Print vs. Digital Report
In our initial Author Earnings report, we revealed some amazing data on the health of self-publishing on the Kindle Store [link]. We included several caveats that this was only a look at Amazon, as there’s simply too much to discuss about publishing today without tackling it in bite-sized chunks. Today we’re bringing print into the mix, as Amazon is said to represent only 30% of the publishing market. Using a Bookscan snapshot of weekly print sales, we compared the top 100 bestsellers in print with the top 100 bestsellers in digital. Since our digital data is a daily snapshot, we simply divided the units sold on Bookscan by 7. It gives us the same time period during the same week (there was even overlap with some titles, though this was not important). What we are asking of the data is market share. How much money is being spent on print overall and how much on Amazon’s digital storefront? Before we got to money, we looked at actual unit sales, which came out to be 61% digital and 39% print: A couple things to keep in mind: A lot of the print sales on the right of the graph above are occurring on Amazon (more occur there than any other single source). Also: We aren’t including other digital distributors. We are doing two things to weight this toward a print share of the market, which is fine. As further reports are run, we will eventually put more of the puzzle together. For now, we’re giving any advantage we can to print. Despite the fact that digital outsells print in terms of units (again, this graph is conservative, as we are only including Amazon digital sales but all of Bookscan’s print sales), print brings in more revenue: We laughed when it came out right at 70/30. A coincidence, as we aren’t looking at Amazon share overall, remember. A future question will be whether non-Amazon digital is greater than or lesser than Amazon print (this would give true market share). What we want to ask here is whether authors should care about giving up such a large piece of the money pie. That’s a big chunk, that 70%. Authors are warned not to self-publish, because they are leaving all of those earnings on the table. It turns out they are only missing out on the crust: Bookstores typically get a 40% – 50% discount off retail price from publishers. That’s their discount, and so their share of the profit. We used an average of 45%, which was typical at my bookstore. That money is shown in green. That leaves 55% for the publisher and the author to share. The author gets anywhere from 8% – 15% of retail, depending on format, contract, and escalators. We used 12%. There’s your crust in blue. When people advise authors that they are leaving 70% of the market on the table by self-publishing, they are actually arguing in the interest of bookstores and publishers, not authors. Here at AuthorEarnings, we care about the content creators. We want them to be paid fairly. Speaking of fairly, let’s look at the digital side for traditionally published authors: If you remember from our first report, we model publishers getting 80% of digital retail price. Amazon gets 20%. The author gets 25% of the publisher’s net. The questions we want to ask, as authors decide how they want to publish to maximize their chances of making a career is: Should authors worry about giving up bookstore sales by self-publishing? Or should they worry about giving up their digital rights if they sign with a major publisher? Let’s set aside what a traditionally published author hopes to earn by putting all of their blueberry pie off to the side: And now let’s look at the same scenario from a self-published author’s point of view. Yikes. Look at all the money this author just gave up. This graph really captures the terror of self-publishing. That huge print market is lost, as wide bookstore penetration is very unlikely. In fact, it looks like I just gave up 70% of my earning potential. Or did I? What about my cut on the digital side? There’s the 70% I get off the known digital daily revenue stream according to our snapshot. That’s a lot of money. More than five times what traditionally published authors make (though on lower prices). On the print side, I’m making a sliver off my print on demand books. So what happens when we total this up?
It turns out that traditionally published authors give up more pie for their crust than indie authors give up for their crumbs. With bookstores closing and e-book adoption still rising, this is a trend heading only in one direction. And remember that we’re leaving out a lot of digital sales on other outlets; print has been given as many advantages as possible in this comparison. Also keep in mind that a lot of print occurs on Amazon, where print on demand books can account for a nice supplement of sales. As authors consider the print market they are giving up if they decide to self-publish, perhaps they should ask themselves how charitable they feel. Ignoring print distribution certainly hurts bookstores and publishers, but the blow on digital is much greater than what is gained from print royalties.
There are other advantages to being in bookstores, such as visibility, but this is offset by the 3-6 month window of said visibility when the 70% of digital earnings is forever. And as bookstores contract and digital gains wider adoption, this conclusion becomes stronger and stronger: More is lost in the decision not to self-publish than is gained from a contract with a major publisher. To balance this, publishers could pay authors a greater percentage of digital sales revenue. We think market pressures will force this decision. Until then, authors should consider what they hope to gain and what they stand to lose as they make the difficult decision to publish, and how.
Download the raw data used to generate the report: