Balance of power continues to shift in the e-book wars

As we’ve written a number of times at GigaOM, the traditional book-publishing business continues to be disrupted, with some self-published authors such as Amanda Hocking making millions of dollars without using a traditional agent or publisher, by selling their own books through Amazon’s (s amzn) Kindle platform. In the latest sign of this disruption, author John Locke — who earlier this year became the first self-published author to sell a million ebooks — has signed an innovative deal with publisher Simon & Schuster that shows at least some players in the industry are thinking about how to adapt to the shifting balance of power.

According to the terms of the deal with Simon & Schuster, Locke — a 60-year-old former businessman who says he became fascinated by the e-book revolution and decided to start self-publishing fiction in 2009 — will continue to publish and sell his e-books himself, under his own imprint (John Locke Books), but printed versions of those books will be marketed and sold by Simon & Schuster through its distribution arm. No financial terms were released, but the structure of the deal makes it obvious that some publishers are prepared to hand over the keys to authors with market power.

Self-publishers still want mass-media fame

Locke isn’t the first self-published author to strike a deal with a traditional publishing house after becoming well known for his e-books. Amanda Hocking — who became the poster child for self-publishing on the Kindle after she made more than $2 million from a series of young-adult novels she wrote and published in the past year — signed a $2-million deal earlier this year with St. Martin’s Press, a unit of publishing giant Macmillan, to write a new series of young-adult novels (my colleague Cyndy Aleo wrote a series of posts recently based on her interviews with several young authors about the changes in the industry).

In a blog post that she wrote about her deal, Hocking said something that drove home just how much the industry has changed: she said that she chose to accept the $2-million offer from St. Martins even though she knew she could probably make more money by self-publishing the books. “I am fully aware that I stand a chance of losing money on this deal,” she said. While some readers criticized her for “selling out” to a traditional publisher, Hocking said she had good reasons for doing it. Among other things, she said she wanted the kind of fame only top-tier authors get:

I want to be a household name. I want to be the impulse buy that people make when they’re waiting in an airport because they know my name.

So far, John Locke hasn’t said much about his motivations for signing the Simon & Schuster deal, but what he has said makes it clear that he was also looking to build his audience outside of the e-book market. “These are people who wouldn’t have the opportunity to find me otherwise,” the author told the Wall Street Journal. Simon & Schuster, meanwhile, sounded pretty excited about being able to ride on the coattails of an established author that it has had to spend virtually nothing on so far –an executive for the publishing house said in a prepared statement:

We are very excited that we can now help to expand John’s readership to include those millions of readers who still savor the joys of sitting down for a few hours of entertainment with a traditional paperback book.

Authors can make books a hit before they are even finished

Although he isn’t a self-published author, a recent incident involving a young writer named John Green also drove home how much the industry is changing: a new book from Green — who has built a large following online through the use of YouTube videos and a Twitter account that now has more than a million followers — hit the number one spot on both the Amazon and Barnes & Noble bestseller lists, even though the book isn’t even finished yet. All Green did was say that he would sign copies of the new novel, and he also recorded a YouTube video in which he read from a chapter of the unreleased book.

As we wrote at the time, this example makes the point that authors already have a lot of the tools for marketing their work, and in some cases — as with Hocking, Locke and other self-publishers such as J.A. Konrath — this can make them so self-sufficient that they no longer need the support of a traditional publishing deal. J.K. Rowling, with her recently launched “Pottermore” site, which comes complete with her own e-book store, is the extreme version of this phenomenon. And this transformation also has implications for other publishing businesses, which I wrote about in a GigaOM Pro report in July (sub req’d).

One thing that’s worth noting, however, is that the deals signed by Hocking and Locke show that the evolution of the book-publishing business isn’t necessarily a zero-sum game. Just because some authors self-publish and are able to build a following doesn’t mean that the publishing industry is dead, any more than the ability of musicians to sell their own music has meant the death of the record industry. What it means is that record labels have to look hard at what they offer to musicians and artists, just as book publishers are having to think hard about the value they offer to writers.

Post and thumbnail photos courtesy of Flickr users Mike Licht and Timetrax23