There are two reasons for my position – and both relate to my concept of thinking of digital publishing as an investment. (As mentioned there, you may disagree with me, and it’s all cool.)
- Smashwords is three business models in one, and they cannot (at present) stand independently.
- Smashwords locks you into all of the business models rather than competing individually on the free market.
We’ll spend a day with each of these.
Smashwords is three business models in one, and they cannot (at present) stand independently. The three businesses are eBook conversion, retail outlet, and aggregator/distributor. Each of them is problematic.
eBook Conversion: The eBook conversion (through Meatgrinder) is notoriously finicky, and requires very specific formatting. Unfortunately, you must use Meatgrinder if you wish to use Smashwords. The degree of work needed is roughly equivalent to creating an ePub yourself 1 (especially if you’ve had to use the “nuclear option”). There are plenty of automatic conversion tools that work just as well (or badly) as Meatgrinder – Sigil, Calibre, and the ePub export option with Atlantis Nova come to mind. Unlike Meatgrinder, you can tweak the output of any of those other three after the fact to fix conversion errors. With Meatgrinder, you have to keep tweaking the source document.
I have to wonder how many folks would even bother with the frustrating tweaking if they could use other options.
While in an email conversation with Mark Coker, he told me that his long-term goal was to accept ePubs from authors; that was five months ago. This mystifies me, as he also said:
WWe are first and foremost an ebook distributor. Our Meatgrinder eliminates the technical and financial barrier that prevent authors from getting their work out there.
If an author already knows how to make a standards-complaint ePub, forcing them to use a different converter creates a new barrier.
Retail Outlet: The retail aspect of Smashwords is also problematic. In my experience, the only people who know about Smashwords are authors or those who directly talk to or follow authors who use Smashwords. This makes me wonder how viable the retail platform of Smashwords would be without having everyone who used their conversion service.
Mr. Coker admitted to me (again, in that e-mail conversation) that about 80% of the sales came through retail partners. I presume the vast majority of those (again, from my own experience selling eBooks) are through Barnes & Noble and Amazon. Both of those outlets have far outperformed Smashword’s direct sales for me. Both of those outlets accept direct uploads from, well, anyone. The iBookstore and Kobo are a little more problematic, but still accept (essentially) the same ePub file.2 Sony is the only one that doesn’t want to talk to small publishers or independents; I expect that will change as it has with all the other digital retailers.
Aggregator/Distributor: This is Smashword’s primary gig, and it’s one place where they are noticeably less skeevy than many of the others out there. (I recently wrote an article about the retailers, which should appear in the April-May (I think) issue of the SFWA Bulletin. That said, the need for such an aggregator is disappearing rapidly. To the best of my knowledge, Smashwords distributes to only two places that, say, I can’t: Sony and individual apps. I discussed my opinion of books-as-apps last week, and I suspect that the Sony bookstore will either open up to individual authors, wither away, or both. As mentioned above, my experience is that most sales come from the nook or Kindle platforms (or direct sales – more on this in the next post); you can upload to both on your own.
Again, thinking about digital books as investments helps. Think of Smashwords as your broker for a second – and then imagine that broker going out and buying the same certificates of deposit from a local bank that you could – and then taking a cut of the proceeds. The time saving is worth something – but I’m not convinced it’s worth as much as Smashwords charges.
In short, all three parts of Smashword’s business model seem unsustainable as individual elements. It’s like a house of cards. Unless there’s something not visible to outside observers, Smashwords currently exists only as long as its customers (and by that I mean authors) are locked into all three parts.
This is a problem in itself – and it’s one that I will go into tomorrow.
1 Full disclosure: I professionally convert eBooks (and fix botched eBook conversions). More on this (and why I’m doing it) at the end of the series.
2 Full disclosure: I intend to announce Alliteration Ink‘s ability to get authors in both Kobo and the iBookstore this week, along with pricing. More on this (and why I’m doing it) at the end of the series.