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What happens to Indie Authors if the Agency Pricing Model Dies?


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Initial post: Apr 29, 2011 5:47:33 AM PDT
Last edited by the author on Apr 29, 2011 6:08:14 AM PDT
Marion Stein says:
Just a thought: Not something I saw being discussed in threads, including the many on agency pricing.

What if Amazon wins? What if there were books available on kindle at prices equal, close to, or less than the discounts available on paperbacks and used paperbacks (minus the shipping)? I'm not imagining a future where everything is 99 cents, but what if the average NEW bestseller was priced 20% or more lower on Kindle than in paperback? What if last year's bestsellers were $2.99 or less? Do you think readers would still be filling up on your books for $2.99, or even 99 cents if there was more inexpensive content available from established authors (other than public domain)?

Thoughts, opinions, insight?

In reply to an earlier post on Apr 29, 2011 5:54:58 AM PDT
Grimlock says:
I wouldn't buy any indies at all in that case.

Posted on Apr 29, 2011 5:57:20 AM PDT
S. Dunham says:
There are always going to be people that will only read best sellers and books from traditional publishers. Agency pricing or not, that will never change. Then there are readers that are always looking for something new and different to read. Those readers are willing to take chances on new and unknown to them authors. I don't know how long the contracts are for, but it won't change this year. So there will be plenty of time for open-minded readers to discover indie authors. Then if the agency publishers change their minds and go back to retail, I don't see those readers abandoning the indies just because the traditional publishers' books are cheaper again.

In reply to an earlier post on Apr 29, 2011 6:00:37 AM PDT
[Deleted by Amazon on Jul 24, 2011 1:09:58 PM PDT]

Posted on Apr 29, 2011 6:00:59 AM PDT
Jersey Girl says:
I probably wouldn"t buy as many indies.

In reply to an earlier post on Apr 29, 2011 6:05:15 AM PDT
MLeMieux says:
Karen McQuestion was successful before the Agency model took effect.

In reply to an earlier post on Apr 29, 2011 6:08:49 AM PDT
Marion Stein says:
Forgive me as your probably a forum regular, but do you buy many now?

Posted on Apr 29, 2011 6:22:40 AM PDT
CLB77 says:
Indies were selling before the Agency Model came on. They've certainly been helped by its advent, and though there were more frequent deals to be had on traditionally published books before the AM pricing, it's not like the trad published books were all free. Or even frequently $2.99, especially for recent bestsellers. Indies were still a good deal then; they're just a better average deal now. Even if the AM ends (which I can't see happening any time soon, unless it's declared illegal),there's still quite a distance between an average price of ~$2.50 for indies and an average price somewhere over $5 for trad published.

Posted on Apr 29, 2011 6:30:37 AM PDT
Mary Ellison says:
Indies won't suffer at all. They will still be able to publish their work, and most of them, being unknown writers, will sell for less than the established authors using large publishing houses. No change.

Posted on Apr 29, 2011 6:36:47 AM PDT
J. Mancini says:
I agree with CLB77. I don't think that if the Agency Model ended it would necessarily lower the price to that extent. I just don't think last year's bestsellers will go to $2.99 or that we can count on the Kindle edition always being 20% lower than the paperback version. (Even though it would be very nice and I certainly wouldn't complain.) I think Indies have carved out a nice niche for themselves. The Agency Model may be helping that, but I don't think it's the only factor.

In reply to an earlier post on Apr 29, 2011 6:39:58 AM PDT
Anne Shirley says:
I think the best Indie authors would probably survive - and by that I mean those who are the most talented writers, since in your scenario self-promotion would be meaningless unless one's sole consideration for purchasing a book would still be the cheapest possible. In order for Indie authors to survive or thrive at that point, it would all be down to the quality of their writing.

Posted on Apr 29, 2011 6:45:14 AM PDT
Bufo Calvin says:
Marion, if books from established suthors were less expensive than those of unestablished authors, as you suggest, than sales by independents would suffer.

I think that's what you are saying with "more inexpensive content available from established authors"?

I don't see the prices from traditional publishers and independents being the same, though...their cost structures are quite different.

Here's a scenario for an independently published booK:

The author writes the book, which takes considerable time and effort. It's lovingly crafted. Maybe a relative proof-reads it before release. The author publishes it using Amazon's Kindle Direct Publishing. The author continues to work at a regular job, and promotes the book in blogs and online forums.

The financial costs? Very low. If the book sells some copies, the author/publisher gets 70% of the price (if it's $2.99...if it's ninety-nine cents, they get 35%...typically).

Here's a scenario for a traditional publisher (with that same author's work):

The publisher has paid a reader to read 250 manuscripts. The reader selects this author's manuscript, and passes it to a junior editor (who is also being paid, of course). Eventually, it gets to an editorial meeting, where the decision is made to publish this book. That's after very high-level (read: expensive) editors have made decisions not to publish ten others.

The book is now worked on by an editor. The author (even a new one) may get an advance during this time. Eventually, other paid people working on the book include: typographers; lay-out artists; publicists (let's say they want to promote this one); lawyers (for the contract, copyright, and so on); proof-readers; sales agents (who work with the retailers to convince them to carry the book); and a cover artist.

This book is one risk...it's one of a few unestablished authors being published by this publisher this month. Probably only one of them will make a profit...the profit from that one has to help cover the expenses of the ones that fail. The publisher also chose to publish a public-interest title that they know will lose money, but will get them prestige (they are hoping for some important award for that one...then, maybe, it will make its money back).

Over time, the publisher has Customer Service costs (although some of those are borne by the retailer), accounting costs, ongoing promotional costs with the retailers, costs in dealing with the retaiers, and more.

The costs for a traditional publisher are much higher, even though a smaller percentage of the receipts goes to the author.

So, back to your original question: if the prices for traditional publishers' titles get much lower than they are now, I do think that would affect the sales of independent publishers.

The bigger fear for them is if more established authors go indie, which we have seen happening.

Bufo Calvin
Amazon Author Central page:
http://www.amazon.com/-/e/B002E0NBIW

Posted on Apr 29, 2011 6:46:24 AM PDT
Regardless of the agency model, traditional publishing houses cannot sustain an ongoing price point of $2.99 or less, and probably not any less than $5.99. Too many entities need to be paid along the way for that to happen. They'll certainly do low introductory pricing for their lesser known authors and probably even giveaways, but those will be limited and/or targeted, and their better known author's and celebrity works will probably still be priced similar to today. As always, they will price what they think the market will bear. It has little to do with the "manufacturing" costs.

Posted on Apr 29, 2011 6:56:56 AM PDT
Mark says:
The publishers have many expenses that indies don't have. Even the indies who pay others for cover art, editing and format shifting should come in well under what the publisher can afford to sell for. Plus, many big name authors are starting to go the indie route themselves - just look at Barry Eisler as a recent example.
Assuming they are at the same price point, it would depend on the prior knowledge of each author. If I hadn't previously read their work it might depend on reviews, reading a sample, or whatever seemed more interesting from the descriptions. All other things being equal, I'd probably pick the book backed by a traditional publisher.

In reply to an earlier post on Apr 29, 2011 7:25:13 AM PDT
They seemed to be doing OK before the model went in place, though not as well as today. So maybe the demand might go down a bit but I suspect they will continue to do well.

Posted on Apr 29, 2011 7:45:45 AM PDT
Last edited by the author on Apr 29, 2011 7:46:17 AM PDT
T. E. Maddox says:
I agree that nothing would happen to them. If they continue to price at around the 2.99 price point then they will still be much cheaper than the books from the publishers.

Remember before Agency Amazon paid roughly 50% of the MSRP and then priced it at whatever they wanted to. If we went back to that system they may still discount the books, even below their cost but they could never price them as low as the indies as that would be a $10 or more loss per book.

Posted on Apr 29, 2011 8:02:49 AM PDT
I have a different take on this. Irrespective of the Agency Model, established tree book authors must realise that they can do better as indies in the ebook market and I expect many will retrieve their ebook rights as soon as they are able. That would really put the cat among the pigeons!

Kindlofax 2011 Basic [Illustrated]

Posted on Apr 29, 2011 8:26:03 AM PDT
The interesting thing is that a lot of established authors are going indie and more will continue to do so. And a lot of indie authors are selling well enough to become established. The distinctions will continue to blur until all authors are competing on the same two metrics-price and quality-that other commodities do. Some indie authors will thrive and others will not.
L.J.

The Sex Club ($.99)
And four other Detective Jackson mysteries

In reply to an earlier post on Apr 29, 2011 8:32:11 AM PDT
In short, it'll be much the same for indie authors. After all, some thrive while others don't already.

Posted on Apr 29, 2011 11:04:08 AM PDT
Scamp says:
Marion, I think if your scenario was realized, then there would be fewer sales for *most* indies. But as always, those who write good books (or at least, books that people want to buy), market them well, and get good word of mouth would still thrive.

I do not believe, however, the prices will go as low as $2.99 for most ebooks, particularly books that are fairly new - even as new as the last 10 years or so. Many of the these books still have a thriving market if they were good sellers to begin with. If they weren't/aren't, their prices could be lowered - but probably not $2.99.

I think some older works that are no longer in print (if the authors haven't snagged these rights already) could do well in the $2.99-$5 range. Right now, these books are yielding no sales. The ebook market, in reviving these titles, is a whole new source of revenue for publishers and sellers. I don't see any particular losses for them to price these books for quick sale. I'm thinking mostly of books that might be considered pulp fiction, and possibly in genres like cozy mysteries, romances, self-help books, other (outdated) nonfiction titles, etc. With these old titles attractively priced, they will no doubt get some nostalgic purchases, but the attractive price will lure the economy-minded readers as well.

It would still be fruitful for them to go a bit higher than that $5 and under range I mentioned for older books that were critically acclaimed and/or are considered modern classics.

Another thing to consider if the Agency Model were to be abandoned is the ability for merchants to offer sales as loss leaders for series they may wish to revive or for a prolific author whose book sales are lagging. This will bring them more business in the other titles. This definitely affects indies - and it definitely affects them now in terms of the large number of free ebooks offered.

Indie books are multiplying like bunnies, so it seems to me that there will come a time when people are going to need some reliable sources to cull the mass of offerings. Will there be reliable organizations that emerge to help readers separate the wheat from the chaff? I think this will begin to happen as ebooks make market gains, and a new form of gatekeeper will emerge.

In reply to an earlier post on Apr 29, 2011 11:32:24 AM PDT
In the comic book industry, people typically prefer having a printed book. Right now indies and Marvel comics sell books for around the same price $3.99. But Marvel's specific books sale for that price, while most print on demand indy books sale for that price. To sale cheaper you'd have to print at least 3000 via Brenner or something like that. But at the same time, the indie has less overhead as they only pay for the books they want to take to conventions and the rest are usually sold online. Basically no overhead.

The beauty of Kindle is that novels are basically words on a page, that can be delivered in so many ways, so pricewise we can go way below the price of the big publishing companies digitally and match them in POD books sold digitally.

I do think prices will go down on midlist authors, but not on the big books, prices will probably stay the same as the actual book or drop maybe 20 - 30% below, but not far below. But like comics, people who are into indies will still be into indies and people who're into mainstream books will still be.

Comics have art in them and appeal on two different levels, but still the Marvel Zombies will gravitate toward Marvel no matter what. Price was the only thing that has recently made Marvel fans wince, as indy comics were traditionally priced higher, because they cost more to produce, so this seems like a welcomed reversal with indie novel selling for less on popular digital platforms.

Posted on Apr 29, 2011 11:46:02 AM PDT
When people say "Agency Model" I keep picturing Stan Smith from American Dad for some reason.

Posted on Apr 29, 2011 1:44:46 PM PDT
T. Moody says:
When I find a good author I stick with them regardless if they are a popular bestseller or an indie. It is in the story telling not the publishing type.

In reply to an earlier post on Apr 29, 2011 1:53:53 PM PDT
That's how it should be.

For instance, of my five favorite authors of all time, two are indies, but when I think of the book, I don't think "indie." I think "great story."

In reply to an earlier post on Apr 29, 2011 1:56:13 PM PDT
Larry Moniz says:
Let's see. Two author colleagues seem to have the best answer for you. JA Konrath says he made more than $60,000 in March with Kindle books, often at 99-cents. Vincent Zandri said on his block that he's currently making about $20,000 per month with a pricing structure similar to Konrath's. Don't know about you, but that would be fine for me. Also, other than the biggest best-seller authors, I'm unaware of too many getting that kind of revenue from traditional publishing houses.
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Discussion in:  Kindle forum
Participants:  40
Total posts:  64
Initial post:  Apr 29, 2011
Latest post:  Apr 30, 2011

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