Book publishing professionals have been interested, to say the least, in the evolution of the music business over the last decade or so: its sudden conversion to a digital delivery system, the easy availability of music over the web, the free downloads that crushed traditional sales, the small labels put out of business and the big ones merging and contracting. The final result is a burnt-out industry, now only a shadow of its former power and prestige. Too much of this story seems to presage current trends in the book business.
Now there is another ominous chapter in their distressing story. In the January 28 edition of The New York Times, there is an article by Ben Sisario entitled “As Music Streaming Grows, Royalties Slow to a Trickle.” The article describes how the new methods that are used to distribute music by companies such as Spotify, Pandora, and YouTube are a lousy deal for musicians. Even iTunes is being left behind by these new services, and musicians can now expect nickels when their recorded songs are bought instead of the dollars they used to earn.
Here is the story of one such musician, a Ms. Zoe Keating, as reported by the Times: “After her songs had been played more than 1.5 million times on Pandora over six months, she earned $1,652.74. On Spotify, 131,000 plays last year netted just $547.71, or an average of 0.42 cents a play.” By now the sale of recordings to consumers, aside from the work of the superstars, only has meaning as PR to promote live concerts.
Is there a strong parallel between the plight of the musician and the likely fate of the book author? I surely hope not, because it is hard to imagine author readings going very far to make up for negligible book sales. But the siren song that has so badly damaged the financial prospects of record labels and musicians might soon be sung to publishers and authors. It could go something like this: forget about selling books for $14.95 each to readers; instead put your books into a big pot to which subscribers, paying a low fixed fee every month, can have access. It is true that you will be paid nickels rather than dollars, but there will be so many nickels!
If the book industry, like the music business, adopts this subscription model, there may be—for a little while—a lot of nickels. But the demand for books is limited—or “inelastic” as economists put it. So many books, so little time! Over time, more and more titles will have to compete for the fixed amount of money collected by the subscription services. And authors really will need to polish up their dramatic reading skills.
And now this just in from Publishers Weekly: Amazon intends to create a market for used eBooks. A print book can be sold by its buyers to someone else with no royalty going to the author. But one copy of an eBook could potentially be resold any number of times. Thousands of times. What would the author receive each time his/her work was resold? Zip.
What can be done? If this worst case scenario happens, publishers may have to consider delaying the release of eBook editions until the print editions have had a chance to earn the publisher and the author a reasonable return, similar to how the film industry times the release of movies to theaters, then DVD, and then later, streaming subscription services. This is a version of the old rule of thumb that suggests delaying the release of the trade paperback edition until the cloth edition has sold through. In any event, publishers must not let any seller of their titles use its market power to drive prices down to the point where authors and publishers cannot do their jobs. And it is always important to remember that when the subject is books, it is not just money we are talking about. We are also talking about sustaining the vitality of our culture.
CEO, IPG/Chicago Review Press, Incorporated
Curt Matthews is the founder and CEO of Chicago Review Press, Incorporated, which is the parent company of Chicago Review Press and of Independent Publishers Group (IPG), the first independent press distributor and now the second largest. Curt has served on the Independent Book Publishers Association (IBPA) board and has also served as its president.