Jane Friedman has spent almost the entirety of her professional career working in book publishing. In the mid-aughts, she began writing about the industry, both for professional outlets and her own blog. A few years ago, she launched a paid newsletter that now generates the majority of her income.
I recently interviewed Friedman about her work. We discussed how she grew her newsletter into a sustainable business, and then we talked about the current state of book publishing. One aspect of this world that’s long fascinated me is self-publishing, so I asked Friedman to fill me in on how this market is maturing and where self-published writers are seeing success.
To listen to the interview, subscribe to The Business of Content on your favorite podcast player, or you can play the YouTube video below. If you scroll down you’ll also find a transcript of the interview.
This transcript has been edited for clarity.
Simon Owens: Hey Jane, thanks for joining us.
Jane Friedman: My pleasure. Thanks for having me, Simon.
So you run a successful paid newsletter focused on the publishing industry. How did you get interested in the goings on in the publishing industry in the first place?
I’ve been working in book publishing since the mid 1990s and it’s the only business I have ever worked in. So it was a very natural fit to be writing and reporting on book publishing specifically.
So when you say you were working in book publishing, were you on the publisher side?
I was. I worked in traditional publishing, both books and magazines, but mostly books.
And how did you first decide to start writing about the publishing industry?
Well, the roots of that traced back to the company I worked for, a company called F+W Media, an enthusiasts publisher, which unfortunately went bankrupt earlier this year. That company was the owner of Writer’s Digest. So I worked for that particular brand amongst some others that the company owned. And of course Writer’s Digest focuses on serving an audience of writers. And so a lot of the work that I did there was writing and reporting on industry issues that affect writers. And then I would say about 10 years after I joined the company, there was interest in producing an industry focused event, which came to be known as Digital Book World. It mainly focused on helping book publishers do better with the digital changes in the media.
But you eventually started moving on from writing for Writer’s Digest to writing for your own blog, right?
Yeah, while I was still employed, in fact, I started doing some stuff on my own because I knew that I was not going to stay at this company forever and I needed to lay the foundation for another life, a freelance life.
What were you writing about? It seems like there are a lot of people who aspire to be writers and the publishing industry is considered to be this kind of opaque industry, and there are lots of myths about how to get discovered. It’s not an industry that’s very open about how to break into it. So was your writing geared towards opening up that mystifying world for a lot of people?
Well, yes, and mainly focused on the business side. There are many sites and blogs out there that talk about craft and technique and being a better artist and also the psychological aspects of the business, and I have very little interest in all of that. I’m really just focused on the numbers, the financials, really interested in how people make money at this, both whether you’re the publisher or the author, and how the business models keep changing, which of course affects writers across all industries. It’s not just book publishing, it’s also magazine and newspaper publishing.
So what would that entail? Giving people advice on how to find an agent, how to negotiate an advance? What are some of the things that you would write advice about?
Yeah, precisely what you just mentioned. Literary agents, how publishers evaluate materials, how they put together profit and loss statements, and how that affects their decision on what books to publish, how editors and agents think about products to be sold in the market.
My goal has always been to help authors be much more independent in their thinking about how this business is going to run for them, rather than relying on, say, their agent or their publisher to kind of handhold them; often nobody gets that sort of hand holding. You know, every year you’ll see an article come out from a writer who’s had a book or two out saying, ‘I thought I was set for life. I thought my $300,000 advance was going to last longer than it did. But then there weren’t any royalties and they stopped offering me the big bucks.’ You see these wake up call articles and I’m always trying to help people avoid those nasty realizations when it’s too late to do something.
And approximately when did you start writing your own content on your own blog?
I started writing for my employer in 2008, and then I started writing on my own turf about a year later. And so I eventually left my employer about a couple of years after that blog started, and I continued writing for them, but realized I had to kind of rip off the bandaid, stop writing for them and start doing it all on my own website. And so that transition happened in 2011.
And this was all happening when things were getting really interesting in the publishing industry. I don’t want to be a fiction writer anymore, but I used to want to be a fiction writer and I was getting really into all this kind of stuff in like the early to mid 2000s when self publishing was called vanity publishing. And in order to self publish back then you were either doing print on demand or you had to basically order a large bulk of your own books and try to convince stores to hold them. And there were ebooks but ebooks were less than 1% of the market. It was just so tiny. And then Amazon invented the Kindle and it was just such a game changer in terms of ebooks becoming a real market that made up a larger and larger pie of the publishing industry. You started to see a lot more success cases within the self publishing sphere. Obviously, there are still tensions between traditionally published authors and self published writers, but self publishing got a little bit more legitimacy. So was this a really exciting time to be writing about the publishing industry because it was seeing changes that it hadn’t really seen in decades?
Oh yeah. It was a very rich time. I would argue it’s still a very rich time because changes have never really stopped occurring since that time period. That 2010 to 2012 period was just like the gold rush time. And people were saying, ‘Oh, traditional publishing is dead.’
In the very earliest parts of my career, I was put on this self-publishing beat. So I was very knowledgeable about the old legacy style of self publishing and the stigma surrounding it. To see it so transformed was just amazing.
You said a lot of your content was free. Eventually you launched a paid newsletter. Walk me through the decision process you went through before launching that.
The current newsletter I run called the Hot Sheet, it launched in 2015 with a business partner. It’s just mine at this point, but we started it together four years ago.
So what was your thinking with this newsletter? How would it be designed in terms of what would go into it? How did you decide what the value proposition would be for people to pay for it?
Well, I realized from some past mistakes that first I needed to focus on the market that was willing to pay more. A prior publication I ran was at a very low price point and it just wasn’t enough money to really make a sustainable go of it. I mean, we were in the black on that first publication, but it was just not enough money to make it compelling as a business model. And so right away I knew that if I was going to charge a higher price, I needed to be targeting a more advanced professional audience who would see the value in what I was providing. And I knew that my information stood out. Even the free stuff stood out for its advanced look at the industry. I had a better grasp of what was going on in the industry because of my 20 years of watching it unfold.
I just had the context and I understood the 360 degree view points of all of the players and how they fell out on the landscape, whether they were more pro independent self publishing or pro traditional. That’s the value that I felt that I brought to this newsletter.
And what do you charge for it?
I charge $59 a year. There are discounts that a lot of member writers’ organizations have. So if you’re a member of one of these organizations, you can get 20 or 30% off.
When did you launch it?
The beta was launched in August, 2015 and then our first paid issues started going out in late September.
So this was before the current crop of startups that have really brought together a lot of these tools under one roof, whereas you probably cobble together a couple of different solutions in order to make that possible.
Yes, and even if a solution like Substack had been available, I’m not sure I would have used it. I use a combination of MailChimp and Chargebee, which is a startup. So far it’s proven pretty reliable. The subscriber data that’s in that system, I could export it and take somewhere else if I had to.
How successful has the paid newsletter been in terms of it becoming like a real portion of your income?
It’s very meaningful. So roughly $50,000 to $60,000 net every year at this point. So definitely a living for one person. I keep the costs very low. I managed to get into Chargebee back when it was priced extremely affordably and I’m still on that legacy plan. The subscribership to the Hot Sheet is around 1,200 people, which means I’m also on a pretty low priced MailChimp plan as well.
And if you had a pie chart of who those people are, what percentage are aspiring writers who are trying to break into the industry versus established professional writers versus people who work on the publishing side?
I would say it’s probably 70 to 80% professional authors who are really serious about making a living from their writing. And very few aspiring writes because those people quickly fall off when they realize this is just above their head or it’s not really applicable to their immediate goals. And then there is probably 10 to 20% of others in the industry, agents, people in traditional publishing, and people who are focused on the author community.
And what do I get if I subscribe? How many issues and how packed are they with content?
It’s every two weeks delivered on a Wednesday about lunchtime and it’s five editorial items, which usually are about a thousand words each, sometimes a little longer. It depends. And then at the end there are links of interest, which is basically all of the stuff that writers should probably be aware of — trends, news, marketing information that’s been reported elsewhere, but that I don’t see a need to be reporting on more in depth. It’s probably a good 30 minute read if you were to read it from beginning to end.
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Ok, back to our scheduled programming…
So you don’t produce a lot of free content anymore?
Right. I still post a lot of content on my blog, Janefriedman.com, but the truth is a lot of it is guest content at this point. I’m not actively writing for free for my blog unless it’s promoting Hot Sheet content. So almost all of the original writing that I do is for Hot Sheet or I’m doing it freelance for Publishers Weekly or Writer’s Digest.
So that kind of differs from how a lot of other newsletter writers are approaching it, where they’re putting out a certain number of free newsletters per week and then trying to use that as lead gen for the paid newsletter. How would you say you’re marketing this paid newsletter?
I do have a free newsletter that I’ve had for many years now. Like going back to 2007, 2008. It’s called Electric Speed. It also goes out every two weeks to about 32,000 people. And so that does have a huge audience of aspiring writers and all sorts of people who are just interested in my digital tool recommendations. That’s mostly what it consists of. There’s a promotion for Hot Sheet at the end of every Electric Speed issue. And then also on my website and some other materials that I send out, I do mention Hot Sheet, but by and large, that’s about the only marketing I do.
But you’re also a sought after thought leader, right? In terms of being interviewed or doing speaking engagements and stuff like that. Do you use that as an opportunity to promote the newsletter?
100%. So I do speak at about 15 to 20 events per year. Every time I’m out on the road speaking, I mention Hot Sheet. I offer people in the audience a discount to subscribe within the next few days. So that does contribute and spread the word as well.
So let’s dive into some of your recent coverage. I am really interested in this self publishing industry that’s really grown over the last 10 years or so. Can you give me a sense of how big it is? Are there studies out there showing the size of the market?
Everyone would love specific figures, but the only entity in a position to say something meaningful is probably Amazon. The only other organization that’s been able to quantify it is the agency that issues ISBN numbers. So ISBNs are the identifying numbers that go on every published book. And so the last time this agency released some stats, it was like more than a million ISBNs for books within the space of a year. The catch here is that if you publish an ebook on Amazon, it doesn’t need an ISBN. So there’s what people call the shadow publishing that’s going on beneath the surface that really only Amazon knows about. But that said, if the self publishing author is pretty serious and they’re trying to distribute widely through all channels, then they probably are going to have an ISBN. And we do know the size of that market and it’s enormous.
Do we think it’s above like $1 billion a year?
I would be surprised if it were a billion.Michael Cader, who is one of the biggest industry experts for book publishing, runs a newsletter called Publishers Lunch. And about a year and a half ago he did some crunching of the numbers, trying to use all of the data points we have from various sources to give us a sense. And he estimated that 80% of the market is traditional and 20% is self publishing. But unfortunately, I don’t remember the dollar figures he cited, but I don’t think it reached a billion.
There’s also a debate over how big the ebook market is because a lot of the numbers are put out by the association for professional publishers and they’re only really counting sales of ebooks that are produced by the major publishers and not really counting self publishing. I know there’s this guy who does like a monthly roundup of what’s going on in terms of self-publishing ebooks sales. I forget what his name is, but he gets cited a lot. You probably know him. He seems to suggest that, because these numbers are put out by the publishing industry, they’re misleading. Once the big publishers were able to price their own ebooks, they raised the prices and artificially stalled the growth of the ebook market for traditional publishing, but that didn’t stop the self publishing side from growing. And so that’s why it’s hard to figure out what the numbers actually are.
I think you’re thinking of the author earnings guy. And he stopped doing those reports maybe a year and a half ago for various reasons I won’t go into, but he was right about a lot of things and I think his work has been important in identifying this shadow industry. I also think his numbers were extrapolations from Amazon rankings. And so there was a lot of fuzzy math involved. But I couldn’t agree more that the official stats that you see coming out from the AAP and other organizations, they’re very distorting and they only look at what traditional publishers report. There is no way to get a real handle on what self publishers earn aside from some of the little hints that Amazon drops about how many authors earn above a certain level in a year.
So as I kinda mentioned before, 15 years ago, self-publishing was just considered vanity publishing. Everybody looked down on it. Knowing what you know now, how do you view self-publishing? Like if you were giving advice to a newer writer who’s written a novel today, how would you advise them to navigate the publishing industry right now? Would you tell them to go straight to trying to get an agent and trying to break into the big four publishers? Or are there scenarios where you’d say, Hey, maybe that isn’t the right path?
I think the best thing that’s happened is that there is no one way to get the job done anymore. There are multiple ways to be an author and succeed. The self publishing market has become extremely competitive. So it is not the 2010, 2012 era anymore. The market is flooded and it’s because of the way that Amazon has changed. For instance, it’s really hard to get your book noticed there unless you’re advertising on Amazon. It’s not something where I would recommend people default to self-publishing because they’ve heard all of these things about keeping your rights or keeping control or being entrepreneurial. It is hard. It is just as hard I think as getting a traditional publisher and succeeding that way. So you have to evaluate the project itself. Where is it most likely to succeed? Is it really something that does well in ebook format? What sort of success you’re looking for?
And then weigh the pros and cons. This is why I do every year a key publishing paths chart, which kind of sets out the pros and cons of the various options that are out there now so people can think through with some sort of checklist to see which is best for them. I will say that self publishing tends to favor very commercial fiction series — romance fiction, anything that people are consuming in really large quantities where you can compete on price. Because as you mentioned earlier, traditional publishers are pricing their ebooks at above $10 often, and so self-publishers compete well when they can undercut that pricing.
Yeah. I did a big article a few years ago about authors who write zombie fiction, and every single one of them that I interviewed would say, ‘I will spend three months and write six books in a row and then I will release the first one for free.’ So that first one should be merely a marketing vehicle, because a lot of people don’t like to sample a series unless they can read the first book for free. And then they just progressively charge more and more. Because I guess their thinking is is the more invested the person is in the series, the more they’re willing to pay. So the first book is free, the second book in the series might be $1, the third book might be $2, and so on. But they don’t even release the first book until they’ve written all six. Because I guess it’s kind of like the Netflix model of allowing bingeing; you have to put this entire series in front of the person so if they’re going to invest in it, they know that they can keep on reading.
Yes, that is the model that you see most prevalent and it has been a result of Amazon itself, which tends to reward seeing steady sales and keeping those sales consistent for visibility. So yeah, that quick release schedule has become a curse for some authors who are having trouble keeping up that kind of pace.
One thing you’ve written about and something I didn’t know about is that there’s a new frontier that’s opening in self publishing and it’s going beyond ebooks and into audiobooks. Why is this happening?
Well, digital audio is the biggest growth area in publishing, at least for traditional publishers right now. I’m sure you know, if you’re paying attention to the headlines, you’ll see talk about 20 and 30% growth year on year and these are things you’re selling at high high prices, and so far there’s no sign that the growth is stopping and publishers are starting to get into really complicated, multiple narrator, full full cast recording editions of their audiobooks. And so of course this affects self-publishers too. There’s a big rush into audio. And what’s been so interesting about the change recently is that you’re seeing some of the innovation in digital audio come from places that aren’t Amazon or Audible and have a lot more flexibility on pricing and offering these lead magnets. Like you mentioned earlier, people will offer the first in a series for free in order to get people in the door and then charge them for the second book, and so on.
It’s been really hard to do that in audio because that lead magnet system hasn’t been established, at least not in the Audible environment. So what we’re seeing are other distributors doing things that are more innovative. And so indie authors are looking now to these other places that aren’t Amazon in order to get some liftoff on their audiobook editions. And I haven’t even mentioned the library market, which is a whole other interesting thing that’s going on with both ebooks and audiobooks. So yeah, it’s going to be really interesting to see how this plays out because Audible right now is in a legal battle over its own recent innovation of the captioning feature, and I’m curious to see how they’re going to respond to the more control and flexibility that other distributors are now offering.
Audible really dominates the audiobook industry even more so than Amazon dominates the print book industry, right? It has pretty much a lock on it. And they bought Audible a long time ago before smartphones even existed. It was kind of very prescient that they figured out that they needed to buy into this market because audiobooks used to be pretty a small percentage of the market, because they were these clunky CDs that you had to get from the library or buy for like $50 per book or something like that. So Amazon was really early in the game and then they caught the smartphone market just at the right time when people were starting to listen to stuff on their phone.
Yes. It’s very impressive and they do still have a huge piece of the market. I don’t know what the percentage is, but it’s got to be 70 to 80%, although people see it changing. So yeah, it’s something I’ve got my eye on.
But what are self-publishers doing? Because it seems like there’s some expensive production costs that would be involved, much more so than publishing an ebook. How are they overcoming these challenges?
Well to date, I think often what they’ve done is use ACX, which is the offshoot of Audible that allows authors or publishers to enter a marketplace where they find narrators. And so when you find your narrator through ACX, you can choose a royalty share, which means you don’t have to pay that upfront cost. The huge drawback is that if you do that, you are committing to an exclusivity agreement with Audible for seven years, which is kind of crazy in the current environment. I mean if we just go back seven years, the ebook market is entirely different. So imagine what the audiobook market might look like in seven years. It’s starting to pose some really interesting strategic questions for authors who may not want to invest in this high up cost. It’s usually $5,000, could be more depending on the length of the book. But you know, it’s probably worth it in the long run to make that investment and then to reap the rewards over a longer period of time by having wide distribution, given the number of opportunities that are opening up,
What are some of these startups doing in the space? Are they just other marketplace apps that you download and it’s just easier for self published authors to list their books there?
So Findaway Voices is one of the most well known companies at the moment for authors because they help you with the production of the audiobook, and then they also do the distribution piece, meaning that they push your audio book out to everyone who sells audiobooks, including Apple, Google, and libraries. And they also of course can send your book out to Audible. So I think authors are looking at how to find a way that allows them to control their price, which Audible does not. It’s a very important distinction there because Audible basically sets it at whatever they want and then you just live with the results. Findaway doesn’t require that, meaning you can price lower, especially if you’re a self published author. As I said, pricing is your one competitive differentiator.
And then there’s also going to be new features where you can make a larger sample available for free. So like the first few hours for example, which just isn’t possible right now through Audible. BookBub’s Chirp is the other interesting entrant. I think they first went onto the market about a year ago. If you’re familiar at all with BookBub on the ebook side, you know that they offer these featured deals and they’re really cheap. So the BookBub Chirp is a similar model, but it’s audio books and they’re selling directly, which is different from the ebook side. There’s also Kobo, another ebook retailer now also starting to sell audio directly. So yeah, a lot of activity.
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