Saturday, May 8, 2010

A Veteran Agent Looks at the Book Business

By Pat Browning

Michael Larsen and Elizabeth Pomada give literary agents a good name. The consummate professionals, they are experienced, generous, active in all aspects of the book biz – and they’re accessible. Larsen’s blog at

covers topics from storytelling to publishing and everything in between.

A recent blog recaps The New Yorker’s article by Ken Auletta on publishing money’s migration to the Web. Some startling figures: 70% of 100,000 print books produced each year don’t earn back their advances; Amazon’s 3,000,000 Kindles generate 80% of e-book sales.

The husband and wife team of Larsen and Pomada left New York for San Francisco and opened their own literary agency in 1972. They founded the prestigious San Francisco Writers Conference almost eight years ago.

The next conference is scheduled for February 18- 20, 2011. It will feature nearly 100 agents, authors, editors and book industry professionals. Attendees will have access to more than 50 “how to" sessions, panels, and workshops taught by authors. Speed Dating for Agents and Ask a Pro offer one-on-one opportunities to pitch your work directly to publishing professionals. The web site is at:

The agency web site is full of helpful information for writers, and it’s great for browsing. Check it out at


 “Following The Money: Publishing 2010”
Michael Larsen’s blog post Thursday, May 6th, 2010.
Reprinted here with his permission.

“Publishing exists in a continual state of forecasting its own demise; at one major house, there is a running joke that the second book published on the Gutenberg press was about the death of the publishing business.”

This is from a must-read article by Ken Auletta about the iPad in April 26th issue of The New Yorker. It includes numbers that follow the money in publishing as it migrates to the Web. They also provide a perspective on the business and where it’s going:

* Six publishers produce 60% of books sold.
* 70% of the 100,000 books that industry produces a year don’t earn back their advances.
*On a $26 book, authors receive $3.90 in royalties, 15% of list price on a hardcover book. Publishers make a $1 profit.
* More than 50% of revenue at Random House comes from backlist books.
* Since 1999, the number of independent bookstores declined from 3,250 to 1,400.
(On the other hand, the San Francisco Bay Guardian just gave a Chain Alternative Award to the Northern California Independent Booksellers Association, which has two new members this year.)
* Independents have 10% of sales, chains about 30%, big-box stores like Wal Mart, 45%, which pressures big houses, like Hollywood studios, to produce blockbusters.
* Publishers have to run two businesses at once: a traditional publishing business and an electronic business.

* Marcus Dohle, the Chairman and CEO of Random, said “The digital transition will take five to seven years.”
* There are 50,000,000 iPhones in the world, which O’Reilly Media vice-president Andrew Savikas calls “a great customer base” for book apps.
* Most publishers are giving a 25% royalty on e-books.
* Amazon’s 3,000,000 Kindles generate 80% of e-book sales, which Amazon achieved, in part, by selling at a loss.
* When Amazon customer can choose between a paperback and an e-book, 40% of them choose the e-book.
* Kindles users buy 3.1 as many books as they did twelve months ago.
* An Apple adviser who used Netflix to download movies compared bookstores to video stores ten years ago.
* Three behemoths–Apple, Amazon, and Google–are competing, so one of them can’t dictate terms.
* Author Solutions works with 90,000 authors.

What these numbers suggest is that publishing is going through a transformation. Old and new media companies will in time establish a business model that works for them and makes money for writers.

What these numbers can’t capture is the article’s engaging, rough-and-tumble portrait of predators at play or the importance of
* publishers in discovering and developing new authors
* independent bookstores in launching them
* writers who keep the whole enterprise afloat by sitting in front of their computers creating the art that makes commerce possible

Former Random House editorial director Jason Epstein said: “When I went to work for Random House, ten editors ran it. We had a sales manager and sales reps. We had a bookkeeper and a publicist and a president. It was hugely successful. We didn’t need eighteen layers of executives. Digitization makes that possible again, and inevitable.”

Author Lee Foster says “This will be a golden age for content creators.” You will create your future as a writer with your head, your heart, and your fingertips. Three cheers for content, whatever form it takes!


Jean Henry Mead said...

A great, informative article, Pat. It's good to have you back.

Mark W. Danielson said...

The writing business is quite sobering when you look at the numbers. I've always maintained that you must love writing to make it worthwhile because the money isn't there.

Anonymous said...

Some great information and much for us all to consider. Thanks for sharing.