More than 5,000 authors who have work for sale at e-publisher MightyWords received a letter Wednesday night.
Half were invited to remain with the site and accept a royalties cut from 50 percent to 70 percent of what they're contracted for now. The other half had their contracts terminated, and as of the second week in December, MightyWords would no longer sell their titles.
MightyWords' decision fits neatly in the trend of downsizing dot-coms. In other words, e-business stinks as usual. But it's significant in the world of bookselling, where self-published authors are getting a wake-up call. If they didn't realize it already, they're largely out there on their own.
"We are interested in building a company that is here for the long term," said Judy Kirkpatrick, executive VP and general manager of MightyWords. "What we are doing is fine-tuning a sustainable business model."
Kirkpatrick said the lower royalty rates would actually provide a boost for the retained authors because of wider distribution authors will now get on sites such as Fatbrain and B&N.com.
B&N.com made a $20 million investment in MightyWords last June.
One author who has four titles with Mightywords.com and requested anonymity said it seems to her that if anything, the increased sales should insure profit margins, not lower them, and that the royalty reduction makes no sense.
"We are adding third parties here and they deserve their cut, too," said Kirkpatrick. MightyWords believes it is actually protecting their authors by guaranteeing them 30 percent of the cover price -- no matter how deep a discount the distributor gives the customer.
In explaining MightyWords' decision to terminate almost half their authors, Kirkpatrick said that it was really the customers who made that judgment.
"Our customers have reported that the vast majority of the titles they want to buy fall into a few main categories, including brand-name business, technical, health and fiction titles from well-known authors. So that’s what we are going to concentrate on," she said.
Wayne Perkins, a MightyWords author who has been dropped, is not pleased.
"I’ve been promoting Mightywords in my book and in my talks around the country as a place (where) new authors can try out their stuff."
But Perkins says there's a difference between the illusion of Internet marketing and the reality of Internet marketing. He says authors can't rely on others to sell their books.
"Most MightyWords authors that I have talked to never sell any documents," Perkins said. "I have to educate them on the fact that it is the author's responsibility to drive business to MightyWords, Amazon.com or their own website."
That reality about marketing -- the chasm between what authors wish a company would do for them, compared to what makes economic sense -- was a real factor in MightyWords' decision.
"So many authors were frustrated that we weren’t giving them any marketing help when that just isn’t what we are set up to do," Kirkpatrick said. "We think they will be best served by other companies that help in that area."
To that end, MightyWords has arranged for authors to get a discount at 1stBooks Library, a co-op publisher who, she says, specializes in helping self-published authors market their work.
Perkins believes that the services of Booklocker.com –- with whom he has a relationship -- and companies like 1stbooks Library, are going to benefit by the fallout in the long run.
"Both companies actually give their authors a lot of marketing tools that work in the reality of publishing and not the illusion of publishing," he said.
Editor's note: M.J. Rose has a novella which is contracted by for sale at MightyWords. Her contract is separate, and therefore not affected by either of these changes.
