https://countercraft.substack.com/p/no-most-books-dont-sell-only-a-dozen

I've only skimmed part of the article linked, and I'm not here to say that the publishing industry is healthy or good or fair to authors or that oodles and oodles of people are buying books or anything like that. But the testimony from Penguin Random House in the DOJ v. PRH trial was a deliberate disinformation campaign by PRH to try and convince the government that their merger with Simon & Schuster wouldn't affect either authors or readers because the publishing industry is totally random so what's the difference between one super-publisher or a million small presses. But it's not true. Obviously.

It is true that as publishing has conglomerated over the years, as they've needed their profit rate to increase, they've focused more and more on sure things like celebrity books and blockbuster deals. Plus there's the weird relationship with political books, where publishing basically takes a cut of money being funneled to politicians outside of, like, campaign finance laws or bribery laws or whatever. When they say that books sell some pitiable amount they're usually using some extremely inclusive definition of books to get that number. It's not just novels, pop-sci, and memoirs like you'd find at a chain bookstore but maybe literally anything with an ISBN, that kind of thing.

But if we focus on the only area I know anything about, debut novelists, it's not the case that publishers are acquiring debut authors as a vanity project that they take a loss on. People have gamed out the numbers that a publisher needs to sell to recoup the expenses of a given print run. I don't know what they are now, but for a small print run, for a book they paid a five or ten thousand dollar advance for, they don't need to sell a crazy amount of copies. It's a fuckton more than twelve or even two hundred. Depending on the particulars I think it's anywhere between one to five thousand. The publisher expects it to do that well, with basically no marketing support whatsoever beyond getting it in the seasonal catalog, and they're normally right. Sometimes they're wrong and the books do better than that, sometimes worse. But on a small book deal like this one it's not that the publisher is losing money, because they still make a profit on most such deals, it's that they aren't making enough of a profit. So they decide to put even more money on marketing sure things, and even less money on debut or midlist acquisitions/marketing. Which is why conglomeration is bad for authors and readers, not that I need to tell anyone on this forum that.

Even on the books with major deals that don't earn out the advance that doesn't mean the publisher's taken a loss. Maybe on some of the examples where they only sold a few thousand copies of a book they paid ~five hundred thousand dollars for (though it's worth pointing out that the NPD bookscan isn't a perfect measure of the actual sales figures of a book. Maybe Timberlake's book only sold 100,000 through bookscan sources but it's not going to be able to see that a studio bought 50,000 to distribute at events). But for many of those, who knows? We don't know the terms of the deal. Maybe Shaq only gets a .001% royalty rate until he earns out his million dollar advance. The publisher might make an enormous profit, but Shaq will never earn out that advance.

And that's without getting into accounting fuckery, which I know nothing about. Maybe the publishers go into some of those big losses with their eyes wide open. "Oh, we cut Chappelle a two million dollar check, he's happy, we get to post a loss come tax time." I mean, it works that way for Hollywood, right?

TL:DR Publishing companies are terrible, but people do buy books.