But people who do are getting hosed. WORSE, the folks with paperbacks, whether new releases or not, because to get that free shipping, people often add a PB to the HOT! NEW! HC they are buying.

I hear a lot of calls for authors to do something else and somehow magically produce and publish, or at least sell, their own books. I do not, however, see a lot of calls for that from writers.

Anyone wonder why that is? I can tell you, because I may be one of the few people commenting that actually HAS some small business experience. Having had, and failed, in a small business, there are a thousand things you must do that are invisible to the customer to keep a small business going.

Here is why authors don’t go into the self (e- or real-book) publishing business.

In order to HAVE a small business you MUST have the following:

Clearance from where you live to run a small business on your premises. If you do not have this, buy or rent space from which to operate same. ($ to $$$) If the authorities find out you are operating a small business from your home (and they will) without this clearance, Very Bad Things can happen. Like fines ($$$$$)

Small business insurance. ($$ to $$$$) If you do not have this and someone injuries himself or you have a flood or a fire, your homeowners will NOT cover you ($$$$$$$$$$$$$$$).

Business licenses. Sometimes three, from city, county and state. ($)

Business tax number.

The ability to process credit card payments ($$. Yes, Virginia, they charge you). You can use PayPal, but that comes with its own set of fees and problems.

Someone to separate your business accounting from your personal accounting. And someone to handle the business tax reporting. If this is you, this is time you won’t be using to write.

A website ($ to $$$$). If you are setting up and maintaining, this is time you won’t be using to write.

Someone to handle orders ($ to $$) After all you don’t want to ship product until you find out if the credit card/PayPal account is good. If this is you….yada.

Someone to think of good ways to promote your books. If this is you….

The sure and certain knowledge that 4 out of 5 small businesses fail in the first 4 years.

A day job, because at the end of 4 years, chances are you will need it.

To sum up, here, to run a small business selling my own books, whether in e- or paper format, I would have to take the odds of 80% failure and the loss of at least 50% of my writing time.

For the record, when our small (scrapbooking, brick and mortar) business failed, our end result was a loss of over $200k.

Start a book business myself? That’s the sound of hysterical laughter you hear. Thanks, I think I’ll stab myself in the eye with a fork a few times instead.

Amazon’s response was posted on the Amazon Kindle Forum on Amazon’s site, apparently by someone who has absolutely no grasp of how publishing–or anything else–works. OF COURSE Macmillan “has a monopoly on its own titles,” you moron! And Nabisco “has a monopoly on Oreos” and Ford “has a monopoly on Mustangs and Shelby Cobras!”*

The book business in general is tanking. How bad? Bad enough that almost everyone I know saw their royalty checks plummet to 50% last year, some going down to 10%. Well duh, you can’t buy books when you don’t have a job. (I am often forced to roll my eyes when I tell people that and they look at me bewildered and say “But I see tons of people in the bookstore when I go, how can that be?” I have to explain patiently that “Tons of people in the store does NOT equate to sales.”)

Amazon has the publishers by the short and curlies. Unlike traditional bookstores, the One Ton Gorilla can demand a discount of 50% on the cover price and get it (as opposed to the chain-store’s 30% and the Indie’s discount of 20%). This is why a new HC, with a cover price of $25 is Amazon Priced at $15. And this is why the price of books has gone up, so publishers can keep their very slim profit margin. (And believe me, it is slim).

Macmillan’s desired pricing model is not as draconian as it seems. They want $15 for the e-copy of a Hot New Bestseller–same as the heavily-discounted price of the dead tree copy, so that the e-copy does not compete with the same book in dead tree, and Macmillan can recoup their substantial investment in the book. This does NOT mean that MY new book in e-copy would be $15. Mine would likely be, oh, $12. And Joe Schmoe’s would be–you got it–$9.99. Plus, in Macmillan’s model, over time that $15 per e-copy would start going down. In 6 months, say, it would be $9.99. And in two years? Probably $4.99, same as a paperback.

So if you JUST CAN’T WAIT–you pay a premium. Same as with any other product.

* Now here is some irony. Amazon is claiming to be a publisher when it comes to obtaining exclusive rights to e-copies of books. Yet not that long ago I actually approached them to write Kindle-exclusive content. I wanted the same terms I would get from any of my other publishers; advance against royalties, half on signing, half on publication. I was told then, in exactly these words, “Amazon is not a publisher.” (But of course I “should feel free to write the content and publish it via the Kindle platform at their generous terms of 30% royalty”**).

So…..three months ago, they WEREN’T a publisher. Now they suddenly are. Oh, except when it comes to treating an author like a professional.

** Lest you wonder why I didn’t take advantage of such GENEROUS TERMS, another author ran the numbers for a series of his that was abandoned and discovered rather quickly that he would be making less money than a first-time writer.

(Oh, and one more thing. The “Advance against royalties”, often shortened to “Advance” is a essentially a no-interest loan, paid out over time to an author, so that he can write the damn book without worrying about where the mortgage payment is coming from. Most of us (especially now) absolutely require these advances to keep writing. It’s a gamble on the part of the publisher that your book will be profitable, because if it is not, YOU don’t have to pay it back.)