With all the hype about RWA and e-books, many people who are new to publishing or have only experienced traditional NY conglomerate print contracts are asking a simple question? Why go e?
e-Books are a growth market. Established indie/e (independent press) is in the second stable growth cycle, with double-digit yearly increases in sales. The larger indie/es--especially those who put out erotic romance books, like Ellora's Cave, Samhain, LooseId, and Changeling--are raking in millions in sales and catching the attention of NY conglomerate press and media alike.

Even the NY presses, who are relatively new to the e-publishing game, in comparison to indie press, are seeing such striking increases in their e sales that two of the larger have vowed to release not only all new releases but also all backlist titles in e-book by the end of 2010.

That's right, even NY is going e. Lines like Harlequin Spice Briefs are e-only lines for shorts stories. NY print lines are releasing e-book copies of their titles. Agents are blogging about dealing with e-book clauses in foreign rights deals.

Whether you are in indie or NY, you need to be concerned about e-books and how they affect you.
Why would an author want his/her books available in e-book? Aside from the fact that it's a growth market, there are many pros to having a book available in e.

e-Books are about choices. Like home video hasn't replaced movie theaters and mass market hasn't replaced hard bound books, e-books are not intended to replace print books. Rather, they are intended to allow for an expanded market (overseas, visually-impaired readers, ex-pat workers, and others who lack physical bookstores and/or shelf space to store books), choices for readers who desire an alternative to paper books.

In fact, just as the NY conglomerates are moving into e-books to supplement their print offerings, established indie/es often offer print books, in addition to their e-book offerings.

What are the pros and cons of e-publishing your work?

With the exception of some NY conglomerates, who are paying the same royalty rates for print and e, you will likely make a higher percentage on e-book than on print contracts. The higher NY conglomerates are paying more than 20% on e-book.

In indie press, the contracts are typically written in net, with precisely what net entails spelled out in the contract. Some indie contracts are written in percentage of cover and take the cut for various third party sellers out in the contract. The typical royalty rate for indie/e runs between 35-50% of net, which amounts to 35-50% of cover on books sold from the publisher's home site and half that or thereabouts on books sold from third party sites.

For e-only lines in NY and indie/e, you will likely reap the benefits of e-submissions. Those would include savings on printing, shipping, and the time to an answer on submission. In my experience, the time e-only lines in NY and indies take, at their longest, is what NY conglomerate print lines take, at their shortest, to answer on a submission. In addition, many NY conglomerate print lines have started doing edits (aside from ARC/galley) electronically, as indie does.

Contract and author/publisher agreement to do so favorable, e-books can sell in perpetuity, always showing on the publisher, author, and genre "shelf," next to newer books, instead of a short 6-8 week "shelf time."
e-Books are available for sale worldwide, in English language, from day one. Readers can purchase them any time of the day or night and enjoy immediate or near-immediate delivery. You can further sign translation rights, but English-readers can enjoy your books without delay.

What additional advantages do you have going with indie/e press rather than NY conglomerates?
Indie/e press allows authors to try new, untried markets that are often picked up by NY conglomerates, if they prove profitable and popular. They allow authors to write in "dead" markets that have an audience but are not bringing NY the returns they look for in a line. They allow authors to write outside the established genre lines and to embark on new territory, like dark romance, urban fantasy for a female audience, and women's erotica. As I noted earlier, NY sometimes picks up these genres, if they prove profitable.

Authors known for one genre are permitted to branch out and try other genres, as long as the finished product is up to the company's standards.

Indie/e press allows reprints, if there seems to be an audience and viable life left in a project. (Moreover, outlets like Fictionwise and Amazon DTP allow authors to sell reprint e-books directly via their sites that even indie/e aren't willing to chance taking on.)

They also allow authors who have started a series in NY (and since had the publisher refuse new books in the series) continue the series in indie/e press. A fine example of this is the new Incarnations of Immortality book Piers Anthony has brought out with Mundania Press.

Indie/e press encourages representative cover art and blurbs and gives authors a heavy say in what those will be. Like they do with their choices in books they sign, indie/e is looking for breakout and not copycat.

Contracts in indie/e are written in plain English and easy to understand. EPIC offers a sample contract and contract red flags to watch for in the contracts. Though you may still want an agent or attorney to represent you, it is not required for the lion's share of indie/e. No one is saying "unagented" not welcome, though they may be saying "by invitation only" or even that having an agent doesn't bypass the slush.  

On average, indie/e contracts hold authors to a shorter period of time and are renewable, if both parties agree to renew. They often include buy-out clauses to release the books from contract, if the author receives a more appealing contract offer for them.

Royalties are paid more often--usually monthly or quarterly--in indie/e. Though most indies do not offer advances against royalties, they aren't as pressing, if you aren't waiting long for royalties to roll in. If you earn publisher site sales monthly, you will still likely earn third party sales quarterly, on their payment schedule.
In addition to the frequency of payments, e-books (in general) take less time to release than a print release does. Though some established indie/es may have a long two or more year work up to a joint print and e release, most indie/es release e-book first and do such much faster than a joint e/p release.

Are there any cons?

At the moment, e-books enjoy a much smaller market share than mass market sales do, but that will change with time, especially since e-books can keep selling indefinitely.

Hand in hand with the smaller market, though some authors in indie/e make as much or more than NY midlist authors do, most do not. Again, this will change with time.

There are some authors who will not consider your indie/e credits as valid publishing credits. However, more and more, they aren't the people who decide if you sign a contract in NY or in indie/e press. According to Dee Powers' survey of NY editors and agents, they consider indie/e credits valid, though they still don't consider self-publishing valid, unless you've hit the self-pub jackpot in sales.

Unfortunately, this snobbery still exists and probably will for some time. These detractors like to say that e-published authors aren't real authors, much as detractors of Gutenberg's machine liked to say he didn't produce real books without illuminations and scribes inking the page.

Are e-publishers real publishers?

Of course they are! The money flows toward the author, as it does in all traditional, royalty-paying press. Reputable indie/e-publishers handle cover art, editing, ISBN numbers (sometimes also LOC numbers), etc. Indie/es vett submissions and take between (based on a study of member publishers EPIC did a few years back) 1 in 40 (for new publishers who aren't taking in many submissions) and 1 in 300 submissions received. They distribute along the same channels (Amazon, Ingram's, etc.) NY does.

Small independent presses are only small, because they are new, in comparison to the NY conglomerates. Once upon a time and not too far away, Harlequin was the new kid on the block.
Welcome to the changing face of the industry.

Related articles...
Finding and choosing indie/e publishers  Part 1     Part 2
Word caps and indie/e publishing
The pros and cons of e-books for readers
Does DRM affect the reading experience