That seems to be the prediction of Mark Coker, Founder and CEO of Smashwords. Via his blog:
“Many indies and traditional publishers alike reported flat or lower sales in 2015. The go-go days of exponential ebook market growth of the early days (2008-2012) are over. As I shared in my November 2014 post, Things Get More Difficult from Here – Here’s How to Succeed, a key factor in the slowdown is an emerging equilibrium for consumption of print and ebook formats. Due to the law of large numbers, ebook sales growth (or declines) will begin to more closely mirror the overall market for all books. The book market is mature and is therefore a slow or no-growth industry. Additionally, there’s an ever-increasing glut of high-quality low-cost ebooks that will never go “out of print.” These continuing factors paint a picture for a more competitive landscape for authors in 2016 and beyond. Every author will face more competition today and tomorrow than they faced yesterday. In addition to the factors I outlined above and in the “Things get more difficult” post, the growth of Kindle Unlimited presents a new existential threat to the industry (more on this in the next item).
Kindle Unlimited will gut single-copy sales and drive greater ebook commoditization
Earlier this year I blogged how Amazon’s merchandising pages encourage Kindle customers to read books for free as part of a Kindle Unlimited or Amazon Prime subscription. Most of the publishing industry remains oblivious to the long term ramifications of Amazon’s strategy here (not a surprise, because despite Amazon operating with amazing transparency and predictability, most industry watchers and media still don’t understand Amazon’s long term self publishing strategy). The issue of immediate concern is that Amazon’s merchandising tactics discourage readers from purchasing single copy ebooks. Amazon is training Kindle customers to view even 99 cent ebooks as too expensive when other books can be read for what feels like free. Amazon’s success with Kindle Unlimited, which now offers over 1 million books almost exclusively supplied by indie authors is going to gut the market for single copy sales at Amazon. It’ll be death by a thousand small cuts. The pain will be felt by four publishing industry constituencies. In descending order of pain, and in order of who will feel it first, these constituencies include traditionally published authors and their publishers which I’ll consider as a single group; non-exclusive indie authors; Amazon-exclusive authors; and competing retailers.
Basically what Mark is saying is that selling single e-book copies, or even e-book bundles will soon become obsolete, replaced by subscription programs. The only question is whether the distributors assume an pool-sharing model (where money is collected and distributed equally among contributors as the distributor sees fit) or agency (where the contributor is paid for each book downloaded or read as an individual unit). If Mark’s prediction is accurate, and Amazon shifts more and more e-books into a subscription program, then you should know much much harder it will be for an indie author to make money. Especially since Amazon continues to dominate e-book sales. Read his post; it’s worth your time.
He also writes:
“During the early days of the indie ebook revolution, it was relatively easy for a quality writer to earn good income self-publishing low-priced ebooks. The market was doubling and tripling each year, readers hadn’t really seen 99 cent ebooks before, and everyone was happy. As I mentioned in the “Ebook publishing gets more difficult from here” post, the exponential growth masked challenges that market’s maturation has now brought to light. Many indies who quit their days jobs to pursue writing full time will find they need to return to a “real” job in 2016, especially authors for whom writing is their sole source of income and they’re already feeling challenged to make the monthly rent. This means production will decline among the indie midlisters. As I’ve been telling the audiences for my ebook publishing workshops for the last seven years, if you want to make a lot of money publishing ebooks get a job at McDonalds instead. Publishing has always been a tough business. Witness the fact that most traditionally published authors must maintain day jobs. Ebook publishing is NOT the path to riches except for a very few authors. Yes, I’ve been pleased see the many Smashwords authors whose indie ebook earnings have allowed them to pay off mortgages, buy homes and save for retirement. These stories inspire me, yet we must remember these are the exceptions, not the rule. In 2015 I witnessed a growing desperation among many bestsellers, some of whom – I can imagine due to their prior successes with indie publishing – had might have changed their lifestyles or quit their day jobs. These authors are now feeling the financial and emotional pain of struggling to make ends meet. I hate to see this pain and anguish. As I’ve advised in the past, your prior success is no guarantee of future success. If you’re among the many Smashwords authors who’ve been blessed and have done well, or if you’re fortunate enough to sell well in the future, please bank that money when it comes. Pay off your debts and be conservative with your savings so you can build up your rainy day fund.”
No one has ever said publishing was easy, but I’ve noticed big-time indies are often more optimistic than the rest of us into the future of indie publishing, in terms of making serious money and not just doing it as a side-hobby. It’s easier to think earning money writing is easy and Amazon is great if you’re one of the lucky few to earn 6- or even 7- or 8- figures a year writing, just as a lot of the blockbuster best-sellers in the traditional system rarely complain about their publishers or support changes to the traditional publishing system that are needed. It’s a matter of whose bread is begin buttered by whom, I guess. I’d guess an author has maybe a 2% chance at best of earning enough money a year to sit around and write (and do writing-related activities) all day. That includes authors who could do that, but who choose to maintain other occupations, such as with non-fiction writers. And that’s just to pay bills; that’s not the lavish lifestyles some of them live.
David Boyle of the Society of Authors, based in the UK, writes:
“You worry a little, as an ebook author, that people might be sceptical that you have ever written anything. Or indeed whether all that writing exists in any real sense, since you can’t see it on your shelf. I mean, where is it? You can’t lend it, copy it or give it as a present. Yet bizarrely, online pirates seem capable of giving it away for free within days of it going on sale.
There are certainly advantages to writing the new generation of ebooks that are designed as such, rather than as reluctantly issued e-versions of printed books. They are often a convenient length – maybe a fifth or quarter as long as a traditional book, just long enough to read on a transatlantic flight or a train to Scotland. And they are priced low enough to sell widely. It is a marginal decision to buy a short book at £1.99 or £2.99. You might as well buy it as not.
an ebook writer, I’m only too aware of the problem flagged up by the Society of Authors, that the income of writers is still falling. I certainly agree that authors should get at least half the royalties on ebooks; the big publishers often fob them off with 25% or less. Well, I would say that.
Yet this is not primarily a difficulty with ebooks. It is a symptom of two more fundamental, linked problems. The competition watchdogs have allowedAmazon and the big supermarkets to strangle what had been a working business model. As a result, the remaining, desperately consolidated, mainstream publishers are trapped in a business model that works for nobody – except perhaps for the 5%, the mega-earning authors, who take 43% of all the money.”
Though Mr. Boyle says he will continue writing (and I assume working his financial services job while he writes on the side), no doubt many authors will come to the conclusion that yes, it’s really, really hard to earn a living from writing and the time spent writing could be better done doing other productive things. I think his concern is more aimed at the Big Five traditional publishers, who are losing to Amazon and who don’t offer a good deal on e-book royalties to their writers. I can’t speak for smaller presses.
So writers of the world: How many of you will continue to write, and how many will decide the time spent writing just isn’t worth it anymore?