Friday, December 6, 2013

Demands From an Independent Author

Over the past few decades, independently owned brick and mortar retailers shuddered when places like Walmart Supercenters, Targets, Kmarts, etc. rolled into town, creating an environment of impossible price competition. Many small retail business owners exhaled their collective dying breath as they watched their impending doom approach like a rapidly growing tsunami. Then they were subsequently, and quickly swallowed into the abyss; relegated to relics of a bygone era of 'main street' American entrepreneurial opportunity. Surrounding communities somewhat involuntarily accepted the transition as their low-wage, increasingly impoverished existences could only sustain a life sourced by the impossibly low prices offered by corporate retail chains. With most American manufacturing jobs already departed during the previous wave of corporate exploitation (outsourcing), local economies became increasingly dependent upon the minimum wage offerings of corporate giants, and many of us stepped off the cliff together and descended in a freefall into a slightly deeper ring of hell; heading toward serfdom. Ultimately, what happened was that the long distance exploitation (e.g. outsourced sweatshop manufacturing) that enabled corporate retail giants to offer unsustainable prices came home, and we were incorporated into the corporate exploitation model once again. This should not be a surprise to anyone, because corporations are accountable solely to shareholders, and therefore must perpetually increase earnings to satisfy their appetite for increased wealth. Exploiting locals [again] was the next, obvious method to sustain continuous profitability. However, this scenario is rapidly transforming as the agents of exploitation must develop new methods in their never-ending pursuit of elusive profits.

Presently, there need not be a corporate encampment in our towns to sap the life out of us, because the corporate planners are slowly realizing that an actual physical presence is relatively expensive. The new strategy is to migrate the exploitation model to an online environment, because by being online, corporations can be omnipresent. There are fewer jobs 'created' in exploited communities, and economies can be savaged, remotely. For example, a corporate department chain can build stores in one small town after another, draining the lifeblood out of individual communities, but online retailers need not ever be physically present; they are already present by virtue of being online entities.

Concerning e-books, Amazon, Barnes & Noble, Apple, Sony, and a few others have implemented systems that are driving professional independent authors into extinction. The primary component causing this effect is marketplaces where authors can directly price-compete with one another. The result of these environments is a veritable race-to-the-bottom, with the victor being, obviously, the owners of the marketplaces themselves; Amazon, Barnes & Noble, Apple, Sony, etc. Of course, participation in these marketplaces, and competing on price is a choice, but with the established oligopoly, independent authors have very few options for other online locations to retail their e-books if they are to achieve a temporarily survivable level of exposure. The alternative to the dominant distribution channels is to launch a new website, which is a lot like opening a brick and mortar bookstore in an uninhabited desert; hopelessly futile.

The Kindle Direct Publishing (KDP) marketplace is a relatively new method of pitting peasants against one another. With KDP, authors write, edit, format, upload/publish, and market their own works. Like the aforementioned distribution channels, the KDP marketplace allows authors to price-compete with one another, with a minimum retail price of $0.99 (at this price, authors receive 35%; ~$0.35 USD). The KDP platform is unique in that it has a program called "KDP Select", which allows authors to give away an e-book free for 5 days for every 90 days of said title's enrollment. This feature is a powerful and effective tool for reaching a large audience of potential readers. Its purpose is to allow authors to gain exposure in hopes of converting free downloaders into future purchasers of other works. Unfortunately for authors, the overwhelming abundance of e-books enrolled in the KDP Select program has resulted in a bottomless buffet of free e-books, and resultantly fewer paying customers. I must confess that I am guilty of regularly using the free book giveaway feature to gain exposure for many of my titles, and many of the feature's other critics do as well. However, as long as this feature exists, it's use will be widespread, and therefore must be implemented by most independent authors who wish to remain visible.

Aside from the obvious, inevitable doom that authors will meet on the course set by this model, there is another issue of acute concern that I have observed in discussions among authors/publishers. It is that the e-book sales reporting tools are inconsistent, some sales do not seem to register (even when authors test the system by purchasing their own books), some sales mysteriously disappear (not returns/refunds), and sales for individual authors are in precipitous decline. With tangible goods, retailers monitor their inventory, sales, payments, etc. However, with digital goods that are sold in a system that is enshrouded in secrecy, accountability to, and responsibility toward, the producers is virtually nonexistent. In other words, not only does the nature of the system contribute to the extinction of writers due to financial de-incentivization, many authors are becoming increasingly suspicious of the sales reporting practices of e-book distribution channels and are beginning to think that the distributors are simply not paying them for their e-book sales. When I first read discussion board posts written by concerned authors, I dismissed their complaints as slightly paranoid, or as impatience with the sales reporting systems. However, as time passed, I observed the frequency of these concerns increasing, even among well-established authors. It seems that notwithstanding the overt extinction-inducing features (i.e. free book giveaways, extreme price competition, etc.), the combination of the sheer number of e-book reading devices sold and the ever-expanding international e-book marketplace should not lead to the precipitous e-book sales declines for independent authors that my peers and I are currently observing.

Many large corporate retailers have well-documented histories of selfish, inhumane, dishonest, and ruthless trade practices. It is not inconceivable to entertain the possibility that these same monsters are continuing to behave in a pattern in accordance with their established characters. However, this is post is not an indictment. It is a demand for increased transparency. As authors, we are the brick-cutters in a modern pyramid building scheme. At a bare minimum, we require adequate transparency and/or oversight to assuage our concerns that the system is less fair/honest than it is purported to be.
As a start, I would like to see the following:
  1. Establish a processing time from the time of purchase to actual sales reporting. This will ensure that authors can verify sales.
  2. Establish a royalty rate at >= 50% of the retail price for all price bands. Currently most systems allow authors to receive a dismal royalty percentage for the lower price bands, i.e. 35% if the price is less than $2.99, and up to 70% if the price is >=$2.99.
  3. Make page view statistics for individual e-books available to authors/publishers.
  4. Disclose Kindle, Nook, and other e-reader device sales data.
  5. No free book giveaways

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