Are You There Authors Guild? It's Me, Reality

By Sarah Lacy , written on September 6, 2012

From The News Desk

I can only hope someone at The Authors Guild is ordering a huge "I'm Sorry" bouquet and mailing it to Jeff Bezos. Like, now.

The misguided protectionist organization is charged with defending authors. It has a habit of picking fights with technology companies. In the case of both Google and Amazon, the guild was concerned that making writers' words more accessible -- through Google's Book Search project and the Kindle's text-to-speech feature -- ran afoul of copyright laws. Because you know, people who were about to run out and buy a copy of "The Hunger Games" are going to read scanned pages on Google Book Search instead or opt for a creepy robot to read it over buying an audio book.

Google wound up paying a fine, and Amazon would up giving publishers the rights to limit text-to-speech. The Authors Guild may have won those tiny battles, but it's been all but unaware of the larger war going on. One in which Amazon has been on the side of most working authors.

Take a step back, Author's Guild, and ask yourself: What do authors want more than anything? The answer, if the authors are anything like me and other authors I know, is as simple as this: New life breathed into old media and more people reading. Most working authors never see a royalty check. They live off an advance, speaking fees, and any other dollars that come their way as a result of the halo of having written a book.

As an author, one thing has always stood out to me about the Kindle: The ease of one-click impulse purchases. I can't tell you how many times I used to talk to people about a book I was working on, and they'd write down my name and the book's name and have every intention of buying it. But I am sure they never did. Because I never did when I was in their position and had every intention to buy something I heard about on NPR or something a friend had slaved over for years. There was just too much friction in remembering what you wanted once you logged into Amazon or went to the bookstore.

But the Kindle -- and the Kindle app on the iPhone -- made it possible to pull out your device, instead of a slip of paper, and in one click buy the book, not just make a note of it to buy later. When I was promoting my first book in 2008, I lugged around boxes to speaking gigs like some miracle tonic salesman hoping people would buy a copy after my talk. When I promoted my second book last year, all I did was give a keynote. If people wanted a copy, they could order it right there from their seats. And guess what? After each keynote my Amazon digital sales always jumped.

The only authors who ever had that level of frictionless checkout were those who write the trashy paperbacks that get sold with the gum and magazines at the supermarket checkout. Now we all get it. No matter how long tail or how obscure.

Every author who has hustled like a fiend to get his or her book in as many hands as possible -- running up against the natural friction points of book sales and the limitations of how much promotion one man or woman can do -- knew intuitively when the Kindle launched that this graph was coming. Or, at least, we hoped it did. You know, the graph that Bezos showed today at the "OMFG!" Amazon tablet and reader launch extravaganza. Here is the Authors Guild's reality check, courtesy of the Verge's excellent live blog of the event:

Amazon -- and technology writ large -- are not your enemy, authors. They are your friend.

It's not just tech authors who feel this way. Even Margaret Atwood -- at the top of her career as an author -- has flung her arms wide open to Amazon, Twitter, and small startups like WattPad. In an interview with her last week, she rolled her eyes and groaned at the claims that technology hurts authors citing that the first cases of piracy happened as soon as the first printing presses were created. Margaret Atwood gets it, Authors Guild. Why don't you?

I don't mean to claim that a graph this dramatic doesn't cause anyone financial pain. This is a massive reversal of fortunes. As goods move from physical to digital, many more stakeholders get to benefit, but that typically means a lot of the last generation's gate-keepers suffer. Ask the music industry. Or newspapers and magazines.

This can likely hurt some authors, just like the move from paper to digital hurt many journalists. Gone are the days when you can write a syndicated column and make a quarter of a million dollars for it, or sit a top of a New York-based business magazine, writing one cover a year for $200,000. People surviving in journalism today are hustlers -- no matter how experienced they are. Authors have to be hustlers too. (That, or reality show celebrities.)

But the group most hurt aren't authors, they're traditional publishers. We detailed this from an industry insider in one of the very first posts written on PandoDaily -- and one of our highest trafficked ever. From that email (emphasis added):

Long-term there’s no future in printed books. They’ll be like vinyl: pricey and for collectors only. 95% of people will read digitally. Everybody in publishing knows this but most are in denial about it because moving to becoming a digital company means laying off like 40% of our staffs. And the barriers to entry fall, too. We simply don’t want to think about it.

Amazon is thinking about it, though, and they’re targeting the publishers directly...

Publishers like to pretend that we make our money from discovering unknown talents for small advances and selling millions of their books. That’s a very small part of our business. The bestselling books are all written by celebs, by people with huge platforms, by fiction writers with a long history of bestselling books, or by people who do a proposal that’s on its surface brilliant. In short, there’s a bidding war among the publishers over the big books...

Enter Amazon’s print publishing arm.... And they’ve been paying a ton of money for books....

But Amazon isn’t stupid. They’re overpaying intentionally to keep advances high (and high advances will bankrupt publishers). And they’re also taking away all the authors who actually move units.

We can’t pay $1 million for books anymore. Amazon could probably afford to lose $20 million/year in their publishing arm just to put the other publishers out of business. I think that’s what they’re trying to do–throw money around in an industry that doesn’t have any, until Amazon becomes not only the only place where you buy books, but the only place that publishes books, too.

So rather than getting a 30% of an ebook (with the other 70% being split between the publisher and author), they’ll be getting a 70% cut (with the other 30% going right to the author). Funny thing is that it’s actually better for authors.

To be honest, publishing is a quaint little industry based on romance and low profit margins. But now we’re in Amazon’s sights, and they’re going to kill us."

The fortunes are changing, and it just got more pronounced today. Authors, it's time to either be Switzerland and hedge your bets, or just switch teams.