Kobo launches an ebook subscription program in Europe; Amazon launches KDP Print (does it make more sense than CreateSpace?); Joanna Penn’s publishing house: another stage in self-publishing maturity; Amazon: a source of new jobs in the UK and US; a new publishing platform with no royalty cut: Bonnier’s Type & Tell; Simon & Schuster and the Milo Yiannopoulos book cancellation.
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The Hot Sheet
Hello, dear readers!

This week, we look at the latest developments at Amazon, both in the self-publishing arena and on the world stage—plus we take a closer look at new and important services emerging from Europe.
 

—Porter Anderson & Jane Friedman
editor@hotsheetpub.com

February 22 issue

Self-Publishing IQ Quiz
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Kobo Launches an Ebook Subscription Program in Europe

As we were going to press, Kobo, in partnership with the online retailer Bol.com, announced a new ebook subscription service for Dutch and international titles.

Called Kobo Plus, the subscription service will be available to customers in the Netherlands and Belgium for €9.99 per month. At launch, the service offers readers more than 40,000 titles—16,000 in the Dutch language—with considerable growth expected this year.

The press release reports that Kobo Plus will be implementing a fair-share business model, with payouts funded by subscription revenues to ensure sustainability—and sustainability is certainly the key issue for any ebook subscription service, as weve reported in the past

Bottom line: Publishers Marketplace notes that, for books distributed via Kobo Writing Life, authors will receive a portion of subscription fees based on reads—and a “read” will be triggered when a user has read at least 20 percent of the ebook. To be included in Kobo Plus, titles must be made available in Kobo Writing Life for a minimum of six months. A Kobo spokesperson would not confirm for Publishers Marketplace if the same payment terms apply to traditional publishers: “Although we don’t comment on individual publisher contracts, I can tell you is that it’s a price-rated, fair-share revenue model.”

Meanwhile, Kindle Unlimited remains the gargantuan player in the ebook subscription landscape, with more than 1.4 million titles offered (although no titles from the Big Five publishers). KU operates in 11 countries outside the US, but not in Belgium or the Netherlands.

Amazon Launches KDP Print: Does It Make More Sense Than CreateSpace?

Since last fall, we’ve been seeing indications that Amazon would roll out an integrated approach to ebook and print book publishing for indie authors. Known in the author community as KDP Print, the service is now available in beta to anyone with a KDP account actively selling an ebook edition. Authors already using Amazon’s CreateSpace to distribute and sell their print edition can transfer that edition to their KDP account in a fairly seamless manner. The big question is: Why would you?

So far, there’s not a clear answer to that question, other than an author’s strong motivation to have an integrated dashboard for book sales reporting and a combined royalty statement. That is indeed desirable, but the current drawbacks to switching are considerable and include:

  • no ability to buy author wholesale (at-cost) copies or proof copies

  • no access to expanded distribution (not a dealbreaker if you’re already using a service such as IngramSpark for that purpose)

  • no access to the paid services offered through CreateSpace (not a likely dealbreaker, especially if your print book is already finished)

  • no support for custom trim sizes if you used them in CreateSpace (see the list of acceptable trim sizes here)

Amazon promises that all these missing features will be added in the future, so we presume this is indeed a true beta that will allow Amazon to work out the kinks. Other than the integrated sales reporting, one benefit to moving CreateSpace titles to KDP Print is the ability to distribute to Japan in addition to US and European markets, but we can’t see this as a driving force in early adoption.

Bottom line: There’s gossip in indie author circles that Amazon plans to push indie authors out of CreateSpace and into KDP for print editions so that CreateSpace can focus on publisher-customers instead. Given that CreateSpace has been serving the print-on-demand needs of traditional publishers for more than 10 years, has top brand recognition in the market among authors, and is the number-one print-on-demand service provider in the United States, that move would constitute a significant and unlikely shift in strategy. (In 2015 alone, CreateSpace issued more than 423,000 ISBNs.) We assume there’s one significant motivation for KDP Print: enabling ebook-only authors to make a print edition available quickly, easily, and at low or no cost through automated formatting tools. Better integration of ebook and print services for indie authors will (one hopes) lead to better marketing support and opportunities in the future. (For example, at the moment, it’s possible for indie authors to advertise ebooks only—not print books—through Amazon.) We’ll be avidly watching to see how Amazon rolls out this integration and if it will become more—or less—financially and strategically advantageous for authors.

Penn’s Publishing House: Another Stage in Self-Publishing Maturity

Earlier this month, UK-based author and indie champion Joanna Penn (The Creative Penn) announced she is establishing Curl Up Press, aimed primarily at building her own print presence and expanding the licensing of her work. Her husband, Jonathan Bleier, will be directing rights. Notably, in this effort, she is not looking to publish others—only her own work.

Long an indie-proud ISBN refusenik for ebooks, Penn is upfront about the need now to use the international identifier that makes it possible for retailers and libraries to find, order, and purvey her work. With her usual wry sense of humor, she writes, “If you want to get your print book in front of bookstores, libraries, and other bastions of the traditional book industry, then you do need your own set of ISBNs.”

In another insight into the maturing structure of her 21-book writing-and-speaking business, Penn is straightforward about the fact that, even now, many booksellers don’t work with Amazon and that IngramSpark has advantages that make using both services for print worthwhile. IngramSpark, for example, offers hardback formats. With IngramSpark’s services, Penn can also ship boxes of her books ahead to her speaking engagements (to sell and sign); she can offer booksellers the discounts they’re accustomed to from publishers; and she expands her international reach in print. She also looks ahead to the services of Aerio, which Ingram acquired last year; Aerio is expected to make it possible for authors to sell their own and others’ books from their sites.

Penn tells Publishing Perspectives that, if at some point Curl Up Press does work with other authors, it’s likeliest to be in the rights arena. Rather than publish other writers, she says, “It’s more likely that we’ll expand into rights licensing and work with successful indie authors to expand their markets.”


Bottom line: There’s an interesting parallel here to what many trade publishers are doing. At each of the major international trade shows, the rights centers—huge halls in which agents rent tables to offer their clients’ books rights—have been steadily growing in prominence. Rights revenue is seen as a way of shoring up sagging book sales. Penn’s new, structured focus on this, along with the move to raise her print profile, shows that she’s detecting a need parallel to the trade’s. At her high-output, high-profile end of the indie spectrum, as Penn puts it, “The outsider becomes the mainstream.”

Amazon: A Source of New Jobs in the UK and US

While we naturally focus here on Amazon for its books-related impact, a couple of news items regarding the company’s burgeoning retail success are worth noting, as well.

It was announced this week that Amazon will create 5,000 new jobs in the UK this year. That’s more than 25 percent of its current level of employment there, and the increases will raise the entire staffing level to 24,000 people. While the company has been severely criticized in the UK for past tax practices of diverting sales reporting to Luxembourg (its European headquarters), it changed over to reporting its UK sales through the UK in May 2015. There are still questions about how much tax Amazon is paying to UK authorities, but a Bookseller report says that some see the job announcements as a commitment to the country in the aftermath of Brexit.

In the States, we already had reports last month of a 100,000-job boost planned in American Amazon hiring this year, an even bigger percentage increase than in the UK, at 56 percent. (Amazon had 180,000 full-time employees in the US at the end of 2016; worldwide, the company comprises more than 300,000 full- and part-time personnel.) Those new US positions aren’t just fulfillment-center positions; they include developers and engineers, according to a New York Times report. Furthermore, Amazon contends that its vendor-marketplace operation sustains another 300,000 jobs in the US.

The Times goes on to point out that jobs are being lost in brick-and-mortar retail faster than online retail can replace them—and this goes far beyond bookstores: Macy’s reportedly has lost 10,000 jobs, while all 250 Limited stores have closed, taking 4,000 jobs with them. The Wall Street Journal (paywall) reported this week that even Walmart’s online sales growth has slowed in the last quarter, growing only 16 percent (after rising 21 percent the previous quarter).

Bottom line: Back in the UK, Amazon is testing actual drone delivery just outside Cambridge. (This video—well worth watching if you haven’t seen it—is a capture of the first full trial flight to a customer.) That’s the kind of automation that, like Amazon’s leadership in online retail, is predicted by analysts to cut even more deeply into workforce stability and threaten further destabilization. For publishing, the point may be that, as wrenching as Amazon’s reconfiguration of the marketplace has been (and will be), the book industry at least has been riding these rails for some time now. Books are where Amazon started, and publishing got an early chance to wrestle with what it means to business. The sharpest authors are those who, like Joanna Penn, have been in the vanguard with publishing itself: scouts who may be ahead of more industries than their own.

A New Publishing Platform with No Royalty Cut: Bonnier’s Type & Tell

In mercifully unpolitical news from Sweden, Bonnier—Stockholm’s 15-nation powerhouse media corporation, which includes Bonnier Publishing—has established a division called Bonnier Books Ventures devoted to new content platforms.

As part of that division, Bonnier quietly launched self-publishing platform Type & Tell in September 2015. Type & Tell has been growing ever since—you can see the Swedish edition up and running. Executives in the London offices tell us that the response to the Swedish beta has been so strong that they’ll be launching an English edition of the site in March (to coincide with London Book Fair). You can get on the mailing list for that one here.

One of the things you’ll notice is a highly granular approach to services: a lot of them, and individually priced. On the Svenska site, for example (with prices in Swedish kronor, of course), the selection of services includes a separation of marketing for print and digital (and individual services, such as mailing 10 review copies), distribution, book cover design, author photos, interior design, format conversions, camera-ready advertisement production, digital ad production, catalog listings, newsletter mentions, Swedish library system reviews, metadata optimization, and more. Not for nothing is smörgåsbord a Swedish word.

Bottom line: The key here is that à la carte approach. Here’s the reason: Type & Tell authors get 100 percent royalties. The revenue to the company is in that big array of service packages, not in sales, and the site’s folks talk to us of working “alongside retail channels,” not head-to-head. We think Bonnier, rightly well regarded internationally, may be making a savvy move for a publisher: capitalizing on its capabilities. Type & Tell’s push is to get indie authors to create both print and ebook editions of their books and to utilize the enormous production, marketing, and media-networking capabilities the company uses for its own output. Keep an eye on this one.

Simon & Schuster and the Milo Yiannopoulos Book Cancellation

Late last year, the announcement that Simon & Schuster had signed Milo Yiannopoulos as an author generated relentless industry criticism and calls for boycott (which we covered)—even as some voices in the community defended the move on the basis of publishing’s support of free speech.

So news traveled fast when Simon & Schuster emailed a statement to newspeople on Presidents’ Day just after 5:00 p.m. EST. It was a classic—one sentence only:

“After careful consideration, Simon & Schuster and its Threshold Editions imprint have cancelled publication of Dangerous by Milo Yiannopoulos.”

Monday’s terse statement came after a video surfaced in which Yiannopoulos appears to condone sexual relations with boys as young as 13 and makes light of pedophilia among Catholic priests. The Conservative Political Action Conference canceled Yiannopoulos’s speaking invitation, and then S&S announced that they were pulling his book deal. And—as we were going to press—the other shoe dropped: Yiannopoulos resigned from Breitbart News.

Over the past several weeks, however, S&S has taken a heavy drubbing. In January, S&S CEO Carolyn Reidy issued a statement to concerned authors that many at the time thought might be predictive of a cancellation. Reidy wrote, “Neither Threshold Editions nor any other of our imprints will publish books that we think will incite hatred, discrimination, or bullying.” Their author Roxane Gay pulled her book from publication in late January and remains fiercely critical in new Tumblr comments after the cancellation.

Bottom line: While it’s easy to stand outside events like this and feel that we all might make better decisions, conservative political books are big money in the trade. Nevertheless, we see a higher bar being put into place in the current political environment: while hate speech may be in the ear of the beholder, we think we’ll see more publishers encounter far greater scrutiny than in the past. It’s worth considering the closing lines of Gay’s new commentary: “There are some who will spin the cancellation of this book contract as a failure of the freedom of speech, but such is not the case. This is yet another example of how we are afforded the freedom of speech, but there is no freedom from the consequences of what we say.”

Links of Interest

News and Trends

  • How “sensitivity readers” are changing the publishing ecosystem: To produce accurate and unbiased books about diverse characters, both authors and publishers are hiring readers from minority groups to vet manuscripts prior to publication. Read more in Slate.

  • After 11 years in business, romance ebook publisher Samhain is closing at the end of February. Troubles emerged nearly a year ago, when the owner openly discussed the company’s continuing decline in market share and plans to shutter. Read the email to readers.

  • You probably already know better, but don’t become a professional critic. Laura Miller of Slate (and formerly of Salon) speaks frankly about her career, as well as writing and reading, over at Poets & Writers.

  • London-based Arcturus Publishing has established a new imprint, Sirius, that will specialize in trade titles for the US market, including practical art and entertainment, history, and science. Upcoming Sirius titles include The Story of World Mythologies by Professor Terri-ann White and Archeology by Gaynor Aaltonen. Learn more at Shelf Awareness.

Marketing Toolbox

  • Indie author Nicholas Erik has written a free and very extensive guide to book promotion based on Amazon’s algorithms, visibility, and traffic. Read at his blog.

  • Romance author Kelly McClymer discusses step by step how she became a bestselling author. Her key to success was a coordinated marketing plan. Find out more at BookBub’s blog.

  • For bloggers and others with valuable online content: Learn how to refurbish your best posts and extend their reach. Read at Moz.

Amazon

  • Amazon is asking indie authors for proof of bestseller claims. Marketer Penny Sansevieri shares the email you might receive from Amazon if you have a bestseller claim on your cover. Read here.

  • Amazon debuts a new imprint in Germany. Tinte & Feder is Amazon Publishing’s second German-language imprint and will focus on contemporary and historical fiction. The first books will release in March. Learn more.
     
  • Amazon has launched a competitor to Skype and Google Hangouts. It’s called Chime and looks to be geared primarily toward business users. Take a look.
     
  • What is Amazon Marketplace and how does it work? If you’ve never understood how and why third parties sell your new or used print books at a discount, this overview at the ALLi blog may be helpful.

Hot Sheet Index


  • Simon & Schuster revenue in 2016 vs 2015: -1.8%
  • Lagardère Publishing (owner of Hachette) revenue in 2016 vs 2015: +2.6%
  • HarperCollins revenue in 2016 vs 2015: -3%

  • Simon & Schuster revenue in fourth quarter 2016 vs 2015: -10.3%
  • Lagardère Publishing (owner of Hachette) revenue in fourth quarter 2016 vs 2015: -2%
  • HarperCollins revenue in fourth quarter 2016 vs 2015: +4%

  • Simon & Schuster profit margin in 2015: 14.6%
  • Simon & Schuster profit margin in 2016: 15.5%

Sources: Sales Slipped, Profits Rose in 2016 at Simon & Schuster, Perseus Purchase Boosts Lagardère 2016 Revenue, Profits Jump at HarperCollins, Harper Regains Some Ground in Second Quarter (subscription required)
Amazon net sales 2014-2016

Closing image: Amazon’s latest filing included a hint about the number of Prime memberships. Based on earnings figures, current subscribers are believed to be around 70 million. TechCrunch commented, “Prime sales alone surpass the entire e-commerce sales of Macy’s, The Home Depot, and Best Buy.” Learn more.

Hot Sheet Services Directory

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