Are you thinking of writing a book? You might want to reconsider.
On Monday, a federal judge blocked Penguin Random House’s proposed acquisition of Simon & Schuster, agreeing with the Justice Department that the merger of the two publishing giants would reduce competition for the best-selling books.
As an author, I agree, except that there are woefully few best-selling books.
Most writers would be better off working at McDonald’s.
Hey, I wrote a book!
I just published a book, Shut Up and Keep Talking: Lessons on Life and Investing from the Floor of the New York Stock Exchange. It is a summary of what I have learned about financial markets while working at CNBC and the NYSE over the past 25 years.
My publisher, Harriman House, was a thorough professional and a pleasure to work with.
This is the part where writers like to say, “It was a labor of love.”
Here’s the truth: It’s taken two years of my life, working every single weekend and a night or two a week.
Every weekend. For two years. A labor of love? I love the product and am glad I wrote the book.
But the road to get there was brutal.
Write a book? Forget making money
Dreaming of six figure advances on that masterpiece you have in mind? Forget it.
If you want some idea of how ridiculous the book publishing industry is, look no further than the proposed merger of Penguin Random House and Simon & Schuster. The Justice Department is trying to block the merger, arguing that the combined entity would reduce competition among the largest houses and squeeze author advances. A federal judge agreed and blocked the deal. Penguin Random House has announced that it will appeal.
Many interesting statistics emerged from the process. The good news: Book sales have been strong during the pandemic. This is understandable considering so many people have stayed at home.
The bad news: Only a tiny fraction of books make the most money.
The New York Times reported that Penguin Random House executives said during their testimony that only 35% of the books the company publishes are profitable, and only 4% account for 60% of those profits.
In 2021, less than 1% of the 3.2 million titles BookScan tracked sold more than 5,000 copies, according to the Times.
Less than 1% sold more than 5,000 copies.
A typical writer lives in virtual poverty
Are you dreaming of six-figure advances for your book? Forget it. A typical writer lives in virtual poverty.
A 2018 survey of 5,067 authors conducted by the Authors Guild found that the median income of the authors surveyed had fallen to $6,080 in 2017. That’s about 50% down from 2007, when a joint Authors Guild and PEN survey found median earnings to be $12,850 (Note: I am a member of the Authors Guild).
That’s the median income. Revenue from book sales alone was a meager $3,100, suggesting authors supplemented their income through speaking engagements, book reviews, or teaching.
No wonder many authors supplement their income with other things. Only 57% of published authors derive all of their income from writing. Those who consider themselves full-time writers earned a median income of $20,300, “well below the federal poverty line for a family of three or more,” the survey found.
Does anyone make money? As with most things in life, the top 10% seem to make what little money there is: they reported a median income of $305,000, but again, this includes other sources of income related to being a writer. The top 10% of self-published authors earned half that: $154,000.
Why has book writing become such a tough business?
The Authors Guild report highlights the explosive growth of alternative ways for consumers to spend their time (video and streaming). They also note that Amazon now controls 72% of the US online book market
Self-publishing also took place: more than a million books were published in the US in 2017 (up from 300,000 in 2009). Two-thirds of these books are self-published, according to a Bowker report cited by the Authors Guild. Self-published authors typically sell significantly fewer books and receive significantly lower royalties.
what can be done How about more readers?
You can talk so much about the lousy publishing business, but what would really help the book business is if people read more and buy more books.
Unfortunately they don’t.
A Gallup poll conducted last December found that Americans read an average of 12.6 books in the past year, a lower number than Gallup measured in an earlier poll from 1990. The sobering result: “Reading appears to be on the decline as America’s favorite pastime.”
That’s no surprise. The competition for eyeballs has never been more intense. In 1990 there was no internet. There was no streaming. There were no podcasts.
Now any idiot with an iPhone can start a podcast or become a TikTok star. The media landscape is not fragmented: it is shaken.
And yet books are published
Which brings me back to my starting point: What fool would write a book today?
I am one.
Here’s my message to aspiring writers: You have to really want it. You have to really believe that you have something to say. You have to believe so hard that you can feel the pleasure coming out of your skin.
You must be willing to sacrifice most of your free time. And you have to forget the two things you probably want: fame and fortune.
No, in most cases you have to be thankful that you were determined to say something and that you had the mental stamina and bravery to get the damn book across the finish line. That’s an achievement to be proud of.
And that’s perhaps the last reason books are still being written: no matter how many books you sell or how much you pay, there’s still prestige attached to writing a book.
I’ve been with CNBC for 32 years, so I’m known in a very small part of the world – the stock market.
More fame? No more money? It’s negligible. But the book increased my visibility and prestige. I was invited to more conferences and many podcasts.
And that makes many of the sacrifices worthwhile.