I still remember the rising excitement as I ripped open the envelope. The letter inside glowed with praise for my work. "At last," I thought, "somebody has 'got' what I'm trying to do with my writing. A real London publisher has finally replied to me!"

I turned the page. There was a list of various publicity packages, options as to how the new book would look, and then a breakdown of how much it was all going to cost me. It was a vanity press. And suddenly I felt like such a fool.

Thinking back, I still flush with embarrassment about the whole thing. I'd had a few stories published in magazines and, encouraged by that, I'd sent off my "book" to a Publishing House who advertised in the back pages of the Guardian Weekend saying that they were looking for new writers. The Publishing House had a name very similar to the one on the spine of some of my favourite books, but with hindsight, not quite the same. I thought that the Publishing House were real publishers who would judge, edit, and hopefully appreciate my work, and at the time I was daft enough, and new enough to writing, not to know any better.

So I decided never to tell anyone that I'd accidentally sent my work to a vanity publisher and started all over again. It took me another two years to find a real publisher (Bloomsbury) for my first book and looking back, I wonder now why even accidentally sending my work to a vanity press filled me such mortal embarrassment. It wasn't really vanity that made me send off my stories, it was ignorance and ambition – two words closely related to vanity, but not quite the same.

The phrase "Vanity Publishing" was coined in 1959 – a derogatory term aimed at publishers whose main source of income was derived from the writers whose work they published rather than any projected sales of their books. But the commodification of the written word goes way back and has always been a contentious subject. The Venerable Bede published his own book longhand and he didn't need an agent. Mark Twain was originally self-published and DIY operators like William Blake, Oscar Wilde and Virginia Woolf have also shifted the odd copy over the years.

My friend Martin Bedford has recently paid good money to have his book printed up. Martin's posters for the Leadmill nightclub were a bright feature of grey 1980s Sheffield, and he self-published his book in response to lots of requests from people who wanted to see all those posters collected together and in print. He saw an opportunity and he took it – although he says he did have a horrible moment, a real self-doubting wobble, as he loaded the entire print run of 1,500 copies into the back of a mate's estate car and wondered how on earth he was going to fit them all into his flat, and more to the point, if anybody would actually want to buy a copy.

Is paying to see your work in print always vanity? Was Martin just ego-tripping? I don't think so. That's self-publishing, albeit still based upon a degree of vanity or at least self-belief. But surely that's a business model, a standard template for ambition? The conviction that what you've got is good enough to release into the wild and stands a reasonable chance of selling is at the heart of launching any new product. And in Martin's case, it worked. The first print run of his book sold out and it's into its second printing and still selling well. Martin cracked it. He found his market all by himself. He did all the work, and now he gets to keep all the money.

Self-publishing is also the accepted norm in niche markets – pike fishing for example. Mark Barret's Fenland Pike is currently doing well, even without an ISBN number. Mark travels up and down the country giving slide shows featuring big fish, fenland history and funny stories. He's selling his book just like a band would, punting out merchandise after a gig. He's put thousands of pounds of his own money into the book, which is a risk, but Mark's status as a Fox tackle consultant and his public profile as a broadcaster and journalist has provided him with an ideal opportunity to do it all for himself. It's hard work though, and Mark says that writing the book was the easiest bit of the equation.

There's still a whole culture of self-affirming self-publishing, made easier and cheaper by Lulu and other print-on-demand outfits, and there's a raft of forums dedicated to the niceties of that process where self-published writers carefully explain and defensively reassure each other that their books are only self-published because their work does not fit into any "accepted" genre or "convention" of marketable fiction. These authors always stress that their self-published books are not underpinned by "vanity" but there's an underlying bitterness there too in most of those posts. And deep down, you know that they know, and they know that you know it ain't the way to do it.

One question here must be one of motivation, Why make the decision to publish your own fiction? Are all those folks on the forums self-published because they've been knocked back by every single publisher under the sun, or are they self-published because they have made a conscious/brave/mad decision to take the matter into their own hands?

The other question is one of validation. That's the killer for me. In fiction, somebody somewhere, somebody else who you don't know, has to say that what you've written is OK and at least worth a read. A knowledgeable third party – ie a publishing professional – has to approve and then come up with the money to get the book out. So that's what stops it all being "vanity". That's the difference. But does that desire for validation stop you being vain?

If only it were that simple.