How Demand Studios’ exploitation of writers turned it into a billion dollar company

Wired has a fascinating article about Demand Studios, one of the word factories that regularly advertises for writers, only to exploit them. You can’t claim Demand pays writers peanuts. It’s more like peanut husks.

It’s worth reading the article to learn how this sweatshop-type operation makes such big bucks. But here, we’re only concerned with the pennies it pays to the people who made it possible for Demand to become the billion-dollar enterprise it now is. The snippet below provides a hint:

It’s the online equivalent of day laborers waiting in front of Home Depot. Writers can typically select 10 articles at a time; videographers can hoard 40.

Nearly every freelancer scrambles to load their assignment queue with titles they can produce quickly and with the least amount of effort — because pay for individual stories is so lousy, only a high-speed, high-volume approach will work. The average writer earns $15 per article for pieces that top out at a few hundred words, and the average filmmaker about $20 per clip, paid weekly via PayPal. Demand also offers revenue sharing on some articles, though it can take months to reach even $15 in such payments. Other freelancers sign up for the chance to copyedit ($2.50 an article), fact-check ($1 an article), approve the quality of a film (25 to 50 cents a video), transcribe ($1 to $2 per video), or offer up their expertise to be quoted or filmed (free). Title proofers get 8 cents a headline.

Don’t write for these — or any — exploiters. Leave these crumbs for the amateurs. I know it’s tempting, as newspapers die, and magazines fight for survival, to take whatever work is available. But writers who do so help perpetuate their own exploitation.

Write a book, instead. Either shop it to agents and publishers or invest in publishing and marketing it yourself. There are plenty of new publishing opportunities to explore, from the Espresso Book Machine which is rolling out a few new locations and may soon make the printing of a single book as cost-effective as printing in bulk, to ebooks, which already eliminate the costs of distribution, warehousing and shipping.

– Anita Bartholomew

Publishing at the crossroads: who will own the future, you or Google?

I’ve written before that I believe the Espresso Book Machine (EBM) from On Demand Books,  could be a publishing industry game-changer, as much and even more so than the advent of ebooks. Although the EBM is only in 10 locations now, the wide distribution of EBMs or other machines like them, would allow authors, with new or out-of-print books, to publish their own work, at lower costs than are now generally available from POD printers. Because the books get published at the bookseller’s site, the author-publisher isn’t saddled with the significant costs of warehousing, shipping and distribution.

And returns? That would be a store-by-store policy issue but here, too, the savings to the author-publisher would be significant. If a store with an EBM permitted returns, the author-publisher might have to bear those costs. But the author-publisher would be spared the expense of refunds and two-way shipping on unsold  books that were published sans demand, and then removed from the shelf and returned when demand failed to catch up to supply.

The lower overhead opens up all sorts of possibilities and Google is now showing us that the game could go either way for those who want to breathe new life into their old books.

A story today in Wired says that Google is going to offer public domain (out-of-copyright) books via the Espresso Book Machine:

Over the last seven years, Google has scanned millions of dusty tomes from deep in the stacks of the nation’s leading university libraries and turned them into searchable documents available anywhere in the world through its search box.

And now Google Book Search, in partnership with On Demand Books, is letting readers turn those digital copies back into paper copies, individually printed by bookstores around the world.

Or at least by those booksellers that have ordered its $100,000 Espresso Book Machine, which cranks out a 300 page gray-scale book with a color cover in about 4 minutes, at a cost to the bookstore of about $3 for materials. The machine prints the pages, binds them together perfectly, and then cuts the book to size and then dumps a book out, literally hot off the press, with a satisfying clunk. (The company says a machine can print about 60,000 books a year.)

Two issues the story doesn’t address give us the clues to what makes this so technology so important to those of us who make our living by the written word:
The possibility for POD editions had been treated as a “maybe someday” clause in the Google settlement. Someday is here, it seems, the moment the settlement gets the judge’s thumbs-up (if it does). Assuming the same pricing structure as the out-of-copyright books, Google gets a dollar, and passes along 63 cents to the Book Rights Registry (BRR). The BRR passes along to publishers what’s left after taking its unknown cut. Publishers pass along to authors — what? Maybe 10 to 25 cents per book sold?

Contrast that to what an enterprising author might get by republishing her or his own out-of-print book and offering it via the EBM. Costs to print via the Espresso Book Machine are just $3 in materials plus whatever the bookseller adds for profit and the cost of amortizing the EBM owner’s investment in the machine. But on the author-publisher’s side, when you consider eliminating the costs of warehousing, shipping, distributors and returns, you’re likely to be about where you’d be with a traditionally published book with one enormous difference. You’ve removed the uncertainty factor that drives costs to unknown, profit-killing levels and keeps so many would-be author-publishers from going it alone.

When you’re no longer working on the crazy model of providing books on consignment and assuming all financial risks, you might actually be able to run a profitable business as an author-publisher.

Can you say the same is anywhere near possible if your books are coming out of the same Espresso Book Machine but the money goes to Google instead?

– Anita Bartholomew

Why writers shouldn’t bet their careers on magazine writing, part II

Article fees are stagnating at best. Numerous magazines have lowered their per-word rates. I hear reports all the time from  writers that magazines assign an article at, say, 1,000 words but demand extra reporting that can require the writer to up the submitted word count by 50 percent or more, with no extra pay.

Writers, brace yourselves. This is your future if you continue to bank on magazines. Magazines were hurting before the economic downturn and you can’t assume that the situation will reverse once the economy stabilizes. See this article from Min on the prospects for consumer magazines — or simply read the following sobering excerpt:

Magazines did not come into the recession from a position of strength, with a [Compound Annual Growth Rate] at a meager 1.1% from 2003 to 2008.

Virtually all of the main revenue drivers for this industry are being depressed by a shifting media economy and digitization, such that magazine advertising will decline 15.6% in 2009 to $10.53 billion and a [Compound Annual Growth Rate] of -6.6% for the 2008-2013 period. This will leave the ad spend on magazines at $8.87 billion in 2013, the lowest level since 1995.

Ever-shrinking ad revenues mean that articles fees must also continue to shrink.

And for those who say, “no problem, I’ll write for the web,” I have to ask: haven’t you noticed that most websites pay less than even the struggling magazines? While some web publications pay at least something, too many are paying so little, the fee offered is an insult. And you can’t pay your bills with the proceeds  of insultingly low fees no matter how quickly you write.

So, what’s left?

My guess is that the writers who continue to make a living from writing will be writing books. Some will get traditional publishers. Some will publish their own books as book publishers also tighten their budgets.

The Espresso Book Machine, or something like it, if it catches on, will make any bookstore that has one a print-on-demand center. That will make it possible for good writers to become publishers without the overhead of warehousing and shipping, and with a lower per-book printing cost than current POD options. But only those who master marketing and publicity will earn enough to make a living.

I know this isn’t a cheery post but I read too many cheery proclamations from writers who keep doing what they’ve been doing while their incomes shrink. We all need to think ahead, not just to the end of the year but to five years from now. Where will publishing be? And where will you be in publishing?

– Anita Bartholomew

Gawker outs publications that stiff writers

One publication kept a freelancer waiting two years for a $40 check, says this piece from Gawker. Another has owed a writer $14,000 since last spring. Several magazines are hiding from writers who call to ask where their money is.

And Gawker’s  list is by no means comprehensive.

Writing for household name publications used to be as safe as money in the bank. Now, it’s become risky business. It seems that three or four magazines go out of business each month and several more are teetering on the brink.

Word of advice: if your assignment involves travel or other major costs, make sure your editor advances you the expense money.

Yes, it’s getting that bad.

– Anita Bartholomew

What’s worse than a rejection letter? A public rejection “tweet.”

As if it weren’t stressful enough to send out that manuscript you worked on for years and then wait for an agent’s or editor’s reply. Now some authors have to fear public shaming. A couple of literary agents, Lauren E. MacLeod and Colleen Lindsay,  have been mocking the pitch letters of aspiring authors on Twitter.

Okay, so not every pitch is a hit. But, c’mon guys, play nice. This is the author’s baby you’re ridiculing. It may seem like a hoot to you but put yourself in the writer’s place.

Meanwhile, authors, make certain that you follow an agent’s guidelines to avoid incurring wrath and ridicule.

“I know writing and querying are hard,” MacLeod tweeted. “So my queryfails have been chosen from people who did not follow submission guidelines.”

Why writers shouldn’t bet their careers on magazine writing

An article by Francis Wilkinson in The Week asks whether writing is now a career that only the rich can afford to pursue:

The high end of publishing—books, magazines, The New York Times, The Washington Post, The Wall Street Journal—has always contained a contingent of wealthy worker bees who don’t actually live off their often meager salaries. But even a couple decades ago, a writer without independent means could still scrape together a living writing about something other than movie stars. Not a good one necessarily, but a living.

It’s not obvious how young writers without accommodating, well-to-do parents or a trust from gramps make it these days. Surely they can’t spend a year or two blogging without pay until an audience evolves to nurture them. They’ll starve.

He also says that “freelance rates for non-fluff magazine writing have barely risen in the past 15 years.” Apparently, Wilkinson doesn’t write for many magazines or he’d know that the problem isn’t just that rates haven’t risen; they’re recently begun falling.

Moreover, the trend of stagnating rates isn’t a recent phenomenon. According to Murray Teigh Bloom, one of the original members of the trade organization that is now known as the American Society of Journalist and Authors, told me about 15 years ago that he earned $1 per  when he began freelancing in the 1950s.

Today, many magazines are still stuck at $1 per word and several want to pay less than that. And it’s not simply because they want to exploit writers (although, they often do because too many writers agree to be exploited).

Every week, at least one magazine goes under. Hallmark magazine folded last week, not because it was doing poorly. It was one of the very few magazines where ad revenues were up.

If a magazine folds because (my assumption) it sees dimming prospects for the future, that solidifies my sense that focusing all one’s energy on writing for magazines is like focusing all one’s energy on selling VHS tapes. Not wise.

I recently wrote an article, for far less than I normally get paid, for an online magazine. It was on a controversial topic, close to my libertarian heart, and I wanted it published, even if it meant taking a pay cut. I felt good about getting the word out there. But the online magazine quickly folded (although its content is still up).

Even writing for major magazines that offer $2 per word and up, you have to contend with the possibility that the publication may not still exist when it’s time to pay you.

But books will always be with us, in some form, even if ebooks supplant paper. And that’s where I’d recommend any writer focus the greater share of his or her energy. It may mean that, in the not-too-distant future, you take on the multiple roles of author, publisher, publicist, distributor and warehouser, because major houses are trimming their acquisitions to those they believe (often wrongly, but that’s another post), will be surefire hits.

Only the intrepid, with an entrepreneurial bent can expect to do well under current conditions that are bad for the economy as a whole but worse for publishing. Any writer who sees him- or herself as too delicate to take on the business of marketing probably won’t survive in this climate absent a hefty trust fund or other means of support.

Should you write for free II? (HuffPo edition)

An article about a political writer who blogs for the Huffington Post without pay has almost every writer I know weighing in. Arianna’s business model, for those who are unfamiliar, is to pay not a cent to contributors  (presumably, she does pay staffers). To say that this makes Ms. Huffington unpopular among some professional non-fiction writers I know is like saying that Bernie Madoff has somewhat miffed his investors.

Despite the antipathy toward her among some authors, Huffington has no trouble getting people to contribute to her success by contributing free text. Even several established writers who make decent rates elsewhere agree to write for HuffPo for the “exposure.” One writer friend suggested I write something here about the issue. So, here’s my take, for anyone who might be weighing whether the exposure is worth it.

For a celebrity, say Bill Maher or Michael Moore, who simply wants to exploit Arianna’s ability to attract huge numbers of political junkies in one place, a guest appearance on the Huffington Post is like free advertising.  While there, they can pitch their next project. And it will pay because people reading HuffPo really want to buy whatever Maher and Moore are selling.

Contributing a post to HuffPo would also make sense for an established but lesser known author of a book about a political topic.  Excerpt your book on the site or paraphrase something to tempt members of this huge audience to buy the whole thing.

It’s similar to appearing on TV or radio without pay to plug your project.

But, if you’re hoping to establish yourself by working for free for Arianna, and you have nothing to pitch to her audiences other than your free copy, you are probably doing little or no good for your own career. You may even damage your brand by establishing your price for the world to see: Zero. Also, you’re lending a hand to exploitation by contributing to its success.

Why do Young Adult novels dominate bestseller list?

During the years that Harry Potter books were selling millions more than comparable adult fiction, we could have chalked up that success story to the charm of the teen wizard tales.

But what do we make of the current bestseller list? Stephanie Meyer’s novels about teen vampires are, by all accounts, less charming and yet,  her young adult stories of teen bloodsuckers are in the 1st, 2nd, 3rd, and 8th positions on the Wall Street Journal’s bestseller list of fiction. A Harry Potter title is in 4th place while Brisingr, a dragon tale for young adults, is in 14th place.

That makes six young adult books in the top 15.

What should authors take away from this? It’s difficult to say. If you start writing a young adult novel now to take advantage of this trend, by the time you’re done, there’s a chance that the trend will be done, too. But if you’re already an author of young adult fiction, you might find agents and acquiring editors more receptive to reviewing your work, especially if there is an element of the other-worldly or whimsy in it.

Freebie manuscript critiques!

How can you hope to get your book published in a market that’s getting tougher every day?

Although it may seem counter-intuitive, new authors sometimes have an easier time getting agents and publishers than do published authors with less-than-blockbuster track records. Acquiring editors are always looking for the next new publishing sensation.

But here’s the catch. Only the most marketable, engaging stories have any chance of attracting agents and, eventually, publishers. Editors have no time to work with diamonds in the rough. They need polished gems.

So, starting in the month of February, I’ll be offering free critiques on Ask the Editor of the first 3 to 5 pages of select manuscripts. Using these manuscript excerpts, I’ll point out what works, what doesn’t and why, and how to improve the overall effect so that the reader gets caught up in the action.

If you’d like your work critiqued on Ask the Editor, the email address for submission and other details on sending your work may be found here.

Remember, even if it’s not your manuscript I’m commenting upon, my guess is that you’ll come away with valuable tools to help you refine your own work.

UPDATE: Critiques offer above is suspended indefinitely as I am swamped with work at the moment.

Reports of the book’s death have been greatly exaggerated

A colleague sent me a link to an essay on the fate of book publishing that appeared last week in The Washington Post. Its author, Andre Bernard, was formerly an editor and publisher at Harcourt, a major house that’s suffering through significant problems. It’s not surprising then that he views the downturn at his old house and other venerable publishers as perhaps signaling the end of book publishing:

“… I can’t help thinking that as this year gasps its way to its merciful end, something terribly sad is happening, that a vague, general shift in the cultural landscape will alter how or what we read in some still indefinable way; that a quirky, creaky, financially insupportable business that in spite of itself produces that most desirable and perfect of objects — the book — is perishing, and that we are yet to fully feel the loss.”

Here’s the thing. Books aren’t going away. Yes, book publishers are in serious trouble. Bookstores are closing. But the book lives on. The books we read will indeed change but they always do. Books have changed in response to markets and technology since the first authors scribbled on papyrus.

We can predict some changes because they’re already happening. Major publishing companies are focusing even more on big “sure-thing” books. But other books are getting published as well, some by the authors, themselves. And some are doing quite well in their niches. Local independent booksellers are disappearing. But books are spreading to shelf space in general retail establishments.

Books are being sold via websites. They’re being touted in clever videos on YouTube and in blogs and promoted directly to online book groups.

Just as we’ve seen the web open up opportunities for writers of shorter forms of news and commentary, we will inevitably see electronic formats open up more opportunities for writers of long-form fiction and non-fiction. With costs such as printing, shipping and returns no longer an issue, publishing will be economically feasible for just about anyone who is willing to invest time, money and energy into promotion.

So, take heart. The book will not perish. It will change. As all things change. Be prepared to adapt so you can take advantage of the opportunities that the changes present.

Happy New Year to all.