I've been giving a lot of thought to Graphicly's new business model. They made a big splash earlier this month when they shut down their apps and shifted from operating as a retail business to a distribution model.
They took a giant leap... backwards.
The change in business model bothered me immediately. It was almost a knee-jerk, gut response, my own reaction surprising enough to myself that I reigned in snarky comments I had begun to make and announced instead my intent to write a blog about it (although I was tempted to keep tweeting when whoever was tweeting for Graphicly picked up on my ire and suggested I try them out - did tweet one reply - that my books had been with them for a while now. Yeah). Needed time to think this through, figure out why it bothered me so much. Think I've figured it out. I'm disappointed, because they seemed to be on the verge of something kind of awesome. And then, they took a U-turn.
You're either with us or... you're leeching off of us. You're either helping us sell or... you're preying on us. Smashwords kept coming to mind in contrast to Graphicly, and not just because of a similar array of distribution outlets offered. Smashwords founder and CEO Mark Coker is kind of brilliant, in my opinion, and part of his brilliance is that he gets the new Social Media Reality and creating partnerships and alliances that are mutually beneficial. You're either with us or... you're a middle man, trying to make money off other people's dreams without sharing in their risk. If only Smashwords' conversion software could handle graphics better. They're not a solution for comics, at least, not yet.
I thought Graphicly was, albeit an imperfect one. It isn't anymore. In shifting from a model where Graphicly sold eComics and made money when and if you made money, to one where Graphicly ALWAYS makes money, and you're on your own... they can spin it any way they like, but Graphicly decided to change from selling WITH creators to making money OFF of creators. They're now charging creators directly starting at $150 per book for the conversion services and distribution they are offering. After that, all sales and profits after the market takes its cut accrue to you, Graphicly no longer gets a percentage. But yes, all the markets that Graphicly distribute to will take their cut, at whatever percentage they deem fair - most take around 30% of the selling price.
This new approach may make fine sense as a business model for Graphicly, but it's not one I'm interested in participating in going forward, and it's a step backwards in the ongoing internet creative and business revolution. It's also stepping away from offering individual comic book issues in favor of graphic novels and collections - it's doubtful publishers will use Graphicly to distribute individual issues when the cost begins at $150 per book. Doubtful for smaller publishers, anyway.
Some of Graphicly's justification for this also strikes me as disingenuous. Micah Baldwin writes in emails to publishers that this change now lets Graphicly help everyone more fairly. You see, now Graphicly treats publishers the same as they help get their goods into different markets where publishers can do their own marketing, where as before, as a retail store/app motivated by percentage of sales, Graphicly tended to promote and favor big-selling, big name titles from major publishers, as this is how they'd make their money. Now they won't have that profit motive driving their work, or so he writes. The suggestion that taking the profit motive out of the equation helps seems obviously counter-intuitive. The rather cavalier admission that in the past they under-served their smaller clients irritates me. And it also makes it sound like they didn't know what they were doing as retailers, while all the while insisting that they did.
Smashwords leads the way into the future, where Graphicly is stepping backwards into the past. The internet has been eliminating the need for middle-men. Seems a step backwards to me to decide to become one. Smashwords takes a percentage of your sales in exchange for converting and distributing your eBooks to Barnes and Noble, the SONY bookstore, Apple's iBookstore, Kobo, and several other marketplaces. Smashwords also has it's own network of sites, different storefronts to put ebooks in front of consumers and searchers in a number of different ways. Look up "Cheap eBooks" or "Science Fiction eBooks" and chances are you'll come across at least one side channel site run by Smashwords. Smashwords empowers publishers and creators, and makes its money by doing so.
Have had some of my self-published books offered through Graphicly, in the interest of trying to make my books available in as many places as possible. Won't be adding any new books through Graphicly, but I will continue to offer the ones currently available through Graphicly in whatever markets they place them, so long as they don't start charging me for that “privilege”. Will admit to some disappointment and frustration with Graphicly when I used them in the past. There was no real sales reporting interface to be found, and it seemed my own books disappeared from my publishers' account – when I could log into it. When Graphicly began to change their interface earlier this year, I was hopeful. But wary, due to my frustrations.
Had a good long talk with Josh Flanagan from Graphicly about some of this. I had been encouraged when they began to offer the kind of inventory control and sales reporting I had been hoping for from them. Glad to see a new uploading and conversion interface, although it was not working right in beta testing. But then they announced the shift to their $150 per book distribution model. Josh tried to explain it to me. This was shortly before the announcement that the apps were going away. Josh talked around instead of answering some of my questions, saying the marketplace was still going to be there for now. After the announcement I could see why he couldn't make himself clearer.
Bottom line, Graphicly no longer serves the purpose for which I'd been using them - they can't put out individual issues of my comic books on an app for smartphones and tablets. Considering that alone, it's no wonder Graphicly's big announcement so disappointed and underwhelmed me. But beyond that, the change from sharing risk and sharing in profits to collecting fees shows an old-fashioned business philosophy at work that I'd hoped we were moving past - this change from selling WITH creators to making money OFF of creators feels exploitative. If you're not with us...