What is so special about going paperback? Why does it make so much more money? If it does, then why not publish the paperback in the begining? Is the paperback publisher different from the original publisher? Like does the original publisher sell the paper back rights? I read a think where Steven king got a 2500 dollar advance for Carrie, but when it went to paperback, it went for $400,000, of which he got half. Why such a big difference? Is it just because only popular books go to paperback anyway, so they will always be worth more?
In the King case you cited, Steven didn’t know how successful Carrie would be, so he took the $2500. When it turned out so popular, he held out for more (a lot more).
Paperbacks sell for about 1/3 of hardcover price, more or less; e.g., a hardcover sells for $19.95, but its paperback would sell for $6.99. But at the lower price, more than three times as many people will buy it. Also, paperbacks are much cheaper to produce. The hardcover, the fabric spine, original artwork: these all make hardcover books more expensive. So there’s even more profit for paperbacks.
So why make hardcovers anymore? Some people just want quality literature (material-wise, not necessarily content). Hardcovers last longer, and look more elegant when arranged on your shelf. Myself, most of my books are paperbacks. On my shelf, I have them stacked horizontally 10 high and two deep.
Why publish hardcovers first, if (no doubt) the publishers want to make more profit? They want to project the image that they think this is quality literature (content-wise), so it deserves hardcover status. If they only published paperbacks, people wouldn’t think as highly of their publishings. Then when they do finally publish a paperback version, it looks like they’re being magnanimous by providing quality literature (content) to the masses at a price they can afford. Of course, in reality they realize that there are 500,000 more potential customers just waiting for the cheaper version.
Just to add my WAG, I think that hardcovers make more money per book. So although the volume of paperback sales may make more money, the hardcover sales are certainly worthwhile. Publishers are dealing with two different markets, so they try reach both.
Hardcovers definitely have a larger profit margin. Take a look at the royalties – authors get 6-8% of a paperback cover price, but 12-15% of a hardcover price.
One big difference is due to sell-through. Paperbacks tend to appear in more places, so you have to print more copies, and more copies are thus returned. They also stay on the shelves for a far shorter time than hardcovers. Finally, hardcovers are returned, which means the publisher can ship them back out to where the damand is, or they can sell them as remaindered copies. Paperbacks are stripped – the covers are torn off and returned, the rest of the book is thrown out with the trash. Publishers can’t resell them.
The ideal for any book is to come out in hardcover, then trade paperback (paperbacks the same size as a hardcover), and finally in paperback. (Trade paperbacks cost less than a hardcover, but are not stripped.) Authors make more money from a hardcover than from a paperback, and if publishers are paying the authors more, you can bet that the publishers are making more money from them, too.
Stephen King was an anomoly. (And he made much more than $2500 for CARRIE’s hardcover – the advance is merely the upfront money; if your book sells more, you get paid royalties).
You guys have pretty much covered everything, but I’ll add a couple more minor points:[list][li]In addition to the financial reasons (hardcovers have much higher margins, the author gets higher royalties, etc.), most authors expect and demand that their work appear in hardcover first. Hardcover is sort of a stamp of approval that what exists between the covers is a quality work (in the mind of the author anyway) or a “real book.” Books that appear only in paperback have traditionally been thought of as pulp fiction or quickie works.[/li]
[li]Hardcovers are expected and demanded by the book trade. Booksellers make more money selling one hardcover book than 3 or 4 paperbacks, so they want the most bang for their buck when the book is first published. Percentage-wise, most hardcovers are sold in bookstores while most paperbacks are sold in mass market channels (discount stores, drug stores, grocery stores). The bookstores expect to get the first crack at selling a book, and hardcovers are a better fit in a traditional bookstore than in a discount store, where customers are shopping based on price. Although, this line has blurred considerably over the last few years as the Wal-Marts and Targets of the world started carrying more and more hardcovers.[/li]
[li]Not only do hardcovers have a higher profit margin and make more dollars per unit than a paperback, they sell into the trade channels at a better price to begin with. Retail trade booksellers (independent bookstores as well as chains like Barnes & Noble) typically buy from publishers at an average of about 50% off the cover price. Mass market channels buy at much steeper discounts, usually 55% to 60%, so the margins are reduced even more.[/li]
Like JeffB said, hardcovers and paperbacks are aimed at two completely different markets. For this reason, a lot of publishing houses only deal in one market or the other. It makes more sense financially for certain publishers to come out with a book only in hardcover and then let another publisher bid for the paperback rights. A traditional trade house may lack the staff or experience or even inclination to deal with the cut-throat competition that exists in the mass market channels. Although this too is changing as the publishing world goes through more and more mergers and aquisitions. The big companies now have one or more trade houses and one or more paperback houses so it all stays in the family.