The Publishing Business: From P-books to E-books by Kelvin Smith

Looking for an overview of the publishing industry? This book is written for the student preparing for a career in publishing. It provides a comprehensive overview, including the main areas of publishing (trade fiction, scientific and technical, educational, etc.), the tasks and jobs involved, and the process of how a publisher acquires material, produces a book, and sells the book. There’s plenty of attention to the economics, marketing, and branding of publishing, balanced with awareness of ethical issues.

The Publishing Business was released last August, and the case studies and discussion of recent developments in e-book rights and marketing are up to date. My favourite thing: the book is a big, attractive softcover with lots of colour pictures and visual interest. I recommend the book to anyone who’s considering working in publishing or simply wants to know more about how books are made.

I got this book as a door prize at an EAC-BC meeting. Iva Cheung, who kindly donated the book, has written a more comprehensive review.

What’s a reasonable e-book price?

One of the most interesting parts of The Publishing Business is a breakdown of publishing costs, which begins to clear up something I’ve been wondering about: loss leaders aside, why are the prices of e-books so close to the prices of paper books? Shouldn’t e-book buyers benefit from the savings in printing and shipping that this medium brings?

Sure. But printing and shipping are a smaller part of publishing costs than I thought. An e-book doesn’t incur the cost of printing, warehousing, distribution, and unsold stock, but it still needs to be written, edited, designed, laid out, and marketed. Even electronic distribution costs money.

According to The Publishing Business (page 63), the publisher’s costs break down approximately as follows:

• marketing, warehousing, distribution, and unsold stock: 30%;
• author’s royalty: 10%;
• production (editing, design, and printing): 20%; and
• other overhead (salaries, office, etc.): 30%.

Now consider that retailers typically keep about 45% of the cover price.* Given the possible savings in warehousing, distribution, unsold stock, and printing, I would guess that something like 20% of the cover price could be saved in e-book production.

That’s not a big difference. The $2.99 e-book may work when it comes after a higher-priced run that pays the bills, but if e-books are to be the dominant medium, they have to cost more than three dollars, or something’s got to give.

* E-book retailers may only take about 30%, but typically the author royalty is higher for e-books (The Publishing Business, page 36).

Reviewed from my own copy of the book.