Every year, my friend Ben DuPont and his colleagues gather fifty or sixty interesting people in a room for what they call the Non-Obvious Dinner. Participants eat for free, but there’s a catch: everyone has to bring along — and be prepared to defend — a prediction of something significant that they expect to happen within the next ten years. And that prediction can’t be something we can all see coming from miles away.

As a serial entrepreneur — and most recently as president of Yet2.com, a marketplace for trading industrial patents — Ben has a big stake in the future. But, then again, who doesn’t?

More to the point, Ben is one of those guys who not only tries to predict the future — he sets out to shape it.

I think of Ben’s Non-Obvious Dinner when I think of e-books. There are plenty of predictions for what will happen in book publishing’s future: fewer bookstores…greater market share for e-books…more interactivity…e-books as advertising platform, etc. I’ve made a few of these predictions myself, but all are pretty obvious to the thoughtful observer.

Yet, though much continues to be written about the impact of e-books, there remain a few aspects of this medium that I think have escaped much notice — or, at least, much chatter. Here are my…

Four Non-Obvious Aspects of the E-book Revolution

1. Dynamic Pricing

There has been a vast amount of handwringing — and justifiably so — about the great race to the bottom that seems to be affecting e-books. (I’ll likely discuss the pricing of Primacy in another post.) E-books started out mostly priced like trade paperbacks but quickly fell below the price of most mass-market paperbacks, and we now see them trending south of five dollars in many cases, sometimes as low as ninety-nine cents. To make matters worse, many of these e-books are competing directly with comparable hardcovers.

These pricing trends didn’t come out of nowhere. For years now the false mantra that “information wants to be free” has had the upper hand against “you get what you pay for.” Exacerbating this insanity: since the Internet arose, writers hungering for attention have completely given away most blog product (and other forms of written expression) in hopes they can monetize their efforts somewhere further up the food chain. But this great giveaway has resulted in little but lower price expectations for much written work that people used to be willing to pay for.

This craven yearning for attention at the cost of any possible livelihood provides a staggering lesson in futility. It’s the opposite of greed-driven crony capitalism but worse than socialism. It’s more akin to the desperation of a worn-out ten-dollar whore who soon learns that no price is low enough.

(I’m not pointing fingers, by the way, unless I’m looking in the mirror. After all, you haven’t paid to read this post, have you?)

But the mechanism that enables one to price an e-book under a buck has a silver lining. It means you can price an e-book however you want whenever you want. It empowers you, in other words, to price to what the market will bear on an hourly basis if you wish, to maximize revenue in the context of factors besides price.

The airlines, of course, have been doing this for a long time, based upon the scarcity of seats on a given flight. Computer maker Dell has done this on a real-time basis depending upon the availability of component parts in their suppliers’ warehouses.

Unlike airline seats and computer parts, the supply of an incremental e-book is infinite. But demand is quite elastic. With paper books, the price is affixed to the book and if an expected publicity hit doesn’t come along — well, the price is still the price until the book gets remaindered.

In e-book land, however, say as an unknown author that you remainder-price on Monday because few people are buying, but then Oprah suddenly invites you onto her show that Wednesday. There you are, Wednesday morning, waiting in the green room, and you’ve magically repriced your book higher in anticipation of making a killing.

That’s dynamic pricing  — a way to stoke demand and maximize profitability in the same week.

2. Supply Elasticity

Publicity, by its very nature, is a hit and miss affair. Sometimes you get a big placement and nothing happens. Other times a small placement goes three times around the world before the printer can get his pants on.

The problem with this serendipity in the past has been that a big publicity hit might come along when there were very few books in the distribution channel (i.e. In bookstores and other retailers or in their warehouses). If the book goes out of stock, retail customers can place orders and wait for the reprint, but it’s a well known fact that some people don’t desire to wait. In that case, with printed books, some of the sales follow-through on the publicity opportunity is lost.

With e-books, on the other hand, there is total elasticity of supply. A customer sees the publicity hit and need one book: she gets it now. A million people see the publicity hit and wish to buy the book: they all get it now. Pure follow-through. One hundred percent opportunity capture.

3. More Buying But Less Read-Through

If you have an e-book reader you may have observed two phenomena. First, because you can buy the book without leaving your house and have it minutes later, you tend to purchase more books.

But, second, as a corollary, because you have hundreds of books in your hand at the same time, you are greatly tempted to abandon boring books sooner than you would have in the past, because the promise of another book lies just two clicks away.

So people will abandon books they’re reading sooner because it’s so easy to do so. But they’ll be purchasing more books, too, and for the very same reason.

Bottom line: more books bought, less reading completed.

4. Story Remains King

We’ve been told that the Internet and action movies and video games and TiVo are leading to shorter attention spans. I don’t know if this is true in the arc of history. If you were the farthest guy from the fire when the poet was narrating The Iliad or Beowulf, and an arrow or a wild animal or a dragon could pick you off at a moment’s notice, what kind of attention span did you have then? Isn’t that why those stories are models of structure and economy?

Maybe we’re coming back to the place where stories used to be, when the only claim that writers had on readers’ attention at any moment was the claim they earned sentence by sentence, paragraph by paragraph (or stanza by stanza).

In this way, we may find, the e-book returns story to its well-earned throne.

Last Week: Publishing Primacy — Folio 7: Seven Pitfalls of Micropublishing

Next week: Publishing Primacy — Folio 9: A Picture of One Hundred Thousand Words

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J.E. Fishman, a former Big Six book editor and former literary agent, is author of the thriller Primacy, which Publishers Weekly called "appealing" and Kirkus called "good, boisterous fun." His mystery novel, Cadaver Blues, was serialized in 2010 on TNB and you can still find it here if you dig deep enough. It's now available in ebook and paperback. His financial thriller, The Dark Pool, was published this year, and his new series of police thrillers, Bomb Squad NYC, will be published in February 2014. He blogs here and at the Huffington Post. Please visit and follow him at his very fancy and expensive official author website.

10 responses to “Publishing Primacy — Folio 8: Four Non-Obvious Aspects of the 
E-book Revolution”

  1. Jeff Crook says:

    #4, I think, is the most significant change, and one sure to doom (hopefully) creative writing programs to the dustbin. The best storytellers have always sold more books than the best writers, anyway. That will only become more obvious in the future.

    My own future prediction – in the next 20 years (but not the next 10), the high cost of college education will destroy the value of college education. Because employers won’t be able to find applicants with the required level of education, a degree will no longer be a prerequisite to employment in many fields that currently require a degree. Most universities will either fail or be taken over by the state and become free or extrememly cheap. But in order to control costs, availability will be limited to students who can pass stringent entrance examinations and/or are willing to trade college for a period of public service.

    • J.E. Fishman says:

      One inevitable consequence of creative writing programs (or of all workshop formats, really) is that they lead writers to believe that people owe them a read. After all, everyone in the workshop has to read your piece from beginning to end, whether they like it or not. But out in the marketplace, nobody owes anybody a read. You have to earn the reader’s attention every step of the way.

  2. Art Edwards says:

    So much change coming–and here–with ebooks. I still feel like no one knows what to do about it.

    I like the .99-9.99 price points, which big publishing will try to sell as a difference in quality (as opposed to a difference in overhead). Others will take their profit as the time readers spend reader their work. The shake-out between the two will be interesting.

    Great stuff, Joel.

    • J.E. Fishman says:

      I have a great Picasso anecdote about pricing/value that I’m saving for a piece on the price discussion. All I can add right now about pricing is this: I recently bought a bestselling $1.99 e-book and, after reading, concluded that I was overcharged. When you go to McDonald’s, you don’t expect filet mignon. But the burger has to be warm and the fries better be good.

  3. Dynamic pricing is a huge deal here and I’m a big fan.

    People forget this sad little tidbit: once your book gets remaindered and costs one penny on Amazon, you’re not getting any royalties on it anymore. I’m not making this up.
    it happens.

    If you sell that same book for a brief time as an ebook, for $0.99 you stand to make seventy cents.

    • J.E. Fishman says:

      Plus, something neither of us has yet mentioned: no returns on those dynamically priced e-books.

  4. dwoz says:

    Hand in hand with “dynamic pricing”:

    Dynamic royalty rates.

  5. I love this series. So insightful and interesting. I can’t believe all the conversations I hear about ebooks tends to be about changes in the reading experiencing–which seems trivial compared to changes in the shopping/buying experience.

    I’ve been hearing that limited “sharing” capacity is coming (or is here, perhaps?) to kindle and ebooks…do you have any thoughts on that?

    • J.E. Fishman says:

      I believe the Nook has sharing capacity (or is about to have it). I have thought a lot about this but drawn no firm conclusions. On one hand, sharing obviously facilitates word of mouth, which can spur sales. On the other hand, in some ways it seems yet another step along the curve that trends lately toward a devaluation of all authors’ work.

      The central argument for e-book sharing, of course, is that it replicates something people already do with paper books. Some people have objected to the absence of this ability with regard to e-books, but it feels akin to me to pandering to the lowest end of the market. I mean, are people who are that desperate to share someone else’s creative work only for free (as opposed, say, to buying a copy as a gift or suggesting the book to a friend for purchase) likely to step up and pay under any circumstances?

      What surprises me, somewhat, in the discussion about e-book sharing, is how few people seem to be taking the position that maybe there are some drawbacks to paper books for creators — most prominent among them that the creator sees no direct monetary benefit when a book gets passed around (or resold). Sometimes the advent of new technology can be a means of restoring fairness to the equation for the creator, can’t it? Why aren’t we having more of that discussion?

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