The Economics of Writing a Book

15 Billion. That's the total net revenue that U.S. publishers took in last year. By some measures, it's a great deal of money-representing the hundreds of thousands of trade hardcovers, paperbacks, ebooks, and audiobooks that get bought and sold annually in the United States. By other measures, it's hardly a blip on the multi-trillion dollar economic landscape, a pittance of a percentage of the American GDP. To put it in perspective, it's about one-tenth of Apple's revenue and barely more than one-third of Apple's profit over the last fiscal year.

All U.S. book revenue added together = 1/10 of Apple's revenue is just a striking little fact to me. Either the value of books is vastly under-represented or the value of Apple is vastly over-represented. Probably both.

I've got strong feelings about the topic: I've written and published three books since 2000, and while it's been a rewarding and ultimately satisfying experience, I'm glad I've done so on the margins of better paid work. I wouldn't recommend any kid decide to "be a writer" when he grows up - it's too hard, the money isn't great, and frankly people aren't reading as much as they used to anymore.

There are two routes: get lucky and a publisher picks you up, and takes care of marketing, distribution, arranging talks on radio and TV shows, etc. Or self-publish and do all that yourself. With a publisher, you've got to be the best; publishers are extremely selective now and they all want the next best seller in an already-defined genre, and very infrequently something crazy or innovative or 'new.' They're all gun-shy. But you pay hefty percentages of your profits to a publisher, who does a lot on your behalf but also gets paid for it.

On the self-publishing side, watch out! There's too much garbage out there so the word 'self-publish' has strongly negative connotations. These days, anyone with $100 and a copy of Microsoft Word can self-publishing the most astonishing drivel. You also get to do your own distribution, marketing, promotion, hand out free copies, mail stuff to book stores etc, and it's a horrific amount of work. If you're lucky you can make millions - there are a couple of authors, mostly publishing teen fiction, who have made serious money selling books for $1.99 to huge audiences of admiring readers. But the bulk of the self-published stuff only sells a handful of copies.

Either way, it's good to have a source of income in the meantime, and especially in the years and years that you toil away at the keyboard. Otherwise, you're going to be eating a lot of catfood.

That guy's website is bog-slow on this old computer by the way. Not sure how they designed it, but they clearly stuffed it full of fail.