I don't claim any professional knowledge of the book publishing industry, but if they're anything like the music and movie industries then there might be good reason to believe they're more responsible for anyone else in the game for authors getting shorted. If a movie studio can cook its books to make it look like a movie such as Harry Potter and the Order of the Phoenix, to name just one example, created a deficit for them of over two hundred millions dollars (which translates to less money for all involved in the making of the movie, EXCEPT the studio), but then on the end hand expend a tremendous amount of resources on trying to get news laws enacted to "protect" their artists from those evil file-sharers – well, it just goes to show that you have to take everything these big companies tell you with a grain of salt.

This is when I first started buying books for myself. But what they had on the shelves then is a far cry from what I see now. What you call "mass-market paperbacks" now were just "paperbacks" back then, and there really weren't many of the oversized, $15-a-pop softcovers you see in stores now. There were hardcovers and paperbacks, and that was it.

I love buying books, but I really don't like the bigger sized paperbacks. It looks uneven on the shelves of my bookcases.

When did that change? (I'm not asking why, because I know that. More profit.)

For example –

In general, if you break it out in Grand Fenwickian shekels (the standard monetary unit for all publishing jobs*) costs for a paper book go something like this –

Fixed costs –

500 Shk – author

400 Shk – editor

250 Shk – designer (no one ever has money for the poor designer)

1260 Shk – overhead**

240 Shk – printer set up costs

plus printing costs

10 Shk – actual printing of 1,000 books urging the overthrow of the

current publishing system

Total – 2660 Shk for the job, or 2.66 Shk per copy.

The publisher prices it at 5.6 Shk a retail copy (wholesale 2.8 Shk), which covers her 5% profit and presumably, the retailer's expenses and profit. To cover the publisher’s costs she must sell 950 copies of the book.

With an e-pamphlet, the fixed costs stack up like this:

500 Shk – author

400 Shk – editor

250 Shk – designer (no one ever has money for the poor designer)

1260 Shk – overhead

Total – 2410 Shk for the job, or 2.41 Shk per copy

The publisher prices it at 5.12 Shk a retail copy (wholesale 2.56 Shk), which covers her 5% profit and presumably, the retailer's expenses and profit. To cover the publisher’s costs, she must sell 941 copies of the book.

The difference in price is .48 Shk – or about 12%.

But what if 2000 people want to buy the book? There’s no increase in fixed expenses for the e-book, so everything copy above 941 is pure profit right? Which would be 1059 times 2.56 or ~2711Shk.

Yes, but it’s pretty close to that for the paper book too. Publishers over the years have gotten pretty good at estimating how many copies a book will sell. Not infallible, but pretty good. So if the publisher thinks the book will sell 2000 copies, she’ll order 2000 copies from the get go which means the additional cost is another 10 Shk. That’s 1050 times 2.8, minus 10 Shk or 2930 Shk. Heck, the profit is higher, because the original wholesale price was greater.

But what if the publisher didn’t know that the demand would be so high? In that case, subtract 250 Shk (printer’s setup costs and actual printing) from the sales of 2800, and you have 2750. The paper book still beats the e-book in terms of profit.

*The real reason I'm using shekels is that people have emotional hang-ups with dollars. Shekels are tip-toeing past your (and mine) emo gatekeepers.

**Simple rule of thumb here – if you're the manufacturer, charge the retailer double what it cost you to make it – this covers your overhead and profit. The retailer doubles the price again, covering her overhead and profit.

Overhead is the publisher's salary, the secretary's salary, insurance, the accountant's fees, taxes, rent, office supplies, heat, light, other utilities, computers, software, etc.) This means that about 45% (this is a guess, and it’s probably more) of what she gets goes to paying stuff that she has to pay, but isn't a direct cost for any one book.

***Of course, if the publisher is wrong, and there aren’t at least 950 who want to buy the book, the publisher will lose money – which must be made up on another book or books – whether it’s a paper book or an e-book.

Jeff