File 770 is mad at me again, so I explain how authors Get Paid

I got a track back in the comments on this:

http://file770.com/?p=18813 

Glyver has had this weird hate boner for me ever since I meddled in the sainted Hugo process. I can’t imagine why a guy with 28 Hugo nominations would be upset when somebody starts a campaign to get outsiders nominated. Of course, he gets just about everything wrong in his summation of what Sad Puppies is about, but we’re used to that sort of hit and run tactic. At least he didn’t say it was about promoting racism.

I don’t have time to do a proper fisking, but the article is about the latest Vox vs. Scalzi thing, and somehow I got drug into it. Apparently Scalzi got angry on Twitter because people kept telling him I make more money than he does. A. I have no idea if I do or not. B. I don’t really care.

Somehow I got appointed to be the right wing’s “gold standard” so Glyver then goes about to prove how I’m really not and later the commenters helpfully explain how my career is in “free fall.” Hoo boy, here we go. They really shouldn’t say stuff like that to a retired accountant.

First off, let’s go through how the New York Times list actually works. It is confusing, biased, and not particularly accurate. Yes, I’ve been happy every time I’ve made the list. I’m also happy to use the NYT Bestselling bit in bios for one big reason. Most regular people, even those who don’t pay attention to the writing world think it is a big deal. So the title has some prestige to it, but it really shouldn’t, and I’ll explain why.

The NYT bestseller list is based upon the reported numbers from a select, supposedly secret group of reporting bookstores. It is also based on the sales for one week, so it isn’t looking at overall sales as much as sales velocity. For example, if a book sells a thousand copies a week for the whole year, it probably won’t make the list, but if a book sells 10k copies in one week and never sells another copy again, it will be a bestseller. This is how the Snookis and various Real House Wives end up on the list, yet they’re the most bargain binned and remaindered type of book there is.

Because the supposedly secret reporting stores aren’t really secret to any publicist, if a publisher wants to spend enough marketing money they can game the system and shove a book onto the list for a bit.  You just need to sell a bunch of books through the reporting stores (of course it depends on who else has something new you are competing against that week too). Some publishers have been more dishonest about this than others. I skimmed the linked Vox article. That’s what he’s talking about. How I got roped into this, I have no clue.

As for Vox’s article, a couple of things, I’ve got no clue if Tor’s marketing games the system and even if they did, to be fair Scalzi would have zero input over what the marketing department at his publisher does. Most publicists are going to send you to those reporting stores to do signings. Sometimes they’ll do co-op advertising (yeah, the big displays of books at the front of the store? Publishers pay for those).

As for making the list one week, sci-fi and fantasy are such comparatively small genres that unless they’ve got something else going for them they will usually only be on there for a week. Keep in mind that the NYT isn’t breaking it out by genre, which is why the list is usually dominated by thrillers and romances. If a fantasy has a media tie in, like Game of Thrones, Outlander, or True Blood, then that gets it out of the sci-fi/fantasy sales ghetto and keeps those books on the list for long periods of time. The only other fantasy novels that hang on for long times are the A lister stars like Brandon Sanderson or Scott Card. The rest of us show up for a week or not at all.

Making the list is really nice for an author, because then you get a little bit of extra attention you might not have otherwise got, but remember aspiring authors, the important thing is that you GET PAID. It doesn’t take into account most bookstores. It doesn’t take into account eBooks. It doesn’t take into account foreign sales, ancillary rights, audiobooks, etc. All of those things enable you to GET PAID.  And the most important thing in the world for getting paid is that your older backlist of books are still on shelves, and still slowly selling, so you’re still getting paid for work you did years ago.

The most accurate measure of book sales is Nielsen Bookscan, because about 70% of bookstores report their sales to it. It is a way better measure than the NYT, but since most regular people have never heard of it, that’s why you never see authors putting Nielsen Bookscan bestseller on their bios. Keep in mind however that saying something is more accurate than the NYT is damning with faint praise, most of that sweet paying stuff I listed in the previous paragraphs isn’t in there either, so it is only a partial picture of how an author is actually doing.

Here is an article from Forbes about the problems with Bookscan.  http://www.forbes.com/sites/suwcharmananderson/2013/01/07/can-nielsen-bookscan-stay-relevant-in-the-digital-age/   So basically they account for 70% of 50%, but that’s still more accurate than the NYT.

My last release was Monster Hunter Nemesis. It was the biggest release I ever had. According to Nielsen I was #2 in fantasy (lost to Outlander). I hit #1 on all of Audible and hung out in the top 10 for the month. On Amazon, I had the #1 urban fantasy eBook, and hung out in the top 10 for the month. I’m pretty damned happy about that. It didn’t make the NYT list at all.

Glyver called me Garth Brooks… Well, 2 seconds of Google and Forbes says Garth Brooks’ net worth is 150 million, so I wish.  Sick burn, dude.

Then there was this winner in the comments:

Well, according to Bookscan Larry’s sales are in freefall. His first mm pb book sold some 51,000 copies, but that was back in 2009, which was an entire different publishing world, then. His latest book in mass market? 3500 copies, at best. He seems to be trading on past success,but honestly most of his books (and his compatriots) are selling poorly. Hoyt’s latest? 200 copies. Freer’s? 600 copies. If anything a lot of this is just knee-jerking on their part, and suggestive that perhaps they should figure out why their sales are plummeting, instead of picking on others for their misfortunes.

Huh? I’m not sure which misfortunes I’m picking on, and since I keep making more money, I’m not really sure how I can plummet upwards.

For my stats I’m not really sure what he’s looking at there, since my last mass market to come out was Warbound in May, which sold about that many, except it came out in hard cover first and had already done pretty good there (not to mention I earned back most of my advance off of eARC sales on that one!).  I can’t speak for Dave or Sarah, but I’ll go through how those numbers can be extremely misleading.

I want to concentrate on the “trading on past success” bit. This irks my inner-auditor to no end, and I really want to crush it, but at the same time I don’t want to start throwing out my personal finances on the internet. So I’m trying to think about how to phrase this without my publisher or my wife yelling at me.

Every single royalty check I’ve had has been larger than the previous one. If I was trading on past successes, wouldn’t that be going the other way? On the contrary, my last royalty was 11% higher than the prior one. That one was 28% higher than the one before it. That one was up 15%, which was good since it was up a massive 43% from the one before it. (all the accountants are laughing now because they realize I’ve gotten back into the statistical trickery of how it looks way more impressive to go to 3 from 2, rather than 7 books to 8).  One reason my royalties have continued to grow is that my earlier books are still consistently selling and being reordered, so it makes for a nice continual income stream.

The more stuff you get out there, the more backlist you’ve got to sell, the more money you make. Like I said earlier, I don’t know which one of us makes more money, but I’ve only been doing this since 2009, and Scalzi’s got like a 5 year head start on me, so just by sellable backlist growth he should be making more money.

To give those of you who want to be professional full time authors here is an example of how a D List author’s stuff breaks down. My last royalty check was for the 6 month period ending December 31st, 2013. Because there is a delay in how royalties are calculated, my last 3 books aren’t on there yet. This is just royalties, not advances. To be vague but give you a ballpark, my royalties for those 6 months was about four times the median per capita yearly income for my state (thanks Wikipedia!).

Of that, only 1% was from Dead Six. My military thrillers don’t get shelved in the Larry Correia section of your local B&N, so after their release they have fallen off. It was a higher % last statement. Swords isn’t on there yet. Keep in mind that number is only half of what the book made because I’m splitting it 50/50 with my co-author. So you might ask, why bother with the thrillers? Why finish the trilogy? These certainly aren’t the most economically efficient use of my writing time, but I enjoy writing them, and my 50% has still made enough off D6 to pay about 10 mortgage payments over the last couple years.

Hard Magic and Spellbound both made a consistent 21%, for 42% of my royalties for the 6 month period. Warbound will be on the next one. None of the Grimnoir trilogy made the NYT list, but now this is where it gets interesting and we have some fun with statistics. So far in total I’ve made almost as much money off of each Grimnoir novel as I have off of the MH novels. Spellbound and Warbound both had bigger selling release weeks than MHA or MHV (which both made the NYT), so what’s the deal? These must be indicators of my “freefall” right?

Nope. Let’s take Hard Magic for example. Keeping things vague, so far Hard Magic has earned money sufficient to make about 50 of my mortgage payments (for perspective, I live in the mountains by a ski resort in a 4,500 square foot house I built 3 years ago, so it ain’t too shabby), or to put it another way, about 1/3 of that Aston Martin I really want (damn you, Clarkson, for showing me the car that haunts my dreams).  But here’s where it gets interesting. 44%(!) of that money is from subrights.

Subrights include things like audio books and foreign translations. None of the Grimnoir novels made the NYT, but they’ve been some of the bestselling audio books on Audible for a few years now. If I could sell regular books proportionate to how I’ve done in audio, I’d already have that DB9. Foreign isn’t anything to sneeze at either. Of the translations, Grimnoir is doing surprisingly well in France. I’ve got a Chinese translation coming out too that I’m really excited for (Asia loves noir-pulp).

Another interesting stat to be gleaned from looking at Hard Magic’s details, and I can’t say anything more specific about this one because I know Toni would kill me, but the percentage from Baen’s Webscriptions (eBooks direct from Baen) is surprisingly large. These aren’t recorded on any bestseller list, but man, it is like having a second Amazon sized amount of money coming in. There’s a lot of loyal customers on there, and eARCs are awesome.

So now let’s get into the books that pay my bills. 57% of my royalties for that period were for MHI, MHV, MHA, and MHL. Nemesis just came out a few months ago, so I won’t see it for a bit. How these have broken down is that I always get a spike from the most recent, and then it tapers off on later statements. MHV has been out for 4 years, but it still earned enough in this 6 month period to pay 7 mortgage payments (or enough to make sure that DB9 has the nice interior and cup holders!).

The subrights percentage for the MHI books varies, but is a bit lower overall that Grimnoir. It has done better in print, done pretty darn good in audio, but hasn’t had nearly as many foreign translations. (A German one just came out this year, so I’m curious how that will do). However, that subrights percent has been higher on previous statements when I’ve been paid for the TV options (MH has been optioned for TV, Grimnoir hasn’t). Now TV option money isn’t huge, but it is nice. Production on the other hand, that’s huge money.

The way TV and movies work is that a production company “options” your book. That basically means they’re paying you money so they can hold onto the rights to keep you from selling it to somebody else. Then in the contract, if they actually go into production you get paid a whole lot more. You’ll see authors refer to something as being “in development” and that usually means that their book has been optioned. That sounds great and all but you need to realize the vast majority of the things Hollywood options never get made. MH has been optioned for 3 years and they’ve finally brought in screen writers and moved it out of development limbo, but since this is Hollywood, I’m not holding my breath. I’ll believe it when the production check clears. Then it is super car time.

I’ve only talked about royalties and subrights, not advances. Now every publisher is different but normally an author will be paid an “advance against royalties” that you’ve got to earn back first before you start collecting royalties. However, every single one of my books has earned out during the first royalty period so it hasn’t mattered much. I’m not exactly living paycheck to paycheck here, and my paychecks are 6 months apart.

When you are starting out, big advances are nice, because that means the publisher is probably going to spend some marketing energy on you. Maybe. But if it doesn’t earn out in a timely manner, that publisher may now look at you as a financial loser. My advances now are pretty decent, but when I was just starting out they were small. The way my advances are structured I get a third on signing, a third on turn in, and a third on release. I’ll have two turn ins this year. None of the money I’ve talked about so far has included the advances. The way it has worked out for me, advances are nice, but I’ve made the real money long term.

In 2011 my writing income increased 65% over 2010’s total. 2012 I only had an 11% increase. 2013 made up for it with a 56% increase. 2014 is on track to handily beat last year. I’ve already paid more in withholding taxes than I made in all of 2010. So my “plummet” is kind of backwards, since it goes up, but I’m guessing Glyver’s posters aren’t accountants.

The lesson to be taken from this, those of you who want to make a living at it, is that you need to keep producing books. Some will do better than others. But the more you produce, the more likely somebody is to read your stuff and tell their friends. Eventually you’ll end up with a chunk of shelf at the local bookstores devoted to you, which they’ll keep restocking as your backlist sells. The big flashy hit is nice and all, but a steady, reliable, and growing audience is pretty damned sweet.

For example, I don’t think Lee Modesitt has ever made the NYT bestseller list. Except Lee has 50 something books still in print, continuously selling, all over the world. The man has done extremely well for himself.  I’d rather be Lee than a NYT bestseller nobody ever hears of again.

Do you get now why looking at one number in a vacuum can be really misleading? Yes, in 2009 I sold a lot of MHI paperbacks, except I sold almost nothing in eBook, had zero hardcover sales, and zero subright’s money.  Or another way to look at it, I made more money off of writing short stories and game tie in fiction last year than I made in all of 2010. In 2013 I sold $108,000 worth of MHI merchandise.

Apparently Garth Brooks and I both have friends in low places. :)