Most authors price at $2.99…

Smashwords founder and CEO Mark Coker found that authors chose to price at $2.99 ”more frequently than any other price point. In last year’s survey, $.99 was a more common price point than $2.99. In this year’s survey, $2.99 was [chosen] about 60 percent more often.”

…but $3.99 sells the most copies.

Smashwords’ findings suggest that those $2.99 authors should price up by a dollar: “One surprising finding is that, on average, $3.99 books sold more units than $2.99 books, and more units than any other price except FREE. I didn’t expect this. Although the general pattern holds that lower priced books tend to sell more units than higher priced books, $3.99 was the rule-breaker. According to our Yield Graph, $3.99 earned authors total income that was 55% above the average compared to all price points.”

Coker also noted that “Books priced between $.99 and $1.99 continue to underperform when we look at the book’s total earnings. $1.99 performs especially poorly. It’s a black hole. I’d avoid that price point if you can.”

Coker acknowledged that if everyone starts pricing their ebooks at $3.99, the enhanced sales effect may be lost: “Today, [the] $3.99 price point appears to be an underutilized opportunity because there are fewer titles than $2.99 and readers respond favorably to $3.99. However, if thousands of authors shift their pricing to $3.99 tomorrow, would the edge diminish? I don’t know the answer to that.”

The full survey, which also includes findings on book length and title length, is here.

Photo courtesy of Shutterstock / Borys Shevchk

Nook Media’s primary new feature, developed in partnership with FastPencil, is a tool that allows authors to write, format and edit, and preview ebooks directly in a web-based platform (see image at left). “It’s an end-to-end solution, from content creation to reaching the customer,” Nook Media’s VP of digital content Theresa Horner told me. “What we are trying to do here is make self-publishing simple. You can come to the product, write, edit and publish into EPUB without ever knowing any bit of technology.” Authors who already have their title as a Microsoft Word file upload it, preview it as an EPUB and can sell it right away.

Barnes & Noble has also added a “quick start” option that lets authors test the product without entering all their vendor information at the start. And authors can “safely and quickly invite their network of friends and editors to read and comment on any NOOK Press project in a secure environment.”

Royalties haven’t changed: Ebooks can be priced between $0.99 and $199.99. Those priced between $2.99 and $9.99 get a 65 percent royalty, while those priced under $2.99 or above $9.99 receive a 40 percent royalty. By contrast, Amazon’s KDP pays a 70 percent royalty on most ebooks between $2.99 and $9.99 and a 35 percent royalty on those under $2.99 or over $9.99.

Nook Press is currently only available to authors in the U.S., though they can opt to sell their titles in the U.K., the only other country where Nook operates.

Barnes & Noble says that self-published titles now represent 25 percent of Nook ebook sales every month, and thirty percent of Nook customers purchase self-published content each month. The company wouldn’t share exact user numbers, but said “tens of thousands” of authors and publishers use PubIt!, publishing “hundreds of thousands of books.”

Our upcoming paidContent Live conference will highlight the changes in the book publishing business, and Howey exemplifies many of these trends. In this podcast, the second in a series featuring digital media creators who are successfully building their own independent empires, we talk to him about his success and what’s next.

paidContent Live takes place in New York on April 17.

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The Story Album app comes pre-installed on the Galaxy S 4, Samsung’s new smartphone that was unveiled Thursday in New York. The app auto-generates a layout from a user’s smartphone photos. The user can then add captions and dates, preview the album and order it directly from his or her phone.

“As our lives become increasingly digital, people are genuinely appreciating the value of physical artifacts,” Blurb CEO Eileen Gittins said in a statement. “By combining the remarkable image quality that the Galaxy S 4 offers with the easy production of books and magazines that Blurb brings, everyone gets the best of digital and analog.”

Blurb already lets users create physical photo albums from Instagram and Facebook photos.

Kobo touts global growth, insists e-readers aren’t dead

Toronto-based e-reading company Kobo announced that it doubled its e-reader device sales in 2012; up by “nearly 150 percent” in December and over 12 million registered users. Citing the super-sketchy Taiwanese tech site DigiTimes, Kobo also claimed it has 20 percent of the global e-reader market. Whether or not that’s true (and DigiTimes is forecasting e-ink device share, not the share of ebooks sold), the company is clearly expanding rapidly — to Brazil, Portugal, Italy, Japan, Spain, South Africa and the Netherlands in 2012, with plans for Russia, India and China in 2013.

At Digital Book World, Kobo’s Michael Tamblyn provided some updates on the company’s partnership with independent bookstores in the U.S. As reported by Publishers Lunch (paywall), Tamblyn made

“a clear case that the ‘indie store’ ebook customer is very different than Kobo’s standard US customer to date. ‘They buy more expensive books’ and “have a completely different price tolerance’ than the traditional U.S. book buyer. Half their sales are at $9.99 and above (versus only 30 percent for the average customer), and those customers ‘also buy different books’…Their indie bookstore ebook bestseller list also ‘looks very different–much more like a print bestseller list, and less like an Amazon top 25.’”

Penguin: Embracing POD, as Book Country adds free option

Penguin U.S. will make its books available through On Demand Books’ Espresso Book Machine (PDF), the print-on-demand machine that appears in around 70 bookstores and libraries globally. (Its technology is also integrated into some Kodak Picture Kiosks in retail chains like CVS.) “Penguin is always looking for new ways to bring our writers to readers and On Demand Books gives us another channel to further fulfill that mission,” Penguin EVP, business operations Doug White said in a statement. The Penguin/On Demand release also noted that the Espresso Book Machine’s software will soon allow users not just to create files for printing but to “convert print files to the EPUB format suitable for e-readers.”

Separately, Penguin is changing the self-publishing options that it offers through its community writing site Book Country. When Penguin launched Book Country’s self-publishing arm at the end of 2011, many complained that it was overpriced and greedy, taking too large a share of authors’ ebook royalties. (Simon & Schuster’s self-publishing offering has received similar criticisms.) In response, Book Country has rolled out a redesign and a host of changes to its self-publishing services, and will relaunch the community writing site later this year. Publishers Weekly reported:

Book Country has increased the author royalty to 85% from 70%, added a free tier to Book Country’s self-publishing services and reduced fees for all its tiers. Now Book Country offers self-publishing packages that start at free, $59, $149, $249 and $399 (which includes 100% royalty if sold through the Book Country retail channel) for its top-tier, which was originally $549.

Inkling opens up to Google

iPad publishing platform Inkling is making its titles — just 400 of them so far, with about 1,000 more expected in 2013 — fully indexable through Google Search. It will also sell those books in chunks. “We’re going to bring people in before they ever get to Amazon,” CEO Matt MacInnis told me. It’s a bullish goal — especially because Google hasn’t been a source of book discovery up until now. At Digital Book World this week, Codex Group’s Peter Hildick-Smith presented research showing that while the majority of frequent book buyers visit Google regularly, less than 1 percent discovered the last book they bought through a search engine.

Lulu had offered authors the option to apply Adobe Digital Editions DRM to their EPUB and PDF files before publishing, for an additional fee. Now the company is dropping that option (and also dropping the hefty fee that Adobe charges for DRM). That means readers who download ebooks directly from Lulu will no longer have to “create an Adobe account, authorize the purchase in Digital Editions or install a third-party application,” Lulu writes in a blog post. “This creates possibilities for the growing number of readers who want to shop, purchase and download books to their e-readers from sites other than large corporate providers.”

As for those larger corporate providers like Amazon and Apple, Lulu’s not exactly claiming those retailers should drop DRM too. “DRM works best when administered by those who control how content is purchased and viewed,” the company writes. “Companies like Amazon, Apple and Barnes & Noble integrate a reader’s experience from purchasing to downloading and finally to reading. These companies do a fantastic job in this area, and ebooks published through Lulu and distributed through these retail sites will continue to have the same rights management applied as they do today.”

Amazon actually doesn’t require Kindle books to be sold with DRM — sci-fi publisher Baen, for example, recently started selling DRM-free Kindle books. Brian Matthews, Lulu’s EVP of marketing, strategy and corporate development, told me that “in the first half of 2013 it’s possible we could make changes to allow authors to automatically choose DRM or not when in distribution.”

Entangled is one of a growing number of “boutique” publishers that seek to strike a balance between the freedom of self-publishing and the structure of working with a traditional publisher. “We believe authors who write great books should receive a majority of the profits,” the company writes in its mission statement. “We also believe authors interested in the lucrative indie publishing model shouldn’t have to sacrifice quality editing, commercial covers, or the power of a New York-style marketing machine.” Entangled doesn’t offer advances and pays authors royalties higher than what they’d receive from a traditional publisher but lower than they’d get if they self-published. In return, it provides them “strong editorial support, a publicist, a personalized marketing plan, and world-class distribution for all of their titles.”

Until now, that distribution has been primarily digital, though Entangled was working with Publishers Group West to distribute a few of its titles. With the Macmillan partnership, though, “Macmillan will distribute English language e-books of Entangled’s new publications in all domestic and international markets and for all platforms where Macmillan currently does business.” That’s beneficial for Entangled because it ensures a much broader reach than it could manage itself. And it’s good for Macmillan because it gives the publisher an entrance to the hot indie market without having to seek those titles out itself. Simon & Schuster ended up buying The Marriage Bargain in a seven-figure deal last year, but this deal should give Macmillan first dibs.

“We are hugely impressed with [Entangled CEO] Liz Pelletier’s vision and what she has accomplished in such a short time,” Macmillan CEO John Sargent said in a statement (found via Dear Author). ”We found her out-of-the-box approach to publishing incredibly exciting and saw potential to work together with her on several levels. We think Liz and Entangled have found a new way forward and we think we can help build on that remarkable success.”

With the launch of Archway, Simon & Schuster hopes to get a piece of the rapidly growing self-publishing market. According to Bowker, over 235,000 books are self-published annually — up 287 percent since 2006. (The actual figure is likely higher since Bowker only counts titles with ISBN identification codes. Titles published without them — like ebooks offered exclusively through Kindle — are not included.)

Free self-publishing services, like Smashwords and Amazon’s KDP, focus on ebooks, while Author Solutions emphasizes print and retail distribution and has higher prices and lower ebook royalties. Archway’s “fiction” publishing package, for example, ranges in price from $1,999 to $14,999. That includes ebook distribution, but Archway authors can’t choose an ebook-only publishing option for now, though the company may add one later. Archway will pay an ebook royalty of 50 percent of net sales, so if an ebook is distributed to Kindle, for example, an Archway author would receive 50 percent of the sale minus Amazon’s 30 percent fee.

Archway is offering services like a “concierge” — “a dedicated publishing guide who will coordinate each step of the book production process” — and access to a speakers bureau. Archway titles will be included in the booksellers’ catalog Edelweiss. And Archway authors “will have the opportunity to create high-quality videos and book trailers for distribution” to the online video networks that Simon & Schuster works with, like Roku and Blinkx. Simon & Schuster is not hiring any staff; services like the “concierge” will be provided by Author Solutions.

Simon & Schuster will monitor the sales of Archway titles and may sign some authors for traditional publishing deals. In recent months, the publisher signed self-published romance authors Jamie McGuire and Colleen Hoover. “We’re excited that we’ll be able to help more authors find their own path to publication and at the same time create a more direct connection to those self-published authors ready to make the leap to traditional publishing,” Simon & Schuster CEO Carolyn Reidy said in a statement.

Penguin acquired Author Solutions for $116 million in July, but the company continues to operate independently and “Penguin is not involved in any of our partnership businesses,” ASI CEO Kevin Weiss told me. ASI already operates white-label self-publishing services for Harlequin and HarperCollins’ Thomas Nelson, for example. “We have an agreement with [Penguin] that all of our partnership businesses are confidential,” Weiss said. “Prior to [a book] being in distribution,” Penguin can’t see it and it is “sealed off behind our firewall…I informed Penguin that we are launching this deal, but I did not get their permission.”

Bowker finds that 148,424 print books were self-published in 2011 — that means that 43 percent of all print books published in the U.S. in 2011 were self-published. 87,201 ebooks were self-published. Publishers Lunch notes a few important caveats: Bowker only counts titles with ISBNs, so “KDP exclusives and other sources that still don’t use ISBN numbers” aren’t included. That means the number of self-published ebooks is likely much higher than 87,201. In addition, the print and digital editions of a single title may be counted twice.

Bowker finds that four large companies dominate the self-publishing space. In 2011, Amazon’s CreateSpace was behind the creation of 58,412 titles, or 39 percent of all self-published print books.

Smashwords was the largest ebook producer, accounting for 40,608 titles, or 47 percent of all self-published ebooks.

Author Solutions, which Penguin acquired earlier this year, and Lulu accounted for 47,094 titles and 38,005 titles, respectively. Author Solutions and Lulu allow customers to self-publish both print and ebooks.

“Beyond those four players, no company has more than 10 percent of market share,” Bowker reports. The company found that small presses, which it defines as publishers who have produced 10 or fewer books, produced 34,107 self-published titles in 2011. The number of print books produced by small presses “increased more than 74 percent between 2006 and 2011″ but that figure is “dwarfed by CreateSpace’s 1702 percent increase during the same period.”

Photo courtesy of Shutterstock user Carlos Andre Santos

Overall, the iBookstore contains 1.5 million books that have been downloaded 400 million times so far, Apple CEO Tim Cook said. The main changes to iBooks — which isn’t updated in the iTunes Store as of this writing, but will be today — are a continuous scrolling option for ebooks (so you can just flick instead of turning virtual pages — a feature readers may or may not care about) and better integration with iCloud so that ebooks sync across devices. You can tap to share a passage on Facebook or Twitter. The company also added support for Korean, Chinese and Japanese, bringing the total number of languages supported to over 40, according to Cook.

In addition, Apple’s self-publishing platform iBooks Author, which lets users create graphics-rich ebooks (like textbooks) for iPad, is being updated. It gets new templates, the option to create portrait-only (as opposed to landscape) books and other customization options.