The long tail is that of the demand curve of products versus sales. The best-sellers are all at one end, but as we move to the other sales drop off in a long slow curve that never quite hits zero. Traditional retailers draw a line only part-way along this curve, because slow-moving items return less profit than the cost of stocking them. But online retailers backed by huge warehouses and fast stock deliveries can easily afford to keep them permanently available. Helped by clever search engines that can suggest possibilities for customers with special interests, these niche items suddenly become profitable. (World Wide Words)
Chris Anderson popularised the concept of the long tail in his 2004 Wired article, The Long Tail. He was talking mainly about cultural products—books and music—and he believed that digital supply and demand would turn the retail landscape upside down.
Almost ten years on, it’s clear that the metamorphosis does not help writers much. (ETA: By ‘writers’ I mean those who write fiction, novelists in particular.)
For sellers, Anderson’s theory works. With digital products, words or music, it doesn’t matter to retailer or a publisher whether a million writers sell one novel or song each, or if one writers sells a million. With no cost (or very little) to store and ship the story or song, the aggregator makes money. Lots of money. They aggregate the payments on an essentially limitless supply of product and walk off with a goodly chunk of change.
For consumers, it works. Imagine you live in a neighbourhood of Denver where there’s no book or music store. If you’re okay with reading or listening digitally you have millions or perhaps tens of millions of products to choose from, to suit any mood, mode, or model. And those products—that album, that book—are as pristine today as they were when they were first available. One keyword search and, boom, you’ve got what you need. You listen to a song in five minutes or gobble an ebook in four hours. You find another. There’s an essentially limitless supply to meet your almost endless demand—almost endless demand for music, that is.
A music consumer can listen almost anywhere, almost anytime. She multi-tasks: listens to music while she drives to work, or has sex, or washes the dishes, or reads email. I’m guessing some people listen to music 18 hours a day. However, while I can imagine (if I must) a reader who can drive or have sex or wash the dishes while reading, I’m guessing if they’re doing both at the same time, they’re doing neither well.
For creators—especially writers*—it’s different again. If you live in that neighbourhood of Denver and have spent a year writing a novel that sells only 3,000 copies, you can’t survive on the proceeds. Readers might be able to discover and buy your novel for the next fifty years but it won’t do you much good. Why? Because your book will be competing with an ever-expanding numbers of blockbusters—new ones, every week, with decent-to-massive publicity budgets. Reader hours are not a limitless resource. The limiting factor is time.
Every day we feel as though there’s less time to read, even for those of us who love books. We are easily distracted: That lyric, that conversation, that TV show, that article snags our attention. And because skimming an article or vegging out in front of the screen demands less attention, less energy, less focus, we take the path of least resistance; the book lies unread. And next time we want a book to read, we’ll pick up the novel we just saw reviewed, or heard/saw talked about; we won’t try recall the title of that other book we were interested in.
In other words, for books, supply overwhelms demand. The long tail works in favour of publishers and retailers but not writers.
On balance, I think publishers make a greater percentage on sales of digital books than on hardcover books**. No returns, no shipping, no cost of production after initial costs—which are only a small add-on to the fixed costs of the print development: plant, overhead (editorial and design), marketing, and so on. Writers make less—about half on a digital sale of what they get on hardcover.*** So the long tail works brilliantly for publishers that have an enormous back list and for online retailers with listings for millions of individual items. It does not help authors.
The long tail will always work for retailers. It will continue to work for publishers—for a while. But publishers need a supply of fresh product in addition to their long tail income and if authors are dying of starvation, that supply line will fail.
My conclusion? It’s time for the author to get a higher royalty rate for ebooks. Both online retailers and publishers who rely on the long tail can afford it. For starters, I’m thinking 40% of net…
* Musicians at most levels can derive income from ancillary products—t-shirts, posters—and performance. Writers rely on the writing itself—except mega-authors who can earn (comparatively) low appearance fees.
** It’s hard to be sure because retailer and wholesaler terms are a moving target.
12 thoughts on “The long tail: not the author’s friend”
I agree up the writer percentage but 40% of 3000 in sales still isn't enough to live on.
Nope. But it would increase the income so it could become a significant percentage of the writer's portfolio.
I get the same — 10% of hardcover, 25% of e-book, comes to the same $2.50 to me.
I don't know what terms my US publisher (part of Macmillan–same as yours, yes?) has with each retailer and my royalty statement doesn't list royalty per unit for ebooks. So I divided Net Earnings by Net Units and came up with $2.32.
I get $4.05 for every hardcover (15% on sales >10k, rising from 12.5% on 5-10k and 10% on <5k).
That means that for every $1 I got for the hardcover, I get a little over $0.57 for the ebook. So, yep, 50% was a bit careless, and an exaggeration, but not by much…
Thank you for insight and specificity. I love your explanation about how who sells what number of copies is immaterial to the vendor. That vendor perspective has seemed to be at the root of recent author frustrations. I offer these numbers as information to share with other writers trying to make a living. My biggest earnings are digital. With bigger publishers, my digital royalties have been 30% of net, but I know they are lower for people who signed contracts earlier than 2010. With publishers who are focused on the digital market, my royalties have been at minimum the 40% of net you mention. (Some offer 30% or 40% of list.) Some of these presses have escalators built in for number of units sold going up to 60%. I'm guessing the trade off is in the market share and in the resources for the content package (art, publisher marketing, advertising, and–though I feel I've been fortunate in having awesome editors–editing.)
So when I bought a copy of Hild, you didn't even get enough income to buy a beer at the happy hour rate of $5.
I enjoyed Hild for a lot longer than a beer. And now I wander off comparing beer and books and wondering what percentage of the purchase price the brewer gets when I buy a beer in a pub versus when I buy it in the grocery store. I suspect that the brewer's margins are better than the writer's.
Thanks for that. Yes, with smaller independent presses it's easier to negotiate. I've had a profit sharing arrangement with one, and a 50% net royalty with another.The Big Fiver operate pretty differently. They give you a big advance and then peanuts in terms of royalties.
And that advance can stop seeming big when you try to live on it for a while…
Well, it's enough if you have Happy Hour on Tuesdays at 74th St :)
I don't know what the comparative margins are on books and beer. Smaller, I'd say (I'm guessing) but it's a volume business…
While I think you're correct in the main — and I heartily agree that writers need a better deal on their digital — I think the picture you've painted is not quite right. For example, you say that digital goods can be managed, sold, and distributed at little cost, no matter how vast the supply. Um, no. Digital is doubtless much cheaper than hard copy, but managing a million titles is still managing a million titles, even if there is no schlepping involved. Digital inventory has its own issues. Second, I think you underestimate readers. Yes, reading is less compressible than listening to music, but those of us who read, read. Everywhere. Whenever we can. Brick-heavy novels, maybe not everywhere, but we may still read other things that can be sold in some form. Plus, yes, we do pursue work we've heard about, keep lists of potential reading materials, and seek reliable recommendations. Finally, why are you so sure that writers have few secondary products to sell? Maybe that's the next wave. There's the traditional personal appearance, teaching, journalism, writers-in-residence gigs. There's the graphic novel and such. Jim Butcher's selling jewelry, I think, and I have seen writers' websites selling t-shirts. At least two authors I follow run communities or special-subscription “clubs”. Another author turned to creating her own events. It could be that a new model is evolving. Hopefully, it will include higher digital royalties.
Why am I so sure writers don't make their money on ancillary products? Because I know many, many writers. Writer-in-residence gigs pay pitifully. Writing a graphic novel is still writing. Running a club of any kind is a lot of work. For those who do sell secondary products, it a) eats a disproportionate percentage of their time and b) brings in less than writing does.
And while digital inventory management isn't costless, it is small compared to the inventory management of physical products.
I think I know different types of authors than you do. The ones I know of who sell secondary products generally write non-fiction based on their areas of expertise. This makes it possible for them to sell more than just their words. They have more than one professional hat. Pure fiction writers may face more challenges, no doubt.
However, I am curious: you say that secondary products bring in less money than writing, considering the amount of time required. How can this be so, given the miserable numbers you have outlined?
By the way, I'm actually learning about digital inventory management right now. Let's just say I've been impressed by the potential costs as digital products continue to grow exponentially. I think the long tail notion was somewhat simplistic, to say the least. Digital inventory management is not as costly generally as physical inventory management, but it can go places no one would ever take physical inventory. Resolving such issues will be the future of the business.
Ah, so you're talking about those for whom writing itself is a secondary product: an expansion of their platform. That is a pretty different case to novelists. (I've just added a note in the text to make this clear that I was thinking particularly of novelists.)
Oh, yep, digital inventory management is a complex and fascinating arena. I don't know as much about it as I should, but I do know that like many things that look simple on surface, the deeper you go the richer the risk and rewards become.
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