On Labor Day: how writers make money
I don’t make my living writing.
I have a full time job (a “day job”) as a trainer (I have a different job title, but that’s how most people refer to me…I do a lot of other things, too, including performance improvement and workflow analysis) for a major medical company. That job gives me by far the bulk of my income…and, importantly, good benefits.
I do, though, make money as a writer. It was really exciting a few years ago when I had my first year where, based solely on my writing income, I would have been above the poverty level. 🙂
Quite simply, many people who choose to be professional writers, who do try to make their livings putting words together, would be in that category…below the poverty line.
I know there are people who think it: anybody can tell a story, whether it’s fiction or an anecdote…how do people make money doing it?
There are a few main methods. I thought I’d take this day where, in the United States, we recognize the value of “workers”, to lay them out for you.
One more thing before I do: I think that increasing numbers of people are making money as writers. That’s been due, in large part, to digital distribution (e-books and other e-texts).
When the only real way that novels (for one example) reached mass audiences was by having them printed in “book factories” and distributed to bookstores, it was absolutely dominated by large companies (and, over the years, those have consolidated into a fairly small number). As a former brick-and-mortar bookstore manager, I can tell you: we just didn’t carry independently published books almost at all.
We needed the power of the big companies. Book selling windows are sometimes vanishingly small. If an author was going to appear on local talk radio, it would often make a huge bump in sales…but only for a few days.
We needed a company that could get us a hundred copies with a few days’ notice (we often didn’t know about the appearance until the same week)…and who would buy back the ones we didn’t sell (normally by giving us credit for future purchases…so they needed a broad enough catalog that we’d be confident that we would use that credit).
Now, that’s changed.
Digital distribution means that indies (independent publishers…often just an author) can compete in the same digital “shelf space” as the biggest publishers.
That has seen the rise of what I call “indie-ployement”: people who make a living without traditional structures. I think they contribute to the perceived unemployment rate, even though (and this is a small percentage) they are much happier making a living without a boss.
Taking that into account, and not limiting this to people who make a living at writing, how do writers make money?
That’s the traditional method.
When a writer writes a book, they automatically (in the USA and many other countries) have a “copyright” to it. They can control (within certain limitations) the copying and distribution of that work.
They can license that right to someone else (a publisher), who does the actual selling of the book, and pays the author for each copy or license sold.
The publisher, traditionally, brought several things to the table. They would have employees: an editor, a layout artist, proofreader, and so on. Those would improve the salability of the book, at no additional cost to the author. They would have marketing and distribution. They would handle the legal parts (including legal challenges in many cases).
So, the author got paid as the book sold, and the publisher took the rest.
It wasn’t right when the book sold in real time, typically.
It might be months afterwards…and for authors with a track record, a large chunk might be paid before. That chunk paid in advance of the actual sales was called, logically enough, an “advance”.
The advance is royalties…it’s not a separate revenue stream.
A popular brand name author could get an advance of tens of thousands (and even more) for a book. They could get the advance before there are a hundred words written down, and could live on it while writing the book.
Once the sales start, the publisher subtracted the advance from the royalties which would have been paid until the advance was paid off…then, royalty checks could start.
That’s one of the biggest things authors losing by going indie: advances. Unless you are a top level author, some of the other tradpub (traditional publishing) benefits have gone down considerably. Many mid-level and new authors say that their publishers aren’t doing much to push the book. Since authors can now do social media (blogging, Twitter, and so on), some publishers expect them to bear the burden of promotion.
Royalty rates vary considerably, and there is a lot of argument and debate about it.
For a p-book (paperbook), it might be eight percent of the suggested retail price (the “list price”).
For e-books, it might be 25% of the sales price.
Again, there are many variations: that’s one reason traditional authors have agents representing them…the agents deal with all of those complicated negotiations.
When an author self publishes through platforms like Amazon’s Kindle Direct Publishing, the royalty rate may be much higher. KDP pays either 35% or 70%…the latter if you follow certain rules (like not blocking text-to-speech access and being within a specific price range).
That doesn’t only go for novels: Amazon also pays bloggers who distribute through the Kindle store, for example.
Royalties were for years the primary way writers were paid, but certainly had the disadvantage of being unpredictable.
We don’t see advertising much in books, and that is a really heated topic. I do think we’ll see that eventually…not necessarily in the middle of a book, but I think a real model that would succeed in the market is possible. You could agree to see an ad in the beginning and end of the book, and in exchange, get the book for a discount (or possibly for free). I think many people would do that…read a very popular book and save a couple of dollars, in exchange for an ad while not actually in the reading experience.
The place where we see it is online, on blogs and other websites.
It may be an obvious ad.
There’s a particular blog that has very good content writing about e-books and e-book reading devices.
When I see their stories in my morning
read, the ad appears as a graphic, and that often throws me. I think the story is about what the ad is showing me..I have to focus on the text to see what it really covers.
It may be much more subtle.
One form of that, and an important one, is being an Amazon Associate.
If you buy something by clicking a link on a site and that person is an Amazon Associate, Amazon pays that person an advertising fee.
The author makes, commonly, both a royalty in that case (because you bought the book) and an advertising fee.
That advertising fee may not be much…fifteen percent or much, much less.
However, another way it works is that if the customer buys something else after following a link from the author’s page (say, a lawn mower or a box of cereal), the author may also get a cut of that sale…and that can be much bigger than the sale of an individual e-book (since the price is so different).
Some people seem to philosophically dislike advertising. I find it a reasonable option, as long as it’s an option. I don’t mind being valued by a company for what I might purchase…and being paid (perhaps in a discount) to consider their products.
I choose not to have paid overt ads in this blog…I think my readers prefer that (although I’ve never polled them on that…perhaps I will). I could probably make quite a bit more money that way, and if I really needed the money, I’d have to re-examine that. This is, in some ways, a personality blog, though. People read it partially because of what I think and feel, and advertising necessarily presents someone else’s viewpoints, which could muddy the waters.
WordPress may show you ads in some cases, but I’m not part of that.
For non-fiction writers, this has long been a way to make money. This doesn’t mean that an author signing books at your local bookstore is paid for that (that’s not usually the case). It’s more likely to be an author lecturing or doing a Q&A. That could be at a convention, or historically, at colleges. One particular author reportedly could do 300 college appearances in a year…at at least several hundreds per appearance. Obviously, it’s harder to write while you are doing all that traveling…but you could do alternate years, for example.
Licensing other adaptations and merchandising
Very different from royalties for books is selling the rights for a TV show or a movie. That can certainly be a big payday for a brand name author. Authors may maintain the licensing rights when using a tradpub, or it could be a deal with the tradpub.
It’s also possible to make some money through things like T-shirts, games, and posters. Not as an author, but George Lucas famously kept the merchandising rights for Star Wars. As I remember the story, the studio didn’t think that was going to be a big deal…and neither did Lucas, who said that the vision was likely going to be selling T-shirts at a science fiction convention in ten years. 😉
Estates do very well, in some cases, licensing a deceased author’s works for new books.
A new revenue stream is
It’s not easy to get in there, but the basic idea is that a rightsholder licenses a “property” to Amazon. Amazon makes it part of Kindle Worlds. Anybody can write a book in that universe, without getting permission first (but following certain guidelines). Amazon gets a cut, the author of the new work gets a cut, and the rightsholder gets a cut.
Snapshot would make a great Kindle World…but getting them to do it would be a challenge.
Crowdfunding and donations
This is a very direct way to support an author.
Crowdfunding typically means that you are supporting a specific project. Individuals pledge money, perhaps to enable the publication of a specific book. In exchange, they may get certain benefits, like a signed copy or e-mails which only go to supporters.
Donations are often just general support. Authors may have a Paypal link on a website: you just give them money, and they use it how they choose. You don’t get a specific benefit. That may sound odd, but it’s a way to say “I like what you are doing and I’d like you to be able to do more of it” without controlling (and thereby possibly altering the behavior of) the author.
Yes, some authors actually get paid a salary, just like other employees. Those won’t usually be authors of novels: they’ll be television screenwriters, technical writers, some periodical writers…it needs to be something where there is a clearcut period of time where there will be a demand for the writing. That may be a fairly short job…one TV season, perhaps. This does exist, though: they may even have benefits and paid time off. 🙂
I say those are the primary methods that authors make money. Most authors make very little money. When you “gotta write”, you “gotta write”. I’d write if I wasn’t paid for it (but probably not as much). I’ve always done something creative, and writing works well for me. I’m very grateful to subscribers (a form of royalty) of this blog, and all of the other ways people make this possible. If (“say WHEN” says my Significant Other) 😉 I retire, I expect to write a lot more. I might even make a living writing when I’m retired…but I’m sure I would do it regardless.
Authors should be able to make a writing living, if there is a demand for their product. This gives you some ways that some authors can do that, or at least, can supplement their income.
Enjoy Labor Day!
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* I am linking to the same thing at the regular Amazon site, and at AmazonSmile. When you shop at AmazonSmile, half a percent of your purchase price on eligible items goes to a non-profit you choose. It will feel just like shopping at Amazon: you’ll be using your same account. The one thing for you that is different is that you pick a non-profit the first time you go (which you can change whenever you want)…and the good feeling you’ll get. Shop ’til you help!
This post by Bufo Calvin originally appeared in the I Love My Kindle blog. To support this or other blogs/organizations, buy Amazon Gift Cards from a link on the site, then use those to buy your items. There will be no cost to you, and a benefit to them.