a sizeable percentage of it. As far as ROI is concerned, is time spent on another book a better return than personally marketing the hell out of a smaller number?
    * paper books, e-books, audio books, tv/movies, etc. are just delivery mechanisms for ideas and stories. They impose their own limitations on structure as well. Which are the best from a time perspective for the writer and the reader/viewer?

    I'd suggest the win is in fitting your content to the available consumption niches, then building a Stross centric business model around it. For instance, people often read in bed, before going to sleep. They need bite sized chunks AND the option of a precis of previous events for the bits they read and forget because they were sleepy.

    They are probably going to want audiobooks and illustration much more in future - with a fast forward button. Increasingly they will not be skilled in creating their own 'minds eye' pictures.

    Oh, and SF has an option that most don't. A cadre of writers can 'play' in the same universe, expanding and cross-selling to an audience that is often invested in the idea, not the specific story. Publishing organised around that has some viability to cut through the barriers to entry problem and keep the profit where the readers want it, with the authors.

    174:

    Back again - good god, a load of the usual insane suggestions that don't seem to take into account the very good points raised by a professional author, rather than Linux geek. Although obviously he is a geek too.

    The whole 'give it away for free and make money on scarce products' thing has always struck me as a fallacy. Essentially, it's using one thing to advertise another - which isn't a new business model.

    What seems particularly 'wrong' is that it's proposing to give away the thing people want (recorded music, a story) in order to drive demand for something far fewer people want (access to the author, etc). It is presuming that the thing that is scare IS actually valuable - or valuable enough to subsidise the creation of what the mass of parasitical consumers demand.

    If you look at the music market, far fewer people attend live concerts than listen to recorded music (by whatever means, including radio) - even if live music revenue exceeded recorded last year (thank you Ticketmaster).

    When it comes to books - I consider myself a big reader, having probably read somewhere in the low 3 figures - yet I've never been to a fan conference, and I've attended 4 author appearances, and I have very little interest in most authors, or musicians - only their work. I am utterly uninterested in having authors call me, name characters after my pets, and by and large in buying any kind of secondary merchandising.

    Charles is an exception because he's also an interesting blogger, but there are bloggers I read who are not authors, and I don't read the blogs of most authors I read, even where I have them.

    Nor do I want access to draft versions of books, or to help edit them. I don't want to have to re-read the earlier chapters, again, to see what changed in the final version. Art is not software - it does not tend to improve the more people have been involved, although I understand how editors and producers help.

    Equally the problem with patronage models is they also presume a 'fan' relationship. The trivial thing that springs to mind is someone like James Cameron - the same people who liked Terminator may not care for Titanic, and vice versa.

    I haven't read all of Charles' books as not all of them appeal to me - so do I just give patronage to his Laundry series?

    Ditto the 1000 / 3000 true fans thing.

    And that is where I think the current system has one big advantage - I get to pick and choose, after something has been created, whether I want to pay for it.

    The BBC is the other approach. And it produces a lot of things I really really like - and I think it is infinitely better than the advertising revenue based commercial television model. But it also produces a huge amount I'm not interested in, and fails to produce a lot of things I would pay for.

    175:

    A note on "premium editions":

    I have in fact paid well north of $50 for a "premium" second copy of a comic book (Watchmen) that I already owned. It was the "Absolute" edition, which features higher-quality paper and repro on the main body of the work (including a re-coloring job which was also quietly slipped into future mass market printings), and various extra material about drafts and work process which probably wasn't all that expensive to throw together, but was of interest to collectors.

    DC keeps doing these things --- including for Sandman, where the "Absolute" collection is in four volumes that list for $99 each. I can only conclude that for *some* work, there is a significant market for people who are willing to pay those prices for stuff which is also readily available in much cheaper packages...

    176:

    Ray: I don't expect hardware ebook readers to ever catch on outside the 10-20% of readers who buy 60% of books.

    But you may have noticed smartphones catching on. And screen resolutions edging up towards 800x480 (WVGA). And microprojectors built into phones are just around the corner. Smartphones are the next iteration of the personal computing business, and already have screens good enough to read books on. All that's missing is a delivery channel, and the Kindle app for iphone shows the way ahead -- give away the reader app, make money off the content.

    Japan's ahead of us on this curve; already last year a couple of the bestselling novels were published as weeky subscription-model piece works distributed to subscribers' mobile phones.

    177:

    Charlie - sure. But then we're back to contradictory selling points. Dedicated reading devices offer a similar reading experience to books - but a smartphone with a tiny backlit screen offers a much poorer reading experience. Who would choose to buy a book to read on a smartphone, for roughly the same price as a printed book?
    And how many people are going to buy smartphones with projectors?

    178:

    I never thought of Charlie as a "supply sider"! You need to be thinking "demand-side".

    First off, the scarcity factor has moved from production to consumption. The available bandwidth that is relevant is not what Google can spit out, but the cumulative eye ball time available. Free content will certainly displace some paid content, but not all.

    For my money, that means that however unwilling you may be to face changes, you must be prepared to:

    1. Market yourself to stand out from the increasingly large supply of content.
    2. Offer what fans and other readers what they want.

    Marketing the Stross brand does not mean doing it yourself. Decide how you want to portray yourself, then find a publicist and have them push out stuff that references you and your works. Use Google alert to monitor performance (and pay for performance). use your fans more. I would bet that there isn't one regular commentator on this blog who hasn't blogged/posted/tweeted/Facebooked/recommended you/a blog item or a book to a wider circle. As for travel to venues, heck Clarke had to travel from Sri lanka, and was doing tele-conferecing just a few a years before his death. You can manage to teleconference over the coming years, can't you?
    Surely a few well paid speaking gigs at tech/corporate conferences would pay you your basic living wage and allow you time to write too?

    What do we fans and readers want? Pay close attention to what has already been said by others on this blog post. Put together "shinies" - DVDs with your appearances to direct payers. Sell first edition signed copies. Self publish some books as an experiment, possibly illustrated versions. Provide galley proofs, story background books, etc, etc. It's amazing what many of us actually want to "connect" with our favorite authors. Offer your availability when you do travel. Merchandising possibilities - work something out with "Think Geek" of products from your stories.

    Remember, while supply of content is increasing, so is all the ancillary services. ( You didn't pay us for submitting typos and story errors either ). Find people who will do the work for a %age and leverage off those relationships.

    Finally, we know you hate tip jars. OK fine. So give us other ways to say "thank you, keep up the good work".


    179:

    Sounds like, with all the grouching, the solution is: keep writing and adapt. Maybe the biggest problem is that you're trying to predict the innately unpredictable, not that you won't be able to make a living writing.

    Look at it this way: if no one can make a living writing, the book market dies. There are too many people who like reading to allow this to happen, and that will provide the pressure to the distributors to keep quality books in the pipeline somehow.

    It might be personal subscriptions, ransomware, ransom plus hard copy, sneakernet, or (most likely) a mix of all of the above, but if you keep writing good books and putting them where we can find them, I'll bet we'll find a way to pay you for them. Trust us.

    180:

    Subscription or Patronage:
    Most authors would probably only end up with a few subscribers
    Might limit artistic freedom
    No good for new authors
    I probably would't spend money on any author under such a model

    Ransom model:
    Likely piss buyers off
    I probably would't spend money on any author under such a model

    Micropayments:
    Probably won't generate sufficient revenue

    Self publishing:
    Terrible idea - generally only for people who can't get a publishing deal
    I would rather authors spend their time writing books (so there's more of what I like to read) than trying to sell them

    Merchandise Sales:
    Only if they have Harry Potter on them
    Otherwise, the cost of design and distribution would likely exceed the sales

    Many eyes model of editing:
    Probably doesn't scale well
    New authors unlikely to have many "eyes"
    Many potential readers might choose to be editors and not pay for the book
    Likely to lead to poor quality (skills of the eyes)
    Possibilty of early drafts of poorer quality leaking out

    Why I like the idea of ebooks:
    Hopefully they'll be cheaper (a paperback in Australia normally retails for over $20) so I can afford to buy more
    The limit to my reading is not time but money (which is why I generally don't buy hardcovers)
    The potential availability of out of print books (there are a large number of books I would love to read, but can't get hold of), or books not available in my local market
    The ease of obtaining a book
    Space - I don't really have enough room for the books I've already got
    Still lets me pick and choose which (e)books I want to spend money on (unlike a subscription model)

    I think that at the end of the day a business model will evolve that allows authors and publishers a decent rate of return on their investment - provided there's sufficient competition at the distribution layer to ensure that no party has dominant market power.

    My big question is, should I go iPhone or Android?

    181:

    Um, that'd be where a few staffers in an office committed no crimes? And where the tape was doctored?

    182:

    (I apologize for thread-jacking) In addition, the investigation of ACORN, if they found actual crimes, would be analogous to investigating foodstamp recipients, while leaving the Big Contractors uncovered. The BC who consider less than $1 billion US to be petty cash. It's not really journalism, it's tabloid stuff.

    183:

    As far as the necessity of marketing is concerned, I probably would easily have paid $35 for Missile Gap, had I even heard such an event was going on.
    As for smartphones, I've tried a lot of different options for reading books on my iPhone, but I've simply never found one that suited me in the slightest. I'm a big fan of the kindle, (borrowed from friend once or twice).
    The info on the importance of hardcover versions has been interesting. I decided that since I only read 4 or 5 novels a year (anything by you, plus whatever other Sci-Fi I stumble over), I decided that I might as well get Hardcover versions to support the authors.
    Sorry I have only examples, the advice already has been pretty interesting, I worry there's not much else I can give. Except, perhaps, that I feel that DRM on ebooks will really kill the luster for me, but I might get used to it. (I've not personally bought an ebook yet for this reason)
    Great Post, by the way.

    184:

    robert.ekendahl:

    "I think the solution to getting paid is more the ease of use. This is why I keep bringing up Apple. We "all" already have iTunes accounts and are getting used to pay for songs, apps and (soon) in-app purchases. They have the user base to get at. The question to me is when they launch a tablet will it feed a working book-as-app business model or will it too have alimit of $0.99?"

    Please note that it's $0.99 per *song*, not per album. The equivalent would be to put chapters on iTunes, at $0.99 each. The question is how much of that goes into Charlie's pocket.

    185:

    What about the idea of advertising space within the ebook reader?

    It seems that embedding ads within the text wouldn't be particularly jarring to the reader, and the proceeds (or a good chunk of them) could go to the author.

    186:

    Tyrathect: there were long and bloody battles by authors to ban publishers from embedding ads in their novels during the 20th century, and I'm not about to re-fight that battle. Suffice to say, I hate ads and you will see ads in my books over my dead body.

    187:

    You could form an authors' and agents' ebook union that asks for time-sensitive pricing models, as you suggested in the amazon thread, and an appropriately higher cut for authors (remember to upwardly adjust with inflation in contracts!) for ebooks in new books. Of course, then you'd be spending alot of time organizing rather than writing; but, doesn't somebody have to do it?

    I think you're unfair to google, though. It isn't goog' that's threatening you, but amazon. And, evidence shows that there are enough freeoid bizmodels out there to support alot of ongoing work of all kinds, from Linux to Slashdot to politico. It IS making for a much more efficient and low-profit environment, better for the consumer, while still long-term sustainable for programmers and authors. We programmers are probably making less, but happier from separation from The Borg, while it's probably about the same for authors.

    There is a another threat to your bottom line that you might want to be aware of. I'm a member of a site, alternatehistory.com, that produces free alternate history fiction. It's, IMHO, generally pretty good free fiction, because there's high-quality criticism onsite. I'm still also regularly buying your books, as well, though, so I might be overstating the threat.

    188:

    Personally, I think the patronage model will return. We are seeing that for web comics, and I think that novel writers (and bloggers) will begin turning in the same direction. I think TV will also move in this direction, starting on youtube, moving to cable and then broadcast/satellite.

    What we will end up with is a continuum. It will start out with someone putting their content up on a blog (for free) with a tip jar. Eventually, they will have enough subscribers/donators which will allow them to go to a publisher and say, "Look, I've got a confirmed customer base of X, and confirmed pre-orders for Y books - how about an editor and a print run?"

    Authors who are already over that hump (such as yourself) could make use of the same concepts - create a subscription model. Subscribers would get books hot off the press, and higher levels could even get ARCs, or even rough drafts.

    These people are fans, some of them are hardcore and want to see everything that you do. They would even pay to see your hand-written scribbles as you plot out the book.

    I keep coming back to the web comic authors because they're already in this model. In fact, some of them are starting to use services such as ustream - drawing the comic _live_ in front of their fans. Their fans get to watch and discuss the comic, and the techniques used.

    Not being an artist, seeing a guy sitting in front of photoshop (or other drawing program) for a couple of hours isn't quite what I enjoy doing. :) However, they do seem to get a large number of people watching.

    Advertising isn't going to work for much longer, too many people are installing adblock.

    Finally, please don't think of it as ransom. Ransom implies that my money could be wasted - that it won't be written. Personally, I don't care what you write, just that you write something. You've built up enough trust that I would be willing to purchase 2 novels a year ahead of time.

    189:

    Why not hide the identity of the buyer in the text, using steganography and public key encryption. The text file itself would become a ticket for premium access to the happy Stross universe (blog, etc.).

    I would also sell leather bound premium editions for 10 times the price of trade paper backs, designed to last decades (not like usual wood pulp!), printed on demand, with the identity of the buyer hidden in the text as well.

    Finally, I would sadistically seed fake copies of the books on file sharing networks and torrent sites, using AI to subtly corrupt the text (much harder to detect than bad quality audio or video).

    I was reading "The Girl Who Played With Fire" on my Kindle and I noticed (on location 282, you can check) that she "stood one metre twenty-four centimetres tall". I compared with my paperback version (on p17) which says she "stood one metre fifty-two centimetres tall". This is the main character we're talking about! Needless to say, I was disappointed in the Kindle. It's like finding out your girlfriend has been cheating on you, and I don't know if I can trust the Kindle again. Now imagine if you never knew if the copy you downloaded of the Internet didn't contain errors like that. That why I think my ideas of hiding the identity of the buyer in the text and seeding fake copies has some merit.

    190:

    I think you could stand to be a little less precious about the monetization possibilities of your website, I vaguely recall a post a few months ago where you explained your policies and thinking "well not all of us can be so discriminating"

    Google doesn't just charge money for traffic, it also delivers tons of it for free, you could signup to dozens of affiliate programs, add their datafeeds and have tons of self updating sales pages orthogonal to the actual human valuable content of the site which G could not ignore. I'm betting these generated pages would have a higher ranking than those on nice-watches-store.info

    I mean why not game google to an extent if you're claiming it's not your friend? You don't owe them anything. Sell hard links! Let google figure out if they're paid, it'll do it good. It needs the exercise.

    191:

    @184 the problem is that the Apple marketplace currently rewards success with success. Popular applications appear at the top of the results reinforcing the popularity, less popular apps never appear.

    I think the real issue here is that individual authors will not achieve enough critical mass to survive in the new marketplace. Some, the JK Rowlings and Dan Browns of the world will hit luck but most will simply disappear into the mass of semi-literate chancers never to be seen again.

    192:

    Only thing I can really think off (which isn't particularly novel nor, likely, adequate) is to use a bundling strategy for ebooks at the hardback price point, increasing the value to the reader by stuffing in more content. Ebook's (presumably not being limited by page count) should mean you could potentially now do this for full novels as well as the traditional short story/novella collection.

    Since output of authors is constrained, it would need be bundling of New Shiny with Classic from Back Catalogue, and/or New Title from author X with recent title from author Y (hopefully getting both sets of rabid fans and benefiting from the cross promotion and having multiple names on the cover).

    If things get really dire you'd probably need some of 'supporting act' system where lesser known authors get bundled with name authors to promote new talent.

    193:

    I think the real issue here is that individual authors will not achieve enough critical mass to survive in the new marketplace.

    Which makes me wonder... go back 30 years, 60 years, 120 years, how many authors were there who could make a decent living just from their (non-salaried) writing? How many more relied on another job, or spousal income, or an inheritance, or, or, or...? Is it the present, or the future, that is the outlier?

    194:

    A Cory Doctorow action figure, in his trademark red cape, with a balloon/WiFi hotspot playset. I'd go for that.

    195:

    Digital distribution breaks the hardback book model if it is simply offered in parallel. That model is a price stratification system based on release date while providing luxury packaging as a rationalization so people who wanted the book right away can feel OK about paying triple.

    You cannot do price stratification as effectively by time alone because people feel stupid for buying an ebook at triple price when they could just wait a few months and get it at normal price and can't rationalize that their ebook is worth it because it is heavier than the regular version. They can also more easily substitute one of your back catalog books for the new one.

    However the hardback model has always had problems in that its two release dates fight against good marketing and the greater size and weight of a hardback book is a negative for many people. I know I have heard of books I wanted to buy and waited for the paperback (nowadays primarily because I like carrying books around) then forgotten them (kind of a double punch there).

    The special edition and bundle sound like good mechanisms for price stratification in EBooks. The point is to provide enthusiasts with some value beyond release date for their money. It doesn't have to be much but it has to be something. SF seems like it could offer some pretty good special editions. Short stories, related back catalog work, posters, author commentary, etc. A Hardcover printed copy could also work very well as part of a special edition EBook. Personally I don't buy special edition movies or games, but lots of people I know do seem to enjoy paying double or triple ($40-80!) for a couple limited edition desk ornaments and a poster.

    One could extend the hardback model to ebooks by releasing only the special editions and bundles at first, or one could abandon release date based price stratification and hope that more effective marketing will equal or exceed less effective stratification.

    For an established writer like Charles Stross I think the end result of this is going to be a win because back catalog will sell better under the ebook regime. Used book stores will slowly wither away and there is a whole special electronic shelf with a brand new copy of every one of your books on it a click away from the book that is currently being marketed or read or finished.

    I do wonder about new writers though. I suppose the upsides for them are that reduced publishing and distribution costs might make it easier to get a first book published (though maybe harder to make money from) and they might be able to get some effective cheap marketing by having their work included in the bundles of more established writers.

    196:

    thanks for an interesting insight into the economics of information generally.

    as a rule I'm torn by the fact that once information is generated, then it is economically efficient to distribute it as widely as possible. It's why the Ordnance Survey charging such ludicrous license fees for their datasets infuriates me. as a government organisation they (like many of their US counterparts) have a perfectly legitimate source of income called taxation. it's just a political sleight of hand by governments to dump all the revenue burdens onto a small group of organisations who are less likely to bitch politically - at the cost of depriving the rest of society of the data. I do fully recognise, however, that the same free distribution is destroying the economic motivation for private generated information. It's kind of reassuring that Charles is as stumped as the rest of us.

    I would make a few general comments though
    - I wouldn't underestimate the role of empathy. I now purchase software, ebooks, music. I never did as a broke kid (I pirated vast amounts of media), but on a salaried income, I cannot bring myself to copy media for anything beyond a trial. Anecdotally, I think most people on an income feel this way. (equally, I can't see kids *ever* paying)
    - I do like the sense of ownership I get from buying the license for an ebook. When I purchase a hardcopy I know that I'll inevitably be giving it away the next time I move, whereas with an ebook with no storage costs, it will be mine till the end of time.
    - to introduce new authors, I'd say there was a role for established, trusted authors (ie Charles Stross) to recommend other works similar to their own. I recognise this assumes authors actually read each other's work (reading between the lines of this blog seemingly Charles does) and would also simply be a service by authors, as well as potentially increasing competition to their own work (although imho competition is mainly between books in general and other media). I discovered Peter Watts through this blog's link to his (non-fiction) site and found Blindsight fascinating.
    - I wasn't actually aware (or rather hadn't given it any thought) that hardcovers were more lucrative for authors. I'd naively always assumed it was simple manufacturing costs to make them hard. I've actively avoided buying hardcovers over the years because they're cumbersome to read, have dustcovers that inevitably rip, never sit well on the bookshelf with paperbacks and are a pain when you want to transport them (I move around a bit for work). If it weren't for these handicaps, I'd certainly have purchased more hardcovers simply to read something sooner, particularly if I wanted to express my appreciation for a bloody good book.
    - Hardcovers of most books never see light of day in many bookshops. Electronic distribution might bring more hardcovers into contact with customers.
    - What I wrote above not withstanding, I *do* have a problem paying hardcover prices in Australia, at approx +50% over prices I paid in the US. I don't know whether any of this australia tax finds its way back to the author, but it is behaviour like this that they can break down the ethical code between reader and writer.

    197:

    Lawrence is actually on the 13th chapter of Realms of Light and has a sample of that up.

    This method is called the Storyteller Bowl. Diane Duane had a book up with this, but has stopped due to some personal problems. I hope she can start again.

    198:


    The only thing I could think of to add to the above is to take the ransom model to the computer age by making it really fine-grained.

    That is, release the novel automatically word-by-word, displayed realtime as the money comes in. Readers can donate once or subscribe. If your goal is to make $50,000 on a 75,000-word book, that's 66 cents per word.

    The advantage is: monkeys love moving objects. If you have even one reader, he gets immediate visible gratification for throwing even $2 in the coin slot. (I know steep for 3 words. But only 100 readers make it 300 words.)

    It may sound trivial, but consider the success of *any* website that constantly changes versus one that only updates monthly. I think the amount of attention they get is geometrically proportional to the update activity.

    It'd be best to hire a new middleman for this. A dozen or so authors could pay one web monkey (grad student) to adapt existing open source e-tail code to the job. Then all the writers can pool their work in one ransom site, basking in the reflected glow of each other's marketing.

    The founding authors can even charge a tax on newer, lesser-known writers who want to put their books up for a much lower rate-per-word, until they've earned their chops.

    199:

    I wouldn't buy alt-hist anyway, but I never even look at fanfic. I rely on publishers and agents to pull out the good writers.

    200:

    Just read a NY Times article (it's long, I skimmed through it) titled James Patterson Inc., I've no interest in his books, but the article touched on some things mentioned here, and he's published by Little, Brown which Charlie mentioned as one of his publishers. One thing I gleamed from it is how one mega-bestselling author can screw things up for other writers put out by the same company.
    From the article:
    Patterson's vision of a limitless empire forced Little, Brown to reorder its priorities. Publishers have finite resources, and the demands of publishing Patterson were extraordinary even for a blockbuster author. Some Little, Brown editors worried that other books were suffering as a result. "To have one writer really start needing, and even demanding, the lion's share of energy and attention was difficult," Sarah Crichton, Little, Brown's publisher from 1996 to 2001, told me. "There were times when some of us resented that. When Jim felt that resentment, he roared back. And he was too powerful to ignore."

    And he has put out books in nearly all their imprints.

    The part about his co-writers made me think of an interview I read years ago in my local newspaper with Kevin J. Anderson (who lives in the area) about his writing process; he hikes through the woods dictating into a recorder, which he gives to his secretary to type up, and they read through it later. Explains how he can write so many books that tend to be on the long side. I remember thinking "That's not writing!", though I guess you do it however you can.

    201:

    If e-books ever achieve sales that change their company's revenues enough to climb out of the 95% confidence interval, I reckon the biggest market will be non-readers.

    You heard me; people who don't spend money on books, don't read many books, don't use Amazon, don't go to bookshops, don't care about DRM or Amazon monitoring which pages they read, do care about shiny status toys. E-readers will be the lowest effort way of responding if someone asks you if you've read the latest Dan Brown. You won't enjoy it anyway so fuck the whole staring at screen issue; but it looks great next to the Wii.

    202:

    I just wrote a few thousand words on Charlie's rant.

    I don't think we've begun to understand the changes that are going to come to the biz with the ubiquity of e-readers. The notion that the author only gets 10% seems pretty ridiculous in such a world.

    Anyhow, I have heretofore bought novels by Stross almost entirely at airport bookstores, but that seems to have stopped working as the store selections get thinner and thinner; so I guess it's online or nothing from here on in.

    203:

    I have this vague feeling that the solution to the problem lies with the government here, and that one can probably prove it with economics but. Maybe the best thing to do here is start giving money to some (sensible, clueful) lobby groups?

    204:

    Honestly, I haven't yet had time to read all the comments here, so my apologies if I'm repeating someone else.

    However, I think the answer is to think like an electronic publisher (which I am). If I had your audience of 100,000 to 200,000, I'd do everything in my power to own that list, and to sell novellas to it directly (both as individual sales and as subscriptions). The long books aren't worth it - people don't value a long book much more highly than a short one, and you want books to come out more regularly to stay in touch with the audience (and smooth out your cash flow, which the subscriptions do as well). Think serialized fiction.

    I know you say you don't like marketing, but the fact of the matter is that you can make all the money you need with a very small staff overhead. Once you start shoveling that work off on a publisher, the overhead increases astronomically and the amount you can make won't be able to keep up unless you're really big. You don't have to do it precisely by yourself, but you'd need a small number of people to do it for you.

    Dead tree publishers don't get the fact that it's all about creating an audience AND KEEPING IT. My company publishes technical books, which need updates, and we make a non-trivial amount of money selling updated books to the same readers. It's much easier to sell to the same readers than to get new ones.

    205:

    Charlie, I'm not going to try and convince you to do something that obviously has little appeal, but I feel compelled to note one point.

    When I was living in the Netherlands I would have been quite happy to make a weekend visit to Edinburgh to attend a lecture given by you. If someone like Iain M. Banks happened to be running an event on the same weekend then the case for a trip to Scotland would be even more compelling!

    I don't think that I am one of your 3,000 most dedicated fans either, I'm not about to travel from Australia to Scotland to attend a lecture that you might offer - although I expect that some people would.

    Finally it should be noted that Edinburgh is well regarded as a destination for tourists. So you don't even necessarily need to convince people to make a trip to another city for the specific purpose of attending your lecture, for some people it would be more a matter of scheduling their planned tour of Scotland to match your speaking schedule.

    206:

    Alexandra Erin publishes serialized fiction on her website and makes a living off of donations.

    When she wants to encourage more donations, she'll post a list of ideas for short side-stories related to the main ongoing serial. Each side story has a donation goal attached to it and she writes them one by one as donations come in. She also provides some incentives for signing up to make a regular monthly donation, like adding your name to a list of sponsors.

    She posts small chapters fairly regularly, which helps keep the audience interested. I don't think she runs them through an editor before posting, but there's a discussion thread attached to each chapter where readers can point out problems. That way most readers don't see the errors.

    Her stories are structured more like a long-running manga series than a traditional novel or series of novels. As long as each chapter is interesting, the story can wander off in whatever direction and keep going indefinitely.

    207:

    About 5 years ago I committed to picking 5-7 authors (and musicians) whose work I enjoyed and paying full price for the most profitable (to them) version of their work I can find. Five years ago I also happened to get out of the early 20's run-out-of-money-three-days-before-payday salary range.

    Anyhow, I bought Missle Gap, and I buy all of Charlie's books in hardback because he's on that list. I'd happily give $25 straight to Charlie every time he published a novel or novella length story. I don't know if everyone can make a living doing that, and I don't know how new authors keep from starving before they build a following of 3000-5000 like me. But the point is that I consciously committed to purchasing from certain creative persons in a way that delivers the most revenue to them rather than the least cost to me.

    208:

    You're not so hot on the idea of having to combine other activities with your writing, and I get the idea. But don't you see that you already are combining other activities, you simply take them for granted.

    Plenty of potential writers have failed because they were not good at working with the publishers. Personality quirks, etc. Some of those potential writers succeed today because they had other personality traits that allowed them other paths that would have been closed 25 years ago.

    Winners and losers. I'm sorry you're not one of those that stand to benefit from the changes, but because it endangers you does not mean it endangers all writers, nor that it doesn't encourage more than it endangers.

    I'll admit to one thing though, while the changes are sinking in, writers are going to have to work harder. Publishing companies found the things they could do for writers to make their lives easier that were profitable because writers didn't like or weren't commonly good at them, and they added enough to the value of the book to be profitable.

    Those balances are shifting and no one has totally figured out what the new things they can do to help writers is and then sat down and specialized in those things.

    209:

    Sorry if this has been posted before.

    I have been involved in a similar discussion on the media front recently. The Hollywood machine plans to roll out DECE (google it... hahaha) This is essentially an attempt to monetize creative bits and bytes.

    Many feel its another attempt at copy protection, but i see it as a fledgling attempt to work with the new media paradigm. Its not perfect, but at least for the first time it looks to engage with the problem in a more realistic way.

    Apple and Disney are trying to flog their own system.
    Competition is healthy, but not if it means both systems fail.

    The future is all about tiered networks and paying for access. Personally i think that putting a media tax on ISP connections is the only real solution.

    Methinks the general Internet needs to fragment into tiered networks. Where general access is monetized.

    Information is bandwidth, but at the moment all bandwidth costs the same. This is going to change.

    Its not so different from our analogue world. Some kinds of information (books, DVDs, newspapers) have a price point that finds a equilibrium between production cost and profit. The bytes we consume at the moment all cost the same.

    Thats the crux of the problem. They should not. Of course, the logistics of tying variable pricing to ISP companies is a grand but not insurmountable technical challenge.

    Damian

    210:

    I apologize in advance for the sloppy analysis-- I owe my knowledge of economics to the study of copyright law. Which is to say, I don't know economics very well.

    That being said, I think of authors like yourself, or Stephenson, or Pynchon as monopolists-- my single source for Stross books (or Stephenson, etc...) It turns out I can only get them from you.

    So as I thought about the question, I thought in terms of typical monopoly problems. Monopolists tend to set prices to where marginal revenue equals marignal cost. This results in loss of revenue that might be gained selling to people who would be willing to buy, but only at a lower price. It also misses revenue that could be obtained from those willing to pay more. But it does maximize profits.

    As has been alluded to, these losses can be mitigated by price discrimination-- selling at different prices to different people. So I wondered about models that might allow for price discrimination.

    It seems to me that price discrimination is most easily accomplished in the book space by product type (within a given market). Ereaders offer a less pleasurable experience than paperbacks, but for a book I'm willing to re-read (and move from one house to the next for decades, and buy when I inevitably lose it or give it away) I'll pay real money for the best quality I can get.

    In practice, this means that I tend to buy paperbacks or go to the library to find new authors or titles-- but that if I like them (e.g., Accelerando, Anathem, etc.) I will buy them in hardback. I have paid much more than hardback prices for autographed or otherwise notable books.

    So, imagining for a moment you only have 3000 fans, one approach to realizing price discrimination to simply print 3000 higher quality books and auction them off. I'd be amazed if you couldn't net $33/book from folks like me, and I wouldn't be surprised if I got priced out of the auction. But at that number you are getting near the point where you are making a living. Of course, being an ex-programmer open source geek and (almost) IP lawyer, I'd distribute it free under CC in some low quality format, for what I'll presume are the obvious reasons.

    Of course, this model has various problems, not the least of which is the existing dominant model that you are constrained to work within, and the need to front the costs of publishing the books. And I'll admit, like many of these ideas, it isn't terribly original.

    I think the reason I bother to share, apart from the opportunity to get more insight from someone I regard as a Really Interesting Guy, is that, having thought about this same issue a fair amount over the last few years, I'm secretly hoping to commit myself to a more open-source indirect-appropriation income model myself, and posting here prods me ever so slightly closer to doing something about it.

    cheers,
    -d

    211:

    For what it's worth, (at most, $CHARLIE_TINY_CUT from four hardbacks + 11 paperbacks)...

    The current publishing model is so borked that the nearest bookshop with new books I might voluntarily buy is about 100 miles from here, in a city I avoid. (rant) And the price of books in NZ is so bad that it's cheaper to buy from a UK website and have chunks of dead tree shipped to within 10 degrees of the most distant point on the planet's surface than to buy from a business in the same country. (/rant)

    Oh, and when I discover an author, it turns out that only one of his books is still in print, so that for the rest, about $2 goes for the book, $10 for postage, and fscking $0 to the author!

    I'm happy to pay for my reading habit. I want to be able to have some of my $$$ going to help Charlie live in a modicum of comfort while writing whatever he wants. (The results have been good so far and I don't want to interfere with that)

    I want whatever future book model emerges to have the following constraints:

    1. Most of what I pay goes to the author (or author+publisher if the relationship in Charlie's discussion of why there is no tipjar continues)

    2. DRM means no sale. I'm perfectly happy to be responsible for backing up and care & feeding of whatever device I read with (although dead trees have a pretty good user interface imho)

    3. Having to buy $iKoolAid(tm) device to read means no sale.

    4. Having to use $iKoolAid(tm) software to access $iKoolAid(tm) store to buy the book means no sale.

    5. If at all possible, there should be a dead tree as well as electronic version for purchase.

    6. If at all possible, it should be possible to but out of print books and have as much as possible of the purchase price go to the author.

    (substitute any proprietary hardware or software for $iKoolAid(tm) - I don't want any of it)

    This probably means that I'm going to end up as a cranky old git lugging 2 pounds of Open Hardware Foundation device and mumbling obscenities at the Kewl Kids as they tell their implants to install Service_Pack_8.4 of Microsoft All_Your_Minds_Are_Belong_To_Us_1.9 (tm)

    And that's the _optimistic_ future...

    Ian Mackenzie

    212:

    Random idea. Might the assumption that the novel is the primary format of written fiction require some modification going forward?

    Just as the music industry and culture broadened its remit from singles to albums in response to changes in the technology of distribution, maybe a similar change is beholden on writing. Maybe novels could be broken up into bite-sized chunks, sold at $1 a pop for a chapter, (or $0.10 a pop for a page?) to be read as the author publishes them, once per month (or day?) Together they may cumulatively form a novel-like entity.

    More speculatively still, this opens the possibility of them forming branching narratives, with the reader free to follow up (and pay for) only the individual branch of the story that seems most interesting to them. Authors could use this feedback while the work was still in progress to influence which aspects of the story to give the most attention.

    It also seems to dovetail with the possibility of multiple authorship. And interleaved fan fiction.

    213:

    @ Pete 162

    Great pitch! I'd buy that book (or, um, option).

    214:

    Your attitude to advertising is astonishingly backward. You still believe that all email should be in plain text, right? Teenagers don't notice adverts, they in fact expect them to get free. As such google provides you with a path to monetize your product, provided you are prepared to get paid via ad's.

    For a near future writer you have a luddite attitude which could cost you a living. Makes no sense.

    Oh and I really like your stuff but am not prepared to buy hardbacks because they take up too much space. I am prepared to pay premium rates for ebooks or paperbacks, preferably where I know the bigger chunk of cash goes to you. I suspect that there will always be a large core readership that will pay for books your problem is that your getting a poor percentage.

    215:

    Might the assumption that the novel is the primary format of written fiction require some modification going forward? Just as the music industry and culture broadened its remit from singles to albums in response to changes in the technology of distribution...

    The primary format for written SF used to be the short story, but that market is dead, dead, dead. I don't see how selling chapters of novels - short stories without the resolution - would improve things.

    The music industry is interesting. Albums went from collections of singles to artefacts in their own right, and sales of single songs were falling through the 80's and 90's, until downloads brought them back. But all through that period, singles dominated airplay.

    (Which is one reason why I don't accept the "people bought iPods therefore they will buy e-readers argument. Short-form music has always been a bigger deal than short-form fiction)

    Teenagers don't notice adverts, they in fact expect them to get free.

    No, they expect to be able to get rid of them - see AdBlocker and TiVO. Start embedding ads in e-books and you'll boost piracy because people will read stripped versions instead.

    216:

    Having read through most of the above ideas I thought I would try a quick “design exercise” approach.

    Problem:
    How to make money from ideas supplied in the form of continuous prose.

    Possible formats:
    Visual, audible, tactile.
    Taste and smell probably have no utility and trying to use proprioception or your sense of balance might be fun but expensive to implement and unwieldy at best.

    Visual:
    Print on paper, etc and sell in lumps.
    Sky-writing.
    Project onto walls for mass audience.
    Personal display screens/projectors.
    Flower beds, differential grass fertilisation, etc.
    Mini-robots programmed to display the text as semaphore.

    Audible:
    Concerts: recite it in meetings.
    Broadcast: sell/licence the rights to have it read on radio, TV, webcast, etc.
    Tapes/CDs.
    Phone-ins: people phone a number to hear recordings.

    Tactile:
    Braille books or readers.
    Mobile phone vibration system programmed to use morse code.

    OK. The sillier ideas might make a fun sideline but not a reliable revenue stream.

    My obvious conclusion is that the practical formats are conventional -- text, printed or electronic; and sound, again either analog recordings or as bits. So, lets look at these four systems.

    Printed text:
    No comment -- this is what we are trying to find an alternative to.

    Analog sound:
    A barely twitching corpse. Only worth considering as a novelty item. Would anyone buy a novel as a box set of 12 LPs? Or even better, 16 or so 8-track carts?

    Digital text and digital sound:
    Where to start?
    My personal take on pricing (UK-based): given that a typical paperback is say £8 and a hardback almost double that, I would say that an ebook should be no more than £4. Why? No physical presence, easy to lose (both data loss and DRM rights) so it must be considered as a disposable item, i.e. it should be priced like a magazine. This is MORE true of DRMed stuff as it is easier to lose.
    Can you sell ebooks in an open format at a price that people will pay -- without thinking “sod this, I can get this free on ” -- and still make money? I would like to think so. Personally I would buy all your books at £1 each without thinking, even though I already own them as paperbacks. At £2 or £3 I probably would -- IF I had an ebook reader. Above £4 -- only when ebook readers drop below £50 or I have a phone with a giant screen or retina-projector glasses. Until then I will stick to paperbacks bought on-line and discounted to £5 or £6. If you could sell books directly to customers at £1 each would you see about the same income per book as you do from paperback sales?

    DRM: I don’t like it. However, what is currently bad about it is its inflexibility. If it were possible to restrict a digital file to one person in such a way that the right-of-use could NEVER be lost and could be transferred easily to someone else indefinite times and would automatically transfer to your inheritor when you die, and so on, it would become acceptable. If nothing better happens along. I can't see this happening until people actually become PART of the internet rather than simply using it.

    A final comment about pricing: ebooks (and MP3s come to that) should be priced by length, not unit. Say £1 per 50,000 words instead of £1 per “ebook”.

    Charlie, I’m sorry there is nothing constructive here. Farmers, for example, have had to diversify to keep ahead. I suspect you will have no choice but to spend some time on marketing (spit) or look at some form of writers co-operative to do it for you.

    However, I do think you should seriously consider the semaphore robots.

    217:

    @203 "we make a non-trivial amount of money selling updated books to the same readers. It's much easier to sell to the same readers than to get new ones".

    Now that's what I call an interesting remark. We are so used to think in terms of dead trees containing frozen, static works, that we find hard to conceive other ways to do things. Selling revised and/or expanded versions could become huge in the near future.

    218:

    Keir @203: Which government?

    Here's a clue: publishing is international. Copyright legislation is international too, because it's drafted in order to comply with international treaties (notably the Berne Convention and subsequent WIPO agreements). A government solution would be great -- if you could get 190-odd governments to agree on what constitutes protecting the public interest (while subject to pressure by lobbyists working for rapacious multinationals).

    Adam @204: I know who you are (I was reading TidBITS in the early 90s). However, you're confusing my online audience with my book-reading audience. The former is typically around 9-11,000 unique site visitors a day, spiking to 15,000 (at times like this when somewhere like HN or Slashdot links to me). Most of them are recurring readers. It's the latter that is hard to reach -- I have no idea who buys my books in airport bookshops in foreign countries like the USA, for example.

    This blog is the most effective marketing tool I have direct access to.

    Ryan @208: your facile slogan, "writers are going to have to work harder", ignores the fact that writers are already working hard: what it means if taken to its logical conclusion is that writers are going to have less time to write. Do you really want that?

    daf @210: I'm a monopolist only insofar as nobody else can write what's in my head. I'm also a sole trader selling input materials to a cartel or a monopsony (the big publishers have aspects of both). And the monopoly aspect of my work means that I can't scale up by farming it out to other people -- I can't simply hire more staff and produce more product. Your point on price discrimination is well-taken, though, and I'd love to be able to explore models based on it.

    Ian Mackenzie: forget Microsoft, Microsoft are so 20th century. The coming threat is Google, or maybe Apple. (Robot advertisers who want to own all your data and bandwidth, or a design-fetishizing control freak Dear Leader who will deliver a wonderful end-user experience as long as you Think Similar.)

    Jonathan @212: Yes, ebooks free us from the physical production and logistics constraints that made the 200-400 page book block the dominant format for fiction. In the long run, this can only be a good thing.

    CT @214: You seem to forget that my audience doesn't consist of advertising-innured teenagers; I see it as consisting of folks like me (read: degree-level-educated tech savvy adults who probably use Adblock Plus).

    Nor is a dislike for advertising luddite. The problem with advertising is that it causes an alien aesthetic -- that of the advertiser -- to intrude in the experience I'm trying to deliver to my customers. It damages the immersive experience. And you know what? The stuff I'm selling is bought because it's immersive. Folks who can cope with 44-minute TV drama format with four 11 minute scenes separated by 4-minute ad breaks, and the first 2 minutes of each scene devoted to a rewind-and-recap for the channel surfers who just tuned in, can find that elsewhere. I like to communicate in concepts that take more than nine minutes (or a two-minute recap) to deliver ...

    219:

    Hi Charlie, I just read Glasshouse. I liked it. It's been a while since a book loaded me up with that many ideas all at once. Thanks for that. I liked the ending too. It felt 'right'.

    I, uh, borrowed it from the local library. Sorry.

    You can thank Artw from Metafilter for pointing me here. I follow discussions like these with some interest. I don't have any answers, just a perspective. For what it's worth:

    * I noticed when I googled Accelerando, the free ebook link isn't the top search result. How the hell did that happen? If you're going to give away a whole book, you'd think you'd be in at least the top three. Bing is even worse. Yahoo! at least links back to your blog.

    * When I downloaded Accelerando, it didn't ask me for anything. Like, if you're going to give away a whole book, you should probably collect some information on the person who is downloading it (like an email address). It's entirely possible that that person might be willing to buy one of your books.

    * You should probably have at least one mailing list of some description. And you should treat that mailing list with a great deal of care and respect. Tend it. Prune it. Fuss over it. Never abuse it. Try to learn a bit about the people on it. Split it into segments, etc. These people will, if treated properly, fund you into retirement and beyond.

    * Ideally you collect mailing addresses from people who have either purchased one of your books, or have at least read one. These people have indicated a willingness to pay for what you write. That's a good thing to know. Make the list completely opt-in, but provide some marginal benefit for doing so - advance notification of when your latest book is due to be released in their territory/language, say. Or tell them when you're going to be at some event, like a signing. The point being, show that you understand that people are doing you a favor by trusting you with their address.

    * I think if you define your role in life as a producer of books, you'll always be a sitting duck for whatever the next gizmo is. Paper books will be cannibalized by ebooks. Ebooks will be cannibalized by whatever the next thing is. Maybe you could turn the situation around and look at it from a reader's perspective. Work out what benefit they derive from books, and try to work out where you can fit in to that.

    That's about all I could come up with off the top of my head. Thanks again for Glasshouse. Any recommendations as to what I should read next? Good luck with your inquiries.

    220:

    Charlie,
    I won,t presume to suggest what you should do.
    I will pay $20US today for access to a year of Charlie Stross content, so you only need another 9999 or so to sign up. If I can't get a deadtree Stross I'll take an E-Stross.
    Think of it people, $20US or whatever conversion for a Stross fresh from the writer's keyboard plus short stories and articles. There has to be 10,000 Stross readers out there.

    If all else fails Charlie you have my $20 whenever.....

    221:

    It seems to me that Google is not your enemy, but your marketers enemy. People want to read your books, you just need a new model that allows people to find your books without you spending much.

    Personally, I find most of my book recommendations through the internet. Partly from the sci-fi reddit. Partly from recommendations due to my Librarything account and from the user reviews after following tags etc.

    I am also one of those five percent with an ebook and buy many of my new books for it.

    As more people get into ebooks I suspect more people will use social networks for recommendation. The transitionary period is a problem - how to maintain the normal marketing whilst this picks up.

    I realise you still have to pay editors etc. But the point I am making is that in the future less paid people will need be involved in writing 'your' books. Meaning you can still earn a living for a lower cover price.

    The real problem to this model is piracy. I think this will be solved through a new kind of social order that is slowly emerging. People are increasing valuing information from social peers over official sources. Largely due to the internet - can't remember the source for this at the mo, but I haven't pulled it out of my bum. I think we are facing a similar social revolution to the one society faced after the invention of the movable type printing press. It will ultimately change the very fabric of how we govern and exchange value.

    It's early days, and it could play out in a multitude of ways, but my favourite idea is that your income in the future will come from your fanbase providing patronage. 3000*£20 is plenty to be living off. In return your patrons are recognised as such in their social networks. They pay for the kudos of supporting something they believe in.

    I don't think that established yet somewhat flexible authors such as yourself will have a problem in the transition. The largest one will be in negotiating deals with your current publishers to allow you to try new revenue streams that essentially cut out their marketing department.

    222:

    @214, while there are many problems with your argument I think the main one is your assumption that teenagers expect things to be free. The problem here is a simple one of information economics. People are willing to trade money for convenience however until very recently the online marketplace has consisted of a large number of easy to use pirated sources and very few usable legal sources.

    Apple is rapidly shifting the market here because by placing an official market on the playing device it changes the game to the extent that the official market will at last be easier to find and use than pirated sources.

    Whether this changes anything I don't know but the idea that goods need to be free is false. All that is required is to provide an easy means to find and purchase goods and until very, very recently no such method existed online.

    223:

    Just a few thoughts (sorry if I'm repeating some previous comment):

    -Problem with the ransom model: what is known as "the Prisoner's dilemma" (incentives to "free ride" are huge). Stephen King tried this model with "The Plant", and I think it was a failure.

    -Problem with self publishing: In a world where attention is scarce, we still need someone to be the "filter" -be it the publisher or a friend (who has had to learn about the content somehow). So I don't think it's viable to move to a completely disintermediated model...

    Therefore, probably tiered pricing is still the best option I can think of...

    224:

    I think patronage has a lot going for it, for certain authors. An agency - to do the administration and promotion, and maybe keep the money in escrow - could smooth things.

    One scenario:


    • Author invites patrons to contribute
    • All patrons get credited in the frontmatter of the final. The more they pay, the more prominent it is (e.g. font size)
    • Those who pay more, get "extras" e.g. a physical copy of the book, a premium physical copy, a set of copies to give friends, a +1 invitation to a launch party. etc.
    • Potentially this might raise enough money to pay for an editor/proofreader/marketing etc.
    • Finished product would be released under some free copy-but-don't-modify licence -- essentially accepting that copies will be made.
    • Patron has some guarantee that at least a proportion of the money will be returned if the book isn't produced by a certain date. (Hence the escrow. Or, you could take/spend the money, making sure you have insurance to cover any circumstances that would prevent you finishing the book).
    • Frontmatter solicits patrons for the next book

    Of course, it's a lot easier to lure in patrons if you've established some fans with prior material. It might just be that a new talent would have to treat their first content as a 100% loss leader. Bad news for anyone who has one novel in them. That said you could start with some short stories.

    225:

    Charlie, I was just listening a podcast on the itconversations website, which seems to cover a lot of the issues raised here: Its an interview with Mitch Ratcliffe, a Tech Journalist.

    http://itc.conversationsnetwork.org/shows/detail4361.html

    Whilst I love your work as is, I think it has an even brighter, possibly lucrative future. Pick any of the links on the show notes for much more..

    Personally I especially like the concept of reading groups, where a group, having paid to spend some money to spend time with you read and discuss issues raised, tech, and so forth in your latest release, current work in progress etc.

    I guess the idea is not for you to work harder - just in a different way, that people will want to keep their copy of your books in different ways, perhaps annotate them, pay for publisher annotated versions(the uber original), "Ray Kurzweils" annotated version from 10 years ago (at a higher price of course), which by the way may contribute to an annuity income not yet envisioned..

    Well listen to the podcast, he explains it much better than I do, and ends on a positive note, a rare thing in the publishing debate..

    Regards
    Dean

    226:

    I would say your option (c), to not "require an old dog to learn new skills", is "clinging to a 20th century business model", or perhaps a 19th century one. You want to write what you want to write the way you want to write, and you still want to make money (I assume the same money) you used to make under the old 20th century model. I'm sure buggy whip makers felt the same way.

    Sorry Charlie, but you are going to have to learn some new tricks, or become a victim of evolution.

    I am not sure anyone fully knows the effects of e-books on author incomes. Will e-books create a new monetary stream where resale, loan, and gifting of paper books prevented that stream? Should a single-owner, or say a single-use medium rate a lower royalty than a multiple use medium? This is the reverse of what happened in music when the CD was released. Artists wanted higher royalties because they felt people would be tempted to simply make cassette tape copies of the "master quality" CDs. If I recall correctly, they felt a CD rated 1.5 times the royalty of an LP or cassette tape.

    Perhaps e-books will increase the market, or keep younger readers engaged. Maybe it will chase off younger readers who will not pay because they are used to downloading "free" MP3s. The bigger issue is "kids today" don't read like they used to. But I fear authors will blame e-books, Google, and any other bogyman out there when the real culprit may be a generational change.

    What are the solutions?

    The idea of a trust, similar to The Guardian, is a possible idea. Surely writers should organize into a guild and collectively bargain with the distributors. Perhaps the bigger problem is, once again, an industry (in this case book publishers and distributors) saw themselves in a different industry than they were actually in (i.e., "book" publishing and delivery, rather than content/story publishing and delivery). Maybe we could say the same about writers. They saw themselves as "writers" rather than "creative professionals".

    Here is a nutty idea. Instead of looking at how e-books disintermediate the publisher/distributor and shift the publisher/distributor's power to the e-book distributor, leverage the vacuum created and take some of that publisher/distributor power for yourselves. A guild could do that. It does mean you have to get into marketing, but a large enough and powerful enough guild could hire people who do that. And for writers with smaller, niche audiences, you don't need the same kind of mass marketing others need, so you might be surprised at how effective a marketer you could be by speaking to the right audiences.

    Here is another nutty idea: Find an artist who can put to paper what you visualize. Then work together to create a video game. It could be a double win if it also drove eyeballs to your books.

    Yeah, yeah, it's a new trick. But evolution is a fair, but unkind master.

    227:

    @214, while there are many problems with your argument I think the main one is your assumption that teenagers expect things to be free. The problem here is a simple one of information economics. People are willing to trade money for convenience however until very recently the online marketplace has consisted of a large number of easy to use pirated sources and very few usable legal sources.

    Apple is rapidly shifting the market here because by placing an official market on the playing device it changes the game to the extent that the official market will at last be easier to find and use than pirated sources.

    Whether this changes anything I don't know but the idea that goods need to be free is false. All that is required is to provide an easy means to find and purchase goods and until very, very recently no such method existed online.

    228:

    Another thought. Do e-books open up the opportunity for easier translated works? Does an e-book potentially have a much wider audience because it is easier to translate and distribute translated copies to new markets?

    Is there a potential SF market in emerging economies?

    229:

    Charlie@218. I never suggested they wouldn't block the ads. Ideally you just need software so ads can be blocked but Google still pay up. I'm sure some of your readers could even provide such software! : )

    Teenagers really don't seem to have the same in built aberration to ads that older people do.
    Surely if you want your books to be in print/electronically available, for money, in 40 years you need to get teenagers to read them now. Degree level educated will buy your stuff in the end, probably the whole back catalog they stole because it was good.
    In addition to that not all kids are computer literate, they might get given a copy of something which does something, like limewire or Adblock Plus, but generally the majority don't have the knowledge to make it work sensibly, how to avoid viruses or to even update it or reconfigure it when things change.

    In the end I don't think that readers of books have or will ever change so much that the medium, the written word, can't make money. Yes people want cheaper but given a small bit of research buying habits can change. No more Amazon etc.

    Unless you know something we don't and are not saying..??


    230:

    I agree that the $9.99 Kindle book is replacing the $24 hardcover. But I wonder if more $9.99 ebooks will be sold than $24 hardcovers?

    I have never bought a full price hardcover. (Mostly due to price but also because I don't like reading hard cover books.) I buy the $9.99 ebook versions of all my favorite authors' books as soon as they are available.

    Before I had a Kindle, I'd see a new book come out and I'd put myself on the waitlist on the library. Now I buy it immediately on my Kindle. $9.99 is only a few dollars more than the paperback versions I am willing to pay for - and I get to read it *now*.

    So from my sample of one, more books are being sold and more revenue should go to the author. I hope so anyway. As an avid reader, I really want authors to succeed.

    231:

    I think you may be mistaken about e-books. While I very much agree that e-books, when they catch on, will kill off the paperback, I don't see them cannibalizing hardcover all that much.

    When I really want to read a new book of fiction, I usually start at the library. A hardback purchase happens if I like the book enough that I want to make it part of my "permanent collection" . Paperbacks tend to be impulse purchases that I might read once.

    232:

    Micropayments have been a lurking idea for a long time. Maybe Paypal might have made it work, but now they're Just Another Bank. Some of that is regulatory load, and I wouldn't dismiss the claim that the greed of the banking industry is one of the problems.

    But I know one place on the net where there are micropayments.

    Second Life.

    You can buy Linden dollars for your character to spend, and you can convert Linden dollars to real-world money (Seems to need a Paypal account). There are also Linden exchanges run that handle other currencies.

    You can buy book-like objects in the game. It's very much niche market, but I did that once. 100 Linden dollars, which is about 35 cents.

    There's a few practical problems in setting up to sell something in the game. There is some DRM built into the game, and playing involves a lot of in-game trade.

    I'm not sure that it would be a paying market, but you are the guy who wrote Halting State. The latest report on the SL economy is here. Of course the company is trying to talk things up, but players took US$ 55 million out of the game. It's not a lot per player.

    Roughly 770,000 active players. It's a small market place.

    Oh, what the heck. I've written a couple of NaNoWriMo things. There's a few coherent novella-sized chunks in there. This might make more sense than PoD would, at least for what I have to sell.

    There's still the marketing barrier.


    233:

    Just checked the prices on amazon for Singularity Sky.
    $6.39 on kindle (delivered via wireless)
    $7.99 for new paperback (plus shipping)
    $4.08 used (includes shipping)

    Which one of these should I purchase to put the most money in your pocket?


    234:

    Jesteraus: the used copy puts no money in my pocket. The Kindle edition probably puts about a 50% cut of the 7% royalty on the paperback in my pocket. The paperback pays me a full 7% of the cover price.

    235:

    All these suggestions about ransoms, auctions, and patronage... they sound sensible and maybe the sums can be made to add up - but to me it seems very complicated from the point of view of the poor reader.

    As things are, you want a book, you go to the shop and buy a book. Or you order one online. Or perhaps you download an e-thingy (ugh).

    In that future, instead you have to join in an auction, or wait till your author's ransom point comes up, or sign up as a sponsor. I just can't see people doing it, much - I think you need to retain the immediacy of a sale (whether of a physical item or something else).

    236:

    On a sidenote - how come some e-books sites are unable to sell some of your books to some countries? Like I tried to buy some of your e-books from BooksOnBoard (linked from the Stanza app on the iPhone) and they refused to sell it to a person in Latvia.

    How come are there such restrictions and can you something to minimize them?

    237:

    Preson with a long URL @ #233:

    -Problem with the ransom model: what is known as "the Prisoner's dilemma" (incentives to "free ride" are huge). Stephen King tried this model with "The Plant", and I think it was a failure.

    Incentives to a "free ride" are indeed huge, but once the work has passed through the ransom/street-performer bit, the end results are (in essence) paid for. That means you can charge a much smaller amount for tangibles afterwards and could even provide an electronic version for free.

    davharris @ #235:

    The main idea of ransoms and/or auctions is taht they're only ever entered into by a relatively small core of harccore fans, once they're done with, the work is then available and people who are not part of the crunchy fancore can just enjoy the results.

    I must say that I've only read theoretical papers on the street performer protocol, not really seen it implemented. There are definitely some things that NEED to be done for it to work (it relies on trusted parties to accept the small up-front payments and either hand it on or return, depending on if performance target(s) are met).

    J. Kelsey and B. Schneier abstract (link to full paper) or Wikipedia descriptions of possible models of the ransom/street performer idea.

    238:

    Algars,

    See this post by Cherie Priest on things which authors have control over.

    http://www.cheriepriest.com/2010/01/20/control/

    239:

    I don't have a solution, although I do lean towards some sort of government solution like Dean Baker's or a PLR-type entity (mainly because all the other market-based solutions on this page suffer from the piracy problem, and don't help those authors who aren't already famous, the next generation of authors).

    However, I do have a feeling that the solution will be linked to Martin Ford's book on the future of the economy somehow:

    http://econfuture.wordpress.com/about/

    The government solutions do remind me of Joseph Stiglitz's idea of a prize fund to replace medical patents:

    http://www.bmj.com/cgi/content/full/333/7582/1279

    240:

    Twenty dollars (US) is a bit low, don't you think?

    An article in a local paper said that my city contributes $34/year/person to the county library system (the city is too small to have our own system) and I'd pay $50/year for the access I have to the library. I'd pay more (and do) for things I get to keep.

    241:

    Charlie@234 buying the used copy may fund the purchase of your next book as a new purchase of course [serious point, resale reduces the net cost of buying new, the software industry is sooooo wrong in its pursuit of resale as a bad thing, £40//£50 a game only works because the initial purchasers sell on, all the initial purchases actually get the games for £35 because they sell on]

    On books: everyone is focussed on the methods of distribution, be it self-publishing hardcopy or e-publishing. What publishers do is 5% actually making and distributing the damn book, they even contract out the typesetting, the printing and the distribution, sometimes the copy editing and usually the proofreading.

    What publishers do currently is get your books into physical bookshops and in front of reviewers who will review it in the mainstream press. You can’t just hire a marketing person to do that for you “straight out of college” (@1) It’s as much about who you know, and certainly isn’t easy. This doesn’t change with e-books, just about visibility in virtual bookshops and different media, still the name of the game.

    @204 “The long books aren't worth it” Something in my soul just died reading that. Please lets find a distribution model that lets the long ones survive! But it is going to be about sub-groups that arbitrate and select, unless we all want to read vast piles of slush from wannabe writers. Someone somewhere needs to filter it then tidy it for general consumption. They also need something to incentivise them to make this effort (be it money or kudos or whatever)

    Doing a bad job or a good job [debate] that’s what publishers currently do. We can change distribution channels and payment clearing houses if want but that function will remain.

    242:

    Perhaps you are right. Twenty dollars US may be too little but Charlie is one author not a library with many. His expenses would be maintaining servers, a website and bandwidth. I bet he would still clear a lot more than the 15% he gets per book.
    The publishing industry is under a lot of pressure right now. How it will shake out I do not pretend to know, but some things are going to change. I can see the Ebook and reader replacing the venerable paperback.(even though I love them) Publishers perform valuable services: filtering, marketing and distribution. If the rewards to the authors stay the same(adjusted for inflation) or improve, I think things will be OK.
    The Subtron(subscriber/patron) Plan is for the time when things go bad or publishers cut too deep. I will support Charlie and as many authors as I can this way, if it becomes necessary.

    243:

    Pirates succeed largely through the fungibility of the content. Authors can reduce fungibility without selling T-shirts, etc.

    For example, you might try "polluting" your online distribution channel by writing several different version : a google searchable free mini version, a pirateable ebook distributed online, and a print only paper back for true fans.. hell even give the free version a "wrong" ending. If people get mildly hooked, they buy the ebook, if they deeply hooked they'll buy the paperback. Sue the few people who digitize & distribute the paperback, even if they're google. Yes, google can fight forever but they probably won't fight the noble author who already gives them a free version.

    I'd say payment models are another major obstacle here. Paypal and iTunes are soo incredibly sleazy that I'd rather pirate than give them any bank account information. I'd buy far more using anonymous digital cash, but our government doesn't like anonymous digital cash.

    Imagine if academia offered some second category of literature doctorate that was only available to successful authors? So perhaps universities might stop hiring professors that didn't hold an honorary doctorate for producing literature along with their real a doctorate. Btw, a nice retirement job might be lecturing for a local liberal arts collage.

    Interesting comment about in-book advertising too.

    244:

    You bring up the point you have no idea who is reading your books in airports in the USA for example. Also tie this into #205, #209 and others.

    So, for research etc.

    Here's some numbers of a different sort: Take 'The Revolution Business'.

    Number of libraries this can be found in across Australia = 23.

    http://trove.nla.gov.au/work/27245063?q=charles+stross+merchant+princes&c=book

    Another I looked up the other day for a writer much less popular than you, and a 'Sci-Fi Essential' had only 6.

    Third largest SF market in the world, apparently. In both of these cases, none at all in my state of this particular book.

    Be interested to know what the numbers were for Scandinavian countries, Finland, Ireland or wherever are, too, etc.

    Same publisher, too. Which, as you are probably aware won't sell ebooks outside the USA.

    Number of secondhand copies according to abebooks = 1. http://www.abebooks.com/servlet/SearchResults?an=stross&n=200000013&tn=revolution+business&x=0&y=0

    So, the 3000 fan theory - how do you get people into this group from geographically diverse areas? Or expand it to 4000?

    As was mentioned, lectures, conventions etc. aren't attendable, so those aren't worth anything, generally speaking in a live sense. Obviously some considerably smaller percentage than your local fans will still buy hardback books, but transport costs also keep going up. Flailing US postal service can't do surface mail, that sort of thing. So ballpark in shop buyers of such are paying twice as much for these objects, or half the value, if you like. Overseas purchasing as well, at a smaller premium than 100% (even rather small via bookdepository - who perhaps are not going to stay the same as a future bet?), but with a time delay of a week or two.

    A comment from someone involved with NESFA not so long ago I think said that they used to sell quite a few books to people overseas, but not so much now. Pretty much for the transport reasons above.

    So a patron/subscriber list base from around the world - what can you give them that is worth paying for in a similar manner? Would it be two-tiered or multi-tiered? Northern Hemisphere anglo, Rest of Europe, Southern Hemisphere, or something like that or whatever.

    245:

    Another piece on the New York Times about Kindle selling strategies :

    http://www.nytimes.com/2010/01/23/books/23kindle.html?hp

    246:

    vatine @ 237:

    "The main idea of ransoms and/or auctions is taht they're only ever entered into by a relatively small core of harccore fans, once they're done with, the work is then available and people who are not part of the crunchy fancore can just enjoy the results."

    So the core fans end up subsidising the halo? I suppose they already do that to a degree, as they're more likely to buy earlier therefore hardbacks. But at present presumably publisher counts on making money from a reasonable mass paperback run, which would go, on this plan, so core fan subsidy is greater.

    A problem I can see is, what happens with a breakout success - at present publisher and author benefit from load of paperback sales, presumably, under the ransom/ auction plan there's no mechanism for charging (much) for those.

    247:

    davharris @ #246:

    Well, my ideal "author", "publisher/broker", "consumer" model has the publisher/broker printing paperbacks and sending that on to retailers, as long as there's a perceived market for them. Don't know what a sensible price point would be (printing cost, royalty, shipping cost and retailer profit; maybe?).

    I suspect a sufficiently slim operation could take enough profit from the ransom stage (not necessarily as an actual cut of the money, purely from interest gathered holding on to it between initial gathering and either returning it or handing it to the author) so as to be able to treat physical books as advertising and not take a cut from them.

    But, central to the whole idea is that the bulk of the income from a book is collected at the initial stage, not from "the long tail".

    248:

    Here's a clue: publishing is international. Copyright legislation is international too, because it's drafted in order to comply with international treaties (notably the Berne Convention and subsequent WIPO agreements). A government solution would be great -- if you could get 190-odd governments to agree on what constitutes protecting the public interest (while subject to pressure by lobbyists working for rapacious multinationals).

    But you don't need 190-odd governments to agree: you need the EU, the US, and China or India, or Australia/NZ/SA and a couple of others. The rest will fall in line, or aren't worth much anyway.

    Yeah, that's a bit immoral, but low income countries are focused on patents and practical things. Most of the countries that wouldn't sign on are already lawless as far as IP goes.

    I mean, copyright only works because of governments (according to orthodox economic theory, which is quite probably wrong given the track record of orthodox economic theory); governmental action seems to be at the heart of the issue.

    249:

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