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iBook Lessons: Picking vendors, price, and exclusivity
iBook Lessons is a continuing series about ebook writing and publishing. There's a dilemma faced by many new ebook authors: how to sell a book for "not much at all" and still earn a decent living. Apple and Amazon policies complicate this decision. Amazon offers a multi-choice royalty system (all prices are USD). You can charge up to $2.98 for your ebook and earn 35% of the list price. That equates to just over 34 cents for a $0.99 ebook. charge between $2.99 and $9.99 for your ebook and earn 70% of the list price less delivery costs, which are $0.15 per megabyte. For big illustration-filled books, this can be a deal breaker. TUAW reader Rosie McG's color photo book ships at over 40MB in size. She writes, "With my book priced at $9.99, my net would have been less than zero." charge between $2.99 and $9.99 for your ebook and earn a straight 35% of the list price with no delivery fees. That equates to between $1.05 to $3.49 of earnings. With Apple, you earn a straight 70% royalty on all sales, regardless of price and you can add up to 2GB of content. So long as you deliver in straight EPUB, without using iBooks Author, you can also sell in any other outlet. So there's no question, right? Sell in both places, and just try to make the most of the Amazon situation as best you can, yes? It turns out the situation isn't so simple, especially for new ebook authors. That's because the $0.99-book, which earns you 34 cents at Amazon and 69 cents at Apple, is the workhorse of the new author. It, like its App Store-based compatriot, represents many authors' first step into self-publishing. And Amazon, with its Kindle Direct Publishing arm, has thrown a big monkey wrench into this decision. That's because Amazon has two weapons on its side. First, it's monster presence in the ebook arena. Kindle titles can be read on nearly any platform you throw at it, from iOS to Android, OS X to Windows. That alone gives Kindle books a cachet not found with iBooks. Authors report that the majority of their sales, by quite a margin, come from Amazon. It's not unusual for the Amazon-iBooks split to be closer to 75%-25% than 50%-50%. It's a big incentive to pick Amazon. The second incentive is KDP Select, Amazon's exclusive borrowing program. In exchange for committing your book exclusively to Amazon, your title can be borrowed for free by any Amazon Prime member. Each member may borrow one title per month. If they choose yours, the reward is vast. A $0.99 book that normally earns 34 cents will bring in over $2. This May, the earnings were $2.26 per borrow: over 6 times your normal earnings. (Amazon has not yet announced June earnings. April earnings were $2.48, March $2.18, February $2.01.) To get in on this, you must drop your book from iBooks and any other vendor, and agree to an exclusivity period of 90-days at a time. KDP Select is transformative. It changes your list price from "Do I really want to waste a buck on this book" to "Oh, that book was good, let me pay a little extra to keep it." Psychologically and emotionally, you get to keep that $0.99 list price to entice a value-reward tradeoff from potential buyers, but the real money comes from getting people to give it a try. Both Steve Sande and I have participated in KDP Select since it launched this past winter. And it's been a surprising source of income for a couple of our books (on using the Kindle Fire with 3rd party content and for setting up the device's email). Neither topic was Apple-related and both books outperformed our hopes in terms of earnings for borrows. The $2.99 books, which would earn us under $2 per sale after delivery charges, consistently earn more than $2 per borrow due to the well-funded KDP library pool. And that brings me back to the fundamental question. How would you, yourself, advise a new author to choose given this situation, especially for the $0.99 or $1.99 first title? Would you recommend going for KDP Select exclusivity and borrowing earnings or would you suggest marketing to iBookstore and the other outlets? And, given our TUAW audience and their likely book topics, would writing a book specifically about an Apple-related subject-matter affect that advice, and if so, how? You tell us. Add your comment below and sound off about iBookstore, the KDP Select program, and markets.
How Apple iBooks needs to compete with Amazon: KDP Select
Amazon has trailblazed; Apple has followed. Apple's iBooks program currently allows authors to self-publish ebooks. Authors create their own business built around iTunes Connect, just as they do for self-published apps. So where does Apple have room to improve? What follows is the first of several posts about how iBooks can improve to better compete with Amazon. In this post, I discuss Amazon's exclusive KDP Select program and what Apple can do in response. KDP Select When Amazon launched its recent KDP Select program, the independent publish world reacted strongly and negatively. KDP Select is built around exclusive Amazon listings, requiring authors to withdraw their titles from competing vendors like Apple's iBooks, Smashwords, and Lulu. If you want to participate in Select, you cannot sell your book in any form with any other vendor. You must enroll books for a minimum of 90 days. During this time, Select allows authors to loan their books for, well, free -- and promote their books by giving them away, again, for free. Sounds bad, right? As a lure, Amazon has promised a shared pot of $500K per month for December 2011 and monthly through 2012, with a total commitment of six million dollars. (The first month is over and Amazon has not yet announced per-borrow reward amounts; most involved are guessing in the range of cents-per-borrow.) What's more, it's a zero sum game: the more authors who play in the arena, the fewer dollars there are for each. Sounds bad, but is it a losing proposition for authors? Personal experience shows that for niche and underperforming titles, KDP Select is actually a great way to gain market traction. Target Market KDP Select with its unlimited free loans and exclusivity requirements is clearly not a game that any well-established book wants to play in. "Talking to Siri: Learning the Language of Apple's Intelligent Assistant" is an ebook by TUAW editor Steve Sande and myself that has been selling quite well on both Amazon and iBooks. It will soon debut as a print book with Addison Wesley/Que. We declined to enroll it in KDP Select. We could not see any advantage from withdrawing it from iBooks or offering it as a free loan book. Instead, we focused on a couple of our highly geeky Kindle Fire-specific titles. These titles cover Email and Third Party Content. In response to Amazon, we withdrew these from iBooks, added them to the KDP Select program and have seen surprisingly good results. That's because KDP Select trades off promotion for free copies. I personally used one of my five KDP promotion free days on Christmas for my Kindle Fire Third Party Content ebook. Mind you, this is a small very narrowly-focused ebook that shows readers how to incorporate content outside of the Amazon system on your tablet. In other words, it's never going to be a general best seller. That day, my sales numbers jumped from modest into the high triple digits. I made no money of course, as each copy was given away for free, but the book's momentum carried it forward to very gratifying sales for the week that followed. In exchange for cultivating a cadre of exclusive-to-Amazon titles, their program is helping authors promote for very low fixed costs on Amazon's part. Amazon's Outlay Amazon has commited to $500,000 per month to share among KDP Select authors. This money is apportioned by loan popularity. A hot fiction title climbing the Amazon charts will do a lot better than a niche geek nonfiction title. One loan is one vote. Authors must compete against each other to gain a portion of the half-million pot of dollars. In addition to this basic fixed-outlay scheme, Amazon has some basic infrastructure costs with regard to loan management and title promotion. Apple's Response To date, Apple has not focused highly on independent authors. This is a shame as more and more self-published works are emerging outside the bounds of traditional publishing. As I'll explain in my next post, to publish on iBooks, you'll need a properly formatted and validated ePub file and a costly registered ISBN (International Standard Book Number). On Amazon, all you need is passion and a Microsoft Word doc file. Add KDP Select to the mix and many potential iBooks titles will never make it to the Apple bookshelf. They'll be limited exclusively to Amazon. Amazon's pre-emptive raid into the independent publisher's world is cutting off titles, both present and future, from iBooks, and other platforms. If Apple hopes to lure these authors to its store, it's going to have to react, and react strongly. Something has to draw them away from Amazon and from KDP Select. Apple needs to provide these authors with a reason to stay away from exclusive Amazon listings, and potentially to list exclusively with Apple. Right now, it does so by offering better terms than Amazon. With Apple, authors receive a full 70% of list price with no delivery fees, the bane of Amazon sales. On Amazon, delivery fees that are linked to file size can cut a chunk of profit out of any book listed for $2.99 or higher. (Items listed at 30% royalty rates, or sold for under $2.99 are exempted from delivery fees.) The problem is that, at least in our experience, Amazon sells better than iBooks, particularly for smaller titles. Items are more discoverable on Amazon and Apple does little to promote independents. If Apple were to provide some way for smaller authors to market more discoverably on the iBooks store, they could grow that indie community. Apple also needs to provide more and better author peer support. Authors, who regularly congregate on Amazon's forums, find little equivalent on Apple's sites. Apple could also hire iBooks evangelists, in parallel to their World Wide Developer Relations, to teach potential authors about iBook authoring tools, how to use iTunes Connect, and provide book publishing road shows -- but more about that in my next post. Will Apple offer its own exclusive agreements in response to KDP Select, as recent unsourced rumors seem to suggest? TUAW doesn't find these rumors credible, but if Apple does, it better make sure to provide the marketing push that's the true draw of the Select program. Posts in this series: KDP Select Better Author Tools Cross Platform Support
