The trend toward reducing book prices to US$.99 or "free" would have been unheard of two years ago. But then, two years before that, self-publishing was an experiment, dismissed as an anomaly. Vanity publishing was the only meaningful way an author could publish without the gatekeepers and hurdles of the traditional publishing landscape. Authors began searching for alternatives when it became obvious that vanity publishers offered eye candy, but their broken pricing, distribution, and delivery models echoed those that exist in the traditional publishing marketplace.
Fast-forward two years. Desperate for a meaningful alternative, self-publishers, and distributors such as Smashwords, quickly rose in popularity. They provided authors the ability to price and control their books' distribution and longevity. This meant the end for lofty pricing models controlled by the Big 6. Instead of remaining satisfied with meager royalties, and forced to turn brilliance into pablum, a significant number of authors abandoned the traditional publishing hamster wheel.
Now, we're hurling past the dreamy period when authors believed readers would pay US$2.99 for an ebook. Before this, pricing was artificially set by the Big 6. The transfer of power to authors and readers had a heady and profound effect. Wild and wide fluctuations existed, with the understanding that the reader would ultimately dictate the price s/he was willing to pay. The Agency model, courtesy of Apple, came around at the perfect time to offer a framework everyone could wrap their arms around.
Without the regulatory governance and stability the Big 6 brought to the table, authors began competing with each other to attract customers. Unfortunately, instead of beefing up our products to differentiate ourselves, we fell back on the short-term price-slashing tactic.
Additionally, thousands of unemployed professionals swelled the writing and publishing ranks as the global economy worsened, bringing along with them a lack of tolerance for slow and steady growth. These weekend warriors were looking to turn a fast buck while waiting to get hired on by their next employer.
The economic possibility exists that many of these unemployed folks, hoping to hit a homerun from writing one book - akin to hoping to win the lottery – are leaving scars that may never heal. Desperate to earn a buck, these part-time authors did exactly as they were taught in the business world: When competing for market share and sales volume, cut prices when you face stiff competition. This is usually the preferred short-term method instead of investing further to develop unique features to a product that is rapidly becoming a commodity.
Commodity sales are basically straightforward. If the buyer can't get the goods cheaply, s/he will shop around, completely indifferent to trappings. Genres of books are crammed full of "me too" ebooks, varying little from each other. As such, ebooks are becoming a commodity, and as such, readers are driving the prices ever faster toward "free" for everything from meager offerings to amazing works.
Frankly, there's just too much competition in today's landscape. The pricing and marketing problems we authors face will get worse before the pendulum swings back toward anything resembling a seller's market, if it ever will. As is the case with Wal-Mart, the expectation of always having the lowest price puts pressure on Wal-Mart's competitors to reduce their prices to remain in business. This slippery slope begins with the greed of one and then rapidly snowballs.
Out of this economic chaos rose an all-too-familiar business model. A fifteen-year-old internet tactic (one with timeless roots) has resurfaced. Known as portals, thousands of websites vainly attempted to retain customers by being all things to all people. Today, we are experiencing a seductively appealing transformation, a shift in packaging and distribution that cloaks a wolf in sheep's clothing.
Amazon's KDP Select took the next evolutionary step and, first out the gate, rushed to capitalize on the lousy economy. KDP Select tempts authors with the potential to get some money in exchange for exclusivity. Potential money sounds much better than no money, which is what most authors are earning these days. Unfortunately, KDP Select appears to be accelerating an author's ever-diminishing returns. You can read more about this situation within an earlier post of mine - "Amazon's KDP Select is Driving Prices Down."
What's on the Horizon?
Leviathans with an Insidious Purpose
In the 1990s, silos such as America Online (AOL) provided customers with a protective and comfortable environment. Not satisfied, AOL's customers clamored for the ability to access the rest of the internet. Free-flowing portals, often created by indie internet-service providers (ISPs) appeared as a result. Silos gave way to portals, as silos aren't constructed to provide access to all types of information, products, and services. Instead, silos can control and restrict activity, suppress pricing trends, and confine distribution. AOL's myopic vision of the future was avoided by the internet-savvy for over a decade. AOL, as it's turning out, was right on track after all.
The world became a much smaller place because of the explosive integration of the internet into our lifestyles. Of late, many folks began dreaming of a quieter and less cluttered playground that supports the pragmatic allure of the cocooning trend. This cocooning phenomenon, where people insulate themselves by creating a narrow band of friends, family, and outside influencers, is a direct outcome of information and stimuli overload. The internet's silos recognize this and market themselves as safe havens and playgrounds.
"But, you ask, "what does all this have to do with ebook pricing?"
Back to Scrambling for Crumbs
The KDP Select silo offers a restrictive environment to authors in exchange for co-op money. Other silos are created around proprietary ereaders. Meanwhile, as all this activity supporting consumers' cocooning is going on, publishing's Big 6 were waking up to realize they were no longer the sole gatekeepers to the writing and reading experience.
Indie publishing's nemesis is scrambling to remain in control of the publishing industry. Leapfrogging KDP Select and going straight for the jugglar, the Big 6 have invested in a hybrid that will rise from the ashes of the legacy and self-publishing models to regain control over the distribution platform. This hybrid makes KDP Select's restrictive environment look like child's play.
Enter Bilbary.com, a silo espousing the reader experience, is built on the backbone and offerings of Ingram Content Group and investments from within the Big 6. From Bilbary's current homepage, the company states its strategic and tactical objectives as:
· Content: We aim to offer all the ebooks in the world. In the next few months we will add 750,000 titles.
· Reader: We are developing a cloud reader so you can read your books online.
· Apps: We are creating apps for your phones, tablets and computers.
· Rental: We are working with publishers on a system of ebook rental.
· Languages: We intend to translate the site and include books in many languages.
· Libraries: Bilbary is working with the public library system to see how we can increase the availability of ebooks to library patrons.
A year ago, Benedicte Page wrote an article entitled, "Coates to Launch Bilbary e-Book Site," which provides a good summary of the company's vision. Then, I took a look at the Bilbary demo on YouTube.
· The role of the author appears purposely downplayed. Bilbary is touted as a reader's ultimate experience. Publishers, which I gathered from the reading will be the Big 6 and their affiliates, will receive their customary (legacy) 80% royalty, but nowhere was I able to find a reference to the indie author's cut.
· Within the welcome email I received from Bilbary, it states, "If you are a publisher, we offer excellent terms and free access to data and analytics on your titles. You will be able to choose whether to sell books, rent, or both sell and rent." Does Bilbary accept authors as self-publishers?
· In the very next paragraph, the email appears to downplay the importance of the author in the publishing lifecycle, as there is no mention made of an author's rights to access data and reports about their titles: "If you are an author or an agent with the digital rights to your books we aim to host both new books and an extensive backlist." By its omission, this reads to me like the legacy publishers will be peddling and pushing their same rules and restrictions within the ebook marketplace. I see Bilbary as nothing more than window dressing. They create an interesting and fresh looking interface, but the machine operating behind the façade is the same old nonsense that indie publishing has strived to circumvent.
What about the future of Indie Publishing?
Can fledgling and growing e-distributors such as Smashwords resist the lure of selling their businesses to silos such as Amazon KDP and Bilbary? No doubt, with only 3 years under their belts, indie-book distributors are market leaders, but their grasp is tenuous. For example, might Mark Coker tire of running Smashwords and sell the company? Being a very rich retiree is an extremely attractive position to be in, especially when you consider the volatility of the global economy and the instability of the epub marketplace.
Well-intentioned and focused on growth, what if Smashwords were to go public? With its extensive lists of titles, readers and authors, Smashwords would be snapped up by the deep pockets of any of the Big 6 publishers, drained of its value, and then spun off or shut down.
The lure of small money is stronger than that of no money. Will authors sell their souls in the hopes of receiving meager handouts offered by this latest incarnation of the legacy publishing model? Tragically, I believe this could be the outcome if traditional publishing succeeds in going toe-to-toe against indie distributors.