Barnes & Noble to become an e-Publisher
In the "I guess they should have seen it coming" department, it was announced last week by B&N.com that they would be launching an E-Book Imprint. B&N expects to publish thousands of new, out-of-print, public domain and original titles in e-book editions over the next few years. Barnes & Noble is in an excellent position to steal other well-known authors away from the New York publishers, since the low costs of e-Publishing leaves room to offer royalties even higher than 35%. Even after paying 35% to the author, B&N.com is left making almost twice as much as the author, with virtually no expenses or unsold inventory.
By doing this B&N is showing its confidence in the emerging electronic book market and attempting to disintermediate publishers. The term disintermediation has become something of a buzz word in the publishing industry. It basically means trying to eliminate as many middle men as possible in the food chain so those further up can assume their profits. It's not a new idea. Publishers, such as DoubleDay have been doing it for years with book clubs. DoubleDay owns about two dozen book clubs under various names. You wouldn't even know it if you didn't check that every book you order seems to come out of Garden City, New York. The publisher selling directly to the consumer eliminates the distributor and the bookseller.
B&N, by eliminating the publisher can sell directly to the consumer. This, too, is not a new idea. B&N has been doing this for years with classics (public domain) books. The difference this time is that they are expanding this idea in the area of electronic books. The reason for doing this in electronic books is because you don't have to produce inventory when publishing electronic books, just a "template" to produce the books as they are required. B&N.com is doing something that bookstores haven't tried before. They are signing up known authors to publish under their imprint. (the imprint is actively pursuing original e-books and announced a deal to publish The Book of Counted Sorrows, an original e-book by bestselling author Dean Koontz, in the spring). To do this B&N is offering a higher royalty rate to authors, lower-priced e-books and an extensive Web marketing and sales network. The imprint is also addressing a longtime sore point for agents and authors by providing accurate and up-to-date information on sales. The first B&N Digital e-books should be available in the spring, although B&N.com declined to specify the number of titles it will offer initially. B&N Digital will pay advances as well as royalties in the 35% range.
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