This looks scary for authors, and maybe it should. Like digital music and movies, the marginal cost of an ebook is pretty much zero. If you are an author, you need to rethink how to make money from your work. It won't be from selling $10 books much longer.
The following analysis of self-publishing's future is from an author who had two successful books on self-publishing. Those (excellent) books are now free on his website. The economics and discovery challenges sound like mobile apps. And this is before fractional book royalties are introduced.
POD books provided a handsome profit margin even at reasonable prices. But Kindle books, with their lower prices, have decimated POD sales. Meanwhile, Kindle customers expect more and more for the low prices they pay. Many feel cheated if they spend 99 cents or even less on a book that isn’t “full-length.” And the flood of easily-published books makes it harder and harder for individual ones to stand out—a problem that can only worsen with time.
The upshot is, if you want to self publish and are new to it, then by all means, hop in. But for a long time at least, it’s likely to be more for love than for money. Sure, self publishing is still a money machine—but nowadays, that’s mostly for Amazon, not authors.
