Last week, I received a press release from the Authors Guild about their latest study on why authors’ incomes are declining, a story that’s been making the rounds in the media. The first sentence: “[The] study upends a common assumption about library borrowing: The readers most likely to borrow rather than buy are college-educated, employed full-time, and earning over $75,000 a year.” The clear implication: Such people can afford to buy but don’t. At the Authors Guild website, in the report’s key findings, libraries are strongly implied to be a factor in declining author incomes. (Review the full study.)
Longtime readers know the problems I have with any study that shows author incomes are in decline. (Read my long diatribe from 2018.) However, in 2023, I was offered a deeper look at the Authors Guild’s 2022 income survey, which revealed notable differences in earnings between traditionally published and self-published authors. On book-only earnings, established self-published authors outearned their traditional counterparts by 67 percent, particularly when using Kindle Unlimited. And the authors most likely to report income decreasing over the prior five years were traditionally published authors and those 65 and older. As to why, Peter Hildick-Smith of the Codex Group, who conducted both of these studies, told me then, “There are a lot of folks out there nipping at your heels, and you’re having to share the winnings a lot more.” (See my full analysis, for paid subscribers.)
While I think that is by far the biggest factor affecting author earnings these last 15 years, the new Authors Guild research looks at book reading and buying behavior that would affect all types of authors. If avid readers are less inclined to purchase books, that would affect everyone regardless of how they publish. But I still urge caution in drawing such a conclusion from this particular study. Here’s why.
First, this study has no historical baseline; it can’t claim book buying is down. The headline takeaway is that only 25 percent of print and ebooks read in the last month were bought new or obtained through a paid subscription. But does that represent a change in consumer behavior? We don’t know because this study is a snapshot only, not a comparison with prior studies. To be fair, it is well known that digital borrowing has surged at libraries, especially since the pandemic. In particular, it was revealed in 2019 that library ebook revenue for Macmillan increased by 800 percent over five years. But if readers have truly abandoned buying for borrowing, total book purchasing, especially for fiction, would be falling. In fact, the opposite is happening. The fiction market has seen some of its strongest growth since the pandemic.
Second, it’s not fair to lump library borrowing in with piracy, secondhand purchases, and sharing among friends. This is how the Guild arrives at that 25 percent figure, when in fact more than half of all reads are paid for. As Guy LeCharles Gonzalez, who ran the library-impact research initiative the Panorama Project, wrote last week, bundling libraries in with other free sources is “a subtle form of lying with data.” Libraries are not free riders, and authors earn royalties for library licensing and sales. (Learn more.) Moreover, Big Five publisher licenses often expire after two years, necessitating repurchase to keep a book available.
Third, a borrowed book is not necessarily a lost sale. The study shows that active library members read 16 percent more books than non-members and are nearly twice as likely to listen to audiobooks. You cannot tell from a survey why a given reader borrowed rather than bought or whether they would have bought at all if borrowing weren’t an option. A borrow only cannibalizes a sale if the reader would otherwise have paid. When publishers were put under oath in the Internet Archive litigation, one witness conceded, on the question of market harm from libraries, “I don’t have any evidence” and that identifying such harm would be “speculative because you can’t truly, directly make that correlation.”
I asked Authors Guild CEO Mary Rasenberger if the survey distinguished between a borrow replacing a sale versus the possibility that heavy readers simply borrow and buy more of everything. She wrote me that the survey doesn’t make that distinction, but “it does show that the library users read more in general, but readers who find Libby don’t tend to buy as many books after they move to Libby.” The study also finds the borrowing effect is most pronounced for brand-name authors (i.e., the ones who are the highest earners). These are the authors that libraries stock more aggressively, and this is where the cannibalization claim has the most merit. Publishers typically price ebooks, especially new releases, at $15 and up for consumers, which may drive more of them to libraries or other methods of acquisition.
If people are motivated to use libraries more (or engage in piracy), a big question is why. Ebook pricing is likely one factor, but it’s worth contrasting the Authors Guild study with the 2021 Immersive Media and Books study, which was academic-led and funded by a coalition spanning both library and publisher interests—OverDrive, the ALA, BISG, and IBPA—rather than commissioned by one party. Both studies collected data on the behavior of avid readers. But where the 2021 study characterizes non-buyers as fans to be converted and treats free acquisition as often additive to buying (it found 41 percent of pirates buy books, and frequently the same title twice to switch between formats), the new Authors Guild study sees a sale that got away. This negative framing misses an opportunity, as suggested by Andrew Albanese at Words & Money: “Amid increasing competition for a reader’s attention, I see the data as more evidence that the Authors Guild and its members should be leaning into the library market.”
While not a focal point of the Authors Guild report, subscription services do come under some scrutiny. They say such services “pay authors a fraction of what they would earn on individual sales” and later mention Kindle Unlimited for paying particularly low rates. Here, it’s worth noting big publishers rarely put titles in KU, especially not high-value titles, and have secured the most desirable terms from audio subscription services. (Indie authors must accept far less, as they have no leverage.) But in my conversations with professional indie authors, usually their income increases by having titles in KU. While it’s risky to be reliant on KU and/or Amazon for income, they have learned to make tradeoffs that benefit their careers over years. For more on this, see my recent roundtable (for paid subscribers) on Audible earnings, where one indie author’s business model thrives because of digital lending at libraries and another’s due to inclusion at KU. I have to wonder if some publishers are not as savvy as these authors at turning subscription and lending models into overall increased revenue and supportive fans.
Bottom line: How readers discover and consume books has been changing dramatically over the last 10 years, and it’s a far more complex and rich market than when I entered the business. If publishers were to limit library access through increased pricing or decreased availability, I doubt it would lead to increased sales and higher author income. Instead, I think people would find something else, whether a cheaper book or another form of entertainment, to fill their time. Michael Cader at Publishers Lunch writes (sub required), “Any dispute over authors’ earnings should be focused on publisher and vendor splits, not stigmatizing eager and regular readers.” Might I add that if publishers were to break out library licensing and sales on royalty statements, showing authors’ share of digital earnings from libraries, that could offer some indication as to where authors should direct their concern? (Again, see my freely available discussion.)
When I asked Rasenberger if there was a specific policy goal associated with sharing this report, she said no. Rather, “We had authors complaining about the loss of income when they saw readers switch to reading library ebooks and audiobooks and were wondering how big a trend that is. We were not surprised by the library reads but by the overall numbers. … One thing we have been looking at for some time is a platform that would allow readers to tip authors for the books they liked and bought secondhand or borrow—or acquired in any way.” While the Guild has at times tried to fight for a Public Lending Right (PLR) in the US (it exists in some other countries), it’s not an effort that would likely gain traction in the current political climate. (Learn more about PLR, for paid subscribers.)
Rasenberger went on to say that policy-wise, the Authors Guild does not take a position on current library lending practices, but she added, “We do however oppose the state library e-lending legislation that is cropping up all over the country.” Rasenberger is referring to state-by-state legislation that prohibits libraries from entering into publisher contracts that require them to license or purchase digital books under certain conditions. These laws are intended to force publishers to renegotiate their library pricing and contract terms. However, the most recently passed state laws don’t take effect until other states pass similar legislation. Connecticut was the first state to pass such a law, and Rhode Island recently followed suit, which could lead to an increasingly tense situation between publishers and libraries. Learn more in the New York Times (gift link).
Jane Friedman has spent her entire career working in the publishing industry, with a focus on business reporting and author education. Established in 2015, her newsletter The Bottom Line provides nuanced market intelligence to thousands of authors and industry professionals; in 2023, she was named Publishing Commentator of the Year by Digital Book World.
Jane’s expertise regularly features in major media outlets such as The New York Times, The Atlantic, NPR, The Today Show, Wired, The Guardian, Fox News, and BBC. Her book, The Business of Being a Writer, Second Edition (The University of Chicago Press), is used as a classroom text by many writing and publishing degree programs. She reaches thousands through speaking engagements and workshops at diverse venues worldwide, including NYU’s Advanced Publishing Institute, Frankfurt Book Fair, and numerous MFA programs.
