When the topic of e-books comes up, one writer tends to get called on to speak for the new industry of books that go straight to their audiences, primarily via Amazon (AMZN)’s Kindles: Hugh Howey.
Mr. Howey is the author of well over a dozen titles, but the one he’s most widely known for started with a novelette called Wool, a story of a dystopian future. It earned him enough that he was able to quit his job and focus full time on writing. He now lives on a boat.
Mr. Howey has become an unofficial spokesperson the digital publishing industry. In fact, we first encountered him when we reported on news that Amazon’s Kindle Unlimited would start paying writers based on how much readers read. It’s a role he’s not entirely comfortable with, as he explains in the following. That said, he’s unabashed in his advocacy of self-publishing as a way to reach more readers and hold onto more income. To that end, he and the mysterious “Data Guy” co-created the website Author Earnings, which reverse engineers market estimates for different kinds of e-book writers, primarily on Amazon.
The Observer has been reporting on some of the most wildly successful e-book authors in our Titans of Kindle series. This is our sixth installment. In the following, Mr. Howey speaks very directly to shortcomings in the current model and where he thinks the market will lead the industry of literary culture.
The following phone interview with Mr. Howey has been edited and condensed:
Why did you decide to take on a leadership role among e-book writers?
I don’t know that I took on that role as much as people fielded questions to me and I always answered them. It’s a lot of timing. You’ve got people like J.A. Konrath and Amanda Hocking that came before me, but I just happened to be publishing and having success at a time when e-books and self-publishing were getting a lot of attention.
And then my deal with Simon & Schuster put me in the limelight a little bit, so when reporters needed to ask something it ended up being me getting the call.
I was actually afraid of it happening, because I saw that happen with Amanda Hocking, where people talked more about her and her success than they did her stories, and I never wanted that to happen to me. I wanted people to talk about my books, but I also really believe in the power of self-publishing, how it’s putting the control and the earnings in the hands of artists and not large companies. I definitely wanted to let people know what their options were, rather than signing away all of their rights.
What’s your relationship to Author Earnings?
It’s a collaboration. My collaborator, Data Guy, is definitely the brains of the outfit. We write the reports together.
Big picture: what’s your take on the world of publishing right now?
I have never thought of myself as an e-book author. Before I always put priority on my print-on-demand books with my very first self-published book back in 2009. It wasn’t until the e-books started selling so well and earning so much that it looked like an e-book centered career, but audiobooks and print books are still a huge part of my release schedule.
I hope it gets to where we don’t really care about how we’re reading the story but we’re just consuming the story. So we won’t talk about whether we saw Deadpool in IMAX or 3D but just how funny the movie was.
I think we are pretty much there with readers. Readers just talk about who got the latest novel by their favorite author. It’s the publishers and retailers that are obsessed about what format things should be in.
I was so sure about this that I didn’t double check, but now that we’re talking, I’m not so sure. Was Wool your first book?
It was maybe my seventh published work.
But that’s definitely your breakout, right?
Yes, that’s the one that let me quit the day job.
We’ve spoken to one author of books somewhat similar to yours who says reviews and such don’t matter. Do you have any sense of what enabled you to crack the public’s interest?
The signal was amplified several times along the way, but the growth was organic first.
I think it had a lot to do with how Amazon’s recommendation algorithms work. I had six other books out there, and I’d developed enough of an audience, but the first few thousand are the hardest. It’s really hard to sell the first 500 or 1,000 copies, whether you are traditional or self-published.
But when Wool came out, Amazon’s pumps were primed. It knew people were reading and highly rating my stories. So they would have told several hundred or maybe even a thousand people that there is this new story out. Plus, that first story has this ending that tortures people. As soon as they finish it, no one sees it coming, and they want to see if their friends will see it coming.
It’s like watching The Sixth Sense or something. You tell everyone, “You’ve gotta go see this,” or “You’ve gotta go read this and tell me what you think.”
So the growth curve was going in my favor. It was going from hundreds per month to thousands per month. By the time it was selling tens of thousands per month, that’s when Boing Boing did a review. So then you’re selling 100,000 a month, but it was already on that growth curve. So these things that amplified it, it’s hard to tell how much impact they had.
When I got Wool it was 99 cents. Is that still true?
It’s free now. The first part.
It got serialized, Dickens-like. Once the five parts were all out, I combined them into a single novel.
What do you think the right price point is for ebooks? How does it vary for someone new versus someone with a following?
I think for a full novel, anything from 50,000 to 100,000 words, $4.99 or $5.99, is the perfect price. I think it puts it in pulp’s territory, and it also doesn’t devalue the written word.
I think a debut author needs to give away some of their material, whether they do it temporarily, or they publish a first story as a loss leader.
They’ve gotta do something to get an audience. Free and cheap helps.
‘I got more phone calls from Amazon before anybody had heard of me.’
And then what do you think it should be after you have a following? Some have said the market almost expects you to up the price some at that point.
I think there are some more who, when they get a following, they think they can charge more because they see they’ve got that readership, but when we look at our pricing data, we see a fall-off above $5.99.
They are probably making more money from their established readership, but they are probably losing some sales. But that’s just the aggregate data, and each individual author will have their own experience.
$5.99 seems to be the sweet spot for novels. There’s also a sweet spot at $2.99 where books and stories sell really well.
So you spoke to this some when you said that Amazon had primed the pump, but what do you think drives sales? Do you think it mostly comes down to consumers taking actions like buying your books and reviewing them on Amazon?
I think the most important factors are in the Amazon store.
I think the way Amazon is trying to create their recommendation system and their storefront is to push the products that please the readers the most—and this is a general Amazon philosophy. They want their customers to be as happy as possible, and they are trying to figure out what’s making their customers happy. How do they spread that to more of their customers?
If you can provide a good reading experience and a good shopping experience. Amazon is going to reward you by trying to grow your audience.
‘Traditional publishers aren’t needed at all for nonfiction. If you look at what they’ve acquired recently … it’s dreck.’
Can you talk to me about your revenue streams? How does your income break down?
Like, do I have another job? No.
I have gone wide, gone into all the e-book retailers before, for years. I went exclusive with Amazon after sampling their Kindle Unlimited program, which requires it. What I found was I got a bigger audience and also more income than I did when I was with other outlets as well.
This has looked like an even better decision as Barnes and Noble (BNED) is basically abandoning the Nook. Apple isn’t keen on having a web-based store and is sticking with the iTunes app, which is not a good experience for shoppers. And Google Play does really funny things to pricing, so I’ve never wanted to work with them as an author.
So right now all my income with my independent stuff is with Amazon. And I also have traditional deals which provide some income and I also have overseas deals.
So Amazon is probably number one overall?
I would say it is 90 percent of my income, and the rest being traditional deals.
Amazon includes Audible and my paperbacks, via CreateSpace.
I’ve done a few print only deals that have moved some of my CreateSpace books over to traditional publishers. I could live just on my print sales alone.
Why did you want to do a traditional deal?
That’s a good question. When I did the deal with Simon & Schuster it seemed like an opportunity to experiment without a lot of risk. It was a seven year deal, so I got the rights back in a short amount of time, and it was print only.
It was an opportunity to do bookstore releases and see what would happen with that kind of distribution. That was the theory anyway. But the week my book was released, Simon & Schuster was in a dispute with Barnes & Noble, which showed me that there was no magic bullet.
A.G. Riddle, a bestselling writer of sci-fi thrillers, told us that he printed a bunch of his own books and then sold those copies through Amazon. He didn’t try to sell them directly to bookstores because it was too much bother. Have you ever done your own retailer deals, or your own print runs?
No, I got into bookstores just because of reader demand for signings and to do events of my own. Promotional stuff. A.G. Riddle has got the right idea. It’s just not worth it. If there’s demand for a book, bookstores will carry it. There’s just no point in trying to put the cart before the horse.
Does Amazon work with you and discuss ways it can serve authors like you better?
Not really authors like me. I got more phone calls from Amazon before anybody had heard of me. I had sales kind of trickling through, and I would get calls and they would ask me what they can do to improve. I get surveys from them all the time, which most Kindle Direct Publishing and Kindle Select authors do.
I think they’re more concerned about what they can do for their—I don’t want to call them mid-list, because that word doesn’t really have any meaning these days—authors who might be close to quitting their day job, or selling several hundred books per month.
I think those authors are really forming the backbone of Amazon’s sales and their customer experience. So those are the ones they seem to care about taking care of.
When we first talked about Kindle Unlimited, you took a very pro-Amazon stance. Bestselling romance writer Marie Force told us she’d never consider going exclusive with Amazon, because she has too many readers in the other stores. Why not get your books out wherever there are readers?
Because I care about the number of readers more than anything else. I spent time exclusive with Amazon and then I went wide, published with everybody. I did that for a while, but when I pulled things out of others to try Amazon exclusively it took me like two weeks to realize that I had been losing readers by staying wide with multiple retailers.
Here’s a hypothetical: If the state of Texas said to me they are going to put my book in the front display of every bookstore, but I’m not going to able to sell my book in any other state. But, I know that if I do it I’m going to sell 5 million copies a year. And before, when I was in every state, I was selling 50,000 copies per year. In that case, it’s a no brainer. I’m going to be exclusive to Texas.
Going exclusive with Amazon and getting Kindle Unlimited I have access to all these other readers. All that extra visibility means a lot more people enjoying my stories.
And I’m agnostic about where those people are coming from. If next week Amazon stops selling e-books in those quantities, and Apple or Kobo stepped up and was selling 80 percent of e-books, I would go exclusive with them if that would help me get readers.
Amazon is the only one of the retailers using the .mobi format for their books. Everyone else uses the web standard, .epub. What do you think about interoperable ebooks?
I don’t know how Amazon could make a good user experience if they offered both formats. The advantage of .mobi is they can update the user experience whenever they want. They can add a new font. Or they can do the x-ray feature. Or they can make sure it’s compatible with Audible, so they can do the overlay of the audio with the ebook edition, with WhisperSync. If they did it with .epub, they’d have to go to a committee and get permission.
They’d be slowing down their pace of innovation.
What we can do as publishers and authors is not have any kind of DRM on our ebooks, which I never do. Then readers can convert them to any format they want.
There’s talk of using the block chain to manage intellectual property, which could make e-books resellable. How would you feel about technology that let your readers sell their digital books?
I think it’s brilliant. I think it would be great if someone like Amazon tackled that, instead of it happening outside of the marketplace, but I’m also not sure how much demand there is out there for people to resell their used e-books. I think it gets more attention than it deserves, because I think most people wouldn’t go through the trouble. E-books are so affordable. They don’t clutter anything up. To me, it’s just not like a print book where you pay $20 for a hardback and want to get $6 store credit.
Are e-books going to get beyond genre? Do you think we’ll see non-fiction or literary stuff?
I think eventually there will be 50 million works of literary fiction on Amazon and there will be 100 million non-fiction books on Amazon, because the books don’t go away, but the numbers of what’s being read will still be genre fiction.
If the people who love literary fiction would read 10 to 20 books per year, then their passion would be better represented in the marketplace.
Some crazy stats that have come out of Kobo that track completion percentage. These books that everyone talks about as being important for literature are ones that no one finishes. I don’t see that as anything to celebrate about this industry, that there are books that are supposed to be awesome that no one really enjoys.
I’m more concerned with people actually reading, so I discount the opinion of people who love books but don’t actually spend any time on that pursuit.
I’m more curious about the nonfiction. It seems like traditional publishers pay people up front to go out and do the work. Do you think the day will come that the market sorts out that problem?
University presses have played a role in that for some time.
I think university presses need to figure out how to adopt some of those self-publishing tools to make it work better. The idea that there are these people who get these advances to go live and do research for five years, and some publisher is supporting them, that almost never happens. If there’s a handful of people like that I’d be surprised.
Most people who make a full time living as a nonfiction writer are usually well established, and they got established doing research on their own, while working full time. Traditional publishers aren’t needed at all for nonfiction. If you look at what they’ve acquired recently, it’s memoir, it’s comedians. It’s dreck. It’s not work that we’d consider our cultural heritage.
I would love to see someone take a Malcolm Gladwell type book and break each chapter out into Kindle Singles. Make each one available for 99 cents, and, if you want to, click a button to complete the book.
I’d like to see people experiment, but it will happen. The marketplace will demand that it happen, and the rewards for authors will be so much greater than what they are currently experiencing.
Further reading in the Titans of Kindle series:
- A.G. Riddle, the author who met thrillers with sci-fi with mysteries with romance
- Kristen Ashley built her own empire after others said no.
- Douglas E. Richards takes deep dives into current technology.
- Christopher Nuttall sees major publishers building a castle on sand.
- Marie Force calls digital publishing ‘blockbuster’ for genre writers.
