There was a pretty damned fascinating piece Instapundit linked to today. It basically spells out the coming death of major publishing houses, or at least their current business model. The weapon? Ebooks at 99¢.

I’m a late adopter of the eBook, I’ll admit. I can’t see popping $139 for a Kindle or $149 for a Nook. ($249 for the color version.) My $175 EeePC Netbook is about the size of a hardback, but I find hardbacks awkward to tote around.

Then I found out that there was a free eBook app for my iPod Touch, iBook. Initially I thought the screen would be too small to be usable as a book reader, but my shooting buddy DustyC showed me that his worked just fine. The last book I purchased, Lois McMaster Bujold‘s Cryoburn (hardback) came with a DVD containing not only electronic copies of that novel in all major formats including PDF and HTML but eight other novels and The Vorkosigan Companion. I was getting ready for a trip to Canada, and I thought, “What the hell?” I loaded the app, and copied over the nine books.

And I LOVE the damned thing. It’s tiny, drops easily into my shirt pocket, it’s still easily readable (and being illuminated, I can read in poorly lit restaurants which I cannot do with a dead-tree book), it has excellent battery life, I can carry a pretty decent library on half the 16GB of memory.

But most books cost every bit as much as a premium paperback, and those are getting pricey these days.

Baen, Bujold’s publisher, was one of the first adopters of eBooks, and got in early with free eBooks for download. Sort of a drug-pusher’s “first taste is free” to get you hooked on an author. So I can go to Baen’s website and download a lot more books, but they’re probably also books I’ve already read in dead-tree edition. I tend to read a lot, and I like Baen’s stable of authors.  (I’d read all of Bujold’s previous Vorkosigan Saga novels, but I didn’t mind reading them again.)

But the article Instapundit linked puts a whole new spin on the topic.

Roberta X has recently self-published her novel, I Work on a Starship, and she’s selling it as an eBook for $1.99, or dead-tree for $18.82. The download is PDF only. That’s OK, there’s a PDF reader for the iPod, but I haven’t installed it on mine. There are, however, about a dozen other formats for book readers (I use the iBook format) and she’s not reaching those customers.

Author John Locke (LOVE the nom de plume) has six of the top 40 eBooks on Amazon right now, and one of them is #1. All of his books are available in all formats, and all of them are 99¢. Out of each sale, the author sees 35¢. His total cost involved is the time it takes him to write a story, and about $1k to give it to a third party for formatting it for all the different readers, and produce “cover art” for the book. As he puts it,

I make back the one-time price by selling 3,000 eBooks, and every sale thereafter is unencumbered.

The interview was done yesterday, March 8. Between January 1 and March 8, he sold 350,000 Kindle-formatted copies of one novel alone. Do the math. That’s $122,500 in just barely over two months.

Now, obviously John Locke is an exception (it does require the ability to write something that people will praise, after all) but listen to this:

For the first time in history, there’s an advantage to being an independent author!

It wasn’t so long ago that an aspiring author would complete his or her manuscript, only to don a pair of knee pads and assume a supplicating posture in order to beg agents to beg publishers to read their work. And from way on high, the publishers would bestow favor upon this one or that, and those who failed to get the nod were out of the game.

No more.

These days the buying public looks at a $9.95 eBook and pauses. It’s not an automatic sale. And the reason it’s not is because the buyer knows when an eBook is priced ten times higher than it has to be. And so the buyer pauses. And it is in this pause—this golden, sweet-scented pause—that we independent authors gain the advantage, because we offer incredible value.

The Gatekeepers once again have lost their power. The walls keeping the unwashed masses out have fallen down.

I’m new to the writing game. But if I’d started self-publishing even three years ago, I would have spent all my time trying to prove to the public I’m just as good as the top authors in America. These days, the burden of proof is on them. Now the best authors in America have to prove they’re ten times better than me. And in a game like that, I like my chances.

The interviewer of John Locke is also an author selling his wares on Amazon. He said:

Coming from a legacy publishing background, I knew that 35% royalties were much better than anything the Big 6 offered. Even so, when I first got into this, I thought that cheap ebooks would be a loss lead, that would get people to read my more expensive books.

And yet, when I lowered the price of The List from $2.99 to 99 cents, I started selling 20x as many copies–about 800 a day. My loss lead became my biggest earner.

Do that math. He went from making $2.09 per book to $0.35 per book, but he sold twenty times as many books. Forty books a day at $2.09 a book is $83.60 a day. Eight hundred books at 35¢ is $280 a day.

Not too long back, Larry Correia self-published Monster Hunter International in dead-tree format, and did so well a major publishing house picked him up and gave him a multi-book deal. Baen now sells the eBook version at $6.00.

I have to wonder if Larry might not have done better staying independent.

Hey Roberta! Are you going to port I Work on a Starship to iBook format?

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