Crowdfunding: Connecting Creators and Patrons

So... here's an article on Gizmodo about How Much It Actually Costs to Publish an Ebook vs. a Real Book, based on Making the Case for iPad E-Book Prices at the New York Times.

Giz puts it all in a handy table -- I'll wait while you go and look -- that makes $13 for an ebook look like a fair deal compared to $26 for a hardcover. The publisher gets about the same amount in both cases. The bookseller -- Amazon, say -- gets $3.90 for the ebook, vs. $13 for the hardcover, which is fair because there's no inventory, floor space, or need to cover inventory that doesn't sell. The author gets a little less for the ebook: $3.25 vs $3.90. Printing, storage, and distribution for the hardback is only $3.25. Seems fair, right?

Not so fast.

Giz also says "There is no equivalent paperback market with lower costs to eke out more money later in a book's life (especially if the hardcover flops)." But isn't the ebook more like a paperback? The marginal cost of one more ebook is zero.

If you take out both the bookseller's and the publisher's cut from the ebook, you're down to a perfectly reasonable $4.53. That still includes $1.28 per copy for copyediting, design, and marketing. That means that an author who sells ebooks directly to the public can make money at a lower price.

And that, my children, is why crowdfunding works.

(I'm oversimplifying, of course. Unless you're already an established author or famous for some other reason, it's almost impossible to get your sales figures up to what a publisher could get for you. And so on. But the publishing industry still has to worry.)

Cross-posted to mdlbear and crowdfunding.