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E-Publishing: Tomorrow's Publishers Today
Jim Milliot, Calvin Reid, Steven M. Zeitchik -- 3/13/00
Emerging web sites offer e-book titles across a growing number of categories

A perusal of the Web finds a gaggle of sites that publish original e-books. More like old-media small presses than anything else on the Web, these companies pay little to no advances and high royalties and, in many cases, display an impressive editorial rigor. For our inaugural e-publishing section, PW spotlights an assortment.

Hoboken, N.J.
Owner:Glenn Hauman
Titles Published: 400

A pioneering e-publisher, Glenn Hauman can truly be considered unique. Not only was he one of the first publishers to offer original downloadable e-books for sale via the Web starting in 1993, but, strangely enough, he is also the first to give up on the conventional e-book retail model. For five years, the site sold a wide variety of titles in the form of downloadable PDF files and ASCII text. But in 1998 Hauman decided to use advertising to support his site and began offering all titles on the site for free. "We discovered that people will download a book and stare at a computer screen for hours to read it. But people just weren't buying. We were squandering their attention," said Hauman.

So he renegotiated his contracts; he offers all his titles online only, for free, and gives the authors a percentage of the ad revenue. Every page of the 400 titles Bibliobytes offers has a banner ad at the top. And now, Hauman said, the site is breaking even. "Traffic went up tenfold," said Hauman, adding that the site generates about 200,000 page views a month. "Revenues went up 60-fold. We made more money in three months giving the books away than we made in five years trying to sell them. Books that never had a single download now get dozens of readers." Hauman believes that Web consumers expect content to be free, like broadcast TV. He d s continue to offer some downloadable titles for a fee. "We're trying to do both. But we're out to abolish barriers to entry for the reader," Hauman said. He said science fiction "d s real well for us," and so do business books. Fantasy/horror author Neil Gaiman's short story "Eaten" has been read 4,000 times since it went online in October 1999.

BB is "a virtual corporation. We outsource everything," Hauman said. Authors receive 35% royalties (revenues are doled out to authors based on the number of page views their work generates) and all contracts "have room for negotiation," Hauman explained. The site adds titles regularly, but, he said, "not often enough. The demand is huge, both from authors and publishers, and from people wanting more stuff to read."

DiskUs Publishing
Albany, Ind.
Owner: Marilyn Nesbitt
Titles Published: 40

With all the talk about e-book sales not measuring up, it's easy to overlook those titles that sell in the thousands-- 15,291, to be exact. That's the sales figure for DiskUs's Best Laid Plans, a romance by Leta Nolan Childers that has been available on the Web for less than nine months--which means it has sold at an astonishing rate of more than 50 per day.

Low sales numbers isn't the only myth the Indiana e-press hopes to explode. "A lot of people don't realize how much editing and converting g s into an e-book," said founder Marilyn Nesbitt. Indeed, the process by which a DiskUs book comes into existence is not simple. Nesbitt gives first pass to readers, unpaid consultants who function as they do at a house like Harlequin. If a book meets the reader's standards, it is sent to a team of editors, who have final approval. (DiskUs has a full-time staff of about 10.) All told, DiskUs publishes less than 5% of the proposals it receives.

Differences between DiskUs and traditional houses are immediately apparent from a look at the site. Prices are cheaper (usually under $10), books are shorter (rarely more than 200 screen pages) and royalty terms are more favorable--about 40% for most editions. Nesbitt holds the e-rights--and only the e-rights--for a term of one year, after which, she said, most authors renew for another year. If a print publisher comes a-knocking, and there are signs it will for one author, Nesbitt said she would even be willing to let the author out of the e-contract if it would facilitate dealings with the traditional house.

Books are available as PDF, HTML and PRC (for palmtops) files, and as Softbook and Rocket editions, and are available on sites like Barnes&Noble.com and Powells.com. DiskUs also sells diskettes via Barnes & Noble and Borders physical stores. This gives the books exposure beyond the publisher's site.

And exposure is what matters most in the nascent world of e-publishing. At present, DiskUs gets play in publications like Romantic Times, since the bulk of its list lies in the romance niche. Nesbitt hopes for more offline marketing and publicity as the house expands into other areas, like fiction. "We're doing a lot of romance right now because so many romance authors are trying to publish books," she said. "But we want to be a general publisher."

Hard Shell Word Factory
Amherst Junction, Wisc.
Owner: Mary Wolf
Titles published: 160

Founded in 1996 by Teri Lea Chandler, Hard Shell was acquired by Mary Wolf at the end of 1997. Since she has taken over, "sales have risen every quarter. They were quadrupling in 1998 and doubled every quarter last year," Wolf told PW. The company's biggest-selling title to date has been Kimberly Grey's Eye of the Storm, a paranormal romance, which has sold about 6,000 copies, while A Wizard Scorned, a sci-fi romance by Patricia White, has sold approximately 3,000 copies.

Romance is Hard Shell's largest category, accounting for about half of its titles. Science fiction and mystery are two fast-growing areas. Wolf said she wants to limit the number of titles released to six to 10 per month. "We published more than 10 one month, and it was overwhelming," she explained. Hard Shell works directly with authors, publishing either original titles or e-books whose rights have reverted back to the author. The company charges no submission or storage fees, and while it pays no advances, it offers a 30% royalty on e-books sold directly through its own site and a 50% royalty on titles sold through third parties, after subtracting third-party charges.

Wolf said that Hard Shell's sales are evenly divided between sales from its site, which offers titles in PDF and HTML formats, and sales through other platforms. Wolf said Hard Shell publishes for nearly every standard available, and will soon add EveryBook and GlassBook editions. The company will also mail a disk to consumers who do not want to download a title.

The company, which has six full-time employees, plus a large number of freelancers (including eight editors), has limited its marketing efforts to placing ads in trade publications that cover its different niches, such as Romantic Times.

Dreams Unlimited
North Branford, Conn.
Owners: Silke Juppenlatz & Bonnee Pierson
Titles Published: 30

Two years ago, romance novelists Silke Juppenlatz and Bonnee Pierson grew frustrated because they felt many good books weren't being published. But instead of bemoaning the state of the book industry, they took what has become an increasingly common step for writers and readers--they formed an e-press.

Leery of becoming a place for "rejects and New York castoffs," Pierson and Juppenlatz chose to focus on one genre--romance--with a smattering of fantasy and horror. "We thought if we stayed within a narrow niche that [second-tier status] wouldn't happen." The gamble has apparently paid off. In the small, scrappy world of e-publishing, Dreams Unlimited has distinguished itself as one of the preeminent houses. It holds the honor of having the first-#1 bestseller on the E-Book Bestseller List, The Renegade's Woman. Many of the press's bestselling titles, like Give Me Tonight by Carole Howey, have sold over 5,000 copies. And the publisher brought in three times as much money in 1999 as it did in 1998, even if much of that was reinvested in the hope of carving out a name.

For all the marketing impediments, Pierson and her partner, the latter of whom, in the spirit of a virtual company, resides in England, enjoy the benefits of an e-press. They aren't constrained like print publishers, who must meet basic quotas and whose decisions are made months ahead of publication. Said Pierson: "I don't have a set number that I release every month. If I want to publish three books this month and none next month, I can."

Electron Press
New York, N.Y.
Owner: Philip Harris
Titles published: 21

The goal of Electron Press founder Philip Harris is to "present quality writing to the public. We are focusing on quality fiction, including thrillers and literature, as well as nonfiction in such areas as memoirs, politics and the environment." Although Electron has released only 21 titles to date, Harris expects to publish another 10 by May, and plans an aggressive schedule for the remainder of 2000.

Electron's best seller is Cold as Ice, a thriller by Bill Armstrong, which has sold about 100 copies, and Harris is frustrated that his inability to find new investors has severely limited his promotional efforts. The company's most successful sales channel so far has been its link with memoware.com, a site that offers a free library of materials for PDA users. Harris is convinced that the PDA platform, either the Palm Pilot or other personal devices, will become a major channel for e-book sales. In addition to supporting the PDA platform, Electron's titles are available through its own site in PDF format, and Harris expects to develop titles for the Microsoft Reader as soon as possible.

Electron pays authors a "nominal" advance, and royalties range from 25%“50%. The company publishes only original material or titles that have gone out of print. Its top price for an e-book is $5.

Harris hopes to launch a print-on-demand service for as much as half his list this summer. Books will be sold through Electron's site, and an on-demand partner (probably Lightning Print) will fulfill the order. "It gives us another marketing platform," Harris said.

Andover, Mass.
Owner: Angela Adair-Hoy and Richard Hoy
Titles Published: Over 500

Originally launched in early 1999 as a "vanity" e-publisher, by September, the Booklocker site had been purchased and revamped by a husband-and-wife team who also happened to be Internet marketing experts--one of whom was one of the site's best selling authors. Angela Adair-Hoy is the author of How to Write, Publish and Sell Ebooks, originally self-published in print and in e-book form through Booklocker. "The original owner decided [the site] was too much work and offered it to us," said Adair-Hoy. The two immediately dropped the "vanity" charges for authors and instituted an editorial review process. "We wanted to make our money from selling books, and it has worked tremendously," she said. She declined to give precise figures for sales and revenues, but pointed out that she herself has five e-books published through Booklocker that currently bring in $4,000 in sales every month. The site offers 500 downloadable titles from more than 400 authors. The firm's contracts are nonexclusive and offer 70% royalties to authors. Titles are offered in PDF, html and .exe formats.

Adair-Hoy said that nonfiction how-to and business books are Booklocker's bestselling categories. Other Booklocker bestsellers include Gifts from the Heart of the Home: Edible Gifts for All Occasions by Jill Henry and How to Start a Home-based Web Design Business by Julie Frost.

Adair-Hoy uses the Internet to promote the site and selects certain titles "that deserve to be in print stores" for extra attention and promotion. She notes that traditional publishers have contacted her about print or book club rights for certain titles. "E-books have already had a tremendous impact on publishing," Adair-Hoy said. "In 10 years you'll have to really search for any given print title. But you'll be able to find it instantly as an e-book."
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