A Churchillian challenge for bloggers


Divergence of the self-publish business model

Lulu is a one-stop do-it-yourself publishing shop. You upload your opus and pick a design template. Lulu then lets you sell your book through Amazon, Barnes & Noble, Borders, or Lulu itself. Your book only exists digitally until someone places places order. Then Lulu handles the printing, shipping, and order tracking. However, in none of this is Lulu unique. Since the late 1990s, two on-demand outfits - Xlibris, backed by the Random House, and iUniverse, backed by Barnes & Noble, have been doing something similar. And Amazon has its own program, BookSurge. The difference, is that Lulu utilizing advanced technology, focusing on serving huge number of small publishers; whereas other shops are basically vanity presses, focusing on their own bottom line. This difference reflect the divergence of the self-publish business model.
At BookSurge, iUniverse, and Xlibris, authors pay an up-front fee of $300 to $1,600, book prices are set by the services, and royalties range from 10% to 25%. At Lulu, by contrast, no money changes hands until a book is purchased; design and layout are free. Authors set the prices for the book. And the royalty rate is 80%, excluding Lulu's charge for production.
Lulu's self-publish business model seems to be working. According to an article in June 2006 issue of Business 2.0, last year Lulu rang up revenue of a couple of million every month. Since August, 2005, book sales have almost tripled, from 36,000 to 91,000 a month. 1000 books are added every week; the site now has 40,000 titles available and 160,000 accounts.
Apparently Lulu is trying exploit the long tail phenomena through technology. In traditional book publishing business, small, unknown authors/books are all too often a barely-tolerated distraction on the road to getting best authors/sellers. They can cost as much to serve as their richer counterparts but generate less revenue. But modern digital self-publish businesses could be efficient enough to serve small, unknown authors/books who generate no revenue at all. Even if only a tiny fraction of them become profitable, a small percentage of a very large number can still be a big number.
Who is the longest tail in the publishing world? It is our blogs, millions of millions of blogs created by amateur authors and journalists like us.