Ads in eBooks

Ads in Ebooks

By Scott Nicholson

(Originally posted at Murderati)

I’ve gotten out of the “writer babble” business for two reasons: (1) I don’t know as much as I thought I did, and (2) it’s all changing so fast that even the boldest predictions of digital evolution quickly become laughable.

I don’t even use traditional publishing as a reference point anymore, because that is so far removed from most writers’ realities that it may as well be Shangri-la or Hollywood. The indie vs. trad debate is now only meaningful for a small group of people, and they are all making way more money than you or me.

So you are in it, and if you are lucky, you made a nice little nest egg back when everyone was standing on the sidelines deciding whether indie was the way to go. Hopefully, you shook off the intellectual shackles that chained us to the agent speed-dating sessions at writing conferences and were hammered and locked into place by “publishing experts” with 20-year writing careers in the old system. You know the mantras: “Get an agent,” “Only hacks self-publish,” and “You can’t produce and distribute a book without the advice of publishing experts.” Basically, ego affirmation. Of course the experts didn’t want to lose their position of authority (and in the agents’ case, the intermediary status of being the first in line to get checks.)

But the gate was left open and the horses all got out of the barn, or something like that (come up with your own gatekeeper metaphor; I am writing this for free!) So now we have a market where the 99-cent ebook had a year’s run, and the pool was finally beginning to find stratification (crappy books sinking, good books nailing stable plateaus) when Amazon unleashed the latest version of indie roulette—the free ebook.

I'm on record as predicting the flat-text e-book era has an outside range of five years, at least for fiction—specialized non-fiction and manuals will continue to be valuable for their content alone. I believe e-book sales will continue, but certainly not with expanding profits for all involved. Now that there are thousands of free Kindle books available every single day, how long before readers come to expect and even demand free books exclusively?

Freebie roulette. Great for readers. Good for Amazon (maybe in the short term, but it is hard to figure the long term). Terrible for authors.

The market is diverse enough to support many different price tiers, but writers who want to survive in 2015 will need to make money off of free books, or they will soon quit writing.

I only see one outcome: ad-supported or sponsored books. At first blush, you'd think N.Y. has an advantage, since Madison Avenue is right there. But can corporations, with their large structures, be able to compete when indie or smaller entities can react more quickly to present conditions instead of protecting some imagined status quo?

J.K. Rowling can inspire a Pottermore built around her brand, and James Patterson, Tom Clancy, and Clive Cussler have already built factories around their names (and, yes, V.C. Andrews, you can roll over in your grave two or three more times for all I care, because this is all your fault). But most of us are not factories or we wouldn’t have to indie publish.

This points out the new era of the branded writer. And not just "writer," but "content creator" and even mere "idea marketer." A personality is more suited to building brand identification and audience than a publisher is. I say "James Patterson" and you get an image. I say "Random House" and what do you get? Randomness. We've seen it here locally: "Ray's Weather" is where you check the weather and "Todd's Calendar" is where you click to find what's happening in the region—and both are ad supported. You can get the free content elsewhere but you don't get the human personality attached.

I'm already experimenting with the ad model because I believe it is viable. I am counting on Idea Marketing being one of my foundational pillars. I am not quite sure what it all looks like right now, but I look at it this way—you don't need NY in order to give away tons of free e-books or to spread an idea or to build a social platform. You are the idea you want to spread.

Other authors will say “I’ll never sell out.” (Ironically, those are usually the authors who have given most of their incomes to agents and publishers…) I don't blame people for sticking with what worked in the past. It all goes to how invested you are in a certain system and how the alternative looks, and, of course, the turf where you’ve staked out your ego. Publishing-industry talk on e-books uses phrases like "managing risk" and "cautious adaptation." That is why those of us in the trenches knew Barnes & Noble was in serious trouble when most in the “publishing industry” only realized it recently when BN’s horrifyingly bad third-quarter reports came in. They are working off of old data while I work off the data I got an hour ago.

And my data says this may be the very peak of the Golden Age of digital publishing. The $9.99 novel may be dead this year, since three-quarters of the current bestsellers are low-priced indie books. As fast as major publishers yank their name-brand authors out of digital libraries, 10 new indies cram into that virtual shelf space. Maybe forever. James Patterson’s factory can’t run on $2.99 ebooks, but mine can.

But what happens when the $2.99 and 99 cents drop to permanently free? Where’s your sponsor? Are you willing to go there? It's not going to be as clumsy as an image of a refreshing Bud Lite popping up when the main character enters a bar (though it's not unthinkable at some point.) Can you see Jack Reacher with a favorite brand of soft drink, or Bella Swan wearing only Calvin Klein? At what point is your willing suspension of disbelief shattered? At what point do you realize the ad is the only reason the book can exist at all?

My informal polling on ad-supported ebooks yields statements like: "I'll quit reading before I put up with that." I also remember saying I'd never carry a cell phone, or be on Facebook, or give up my vinyl albums, or start thinking that maybe nuclear energy is the best short-range answer to our energy addiction. Or that I’d ever read an entire book on a screen.

I don’t know the answer, but I am deeply invested in the question. So, ads in ebooks. As readers and writers, what is your opinion?

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The Unofficial Scott Nicholson Ebook Predictions for the Future of Publishing: Updated

Just for giggles, I thought it might be fun to go back to some of my "Predictions for the Future of Ebooks" I made in September 2010 at Debbi Mack's blog (complete post is here). I will give myself a grade from A to F based on what has happened since and where it may be trending. Even though the predictions were fairly tongue in cheek, they were based on what I knew at the time. As usual, I only learned that I don't know very much! Feel free to chime in with your own predictions.

1. The Kindle will deliver the knockout punch to the Nook, Sony Reader, and Kobo e-reader by Christmas 2011. 

GRADE: F. I clearly botched this one, but I do believe Sony and the Nook are about at the end of the road, and Apple has still not entered the ebook market. Kobo has made great worldwide steps and looks to emerge as Number Two behind Amazon's Kindle.

2. By December, many of the indie writers who jumped on the $2.99 pricing bandwagon for e-books will drop to 99 cents in an effort to drum up numbers.

GRADE: B. Most indie writers do price their books at 99 cents, although an increasing number of the more successful indies are moving to $3.99, and it seems to work. Apparently, the $2.99 price point, like the 99 cent price, has become for some readers a warning sign that the book is indie. An author who charges more is worth more, even if it's the same author! Why didn't I think of that?

3. The Big Six group of publishers will be down to the Big Three in five years, and Amazon will be a bigger publisher than those three survivors put together. 

GRADE: B. Still too early to tell at this point, but Amazon is trending up up up. I've been impressed by the transition big publishers have been able to make, steering the massive ship just in time to avoid a head-on with the glacier, but I still believe scraping the bow will be enough to sink her. Still, we can't discount the huge cargo of backlist she's hauling.

4. Small publishers with identifiable markets will adapt better than large publishers who have no identifiable markets, because publisher brands are meaningless to the average reader.

GRADE: C. Again, it's early, but a lot of small presses have done very well in the ebook era, thanks to low overhead and in the joy of ditching the whole bookstore distribution system that always freighted them with a disadvantage. But publishers have not lost their writers as fast as I thought they would, and there seems to be plenty more writers willing to board the sinking ship, just to say they were there when it happened. A small but vocal core of readers also seems to be demanding protection from those pesky indie authors and their millions of unedited books (while big publishers scan paper copies and dump out inferior formatting in far too many cases). I only give myself "average" because publishers have done better than I expected (for now).

5. In five years, there will be about 200 bookstores in the United States, centered in the major cities.

GRADE: A. And you can say good-bye to Barnes & Noble, which has pretty much gutted its shelf space to start selling Nooks and carpets and toys and beanie babies and iPads. (I guess it depends on at what point you stop considering B&N a "bookstore" and start calling it a "general merchandiser.")

6. In five years, there will be 10 million e-books for sale at Amazon.

GRADE: A. I'm sticking with this one. Ebooks passed the one million mark early this year and, at the rate at which indie authors are befriending me on Facebook and the frantic rush of veterans to get their ebooks out (not to mention everyone turning their short stories and articles and blog posts into ebooks), I'd buy stock in this prediction.

7. The publishing industry won’t exist in 10 years. Instead, we’ll have 20,000 cottage industries supplying digital content, very few beyond the hobbyist level.

GRADE: C. I believe something calling itself "the publishing industry" will still be around, but it will be fairly unrecognizable-- about on the order of what "record labels" and "movie studios" are now--a few big power brokers but tons of tiny cottage industries. And those agents are doing a pretty good job of turning themselves into epublishers, although I still don't see what advantages they can offer over doing it yourself.

8. In five years, even the e-book bestsellers will sell for 99 cents. Most of the rest will have no value. 

GRADE: B. I'm sticking with this but downgrading myself because it's going to be difficult to determine "value"--because advertising will make a big impact on book pricing.

9. The 20 surviving novelists still getting published in print in 10 years will make out like bandits.

GRADE: A. I'm sticking with this one. And I'll bet half of those bestselling authors will be dead, with the names farmed out. For the record, the complete prediction was based on rack presence in retail stores, not POD or those antique specialty shops we'll nostalgically call "bookstores."

10. The authors unfortunate enough to have been moderately published in New York this decade will be the worst off in 2020, when most sales are digital and they have signed clauses that basically grant their e-rights in perpetuity. 

GRADE: B. I've observed an interesting phenomenon with the authors who have signed major deals and kept publishing their own books. Their own books sell better than the major releases! Even at lower prices, they earn far more money. So they are using their major publishing deals as LOSS LEADERS!!! That is something I hadn't expected. But those authors locked in at 9.99 retail prices with publishers who have forgotten them will be lucky to ever see a nickel in royalties. And yet people are STILL querying agents, signing contracts, and banking their futures on someone else's needs.

11. The Big Three will have some spin-off revenue in enhanced digital books, but only for the brand-name authors who died and didn’t have heirs smart enough to start their own publishing companies.

Grade: C.  Well, Pottermore is attempting to launch, and Pattersonville, ClancyPants, and Cusslerland can't be far behind, but the only people who get even remotely excited about enhanced ebooks are the middle players who want to "intermediate" themselves into the production process. For money. That no reader wants to give them.

12. In a desperate survival attempt, publishers will move to a subscription model, similar to the Netflix model, where consumers pay a flat monthly fee for the books they want to read. 

Grade: B. I knocked this out of the park with Amazon, which last week announced it was rolling its own lending library into its Prime subscription (which is basically Netflix without the bad management). But I am flubbing on the feet-of-clay publishers taking advantage of their one main strength: an actual library of content. 

13. By 2013, 85 percent of the writers who published their rejected manuscripts in 2010 will give up for good, retiring with $200 in net profit and a good story for the grandchildren.

Grade: C. I am already seeing dramatic announcements of "I'm quitting" from writers who nobody knew had even started. But it seems like a lot of writers are earning at least a little bit, and since there's no overhead, there's no reason to quit. If nothing else, 2011 will be remembered as the year shameless self-promotion crested into a tsunami and flooded every social media stream. And way more people are entering the game ("Gee, I hear you can make a million on Kindle. I'm going to start writing!") than are leaving it.

14. The smart writers who are dumb enough to stick with it will earn their money through content advertising, product placement, multimedia branding, and tireless promotion.

Grade: Incomplete. I still think ads are coming, presaged by Amazon's Prime library and the reduced-priced "Kindle with bargains," but it is still too early in the evolution to pat myself on the back or kick my rear.

15. Half of these predictions will be wrong, and no one will be able to tell which ones they are, because this blog post will be stored in a free e-book that no one ever reads.

Grade: C. I don't think I've put this in an ebook yet because it will date badly one way or another. Sorta like the guy walking around with a "The End is Coming!!!" sign. Even if you're right, you're still an idiot.

16. I will still be writing in 20 years, and no one will care about my predictions. 

Grade: Makeup Test. Depends on how many people drop by to read this and comment.

Final Grade: Pass. By following what I believe, I've managed to carve out a career, so my predictions are working for at least one person. Okay, I admit, I graded myself on a curve. What can I say? I'm the teacher's pet.

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How NY is Fueling Its Own Demise

I don't like to talk sales numbers, because it inevitably sounds like whining or bragging, but since Jan. 4, I have sold more books than Snooki, according to this article.

I know the major publishing industry is desperate and that's part of the reason they have been tossing real writers overboard while others are fleeing like rats from a burning ship. Every "sure bet" deal for Snooki or George Bush or Sarah Palin or Madonna sends 100 real writers to the soup kitchen.What's stunning is how New York is so actively and willfully tossing gasoline on the flames of its immolation. By failing to recognize the tastes of readers or developing the literary talents of tomorrow while engaging in a wholesale denial of what people want to pay and how they want their books delivered, their ship will soon be a smoking cinder slipping beneath the waves.

Not coincidentally at all, those writers look for their audience elsewhere, and the largest, hungriest audience in the world is sitting next to their Kindles as we speak. The Kindle/Nook phenomenon is not just a tech craze or a groovy new consumption model. It's a release valve for the pent-up desires of so many people craving a wealth and diversity of reading material. Your average public book display will have 20 copies of the same 20 books all across America. Those books are the top 20 on the bestseller lists for obvious reasons.

People now have a choice. Nearly a million choices, really. And it's only the beginning.
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new mystery release--CRIME BEAT

Hey, sign up for my free newsletter and be entered to win a limited-edition hardcover of Transparent Lovers, from PS Publishing. Also giving away used hardcover of Max Brooks' World War Z and three sealed copies of Black Static magazine. Drawing Thursday to commemorate launch of my new mystery novella Crime Beat.

Crime doesn't pay...but neither does journalism. When John Moretz takes a reporter job at a small Appalachian newspaper, a crime spree erupts that quickly escalates to serial killing. And Moretz seems to know just a little bit more than he's putting on the front page.

99 cents for a limited time at Amazon
Or at Amazon UK
For Nook at BN.com
In all formats at Smashwords

Thanks for helping spread the word.
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We did this e-book era, so now what?

If you've been at all interested in indie publishing, you read JA Konrath's blog, and he's made his latest compelling case for controlling your own content in the digital era. While I agree wholeheartedly with the underlying principal, I am not so convinced there will be eternal expansion in the e-book market. The digital book business has changed so much in a year that Joe's and Lee Goldberg's joke of "Who wants to be a Kindle millionaire?" is no longer a joke, it's just a question of who will get there first.

Barely 20 years ago, the average mass-market paperback sold 100,000 copies. Writers who planned their retirements on that expectation are probably in some low-level government job right now (like the other 40 percent of the country) or are lucky enough to be drawing unemployment like the other 10 percent. A writer who expects to continue to earn $2 per ebook for the life of copyright may meet the same fate. Though I suppose for most writers, any job pays better than writing.

I'm on record as predicting the flat-text e-book era has an outside range of five years, at least for fiction--specialized non-fiction and manuals will continue to be valuable for their content alone. I believe e-book sales will continue, but certainly not with expanding profits for all involved. Somewhere along the way, readers have to keep paying to support all this, and there won't always be a fresh army of new advocates every Christmas, and the current readers will have several lifetimes' worth of content hoarded away. That brings us to the question of "What next?"

I see two splits, with some overlap. Bestsellers at 99 cents, and ad-supported books. At first blush, you'd think NY has an advantage, since Madison Avenue is right there. But can corporations, with their large structures, be able to compete when indie or smaller entities can react more quickly to present conditions instead of protecting some imagined status quo?

When someone like Seth Godin breaks from a publisher, it's news. But Seth Godin could snap his fingers right now and line up way more advertisers on his own (or, at least, earn a far greater share of the proceeds) than he could with a shareholder monkey on his back. If you look at what he's doing, he's basically created his own media empire. James Patterson has done the same thing but under a corporate imprint--I wouldn't be surprised if he takes his own road soon, but he may be at the age where he'd rather just ride out his momentum.


This points out the new era of the branded writer. And not just "writer," but "content creator" and even mere "idea marketer." A personality is more suited to building brand identification and audience than a publisher is. I say "James Patterson" and you get an image. I say "Random House" and what do you get? Randomness. We've seen it here locally: "Ray's Weather" is where you check the weather and "Todd's Calendar" is where you click to find what's happening in the region--and both are ad supported. You can get the free content elsewhere but you don't get the human personality attached.

I'm already experimenting with the ad model as my website undergoes redesign. I am counting on Idea Marketing being one of my foundational pillars. I am not quite sure what it all looks like right now, but I look at it this way--you don't need NY in order to give away tons of free e-books or to spread an idea or to build a social platform. I'm still honing my core beliefs, but they center around compassionate self-reliance and the exchange of ideas.

My indie experience was cited on a post by Jim C. Hines where he talks about his "failed experiment" of putting out an indie and mentions Laura Gilman's expressed fear of piracy (for a story collection, of all things--most people would be lucky to have those stolen, though mine do sell unexpectedly well). I don't blame people for sticking with what worked in the past. It all goes to how invested you are in a certain system and how the alternative looks. Publishing-industry talk on e-books uses phrases like "managing risk" and "cautious adaptation." I have nothing to lose so I can afford to go balls to the wall.


I had a talk with an Amazon DTP tech a few weeks back, and Amazon is continually exploring ways to build on the interactive experience inside the e-book. Google clearly is planning an ad-based model. And it's not going to be as clumsy as an image of a refreshing Bud Lite popping up when the main character enters a bar (though it's not unthinkable at some point.)

"I'll quit reading before I put up with that." Yes, I've heard that. I also remember saying I'd never carry a cell phone, or be on Facebook, or give up my vinyl albums, or start thinking that maybe nuclear energy is the best short-range answer to our energy addiction.

I'm not a pessimist, because I'm extremely grateful to be free enough to act as I see fit, but when "How to get free Kindle books" are the bestselling Kindle books, I feel which way the wind blows. Now, as soon as I can figure out how to give away a million sponsored ebooks, I might be in the running.

All you corporations out there that I am studiously avoiding mentioning for free, you know where to find me.

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