My valued neopatrons called my attention to this viral Substack post by author and editor Elle Griffin. In it, she shares facts that came to light in the US government’s recent suit against oldpub giants Penguin Random House and Simon & Schuster.
The main takeaway is that publishing house representatives called to testify spent their time on the stand shooting holes in oldpub’s own business model.
Related: The Big Four
In 2022, Penguin Random House wanted to buy Simon & Schuster. The two publishing houses made up 37 percent and 11 percent of the market share, according to the filing, and combined they would have condensed the Big Five publishing houses into the Big Four. But the government intervened and brought an antitrust case against Penguin to determine whether that would create a monopoly.
The judge ultimately ruled that the merger would create a monopoly and blocked the $2.2 billion purchase. But during the trial, the head of every major publishing house and literary agency got up on the stand to speak about the publishing industry and give numbers, giving us an eye-opening account of the industry from the inside. All of the transcripts from the trial were compiled into a book called The Trial. It took me a year to read, but I’ve finally summarized my findings and pulled out all the compelling highlights.
Related: Oldpub Cope
And those highlights vindicate everything that newpub pioneers like Joe Konrath and Dean Wesley Smith have been saying for over a decade.
The DOJ’s lawyer collected data on 58,000 titles published in a year and discovered that 90 percent of them sold fewer than 2,000 copies and 50 percent sold less than a dozen copies.
Related: No Future for Oldpub
Hill says titles that earn advances over $250,000 account for 70 percent of advance spending by publishing houses. At Penguin Random House, it’s even more. The bulk of their advance spending goes to deals worth $1 million or more, and there are about 200 of those deals a year. Of the roughly $370 million they say PRH accounts for, $200 million of that goes to advance deals worth $1 million or more.
Keep in mind, that 70 percent of advances goes to 1-2 percent of authors. Yet only 20 percent of those authors earn out their advances. Because 4 percent of books earn 60 percent of oldpub’s profits. And along with perennial backlist sellers from decades—sometimes centuries, or in the case of the Bible, millennia—past, those unicorn titles are what keeps those pricey Manhattan offices’ lights on.
Related: No Gatekeepers Where There Are No Walls
A charge levied against legacy publishing from newpub authors alleged that oldpub did little to promote new authors and help them build brands—not enough, at least, to justify publishers’ 85 percent cut of the royalties. Now we have top corporate officers admitting as much under oath.
Q. Would you agree that those type of authors, meaning the ones with the built-in audience, are also authors who would command a high advance if they went to a traditional publisher like Macmillan or PRH?
A. That’s a broad brush. But, yes…
Q. And you’re willing to pay more if they have a significant following?
A. Yes.
— Donald Weisberg, CEO, Macmillan Publishers
Related: One Foot in the Grave
But all of the above could be deduced by anyone with a sharp eye and a clear head. An even bigger admission confirmed newpub’s educated speculation about oldpub’s love-hate relationship with Amazon.
Every second book in America, ballpark, is being sold via e-commerce…Amazon.com has 50 million books available. A bookstore, a good independent bookstore, has around 50,000 different books available… an algorithm decides what is being presented and made visible and discoverable for an end consumer online. It makes a huge difference.
— Markus Dohle, CEO, Penguin Random House
Related: Why Amazon Failed
And it gets even better. Newpub authors have long suspected that Amazon’s algorithm has become a payola scheme. Now we have proof.
Q. Penguin Random House has hired data scientists to try and figure out these algorithms so that its books get better presented on Amazon than its competitors’ books?
A. One of the many efforts that we pursue, correct.
Q. And Penguin Random House pays Amazon to improve its search results?
A. There is something that is available to our publishers, it’s called Amazon Marketing Services, AMS, and all publishers can spend money and give it to Amazon to have hopefully better search results.
— Markus Dohle, CEO, Penguin Random House
Related: How Amazon Cut Your Royalties Under Your Nose
“But indie authors can do their own ad spend with Amazon,” you may object. And while that’s true, the ad algo runs on a bid system. And there is no way you can outbid subsidiaries of multibillion-dollar megacorps. Yet oldpub is riding the tiger. Because while they’re dependent on Amazon, Amazon does not need them. And could unleash a book apocalypse on them with the click of a mouse.
Q. No books are found on Kindle Unlimited? Because you think that’ll be had for the industry?”
A. We think it’s going to destroy the publishing industry.
— Markus Dohle, CEO, Penguin Publishing House
Related: Amazon Ghettos
The nightmare scenario that keeps oldpub executives up at night is the prospect of Amazon going all-in on a Netflix style model.
Around 20 to 25 percent of the readers, the heavy readers, account for 80 percent of the revenue pool of the industry of what consumers spend on books. It’s the really dedicated readers. If they got all-access, the revenue pool of the industry is going to be very small. Physical retail will be gone—see music—within two to three years. And we will be dependent on a few Silicon Valley or Swedish internet companies that will actually provide all-access.
— Markus Dohle, CEO, Penguin Publishing House
Related: eBook Zombie Memes Won’t Die
But a robust KU-type subscription service isn’t the only bogeyman making oldpub lose sleep.
There is a New York Times best selling author in the science fiction and fantasy category. His name is Brandon Sanderson. I believe he’s published by both Macmillan and Penguin Random House. He went onto Kickstarter and announced that he would be offering four of his novels to anybody who wanted them if they wanted to donate to Kickstarter. And he raised over $42 million…
— Jonathan Karp, CEO, Simon & Schuster
Related: King Brandon Does it Again
Look, the upshot is that newpub authors were right all along. Oldpub is a vertical paper distribution monopoly that hangs on a thread held up by a handful of unicorn authors. The overwhelming majority of those are already famous, broke out decades ago, or are dead.
“Traditional publishers” are not there to help new authors realize their validation-granting dreams. By their own admission, they are venture capitalists looking to lay big bets on strong horses so they can extract value from those rock star authors’ success. That is not a sustainable business model. That is parasitism.
To be honest, it bodes ill of authors as a whole that any of us even consider working with oldpub anymore. The hard numbers gave the win to newpub almost a decade ago. Anybody who didn’t go indie then was just plain delusional. We have now evolved past the Amazon-centric indie model into far more profitable, reliable, and independent Neopatronage. So writers who persist in wanting parasitic New York publishers to take all of their rights and 85 percent of their earnings forever—most times in exchagne for a one-off payment of $1500—defy description.
Newpub is old. Oldpub is dead. Long live Neopatronage!
Turn your 3-star writing into 5-star writing
I’ve helped dozens of author clients find the right words and present the right elements in the right order to take their books from good to great.
Very interesting testimonies. It appears Oldpub has also been a long standing an ideological gatekeeper. From the cheap seats, it seems they’ve been occasionally in the business of overt bribes to politicians of all leanings.
Let me touch on the later idea first. Does anyone really think that a Mike Pence biography had a market right after he punted on the election ? How about that random FBI guy who was an open traitor? (The name fails me, but he could have been anyone.) Even of the PBS lefties, do we think that there was an over the top demand for Hillary Clinton’s life story?
Yes, me too. From the outside, what appears to be happening is after (or before the fact) bribes. Pay a ghost writer, take a few hours of their time, give them a huge and unrealistic cash advance, send them on a little paid vacation, uh book tour, dump the books in Costco, try to defray a little of the cost, and then ultimately dump them in the landfill. As long as there is even a surface business case and it can be funded by Curious George sales, why not? It’s not their money. Ultimately, like so much of corporate art, it appears part of what is doing them in is a profound lack of interest in the business while using established revenue streams to fund pet political projects.
I think everyone is aware of the recent gatekeeping in Oldpub, so I will add this thought as a causal reader of non-fiction/old fiction. The publishing industry, like the media industry in particular is dominated by a certain ethnic group. If I track down the decision making executives and editors, it will have a per capita problem, that several occupations of public influence also have.
The dividing line between non-fiction published before WWII and after is stark. The ethnic group in question is never mentioned in a poor light or even generally directly after WWII in my tiny sample. There are many open, published works on the subject before WWII, particularly in the 1920’s and 1930’s. The subject vanishes almost entirely after WWII. Even an author who was a Trotskyite in the 1920’s does not mention it at all, in a 1960’s work that does manage some race realism otherwise.
I love Agatha Christie. In the 1920’s she’s writing a book with an open and vaguely dark now unPC antagonist in an international thriller. By the 1960’s she’s openly pushing the racial agenda that seems to be a universal in their community in her mysteries. It’s possible she genuinely agreed, as she was liberal leaning for her day. But still, most of her moral lessons are subtle. The particular book I am thinking of was particularly heavy handed on the subject. Anyway, by the 1990’s, if I use Robert Bork as any indication, the only commentary allowed is in the positive and as victim.
This is not the only topic where such ideological gatekeeping exists. We will never know how many people in the late 20th century had done genuine deep dives into any number of topics, only to discover that Oldpub universally refused to publish their book for wrong think. We here in the “land of the free” have been had mass censorship for a very long time. It just hid itself inside corporate structures. People don’t like to hear that “woke” is not brand new. Unfortunately, it’s only that they stopped being able to hide it, along with their disinterest in running functional businesses.
There is also a stark decline in intellectualism from the 1920’s to Bork’s book, despite ironically a sampling of books about the decline of the West. Going from reading Hilliare Belloc to Robert Bork complaining in rather pop culture terms about rap music is to experience the decline of the West in a matter of a few decades.
This tracks pretty well with the time line of literate types and Utopian politicos taking over the publishing industry and either memory holing or sabotaging genres or material that wouldn’t be good vehicles for the Prototype of The Message.
I don’t consider it a coincidence that Gernsback was both a member of the group you describe and the earliest precursor to “Fandom”.
Question: The first book I hope to complete upon my upcoming retirement is a non-fiction account of the history of Catholic Education in America. While I’d avoid any traditional publisher for fiction, for such a niche book as this – do I still go solo? Or do I try to find a publisher with customers in this niche?
I can only speak as a consumer of non-fiction Catholic content. There are clearly gatekeepers inside mainstream Catholic publishing, along with the same aging celebrity author effect found in Oldpub. There are big “names” from the 1980’s/90’s and nobody breaking out in particular since the 2000’s. Since it is low volume niche content, the gatekeeping maybe more extreme, not less so. That’s 100% speculation, however. Your question might be answered reasonably quickly by a few research phone calls/emails to established Catholic publishers about your chances for publication.
There are also certain topics/viewpoints that are forbidden. Ironically right now, openly schismatic/anti-clerical attitudes are not off limits, but that’s another essay. Your content may not be at all edgy. However, if you do a deep dive into history and discover unPC facts of any kind, it maybe difficult to find a publisher. E. Michal Jones ended up having to be his own publisher, for a framework/history outlines that are entirely Catholic. Controversial for sure, but within the bounds of the faith.
You go solo. Please do reach out to me when you’re ready to start.
The nonfiction aka textbook and… medical-scientific market iscgoing to get interesting.
Yes, almost as interesting as the practice of STEM fields themselves.
Changes are already happening in STEM. See Hans Schantz’ Substack, Fields & Energy. His new book being previewed there will look at Electromagnetism, but will also investigate the roots of Quantum Mechanics. It is targeted for a fundraiser when completed.
https://aetherczar.substack.com/
There are also textbook indies who have been concerned about skyrocketing prices for students for years. Consider Ben Crowell who has self-published a large number of undergrad physics and math textbooks, either available for free in PDF format or nearly at-cost in physical format from Lulu. Check out the number of adoptions by high schools and colleges for this essentially free or low-cost library of science textbooks.
http://www.lightandmatter.com/
This bodes well for the Indie bolt cutters working their magic in all realms of Lumber Mill/Electron Museum publishing. Some may take longer to crack open, but crack they will.
It’s heartening to see indies tackling the textbook scams. At least we know they won’t move some commas around and demand instructors buy whole new editions bundled with books they don’t need for double the cost of last year.
Ooh, thanks! I have downloaded one and bookmarked the rest for my physics-obsessed kid.
Another author’s take on Elle Griffin’s article here:
https://www.ecosophia.net/lenocracy-in-extremis-the-case-of-publishing/
TL:DR: Smallpub is still doing allright. Big5 publishers are in deep doodoo because they’re poorly run and their business model stinks, and they’re all snooty white-collar PMC types who have no idea what regular readers want, and no way to find out either. Yay class wars. It’s all part of the decline of western civilization.
You can tell Griffin really shook the hornets’ nest this time by all the deadpub shilling it provoked. One Big 5 water carrier barfed up a blog post in which he implied that newpub authors drop $200,000 to spare their books the dreaded “self-published stigma.”
Question begging aside, all that blogger did was illustrate how out of touch deadpub is. You can hire a top-of-the-line editor for orders of magnitude less than 200K, and you can design a professional-grade cover yourself for free. I know because I did, and that book became an Amazon #1 best seller.
$200k?!
That’s videogame money. Imagine spending 200,000 of your most favorite dollars on a book that will likely net you $200 instead of a videogame that would likely net millions.
Saying “Some indie authors spend $200,000 self-publishing their books” is like saying “Some comic book fans spend $200,000 on a single issue” then not mentioning it’s Action Comics #1.