Small publishers may find it harder to work with Kobo/Borders than Amazon/B&N

Small Publishers have to get away from the current notion that seems to dominate their thinking, that the only way to sell eBooks is to do so though Amazon, B&N and iTunes et al.

They need to start setting up their own online presence or getting together to form a joint one. The more they feed the giant the more it will devour them! Readers are capable of exploring the web for alternative sources. There is a future beyond the Majors!

There are enormous opportunities out there for entrepreneurial ventures in this field instead of everyone sitting around bemoaning their plight.

Get off your ass and start making things happen !

I strongly disagree with the above comment and I think that the Kobo decision is another silly one; go where the crowds are and Amazon is that place for now, but no reason to stay that way; as a reader my time is limited and I am not going to surf 100 places to look for gems; sure if you have enough fans, by all means sell books to them on your website, but building them, well, websites are one a million so to speak…

Hi Paul — here was my response I posted back to Tomorrow’s Book. (Comment widget there is a little slow to load, so people might miss it.)

I guess that’s one way to look at it. At Kobo, we probably spend more time and energy showcasing and promoting self-published authors and small presses than most of the retailers mentioned above. We like them, _read them_, get excited when they do well, regularly see them in our Top 10. We truly believe that one of the incredible things about ebooks is the ability for self-published authors to reach massive audiences in an entirely new way. But we are also not as massive as some of our competition. When you’re David amongst a bunch of Goliaths, you have to focus a bit.

So it’s true — rather than building out self-publishing infrastructure or white-labeling someone else’s, we created partnerships with Smashwords. Mark and his team have been such passionate, enthusiastic advocates for ebook self-publishing, not just building software or tools but a community of authors and small publishers — definitely not just a “middleman”. They add some real value that we’re happy to support. And we did a partnership with Author Solutions for similar reasons. And that freed us up to be first bookstore on Android and Blackberry, among the first on iPad, first on PlayBook, first $149 device, ebooks in 200 countries, and so on, giving authors and publishers greater distribution in more places and on more devices than ever before. And doing it while being a tenth the size of either of the retailers above (twentieth? thirtieth?) We’ll keep picking our battles, loving independent publishers, and focusing on getting the best possible book in the right person’s hands.

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The only other thing I’d add is that the email message he refers to usually ends with this:

“That said, every publisher is different so if you think a direct relationship would be beneficial to both parties let us know.”

What it comes down to is: if a self-publisher, small publisher, or independent press wants to work with us directly, we’d love to have them, and with terms they will find as good or better than those from other retailers. If they’d rather not, no problem — we have partners they can go to as well.

Hope this helps,
Michael Tamblyn
EVP Content, Sales & Merchandising – Kobo

Liviu – I see some of your points. It certainly is a huge mistake by Kobo I agree. But I am not so sure about the unwillingness of readers to visit a variety of sites. I think this is counter intuitive especially in the world of web buying we have seen over the last 10 years, where buyers regularly surf a range of outlets to buy their products.
Readers especially are the kinds of people that enjoy checking out a variety of places for their books. The big mega sites are enormous cold massive repositories of eBooks. I believe readers will enjoy well designed eRetailing eBook sites that specialise in specific genre works, specific geographical works – where they can communicate with a social network of like minded readers and get recommendations from them. In fact I believe that the whole area of recommendation/social/ genre area will be the biggest and most powerful driver of eBook sales in five years time and Amazon will struggle to deliver on that because it is simply too big.

I suggest to you and others that small can often deliver what large cannot and the history of retailing is littered with that truth. The big will stay successful but there is lots of opportunity for the small to succeed very well. All it needs is people who will try.

I do not consider working with middlemen like smashwords as life-sucking. What we have is a partnership. We help one another. What we pay is reasonable for the services provided.

Sean O’Mordha
Celtic Publications of Nevada

May I ask … what is involve with going through Smashwords ? what do they do and what do they charge ? I assume they offer formatting, ftp etc services in getting the book on to Amazon etc. ? so that Kobo don’t have to ?

Howard: Smashwords essentially takes a Word document provided by the author and converts it into a variety of e-book formats. The author can select which formats the e-book is to be available in. This is at no charge.

Smashwords sells the e-books directly on its web site. There is no listing charge. Smashwords collects a 15% commission on each sale (except on free e-books), about half of which goes to pay the fees from the various parties involved in credit card transactions. The author ends up with 85% of the sales price.

If the e-book is properly formatted, it will be placed into Smashwords’ Premium Catalog and available through most of the big e-book stores. The author can select which, if any, e-book stores that an e-book will be distributed to. There is no listing or distribution charge. The e-book stores take a variable commission of each sale (50%-ish), and again Smashwords takes 15% of what’s left. Typically, the author ends up with somewhere around 45% of the sales price.

I’m sure if I got something wrong, Mark Coker will drop in and straighten me out. 🙂

Thanks for that Doug – appreciate it. So by going to Kobo through Smashwords the author loses the commission charged by Kobo (or the 30% by Amazon) PLUS the 15% charged by Smashwords …?

That is a big kick for doing a bit of formatting 🙁

According to Smashwords’s Support FAQ: “For Kobo, your royalty is higher at 46.75%.”
ref: http://www.smashwords.com/about/supportfaq

Kobo takes 45% of the sales price for listing and selling the e-book and for handling the consumer end of the financial transaction. Smashwords takes 15% of the remaining 55% (8.25%) for the formatting, supplying, and handling the author end of the financial transaction including tax withholding and all of that. This is approximately what they get on a Smashwords-direct sale after paying off the credit-card leeches.

Not specifically applicable to Kobo, but Smashwords will also supply a free Smashwords ISBN (go price those at Bowker!), or you can buy a personal ISBN from them for $9.95. If you aren’t distributing to Sony or Apple, an ISBN is optional.

The thing is, if you don’t ever sell a copy, you don’t ever pay a penny (unless you spent the $9.95 for a personal ISBN). Everything is paid out of commissions on the sales. If you price your book at “free”, there aren’t even any commissions.

Even at a 40% final royalty rate, you’re doing a whole lot better than what you’d get from a traditional print publisher (about 10%).

It would seem that going on a Computer course, specialising in creating well formatted eBooks, including meta data, would be a well worthwhile investment for any serious author.