It didn’t last too long, however. By the end of March, even those newly minted authors were openly considering leaving KDP Select, despite how successful it had been for them. Self-publishers were noticing that even when they had a stellar free run, garnering thousands and thousands of downloads, it was no longer catapulting them up the charts on their return to the paid side.

Science fiction and fantasy author Ed Robertson penned an excellent hypothesis and gave me permission to re-post. If you don’t understand exactly why successful free runs used to almost always translate into a run at the charts, then read my post on Popularity Lists first for background. That said, here’s Ed:

BACKGROUND

Around March 19, Amazon changed the way they sell books. In a Kindleboards thread devoted to the subject, authors tracking the performance of books during and after a free promotion began reporting strange results. Prior to then, books that gave away several thousand copies during a promo would shoot to the top of the popularity lists some 36-48 hours later. It was like clockwork. Clockwork that paid you several hundred dollars.

Because the popularity lists are a big deal. These are the default book listings you’ll see when you’re browsing around by genre. Here’s the Fantasy list, for instance, with GRRM clogging up the top 10 like the greedy goose he is. If you could ride a free promotion to the top of those lists, your book would be extremely visible to shoppers. Depending on genre and your book’s presentation, topping the pop lists could snag you dozens or hundreds of sales before other books overtook you. Sometimes that visibility was enough to launch a book into the stratosphere, where the stratosphere is also made of money. It was kind of a big deal.

Then, things changed. Except they didn’t change. Not for everyone. Authors began reporting lower sales than expected as well as strange-looking lists. Chaos reigned! Dogs and cats living together, watching couch-bound authors tear out their hair. After a couple weeks, we thought we had it figured out: there was no longer a single popularity list. There were two, and books no longer seemed to be vaulting to the top no matter how many free copies they gave away.

Well, we were wrong. There weren’t two lists. There were three.

Because I am extremely imaginative, I’m going to refer to them from here on out as List A, List B, and List C. I’ll get into the methodology in a bit, but for now, I worked this out through carefully observing my books, reading other Kindleboard authors’ results obsessively, and lobbing theories around with other authors. I would never have figured this out on my own. I know, never say never. Trust me, eventually I would have gotten frustrated and left to play Mario Kart instead. One other author in particular did tremendous heavy lifting. Like the Eye of Sauron, he (or she?!) is far-seeing and awesomely powerful. And much like Sauron, you can’t invoke his or her name without facing terrible wrath. Some of the Eye’s secrets must remain just that.

But the outcome of that info can be revealed. So without further ado, here’s how the three lists work.

THE CHANGES

List A is the same version of the pop lists that existed prior to March 19. It is Select- and freebie-friendly. Here’s roughly how it works:

• Ranks are heavily weighted to the last few days
• Free book downloads are weighted equally with paid sales
• Borrows count as sales

List B appears to be a throwback pop list, one that was running throughout most of last year. Here’s how book ranks are calculated on it:

• Ranks are determined by the last 30 days of sales, with no extra weight given to the most recent sales
• Free book downloads are discounted heavily–maybe as little as 10% the value of paid sales
• Borrows don’t count as sales

List C is a lot like List B, with a couple major differences:

• Free book downloads aren’t counted at all
• Recent sales are weighted somewhat more heavily than List B(?)
• Borrows don’t count as sales

What does that mean in practice? A lot. A lot a lot a lot. Here’s where my book The White Tree ranks on all three lists at this moment in time. Each shot will look a bit different because they’re taken from different browsers–that’s one way to see different lists. The list in question is Fiction > Fantasy > Series, a fairly quiet little fantasy subcategory.

List A:

List B:

List C:

Pictured: Oh shiiiiii–

METHODOLOGY

Most of this was achieved through comparing tons and tons of different books on different browsers, just like the screenshots above. Here’s some stats for the book in question that helped me figure out what was happening here. On March 28-29, The White Tree was downloaded 4700 times (free). On April 17, it was downloaded an additional 1300 times. In April, its paid numbers came in at 210 sales and 46 borrows.

Since March 19, my main browser’s been displaying List B. My big clue to List B came on April 28, when I noticed my book had, over the span of a day or two, dropped from #67 in Epic Fantasy to #165. Rank didn’t slide–it instantly dropped off a cliff. Why? Because it had been 30 days since all those free downloads had come in. I’d noticed the same thing around March 23–I’d done a huge giveaway February 22-23, and once 30 days elapsed, it suddenly plummeted from around #45 to around #255. I didn’t know what it meant then, in fact I don’t think I even knew there were two lists at that point (let alone three), but when it happened again, I had a pattern.

I also had several weeks of observations piled up by then to help me understand new data. For weeks, List B had been showing me very static lists. The books at the stop stayed at the top. There was very little churn. There were very few Select books, i.e. books that were likely to have recently been free, especially within the top ~60 results (first five pages). Most books at the top were traditionally published. List C was even more trad-dominated; generally speaking, an indie title on List B would be ranked 15-25% worse on List C if that title hadn’t been free, and would rank much, much worse if their List B rank was dependent on free downloads (like, hundreds of places).

When I compared the top 240 titles in Epic Fantasy between List B and List C, here’s what I found: on List B, 188 titles weren’t in Select, and 52 were. On List C, 217 titles weren’t in Select, and just 23 were. With no benefit from freebies, and with fewer paperback sales to pad the numbers, most indies get killed in List C.

When it came to figuring out that borrows weren’t counted in List B and C, The Eye of Sauron was particularly helpful. We compared Select books with lots of borrows to non-Select books whose sales were roughly equivalent to the Select books’ total sales+borrows. On List B and C, the non-Select book came out ahead by a good chunk. We compared Select books with lots of borrows relative to sales with Select books with few borrows : sales. (None of these books had recently been free, which acted as a “control” between List A and B.) The ones with a higher ratio of sales : borrows almost always came out better on List B than on List A.

While I wouldn’t lay my life on the line for every one of these observations, I am very confident in the overall conclusions reached. There are three different lists. You can see them for yourself–just compare lists on different browsers, computers, and Kindles. If you’ve gone free recently, you’ll note your popularity rank on List A is much better than B or C.

How do you tell which list you’re looking at? Well, that could take a day or three to figure out, but in short, if you see a bunch of Select titles on the first pages of the pop lists, you’ve probably got List A. If it’s almost all traditionally published books, it’s List B or C. From there, compare your lists on another browser/device; if you’re seeing List C, trad books will generally be even more dominant.

WHAT THIS MEANS

What does all this mean? Hey, maybe you haven’t noticed, but this post is already epically long. The internet is only so big, you know. I’ll save that for a future post. For now, here’s what’s key: there are three different lists. Your book is listed on all three, but any given shopper is only seeing one version of the lists. (In other words, different people see different lists.) If you’re an indie in Select, one of these lists is good. The other two? Well, let’s just hope they’re not here for too much longer.

UPDATE: The same day I posted this, Amazon changed their sales algorithms again. This post will provide a lot of the background to what I talk about in the followup post.

* * *

I want to thank Ed for allowing me to re-post this. His blog is excellent, and particularly strong on things like understanding the inner workings of Amazon.

If you would like to check out some of his books, the fantasy novel The White Tree (pictured up top) is particularly recommended and available on Amazon and Amazon UK, but he has plenty more titles here.

I can also vouch for his data geek bona fides and the methodology employed above. We’re part of the same online writers group and I watched the testing of this theory unfold as it was verified by multiple participants.

While the implications of some of this may seem ominous for self-publishers – especially those depending on the power of Select and the associated free runs – I want to urge everyone not to panic, and to keep speculation from veering into tin-foil hat territory.

Amazon is always testing things, making frequent changes to their algorithms. Some of those changes have favored self-publishers, others haven’t. As I have said on many occasions, Amazon don’t care who has published a book, and have previously made changes that disfavor books from their own imprints.

What they do care about is recommending the book the customer is most likely to purchase. And the basic equation never changes: write good books and lots of them, and let readers know they are there.

Speaking of good books, Ed Robertson’s dystopian novel Breakers is free today.

UK peeps can grab a free copy here.

One final thing (apologies to Ed). I’m blown away by the response to my open letter to the DOJ. I was expected a handful of writers to co-sign, tops. There must be around 150 names now. So, a big thank you from me. I’m going to keep it open for another day or so as names are still pouring in.

Then it gets sent.

UPDATE: Ed’s Breakers is #8 in the free store. Go Ed!

I won’t go into the details of how wrongheaded that letter was. It has already been systematically taken apart by Joe Konrath, Bob Mayer, and Dean Wesley Smith.

Also worth reading are Joe Konrath’s subsequent dismantling of another open letter to the DOJ written by Simon Lipskar (a board member of the AAR), as well as the comments made by Passive Guy on the same topic.

If you have any doubt whose side (most) agents and the AAR are on (clue: it’s not writers’), then you need to read this guest post by Ann Voss Peterson on her exploitative Harlequin contract, the subsequent reaction to Ann’s post by romance agent Scott Eagan (read the comments following that piece) and agent Steve Laube, as well as Joe Konrath’s filleting of the latter.

I have heard privately from one agent who is opposed to the AAR’s position, but I haven’t seen any public postings to that end. If they exist, please point me to them and I will amend the above characterization (but I fear I won’t have to).

* * *

Gail Hochman, the President of the AAR, sent a copy of that open letter mentioned at the top to all members of her organization, along with an accompanying note calling on her fellow agents to both write similar letters and encourage their clients (i.e. writers) to do likewise. Their explicit aim is to influence the judge presiding over the suit.

From Gail Hochman’s letter to AAR members:

The DOJ must read and report to the judge who must ultimately approve the settlement each communication it receives commenting on the proposed settlement. For that reason, in addition to the AAR’s letter we urge all AAR members to express their views on the settlement to the DOJ and we hope you will also urge your clients to do the same.

Your note might address whether you feel the settlement will foster competition and well-being in the literary marketplace, or the opposite. There is a time limit for such communications, so your messages should be sent as promptly as possible. (The address is on the AAR’s letter.)

We believe it is tremendously important that we all be heard on this most significant issue. We believe the more letters from publishing professionals that are received, the better the chance of affecting the judge’s final decision.

While I’m not a member of the AAR, I suppose I am a “publishing professional” in one sense. I will gladly answer Gail Hochman’s call. A copy of the letter I’m sending on Thursday morning is below. If anyone wants to add their name to it, please make a note in the comments (or email me privately at david dot gaughran at gmail dot com) and I will include your name.

It would be great if there were other writers’ names to add, but make no mistake, this isn’t a petition. If mine is the only name at the bottom, I’m sending it anyway.

Some authors may be reticent. I can understand that. Many of you may be seeking representation or a publishing deal and may be afraid of stepping on toes. That’s fine. I don’t really care about that stuff so I’m happy to take any potential flak.

* * *

To: John R. Read, Chief, Litigation III Section, United States Department of Justice, 450 5th St NW, Suite 4000, Washington DC 20530

Dear Mr. Read,

I’m sure you will have already received plenty of letters regarding the terms of the proposed settlement; I would like to apologize at the outset for adding to the pile.

I felt it necessary to contact you, however, as I fear that the multiple letter-writing campaigns aimed at influencing the presiding judge may give the impression that authors and publishers (and readers) are uniformly opposed to the terms of the settlement.

As an author and publisher (and reader) I can assure you that this is not the case.

Unlike some of the publishers named in the suit, I’m not part of a major media conglomerate that owns newspapers and television stations around the globe. I’m a one-man operation who set up a publishing company to release my own books.

I’m far from unique. There are thousands and thousands of writers just like me – writers who couldn’t get their books published by the conventional route who then self-published their work and reached thousands of readers.

A few short years ago, this was not a viable path. Self-publishing was expensive, difficult, and risky. The rise of e-books enabled thousands of writers like me to bypass the middlemen – literary agents, publishers, distributors – and sell direct to retailers and readers. Without the presence of all these middlemen taking a cut, I can sell books very cheaply and still make a good profit.

This disintermediation benefits authors and readers directly. Readers have more books to choose from, and when they choose books published by independent authors, they are almost always significantly less expensive than titles from the defending publishers.

It’s similar to what has transpired in many businesses since the rise of the Internet. All kinds of middlemen – such as travel agents and insurance brokers – have gone from being indispensable to optional, and face the according challenging business conditions.

Publishers and literary agents are no different. Writers no longer need them to reach readers. Instead, they can publish their own work, sell books at cheaper prices, and make more money.

The kind of disruption caused by the Internet is often messy. Not everyone comes out a winner. As such, vocal resistance is to be expected, especially from those who do quite well under the status quo.

One such group are best-sellers like Scott Turow, the President of the Authors Guild – an organization that claims to represent the interests of writers. Another such group are literary agents like Gail Hochman, the President of the Association of Authors’ Representatives – an organization of literary agents, which also claims to represent the interests of writers.

To be clear, neither organization speaks for me. And, in my opinion, it’s fear of change, fear of competition, that drives literary agents and publishers (and best-selling authors) to support the Agency model and disingenuously claim it benefits readers.

I don’t know if the publishers named in the suit (and Apple) colluded to fix prices, however, unlike the Authors Guild and the Association of Authors’ Representatives I don’t believe that means that we should simply throw our hands in the air and move on. I believe the judge is perfectly capable of making such a determination.

If the chain of events laid out by the Department of Justice is accepted by the court (and the case seems compelling to this layman), then I also don’t believe that the terms of the proposed settlement are too onerous. Law-breaking should be punished, not swept under the carpet.

Personally, I believe that the actions the defending publishers and Apple are alleged to have undertaken, and the subsequent defense of those alleged actions by the Authors Guild and the Association of Authors Representatives (and the respective defendants) are motivated by fear.

The world is changing and they don’t like it. Amazon, as the prime mover in facilitating those changes, is the primary target of their ire. I don’t share their apparent hatred of Amazon. From where I stand, Amazon has done more to make self-publishing a viable path than any other company (something which benefits authors through increased paths to publication and readers through a greater selection and lower prices).

I don’t think Amazon has done this because they have any favorable disposition towards self-publishing per se, rather I think that this was a (happy, for me) by-product of their support of the digital revolution and their customer focus.

More than any other company, Amazon made e-reading attractive, widespread, and cheap. This has come at the expense of reading books in print – a market which was controlled by companies such as the publishers named in the suit.

What is replacing it is something very different: an open market with thousands and thousands of competitors for the defending publishers (and those competitors are able to compete largely because of Amazon’s self-publishing platform – KDP – where independent authors can set their own prices and reach readers all over the world).

This, I submit, is the real reason these publishers (seem to) hate Amazon: because Amazon is creating, for the first time, real competition in publishing by facilitating and encouraging the switch from print to digital, and giving new competitors the tools and platform to really compete with the existing players.

It seems the defending publishers sought to slow this transition by forcing higher prices on Amazon and their customers (and by extension, the customers of every other retailer). In my opinion, this shows contempt, both for the readers who purchase their books and for the authors whose sales have suffered as a result of these artificially higher prices.

I trust the DOJ will pass on this letter to the presiding judge and that the only voices heard in relation to the proposed settlement won’t be those orchestrated by the global media conglomerates, which own a controlling interest in some of the defending publishers.

Regards,

David Gaughran, Author and Publisher (and Reader).

UPDATE: As the offers to co-sign the letter are still pouring in, I will postpone the sending of same until next week. I think we have about 150 names to add to the bottom now, which is a stunning response – thank you.

UPDATE 2: I haven’t counted all the names, but we must be close to 250. I’m sending this tomorrow (Friday, May 25th), so you still have time to co-sign.

UPDATE 3 (Friday, May 25th): The letter is in the mail. My sincere thanks to everyone who co-signed.

If you prefer paper-based thrills, the print edition is now available from Amazon (print formatting again by the wonderful Heather Adkins).

It should appear very shortly on The Book Depository and Barnes & Noble, as well as in some physical bookstores.

Let’s Get Digital is only free on Amazon US, but I don’t want anyone to miss out. If you own a device other than a Kindle, download a copy from Amazon anyway, then email me at david dot gaughran at gmail dot com and I will send you an EPUB version that will work on your device. If you use one of the Euro Kindle Stores (where the book isn’t free), just email me and I’ll send you a Kindle copy.

I recently moved to London and I’m still without an internet connection. Don’t panic if there is a slight delay in my response to your email. I’ll get to it eventually and you will get your copy.

Why is this book free?

Let’s Get Digital has been my most consistent seller (although A Storm Hits Valparaiso recently overtook it in 2012 sales), so why did I make it free?

Every so often, Let’s Get Digital makes a run at the charts. However, since the advent of KDP Select, it’s much harder to get the book to stick. Even when it was #2 in its category, it only reached around #65 on the Popularity List – pushed down by all the books that had been on a free run (explained here).

I needed a free run to even things up a little. However, I was wary of a reliable seller getting stuck on free, costing me a big driver of revenue. So here’s what I did.

I opted out of all channels on Smashwords except for Apple (who tend to be the nippiest in reflecting price changes at Smashwords). Then I dropped the price to free on Smashwords on a Wednesday (they push new prices out to Apple on Thursdays).

As soon as it went free at Apple (which was a couple of days later), I got a couple of people to report the free “price” to Amazon. It took a couple of weeks, but Amazon finally made it free at some point last night.

This morning I woke to see that it was free, had been picked up by the good people at Pixel of Ink, and had already amassed over 4,000 downloads, bumping it up to #70 in the Free Best Seller List.

I immediately turned it back to paid on Smashwords and opted back in to all the partner sites. If all goes to plan, it should go back to paid on Apple by Saturday, and then I can begin plaguing KDP to do the same. Hopefully they won’t drag their feet to much, and I will see a little bump on my return to the paid side.

If that happens, it’s a bonus, but the real point of this is to even some of that disparity in the Popularity List. And it’s never a bad thing to have thousands of people download your book, even if it is for free.

I have to keep this blog post short; internet cafes are hardly ideal for blogging! I should have a more regular connection in a few days, and normal service will resume once I clear my inbox (which is looking quite frightening at the moment).

If any of you would like to help get the word out about the free version of Let’s Get Digital, here’s a sample tweet:

Top rated self-publishing guide Let’s Get Digital is #free on Amazon: http://amzn.to/y0Qe5S

Thanks in advance! Now, I need to go find somewhere to live…

The argument about whether to self-publish has been debated in great detail both here and elsewhere. I don’t want to add to that general discussion today, rather I want to offer up my personal experience of self-publishing.

Given that this is an anniversary of sorts, I would like to look back over the last twelve months and examine the results of that decision, and compare it with what would likely have happened had I decided otherwise.

Regular readers will know that I broke my own impasse by deciding to publish some short stories, while holding A Storm Hits Valparaiso in reserve. It was still being considered by a handful of agents, and I wasn’t completely convinced that self-publishing was the right approach.

Publishing the shorts was an experiment of sorts, but the results far exceeded my expectations. I knew within a month or so that I would publish everything this way and I withdrew A Storm Hits Valparaiso from the agents still considering it.

Looking back a year later, I’m sure I made the right decision. In my first twelve months, I sold 3,482 books and made well over $8,000. Not all of that is profit, I estimate $3,000 went out the door in expenses (haven’t tallied those yet), but $5,000+ is a pretty solid first year.

Aside from those 3,482 paid sales, I gave away well over 30,000 books and had a story go viral on Wattpad, where it is approaching one million reads.

(Before anyone gets too excited with the above number, each chapter read is counted individually on Wattpad. I have 65 chapters, so that translates to around 13,000 people who actually read the book from start to finish, plus another 5,000 working their way through it right now.)

One fascinating thing about Wattpad is seeing around 70% of the people that start the book (i.e. open the first chapter) make it all the way to the end. Given the amount of people that would merely be rubber-necking to see why something got a million reads (I do it all the time myself), that number blows me away.

Whatever way you slice it, whether free or paid, thousands upon thousands of readers have been exposed to my work in the last twelve months. And I’ve made some money. Self-publishing has been paying my rent since August.

Things are looking up too. I’ve been growing month-on-month. I’ve sold around 500 books in each of the last two months. And, in a couple of weeks, my 2012 sales will overtake my total for all of 2011. I’ve already surpassed 2011 in terms of income, and I’m on course to more than double what I earned last year.

And that’s before I release anything new. I’ll have two full length releases over the summer, I’ll try and squeeze in another before Christmas, and there should be some shorter pieces too. If they perform anything like the books I’ve released already, income could rise significantly.

We also mustn’t forget that the market continues to grow, both in the US and elsewhere. I’ll be releasing a variety of translations to capitalize on this, beginning with the French edition of Let’s Get Digital in a matter of weeks.

I will also be focusing on the paperback side, releasing almost everything in paper as soon as possible after the e-book, and increasing the number of stores stocking my print editions. Depending on how sales go, I may start looking at using Lightning Source and/or doing my own print run. Maybe even a hardback. Who knows? Anything is possible. Maybe even audiobooks.

In summary, I’m pretty damn happy about my first year. I’ve sold books, I’ve made money, I’ve built a platform, I’m finding readers – all from scratch. I didn’t even have a blog or a Twitter account a year ago. And, rather than all these tasks leaving little time for anything else, I’m writing more than I ever did before. A lot more.

I couldn’t be happier. Okay, I could be selling ten times as much. I’m pretty sure that would make me happier. But I’m way ahead of where I thought I would be even on my most optimistic projections.

But the biggest change has been on a personal level. I don’t even recognize that guy who used to fester in slushpiles all over Manhattan. I have more confidence in my work and in myself.

For the first time that my destiny is in my hands. Making a living from writing is no longer a mere pipe dream; now it’s a possibility within reach.

But what if I hadn’t self-published? Where would I be now?

Let’s see. If I had listened to the advice I was getting on a certain writers’ forum, I would have either kept querying, or trunked A Storm Hits Valparaiso and started something new.

I had 300 rejections (including those that didn’t respond) from agents in Ireland, the UK, and the US, as well as a handful of rejections from editors. I had lots of partial requests, many full requests, and even got as far as the phone call twice, but always fell short.

I had started to write a new novel, but I was doubting every word and had been stuck at the opening for some time.

However, let’s cut this alternative scenario some slack. Let’s assume that I dusted myself off, continued to query A Storm Hits Valparaiso and, after three months, finally caught a break and landed an agent.

I’m sure the agent would have wanted some changes, so let’s assume we hammered those out over another three months before going on submission.

I severely doubt that an MS which attracted 300 rejections – many focusing on the difficulty of selling a historical novel from an unknown, unpublished Irish writer set during the South American independence wars – would attract a firestorm of attention from publishers, but let’s assume I got real lucky and landed a deal within six months. I’ll also be generous and grant this alternative me the average advance: $5,000.

In this alternative scenario – which is the best possible outcome on the spectrum of realistic possibilities, requiring a series of incredibly lucky breaks – I’ve also made around $5,000.

But wait. I don’t even have all that yet. I’ve probably only got a check for a third of that, and 15% is going to my agent. I would likely have banked just over $1,400 by now (or, more likely, be waiting on the check from the publisher or the agent).

My agent and publisher would be advising me to start blogging and set up a Twitter account. With the level of marketing I’m likely to get (on a book the publisher bought for $5,000), the promotional burden is going to fall on my shoulders.

The book wouldn’t be released until Fall 2013 (when I receive the final third of my advance, the second check being on acceptance of the manuscript), and I would most likely never see another penny from it either. I might catch a break and make a few grand from foreign rights sales, but that wouldn’t be for some time.

And that’s the best case scenario.

It’s much more likely that I would have failed to get representation for A Storm Hits Valparaiso, let alone a deal. I probably would have given up, trunked it, and continued to hammer away at something new.

I’m pretty determined, but the query grind was getting me down. I don’t think I could have pumped the book out that quickly, and probably wouldn’t have started querying again by this time. In fact, it might have been well into 2013 before I would have been ready.

And, of course, A Storm Hits Valparaiso would simply have gathered dust, rather than being my top-seller in 2012.

I think I made the right decision.

Competitions, blog reviews, giveaways, guest blogs, interviews, presence on reader forums etc. can all bring extra traffic to your book pages, but they are very time consuming.

If you want to move beyond what is essentially hand-selling your work, you need to gain visibility on Amazon, and let them do the hard work of selling your book for you (while you spend your time writing instead). Just make sure those basics are in place first, or you won’t get a good return from anything outlined below.

Visibility on Amazon: Best Seller Lists

One of the most straight-forward ways to achieve visibility on Amazon is via one of the many genre and sub-genre Best Seller Lists. Before you pelt me with rotten eggs, I said “straight-forward” not “easy.”

Whether you are currently appearing on a Best Seller List or not is a direct function of your Sales Rank and the categories you choose. There is detailed advice on choosing the right categories here, which I strongly recommend you read.

As I’ve mentioned before, appearing on a Best Seller List doesn’t have the splash it used to, because many readers think they are browsing those lists when they are actually browsing the Popularity List. Before KDP Select, this didn’t matter so much; there was little difference between the two list. All that has changed since December (explained in full here).

That aside, appearing on a Best Seller List is still useful, can drive significant sales, and should be a target of anyone’s marketing efforts – especially considering that most publishers don’t select the right categories (or, sometimes, any at all).

You shouldn’t just aim to scrape in at #100 in the category you are targeting. Ideally, you want to be on the first or second page – readers don’t seem to browse further in any numbers – and it’s often better to have that prime spot in a smaller category, than to be so far down the list on a bigger category that you will rarely get viewed by browsing readers.

Getting into that prime spot will require a wildly varying Sales Rank, depending on the category. For example, at the time of writing, appearing on the first page of Kindle Store > Kindle eBooks > Genre Fiction > Romance > Contemporary requires #206 or higher but appearing on the first page of Romance > Series only requires #4,908 or higher.

Some sub-categories are even less competitive. Comic Fiction only requires #62,639 to hit the first page, and my short story If You Go Into The Woods is safely ensconced at #6 in World Literature > Eastern European with a modest ranking of #275,882.

That latter category, obviously, won’t attract too many browsers, but some visibility is better than none. There is no point classifying that story as Literary Fiction, when you need to rank below #2,000 to even hit the bottom of that chart.

In short, you should try and pick a category where you will place, and, if possible, where you will appear on the first two pages.

It should go without saying, but remember to restrict yourself to relevant categories. Even though A Storm Hits Valparaiso has a romantic sub-plot it is not a Romance by any stretch of the imagination. Choosing inappropriate categories will not help your sales in any way and could attract nasty reviews from the (very) few that do sample/purchase.

Pricing

I’ve detailed my thoughts on pricing in Let’s Get Digital (you can read the relevant excerpt here), and those haven’t changed too much. I’m a keen believer in experimentation and pricing at the level which maximizes income – whatever that may be.

I also like pricing at the higher end of the indie spectrum ($4.99 for full-length novels), as that allows a lot of flexibility with things like coupons, limited time sales and so on.

Regular readers will know that I’ve tested various price points for A Storm Hits Valparaiso and seen little difference in sales between $2.99, $3.99, and $4.99 (but an increase in income).

I had never tested higher price points, though, and if there is any genre which can handle that, it’s historical fiction. A Storm Hits Valparaiso hadn’t sold consistently outside of its launch, an ad spot, or a sale – so I really had no idea of the ideal price.

After a strong March – thanks to the St. Patrick’s Weekend Sale – the book just died in April, and only shifted two copies in the first two weeks of April. I decided it was time to take action.

Changing price will do little on its own, especially if you aren’t getting traffic to your book’s page already. Price is not discovery tool, unless allied with something else (e.g. an ad or a mention on a reader site etc.). In other words, there was no point in raising price unless the book was actually visible and by mid-April, it was down the back of the warehouse. For this to work, I needed it on the front table.

My Experiment

The plan was simple: cut the price to 99c, and, once it achieves optimal visibility (i.e. when the book peaks in the rankings), raise the price to $7.99.

As I cut the price, I switched the book’s categories to Historical Fiction and Literary Fiction – two competitive categories with no sub-categories, where you need less than #3,000 and less than #2,000 to chart at all.

The lack of sub-categories makes it really difficult to break in, but it also means there is less churn on those lists – position is stickier.

Nonetheless, it was a high-risk strategy. If I fell short, the experiment would be pointless. On the other hand, my previous categories of Men’s Adventure and War Fiction had brought me little joy – hardly surprising, readers of Bob Mayer and Clive Cussler are unlikely to be interested in my work.

I dropped the price nine days ago, planning to let it run for around four days. The algorithms don’t reward a single-day spike as much as a sustained increase, so I didn’t wheel out the push simultaneously.

On the Saturday, I hit Twitter and Facebook. On Sunday I caught a huge break and was featured by the good people at Pixel of Ink. As such, I postponed the blog post announcing the sale until Monday, so that I could try and spin out at least three days in a good position – hoping the algorithms would then soften its (eventual, inevitable) fall.

By Tuesday the book had really caught fire, eventually peaking in the evening in the Top 500, shifting over 300 copies; it was time to raise price. I had second thoughts about $7.99, but I looked at the books around me in the chart (at this point I was #18 in Historical Fiction) and they were all $9.99 or higher.

I felt my book could hold its own. In fact, it could be argued that the 99c price, once it had gained me entry to the club, was hindering rather than helping as it made the book look like it didn’t “belong.”

Unfortunately, a lagging price at Kobo threw a spanner in the works, and Amazon price-matched to $3.99. Sales were still reasonably strong, but I didn’t get to test my new price point. I started slipping down the charts, and then, when Kobo finally raised the price to $7.99 and Amazon followed suit, disaster struck, and my book was stripped of all its categories.

The whole point of this experiment was to gain visibility. Now I had none. Over the next week, the book slipped from #1,000 to #35,000 (but has recovered a touch since). It made a handful of sales on the way down (and is still selling more than before the sale), but I wasn’t able to capitalize on my position as well as I had hoped.

The jury is still out on $7.99, as I never got to truly test that price at the best time.

Despite that disappointment, the experiment must be viewed as a success. The first part went better than hoped – I sold a lot of copies at 99c and made over $100 in the space of a few days. I also made another $100 the day I raised the price – so that’s all good. Plus my book got into to the hands of hundreds of new readers and picked up a couple of very nice reviews.

The second part was less successful and just goes to show that even the best laid plans are subject to the vagaries of an increasingly glitchy Amazon system. If my price change gone through as planned and, especially, had my book kept its categories (and if my Also Boughts had updated), I could have made a lot more. But I’m not going to grouse, I had a good deal of luck, it was a great run, and sales are up.

And there’s always a next time.

Moving to London

I’m moving to London next week. Internet access will be intermittent for some time, I will be slow to respond to any emails, and blogging will be limited – until I get somewhere permanent to hang my hat.

Book sales and other income are about half of what I need to get by in a place like London. I had been planning to work for a start-up – in a very exciting position – but they failed to get VC funding, and the project has been mothballed for now. As such, I’ll be seeking some kind of role in digital marketing (what I previously did) or digital publishing (what I’m doing now), or, best of all, something straddling both worlds.

I think there will be many such roles in London, but if anyone is aware of any interesting opportunities or projects, please get in touch at:

david dot gaughran at gmail dot com

Among other things, the DoJ has been accused of working for Amazon – helping them to “destroy the publishing industry.”

If you want to sample the mindset I’m referring to, simply visit the comments of any article on the matter in the trade press – such as this or this (although this vocal group are strangely absent from articles such as this one describing publishers’ (alleged!) attempts to cover up their actions by deleting emails).

I’m not sure when “the publishing industry” become exclusively synonymous with the largest publishers. I’m not sure when their narrow interests became everyone’s interests, because what’s good for Penguin isn’t necessarily good for writers, small presses, or indie bookstores.

The publishers named in the suit claim that Agency was/is necessary for competition. In Penguin’s statement released after the antitrust suit was filed, their global CEO John Makinson said “the agency model is the one that offers consumers the prospect of an open and competitive market for e-books.”

John Sargent, the CEO of Macmillan, said that his company “changed to the agency model [...] to support an open and competitive market for the future.”

These publishers may claim to be fighting the antitrust suit in the name of competition, but the truth is they don’t want competition at all. They just want the faux-competition between themselves that was the status quo before the digital revolution.

One of the reasons large publishers were desperate to switch to Agency – even to the point of (allegedly!) breaking the law – was they knew that Agency would lead to higher e-book prices.

In case there is any doubt about that, this was confirmed by Steve Jobs. In his authorized biography, Jobs says (and these words are repeated in the DoJ’s complaint):

We’ll go to [an] agency model, where [publishers] set the price, and we get our 30%, and yes, the customer pays a little more, but that’s what [publishers] want anyway.

Why did the large publishers want higher e-book prices? Well, it’s simple. They were desperate to protect print sales and slow the changeover to digital (and to keep readers frequenting bricks and mortar bookstores for as long as possible).

I laid out that particular argument back in December, but, in case there is any doubt, let me quote from that piece:

Evan Schnittman – Bloomsbury’s worldwide MD of Sales and Marketing, Print and Digital – was speaking at The Bookseller’s Futurebook conference in London, when he said, “For every print book we lose to an e-book, we lose money.”

A few days before that, in an article in the New York Times on the recent spate of high-quality hardbacks from large publishers, Nan Graham – Senior VP and Editor-in-Chief at Scribner – said: “We hoped that a handsome object would slow the migration to e-book for [Stephen] King.”

In a print world, large publishers control distribution. They control (most of) the slots in chain stores, airport stores, box stores, and supermarkets, as well as the co-op therein.

In a digital world, they lose that control. There is less co-op, there is a level playing field for titles not from the large publishers, and, as a result, much more competition.

Be under no illusion, self-publishers and small publishers are providing stern competition. The inroads they have made onto the Amazon bestseller list are well documented. Indeed, as I have pointed out many times, if you drill down to the genres that went digital first, this phenomenon becomes even more apparent (a recent data mining survey showed that self-publishers had captured 66.1% of the Kindle Top 100 Science Fiction spots).

Once you understand this, it’s a lot easier to decode other statements.

When large publishers say that the discoverability puzzle hasn’t been solved online, they are really expressing despair at retailers recommending books not published by them.

When large publishers say that online retailers haven’t matched the experience of buying in physical stores, they mean that they wish there was some way to relegate all that horrid self-published work to the rear (or, preferably, the warehouse), and have tables out front piled high with Dan Brown, Jonathan Franzen, and Snooki.

When large publishers say they are coming together to form a community for readers to help them find great books, what they really mean is they want to limit the discoverability of new books to titles they publish.

They don’t want to be fighting for reader attention and dollars with a horde of small publishers and self-publishers (who keep their overheads low and can price cheaply). They pine for the pre-digital world where they had a lock on distribution.

In short, they don’t want competition.

And, while we are talking about the pre-digital world, we shouldn’t forget the large publishers actions in the 1990s where they illegally offered exclusive deep discounts to big retailers like Barnes & Noble, screwing indie bookstores (a practice that continues in other territories, where it is legal).

The reason for this favoritism is simple. Barnes & Noble plays the game. They reserve the spotlight (almost exclusively) for titles from large publishers. Those troublesome indie bookstores have a nasty habit of recommending books that Manhattan haven’t anointed.

When it suited large publishers to screw indie bookstores, they had no qualms in doing so. Now it suits them to shed crocodile tears for the fate of those same indie stores as much of book-buying goes digital. I’m sorry, but I call bullshit.

It also suits the narrow interests of large publishers to criticize Amazon – or, to be more accurate, to feed anti-Amazon stories to reporters (see comments), and then let their proxies endless repeat the same zombie memes.

The next time that large publishers, or their proxies, complain about “monopolistic” Amazon, remember the true reason for their hatred.

They hate that Amazon isn’t deferential, and refuses to hand over whatever co-op they want at whatever price they want.

They hate that Amazon won’t build them storefronts to obscure all those pesky books from small publishers and self-publishers.

They hate that Amazon is offering competition for writers’ content in the form of a viable self-publishing platform and progressive, author-friendly imprints.

They dearly wish that Amazon would be more like Barnes & Noble and remember their “place” in the traditional order (below publishers).

They dream of Amazon’s recommendation engine being more like that of Barnes & Noble, which is clearly tilted towards large publishers.

But that’s never going to happen.

Amazon will always recommend to readers the books they are most likely to buy – whoever published them.

Amazon’s system will even recommend a book by Scott Turow, or one published by Macmillan, over one published by their own imprints if they think that is what the customer is most likely to purchase.

This agnostic recommendation engine has, for the first time, created true competition. And the large publishers hate it.

Pricing Experiment

I want to give regular readers a heads-up. I’ll be conducting a pricing experiment with A Storm Hits Valparaiso this week. I’ve laid out my views on pricing here, where I stress the importance of experimentation.

I’ve tried all sorts of prices with this book, and have seen little difference between $2.99, $3.99, and $4.99. However, I’ve never tried higher, and if there is one genre that might be amenable to higher prices, it’s historical fiction.

As such, I will be trying out a new price point, $7.99.

I wanted to warn anyone that was considering purchasing the book to grab it now while I’m running a flash sale at 99c (price goes up Wednesday). UK readers can get it for 99p here, and those affected by the Surcharge, owners of other devices, or those who want a PDF, can buy direct from me for the same price.

Why have I cut the price if I’m going to test out a higher price point?

Well, after a great March, the book had been doing poorly in April, with only four Kindle sales (dwarfed, strangely, by paperback sales). I knew there was no point attaching a new price when the book wasn’t visible at all (it had slipped out to 200,000 on Amazon US).

To get it some visibility first, and thus truly test out a higher price point, I dropped the price to 99c on Saturday, which immediately brought it up to 25,000 in the rankings.

Then something amazing happened: the good people at Pixel of Ink featured the sale.

There is a serious lag on reporting at the moment, but that appears to have generated around 130 sales in 12 hours, catapulting me to #869 in the rankings (or so I’m told, I was asleep at that point!) before slipping back a touch.

I didn’t see it quite that high, but grabbed a few screenshots when it hit the Top 1000 (a first for me) and #30 in all Historical Fiction.

I’m going to let this sale run until Wednesday. I want to see how many sales I can chalk up, and if I can push the book higher, before raising the price. If you want to help tweet about the sale, please feel free to copy-and-paste the below tweet, or simply click to retweet this one:

Flash sale: A Storm Hits Valparaiso reduced to 99c for a limited time http://amzn.to/Aovwbm #histfic #kindle UK: http://amzn.to/Ap6jDW

In any event, I’m still waiting for Smashwords to push out my new $7.99 price to Barnes & Noble. If that doesn’t happen before Wednesday, Amazon will just price match back to $3.99.

Depending on how the next couple of days go, I may change the plan slightly, but the price will certainly be going up first thing Wednesday, and will likely stay that way for some time.

I will, of course, share how all of this goes. Happy Monday!

UPDATE (TUES NIGHT): 

It looks like the first part of the strategy was a success. A Storm Hits Valparaiso is up to #459 in the overall Kindle Store, and getting some hot front page action in Historical Fiction at #18.

This is way, way higher than I’ve ever been before. Plenty of screenshots have been taken. Mostly to prove to myself in a couple of days that it actually happened!

I plan to raise the price last thing tonight to $7.99. It looks like all the other retailers have that price, except for tardy Kobo, who still have $3.99. I’ll try and raise to $7.99 soon, but suspect Amazon will price-match Kobo.

And then we’ll see what happens.

A settlement has been agreed with HarperCollins, Hachette, and Simon & Schuster; Macmillan claimed the terms were too onerous, and Penguin appears to have refused to contemplate settling.

The agreed settlement must still be approved by the court, but among the conditions are the end of Agency (despite the attempted spin by PW in the above-linked article) and the return of pricing control to the retailers (such as Amazon). In addition, the settling parties will be monitored by the DoJ, who must be copied on any communications surrounding this or any related matters.

While the DoJ’s case is getting all the attention, it should not be forgotten that all the above parties are also being sued by sixteen State Attorneys-General who are seeking both injunctive relief, and compensation for “e-book customers paying $100 million in overcharges.” HarperCollins and Hachette have also settled that case; as it stands, the remaining parties will go to court.

Finally, the European Commission has its own continuing investigation. Reuters report that Apple and four of the above publishers have sent a proposal to settle the case (Penguin being the hold-out). It’s far from certain that the Commission will accept this proposal, and they are said to be watching the outcome of the DoJ’s suit with great interest.

Penguin’s strategy of refusing to engage in any settlement negotiations is curious as they appear to have the most to lose if this matter goes to court. As the Bookseller notes from the DoJ suit:

[Penguin] is referenced 41 times, more than Macmillan, and double the number of times any of the settling publishers–HarperCollins, Hachette Book Group, and Simon & Schuster–are referred to. [Penguin CEO John] Makinson is also directly named, as is David Shanks, CEO of Penguin USA, a number of times: again more than any other CEO.

The suit contains a number of juicy allegations, all of it quite damning for Apple and the respective publishers. Despite the robust statements from Macmillan and Penguin – and their cheering-on from certain quarters of the publishing industry – to this layman’s eye the case appears to be clear and substantial, backed up with hard evidence including: phone records of conversations between publishing executives at the various companies and Apple; internal and external email transcripts from the defendants; and, sensationally, an alleged attempt to delete emails “to avoid leaving a paper trail.”

The full 48-page complaint is here, but The Verge do an excellent job of parsing the key points, and The Business Insider have a great blow-by-blow account, highlighting the most important section of the actual suit.

Before the Agency model was brought in at the start of 2010, e-books were sold (like print books) under the wholesale model. What this meant was that publishers would decide the list price of an e-book, and the retailer could set the retail price of their choice.

For example, if a publisher decided that Stephen King’s latest was to be priced at $14.99, Amazon were free to discount the e-book as much as they liked to their customers, but had to pay the publisher as if the e-book had sold for $14.99. Contrary to some widespread misunderstandings, Amazon had no control of the list price publishers would set – which was the price which decided what payment publishers (and authors) would receive from Amazon.

In practice, this meant Amazon discounted a large number of books from publishers, in an attempt to bring the retail price to $9.99 or below. Again, to be clear, this did not affect the payments publishers received, only the price customers paid, with Amazon swallowing the difference.

Publishers were said to be unhappy with Amazon’s discounting policy for two reasons. First, they feared this pricing approach would allow Amazon to grab an increasingly dominant share of a fast-growing market. Second, they worried that aggressive pricing of e-books would hasten the adoption of e-reading, threatening their business model (they largely controlled print distribution, but digital was wide open). The problem, in legal terms, is what happened next.

The DoJ allege that as early as September 2008:

[The publishers'] senior executives engaged in a series of meetings, telephone conversations and other communications in which they jointly acknowledge to each other the threat posed by Amazon’s pricing strategy and the need to work collectively to end that strategy.

The respective CEOs were alleged to have met in secret in the private dining rooms of upscale Manhattan restaurants, talking about how to deal with Amazon.

The DoJ allege that by 2009, the result of these meetings was an agreement “to act collectively to force up Amazon’s retail prices.”

However, in the meantime, while Apple weighed their entry into the e-book market, the DoJ also allege that Apple “contemplated illegally dividing the digital content world with Amazon, allowing each to own the category of its choice – audio/video to Apple and e-books to Amazon.”

By late 2009, “Apple and the [publishers] settled on the strategy that worked,” which was, of course, the Agency model. This model had two key points. First, publishers would control retail pricing. Second, the contracts would contain a most favored nation (MFN) clause, essentially meaning that publishers would not be able to have lower prices on Apple’s competitors.

According to the DoJ’s suit, “instead of an MFN designed to protect Apple’s ability to compete, the MFN was designed to protect Apple from having to compete on price at all.”

I just want to pause here for a moment, because I believe this is a crucial point. Defenders of Agency have argued that the model gave Apple (and other retailers) an opportunity to compete. The DoJ’s suit quite clearly alleges that the model prevented competition.

The result, of course, was increased e-book prices. This was predicted by Steve Jobs, who famously said in his authorized biography (and these words are repeated in the suit), “We’ll go to [an] agency model, where [publishers] set the price, and we get our 30%, and yes, the customer pays a little more, but that’s what [publishers] want anyway.”

As the suit alleges in quite bald terms:

Apple was perfectly willing to help [publishers] obtain their objective of higher prices for consumers by ending Amazon’s “$9.99” price program as long as Apple was guaranteed its 30 percent margin and could avoid retail price competition from Amazon.

Of course, the Agency model would only do its job if all the other retailers signed on. To that end, the DoJ’s suit alleges that Apple and the publishers “set in motion a plan that would compel all non-Apple e-book retailers also to sign to agency or else as [Steve Jobs] put it, the [publishers] all would say, ‘we’re not going to  give you the books.’”

The suit goes on to give further details about pricing based on internal Apple emails which are alleged to show that the publishers were dead-set against Amazon’s $9.99 pricing for new releases and bestsellers, weren’t crazy about Apple’s proposed $12.99 price point, and successfully negotiated a tiered pricing structure to include some bestsellers and new releases at $14.99.

As to whether the publishers colluded, or acted in concert with each other, the allegations in the DoJ’s suit are clear. They quote internal Apple emails from an executive called Eddy Cue (Apple’s Vice President of Internet Services) who claimed that “all of [the publishers] were very concerned about being the only ones to sign a deal with us.” And the suit further states:

Penguin explicitly communicated to Apple that it would sign an e-book distribution agreement with Apple only if at least three of the other [publishers] did as well. Apple supplied the needed assurances.

The suit goes on to state that a further publisher (presumably Random House) who hadn’t signed up to Agency saw its market share grow. As a result, the DoJ allege, they came under increasing pressure to toe the line.

Penguin – and its US CEO David Shanks – are alleged to have taken the lead in convincing Random House to switch to Agency, actions which included encouraging “a large print book and e-book retailer to punish the other publisher for not joining the defendants’ conspiracy.”

The DoJ is quite clear about Apple’s role, alleging that they “knowingly served as a critical conspiracy participant” by promising the same deal to all the publishers and keeping each player in the loop as to the status of negotiations.

The suit goes into forensic detail about all the meetings that took place between the various parties, and clearly synchronizes email communications and phone calls between Apple and the publishers, as well as between the publishers themselves.

So that’s the DoJ’s case. As for the settlement, Wired do an excellent job of summarizing the key points from the agreement reached between the DoJ and Hachette, HarperCollins, and Simon & Schuster.

In short, Agency is toast. Presuming the settlement is approved, the publishers will be forced to terminate their agency contracts with Apple within seven days. A lot of speculation will surround what will replace those contracts, but the DoJ have set out clear guidelines.

For a (minimum) two-year period, any new contracts will not be allowed to prevent any retailers from discounting. For a (minimum) five-year period, those contracts will not be permitted to contain the “most favored nation” clause that caused such problems for the DoJ (and which was the backbone of the alleged price-fixing effects of Agency).

Finally, there are a series of onerous compliance conditions for the settling parties including designating an antitrust compliance officer, providing copies of any agreements with e-book retailers for a five-year period, notifying the DoJ of any joint venture with other publishers regarding e-books, and copies of any (non-privileged) communications regarding plans or strategies related to e-books. The DoJ also warned against the publisher retaliating against any retailers (presumably Amazon). It looks like the DoJ will be keeping a very close eye on the settling parties.

As for the parties which didn’t settle – Penguin, Macmillan, and Apple – they face a range of possible outcomes. Some anti-trust experts believe the DoJ has a much stronger case against the publishers than it does against Apple, and the details of the suit do seem to focus much more on the respective publishers’ actions. That may not matter, however. With three of the publishers agreeing a settlement to end Agency, it’s hard to see how it continues in any form.

What takes its place is less obvious. Will the wholesale model return? Or will the publishers come up with an alternative system? If it’s the latter, the DoJ will be watching closely to make sure that doesn’t result in higher prices for consumers – which was the one of the key aims of Agency in the first place.

Whatever happens, one thing seems clear: e-books are about to get cheaper.

A more complete list of beneficiaries is here, but it includes the Brooklyn Book Festival and PEN; journals like The Los Angeles Review of Books, One Story, and Poets & Writers; 826 Seattle (a tutoring program aimed at kids) and Girls Write Now (a mentoring program for girls); as well as various other associations such as Lambda Literary (supports LGBT literature), Words Without Borders (international literature), and Voice of Witness (human rights).

Wait. Hold on one second. This sounds like a good thing! Even the Salon piece says:

At a time when independent publishing is struggling to survive, in part due to the influence of Amazon, recipients say that these grants offer crucial — if ironic — life support. Sometimes the grants pad out thin margins of survival, and make it possible for worthy programs to maintain their tiny staffs. And there’s no question the grants support legitimately important work: Literature in translation, international poetry, smart criticism, youth literacy efforts.

So far, so good, right? I mean, they used the word “ironic” in there, which makes me think that some bad stuff is coming, but giving all this money to good causes can only be a positive thing, right? Wrong, according to Alexander Zaitchik:

Is the program simply a calculated corporate response to past accusations of stinginess? Is it part of a long-term strategy to divide and conquer the last bastions of Amazon’s critics, while winning over some of the very people Amazon may find useful as it develops its print-on-demand and e-book business?

It depends whom you ask. Of more than a dozen grantees Salon interviewed, some completely disassociated Amazon’s charity from its business practices. Others were more conflicted, but saw nothing to gain by dwelling on the source of the funds or turning their cash-strapped offices into an Ethics 101 seminar. Others saw Amazon’s grant giving as something to be feared: An evolutionary skill developed by a natural and intelligent predator growing ever stronger off the blood of its prey.

Okay. So, some people interviewed didn’t agree with Alexander Zaitchik’s theory that Amazon’s grants are part of some nefarious plan to buy silence as they destroy the publishing business and our literary heritage, but, to make sure the readers don’t focus on that, he quotes plenty of those who have a problem with it. Like this (unnamed) guy:

“The grants are a blatant attempt to buy goodwill from an industry that they’ve ravaged,” said one veteran indie publisher who asked not to be identified because he’s involved in an Amazon-funded project. “They are a rapacious, horrible company from top to bottom. But they have all this excess capital, so $25,000 here and there is nothing to them. And it’s working. People say, ‘Oh, look, they’re funding a translation prize, what could be wrong with that?’ Yet everything about them is still evil.”

In case you skipped over the dubbing of Amazon as rapacious, horrible, and evil, Alexander Zaitchik helpfully follows up in the next sentence by calling them “the devil.”

The basis for these opinions of Amazon is outlined briefly, covering the same tired ground of allegations of monopoly (which I dealt with here) and Scott Turow’s wrongheaded attack (which I picked apart here).

However, there is some new information, which made additional headlines last night when PaidContent picked up the story, disclosing further details. According to Alexander Zaitchik, for the first time, two of the “Big Six” publishers have refused to sign their annual contract with Amazon:

The main sticking point is exorbitant increases in “co-op promotional fees” for e-books that the publishers see as an illegal gouge by another name. One person familiar with the details of the proposed 2012 contracts that Amazon has submitted to major New York publishers described them as “stupifyingly draconian.” In some cases, he said, Amazon has raised promotional fees by 30 times their 2011 cost.

I’m sure this news will provide Amazon-haters with plenty of ammunition, but a basic analysis shows why that would be extremely misguided.

In case you aren’t aware, the “co-op promotional fees” they are referring to are the online version of paying for placement in physical bookstores (such as face out instead of spine out, or prime position on front tables, etc.).

On Amazon, this translates into those ads you see in various parts of the Kindle Store, books being featured on the homepage or various other pages, as well as inclusion in the targeted email blasts to Amazon customers or in lucrative programs such as the Kindle Daily Deal.

This exposure on the Amazon site is a huge driver of sales. The Kindle Daily Deal alone regularly places the chosen book into the Top 10 in the overall Kindle listings. (Indeed, they appear to have the power to do that with any book, so there is a real scramble to be included.) While publishers agree to cut the price of the featured book, that price is usually returned to normal the following day, making the publisher a staggering amount of money on the way back down the charts.

The Salon article, the PaidContent piece, and a subsequent story in the Bookseller are all short on details, but it’s safe to assume that Amazon wants to raise the price for these various marketing programs, causing uproar among publishers.

This raises a number of questions. First of all, isn’t Amazon fully within their rights to charge what they like for advertising on their site and marketing to its customers? Do publishers think they can name their price and Amazon must accept? What planet are they on?

It makes perfect sense that Amazon would raise their prices. In the last twelve months, the e-book market has grown dramatically. I think it’s safe to assume that the number of visitors to the Kindle Store has also risen by a huge amount. If a newspaper doubled its circulation, wouldn’t it be prudent of them to raise their advertising rates?

Amazon has greatly expanded their own publishing program in the last twelve months. I think it’s also safe to assume that they are keeping an increased amount of this co-op for their own titles – which makes sense, and which they are fully within their rights to do (and, indeed, if I was published by Amazon, I would mad if they didn’t).

This is a fake scandal. There are less co-op spots available now. The amount of traffic to the Kindle Store has increased dramatically. It’s perfectly logical that the price would go up. Anyone who claims otherwise is simply not thinking.

The anti-Amazon PR campaign really jumped the shark with that Salon piece – a ham-fisted attempt to spin Amazon’s support of a variety of literary organizations into some nefarious attempt to buy silence.

I shake my head at all these Amazon stories – all of a sudden, Big Publishing cares about small presses and independent bookstores! – and the cynic in me wonders about their provenance. Is all of this an attempt to distract attention away from the investigation of (alleged) price-fixing and collusion between several large publishers and Apple?

If so, they failed.

Because the Department of Justice filed their antitrust lawsuit this morning.

Unfortunately, Jodi Picoult wasn’t pressed by the interviewer and didn’t elaborate (it would have been amusing if she had done so IN ALL CAPS).

The (outdated) blanket warning to avoid self-publishing generated a lot of reaction in the comments of that piece and anywhere else it was reprinted. I won’t rehash all that, only to note that, by contrast, Ms. Picoult thinks it’s a fine idea to sign with an agent who has no clients and zero experience.

Jodi Picoult got an opportunity to explain her position in a little more detail to the Huffington Post the following day.

My current advice is to not self-publish. It’s still too hard for people to separate the wheat from the chaff, and what you miss out on is the marketability that is afforded to you by a brick and mortar publisher. There’s a lot of crap out there, and one day we may find a way to segregate well written self published fiction from that stuff which anyone can throw on Amazon, but I just don’t think we’re there yet. Let me put it to you this way. The anomalies of self published fiction, the Amanda Hockings of this world – what did they do with their next book? Do they self publish it? No – they make sure they get a publisher.

I won’t spend much time discussing the obvious error at the end, only to point out that Amanda Hocking had self-published numerous titles before she signed on with an agent, released more afterward, and, when she finally agreed a deal with a publisher, she only signed away some of her books, and the rest of her self-published work is still on the market (and she has stated on numerous occasions that she will continue to self-publish).

It must also be noted that before Amanda Hocking self-published, she had failed to attract the interest of an agent or publisher in those very same titles. The success of her self-publishing endeavors, however, bagged her a $2m advance. Needless to say, Hocking would be in a very different position today if she had followed Jodi Picoult’s advice.

That aside, I want to focus on a more fundamental error in Jodi Picoult’s argument, as I have seen it recurring in numerous statements as large publishers and their proxies struggle to explain what they offer writers in a digital world.

The Myth of the Segregated Marketplace

Jodi Picoult is urging writers not to self-publish as it’s “still too hard for people to separate the wheat from the chaff” because there is “a lot of crap out there.”

Newsflash: there is no segregated marketplace. All those e-books from publishers and self-publishers jostle for attention in the same retailers, side-by-side on the virtual bookshelves. Self-published titles aren’t ghettoized, and they don’t carry a warning label.

In other words, an author published by Random House faces the same discoverability challenges as a self-publisher. We’re all trying to climb out of the same primordial ranking soup. Having a publisher’s imprint name in your product description offers zero assistance with that task.

When agents, publishers, and authors caution against self-publishing because it will be hard to get noticed, they don’t seem to realize that all titles face that problem, whether self-published or not.

In short, both kinds of authors have to deal with whatever amount of crap is out there.

The “Amount of Crap” Myth

I’ll assume the basic assumption is correct, that there is a lot of crap available. I’ll also ignore the provenance of this crap – whether that’s content farm crap, scraped Wikipedia crap, genuine self-published crap, or crap books from big publishers – and I’ll just agree: there is a lot of crap.

However, and this is the key point, the crap is invisible. Nobody sees a book that’s #700,000 in the Amazon rankings. They don’t appear on any bestseller lists. They aren’t recommended in Also Boughts. Readers don’t see them.

Those who believe the amount of crap is an issue must think that visibility on Amazon is distributed equally. Rather, it’s a form of meritocracy where books that are purchased more often are displayed to readers more often. Crap books that aren’t being bought will not be recommended at all.

Even if a reader stumbles across a crap book, by viewing the page and not purchasing the book, they handicap that title in Amazon’s recommendation engine – which analyzes readers with similar buying patterns and displays the book they are most likely to purchase – making it less likely that someone else will happen upon it.

Readers are pretty good at ascertaining whether they will enjoy any given book and sampling allows them to see whether the story holds up to the promise indicated by the cover, the blurb, and the reviews.

Even if the book is a polished turd – striking cover and enticing blurb, but crap writing – sampling allows a reader to find that out in advance, and, in the rare instance that the sample is the only part where the writing is any good, the book can be returned (and will be slated in the reviews, warning future readers away).

Books live or die on word-of-mouth. Unless an author is in the rare position of having a significant built-in audience, and merely has to announce a book’s release to catapult it to the upper reaches of the charts, they will depend on readers who discover (and enjoy) the book sharing that opinion with others, whether that’s through online reviews, social media, email, reader sites, or plain old conversation.

Crap books are invisible. Crap books will not be recommended by one reader to another. The amount of crap doesn’t matter because crap books are irrelevant. There could be 100 million crap books on Amazon, and it wouldn’t matter one bit.

Crap books aren’t the reason why discoverability is a challenge for most writers. Good books are.

A Case Study

My last release is a perfect example. One important discovery tool on Amazon is the Hot New Releases list, which displays the top-selling books in each genre and sub-genre released in the last thirty days. Getting on the first page of this list for your genre or sub-genre can be a great driver of sales, but readers don’t seem to browse past the first page in serious numbers.

(In fact, it’s doubly important in historical fiction, which has no sub-categories to aid visibility, and where you need to be ranked at regularly below #2,000 to #3,000 to scrape in at the outer reaches of the chart.)

The day I launched A Storm Hits Valparaiso, I had a reasonable expectation that my mailing list would propel the book onto that first page, and that sales could kick on from there (or at least stabilize somewhat). However, on that same day, twenty-two backlist novels were released by Patrick O’Brian’s publisher (making me wish the bloody market was segregated!).

I had no idea this was coming or I would have pushed back my release by a couple of weeks – especially considering we were aiming for the same readers, I’m an unknown in that genre, and Patrick O’Brian is one of the top-selling historical novelists of all time.

Despite a great launch, I couldn’t crack the front page of Hot New Releases and sales died once my mailing list had finished purchasing.

Since then, I’ve had sales spikes and troughs. Overall, the book has done reasonably well (nearly 500 copies sold) for my first outing in that genre. The reason it hasn’t done better has absolutely nothing to do with the amount of crap books out there. Rather, it faces competition for the spotlight from some very good books indeed.

If all the crap historical novels disappeared tomorrow, my sales would be unaffected. However, if a decent chunk of the good historical novels disappeared, I would benefit from increased visibility on genre bestseller lists (etc.) and my sales would rise.

Indeed, one could make the argument that self-publishing is more prudent as you will get your novel out now, rather than in a year or two (or longer, factoring in the time to find an agent, go on submission, and land a deal) when all the large publisher backlists will be digitized and there will be even more great books vying for readers’ attention.

Shock News! Readers Find Blog In Sea Of Crap!

It’s just over one year since I started this blog. I don’t know how you found it among the sea of crap – the one trillion web pages that swamp the internet – but you did it! Somehow!

Thank you.

All those beautiful sales vanish from our reports, replaced by a taunting brown streak – which only disappears whenever things get moving again.

Checking those sales numbers can be addictive, particularly when you are on a run. Less so when Amazon’s customers appear to be boycotting your books.

But enough of that, March was great. A bumper month even. Before I go any further, I have the usual alternative reading for those averse to sales talk and number wrangling.

British science fiction author Ian Watson has an extended essay on his website detailing his experiences of working with one of the most fascinating creative minds of the 20th century: the brilliant, mercurial Stanley Kubrick. Set aside half-an-hour, it’s a real treat.

On to the numbers. Here are the last six months:

October: 157 ($285)

November: 261 ($560)

December: 259 ($665)

January: 299 ($765)

February: 301 ($735)

March: 484 ($870)

After redistributing some late reporting Smashwords sales (including my first at Kobo!), February actually nudged ahead of January, keeping my seven-month streak of pretty much unbroken growth intact. That should come to an end this month; March will be difficult to match. Either way, I’ll cross 3,000 paid sales this month – probably even this week.

The St. Patrick’s Day Blowout almost exactly accounts for the increase on February. As my two participating titles were reduced to 99c for the promotion, royalties per-book were significantly lower, meaning that income (a more important barometer for me) didn’t rise as dramatically. That doesn’t mean the exercise wasn’t worthwhile. Without it, there may have been a big dip this month.

I had a new release in December, and sales and ad spots in January and February, then the blowout in March. I have nothing at all planned for April, so a drop is more than probable. Perhaps even a significant one. Then again, I said that last month and still managed to pull a rabbit out of a hat. My expectations are set at the appropriate level, but maybe I’ll cook up something.

The strange thing is that sales always follow the same pattern – no matter what I do – a slow start, a fat middle, and then they just die in the last week of the month. Can’t figure that out.

Again, the vast majority of sales were Amazon US (the main focus of the St. Patrick’s Day promo event).

Smashwords numbers are incomplete (I only have Barnes & Noble for part of March, and little else), so hopefully they will rise some, maybe even taking me over 500 sales for the month.

Beefing up the non-Amazon column are paperback sales through Createspace and The Book Depository (the latter being a far bigger seller), and direct sales to independent bookstores – something I hope will be a big growth area for me this summer. More on that soon.

I also opened my own e-bookstore last week. If you want to know how that’s done, I blogged about it here. It’s relatively straight-forward and the great thing is I’ve already been paid for the (small handful) of sales I had in the last ten days of March. How cool is that? I’m hoping that this will become an important channel for me in the future too.

The Euro Kindle stores were a wash for me last month, but that should change with the release of my first translated title – also coming out in paperback. The whole translation project will be picking up steam over the summer, and I should have several titles in several different languages by end of year.

The English paperback edition of Let’s Get Digital will be out very soon. I’m just waiting on a cover. I’m excited about that, but was less happy to hear that someone had beaten me to the punch.

Old School Piracy: An Unauthorized Paperback?

A pirated paperback edition of Let’s Get Digital has been on sale on Amazon US and Amazon UK for at least a week. I only discovered it today when Author Central decided to link the pirated copy to my (genuine) Kindle edition.

While this move alerted me to the fraud, it also gave legitimacy to the pirated edition, as well as the benefit of my 74 reviews in the US, and 14 in the UK. A quick call to Author Central today got the editions de-linked. And the (slower) legal process of getting this book removed has been put into motion with Amazon’s Copyright Agent.

Worryingly, the “Look Inside” feature on the pirated book displays the Kindle Version (because they had been linked). This could cause customers to think they are either getting something official, or something formatted far better than the pirate version is likely to be.

I also contacted the seller directly – a company called Book On Demand Publishing – via their contact form on Amazon Marketplace. They claim to be a “self-publishing service” and don’t know who is responsible for the book!

Frankly, I don’t trust them and don’t believe them. They seem to have zero web presence. They said they would take down the pirated book straight away, but haven’t done so. And the email was barely literate.

Their Amazon UK Marketplace listing has 104,517 titles. Much of this seems to be content farm crap – “books” scraped from Wikipedia etc. (e.g. this Stephen King Vampire book). However, there are also many titles which have been simply pirated (such as this one from Faber & Faber). There’s a handy search box, in case you want to nose around.

In case anyone thinks that the above is in contradiction with my stated views on piracy (i.e. much of piracy can’t be considered lost sales, that which can is countered by convenience and price, and there isn’t much you can do about it anyway), let me explain why this is different.

First of all, this is a paperback edition listed on Amazon with a $20 price tag. As such, it’s existence directly affects my ability to sell my own work, and is trading off my hard-won reviews.

Second, it’s likely a shoddy edition given that it’s scraped from an e-book, the cover is awful, and I doubt it is properly formatted etc. However, it’s presented as a legitimate book on Amazon (and not one of ten thousand in a torrent), damaging my “brand” as an author/self-publisher with its shoddy presentation.

Third, there are simple steps I can take to guarantee its removal, even if the wheels don’t turn quite as quickly as I would like, unlike the whack-a-mole of trying to eliminate digital piracy.

This “publisher” is clearly a waste of space, spamming the Amazon listings with junk books and pirated material. Amazon pledged to take a closer look at their operation.

WordPress Stats Go Global

Let’s not end on a nasty note. March was a record month for this blog with over 40,000 views. That’s especially pleasing because my two previous record months were artificially boosted by having posts featured on WordPress.com’s homepage. March managed this without that help.

WordPress has added a country breakdown to the stats page. Here’s last month:

If any of you guys have a friend in Greenland or Kazakhstan, could you do a bro a solid and get them to color in some of that gray?

UPDATE: Amazon’s legal department have responded to my request and have initiated the process to remove the unauthorized paperback editions from their various websites, and that they should be gone in a few days. Impressively quick (a matter of hours), but I do hope they take a closer look at Book On Demand Publishing – who have over 100,000 such titles on Amazon.

UPDATE 2 (Tues): Both unauthorized paperback editions were gone when I checked this morning. I’m impressed by the speed that Amazon’s legal team dealt with this situation, once they were made aware of it. Some questions remain about the systems they have in place to detect this kind of thing, and there are some suggestions in the comments below.

Note: The above figures have been revised. I thought I had earned $780 this month. That was a miscalculation. I actually earned over $870, beating my previous best by $1.61. That record had been around since August; it’s nice to break it.