Rocket Bomber - publishing

Home repair and book production

filed under , 28 October 2014, 16:33 by

Long-time readers of this blog know how much I love making analogies -

If you want to, say, update your kitchen, or build an addition on the back of your house you have some options:

  • A real do-it-yourself-er and general handy-type might need to call a plumber or electrician but otherwise is fine with doing the framing, hanging wallboard, hanging cabinets, setting tile, installing carpet, and all the finish work — not just plaster and paint, but wood trim, weatherstripping and caulk, maybe some wallpaper. And when all that is done, our intrepid homeowner also does their own interior decorating, furnishing the space to as-seen-on-TV standards buying salvage & fleamarket and doing their own refinishing on vintage and near-antique pieces.
  • More realistically, you get on Google and read online reviews and ask around and you subcontract all that other crap out — you maybe take care of your own demolition (yeah! break stuff!) but you get the real professionals to come in and fix it. You end up juggling different schedules for weeks (or months) and dealing with multiple contractors (first the concrete pour, then the framing, exterior siding, interior walls, windows & doors, floors & finishes) and when it’s all done, you look at your newly-fattened credit card bills and sob — while sitting in the beautiful new addition to your home. bittersweet.
  • You can cede even more control (and more money) in the process by hiring a general contractor — someone to take point on the job and juggle the various subcontractors for you. The drawback is that you’re paying costs plus fees (to the GC) but the tradeoff is that maybe you get to keep more of your sanity. Plus (and this is often a big plus) the General Contractor has done all this before, projects both bigger and more complicated than your little bathroom re-do or new screened porch.

The tradeoffs are obvious: you can keep control, and spend less money, while doing more of the work — or you can choose to spend money to solve problems and take a more hands-off approach.

As a writer who wants to ‘build’ a book (either from the bones of a draft or doing some small repairs on a mostly finished manuscript) you have the same options as our hypothetical homeowner: Do the work yourself, coordinate a bunch of subcontractors (free lancers) to get the work done, or maybe try to find a ‘book packager’ to work as your general contractor and bring the book to print.

Your fourth option is to sign a book deal with a publisher, but that’s not really your option – it’s theirs. (Getting an agent and landing a book deal would be a different analogy.) Let’s just assume for now that it’s your ‘house’ and you’re the one building it.

When dealing with home repairs and renovations most of us are clueless — unless and until we’ve done it a few times. But most homeowners know the general scope of what’s about to happen, and they’re willing to do a little research (months or even years of on-again-off-again plans) before they make any calls or write any checks. And because we live in houses, we have a pretty good idea of what the final space should look and feel like, even if we’ve never lifted a hammer or trowel before.

When writers have the same opportunity to ‘fix up’ a book, they often go the do-it-yourself route, underestimating the scope of the work and (perhaps) overestimating their own skills as self-editor. The primary reason to do this is of course the cost — either we begrudge the expense or we just don’t have the extra cash right now to pay a freelancer to do the work for us.

To get the job done, we can also borrow against the ‘equity’ in the book: trading rights or revenues to get the book into salable condition, either with a small publisher or a digital-only publisher. There are risks, of course, but no money is required up front* and the other option, keeping the manuscript in a drawer for who knows how many more years with no potential for readers or sales at all — well, we all know how that would work out.

* …goes without saying: if a publisher asks for money it’s likely a ‘vanity press’ or some similar scam. caveat emptor.

To authors, all I can do is caution you to think things through. It might not be a bad idea to get some professionals to help — even the most die-hard DIY weekend-warrior will hire an electrician or plumber. And instead of trading equity in the book, maybe think of editing and production like any other household and/or life expense, and find some other way to pay the money out of pocket to get the work done. Be a smart book owner: do your research, consider your options, treat the pros you hire to work on your book the same as a contractor who works on your home (i.e. with respect, with open communication about scope of work and expectations, with a clear outline for when the work is complete and when payments will be made). (There isn’t a Yelp for online freelancers—that I know of—but as the market grows, maybe there will be? Never be afraid to ask for references or a portfolio …or to ask other writers for recommendations.)

Just like a major change to your home, you’re going to have to live with the results for a long time, maybe the rest of your life.



Amazon's Monopoly isn't Books.

filed under , 24 October 2014, 18:52 by

Amazon has a monopoly — but their monopoly power is not a stranglehold on books.

Amazon owns the customer base for books. Amazon owns the readers.

And now you’re about to object to my stark declaration, for obvious reasons: that’s not the way markets work. Customers are the free-est of free agents, and no one (except the government) can force you to spend money if you don’t want to. Companies don’t own customers, they are earned through competitive pricing and excellent customer service.

Customers are usually happy to be associated with a company — maybe just as a satisfied end-user, but perhaps also as a genuine fan of the product, or a smiling repeat customer at a store or restaurant, or an advocate for the brand online (through glowing reviews) — in the best/worst case: maybe you just can’t shut up about how great the damn thing is to friends, family, strangers, the internet, and even—in quiet moments alone—to yourself. A chunk of your personal identity may be tied up in the product. “Guinness Drinker”, “Steelers Fan”, “Apple User”, “Amazon Kindle Author”, Whatever. Who am I to judge? After all, your enthusiasm—no matter how fierce—is dependent on the product continuing to meet your expectations. Loyalty earned can be banked but also just as quickly frittered away; no company can coast on past accomplishments for long.

Unhappy customers are the ‘canary in the coalmine’ for emergent monopolies, in fact. When you find yourself grudgingly paying money for something, maybe even something you hate, that’s generally when we know something other than ‘free markets’ are at work. Cable companies, I am looking directly at you.

So it is impossible to say that Amazon owns readers, because no one owns a customer. Except, of course, that Amazon kinda does own us.

Not all readers: there are folks who are definitely book customers, but only buy one or two books a year. There are plenty of people who borrow books from the library, dutifully adding their name to the waiting list instead of rushing out to buy the latest bestseller. There is a small contingent of Amazon haters, an even smaller group that shops online from Powells (and others), and a number employed as booksellers who can pay less than Amazon asks by using their employee discount — well, about half the time. (Amazon prices are really hard to beat.)

So not all readers. But the most avid readers? People who buy more than one book a month (or a week)? Folks who not only buy books the day they come out, but preorder them? The unlucky (or is that lucky?) few who have literally run out of space for books — every shelf is full and every flat surface has a stack of books on it? Oh yeah, these are the Amazon customers I’m talking about.

Amazon owns you. It’s not outright deed-and-title ownership, of course, because free markets etc. etc., but Amazon has your credit card on file—and the fancy one-click patent—so it is so often so much more convenient to just buy stuff there. Pre-orders are even easier, and your card isn’t charged till it ships. Amazon makes suggestions — kind, neighborly suggestions — because it knows you, everything you’ve bought or even just looked for on the site. And, since Amazon had the first ereader device worth owning, Amazon is likely your supplier of choice for your digital library, too.

You could leave Amazon. Indeed, to prove some snarky blogger wrong, you could likely go to your shelf (or lean over and pick one off the table) and hold up a book and say, “See this? This book I bought in a store! I didn’t get it from Amazon. Stuff it, Matt, you’re over-exaggerating again,” and I’d have to sit here and lump it, because even Amazon Prime subscribers and the most avid of readers will have at least one book like that.

Of course. But, he asked with a smile and a glint in his eye, did you find out about that book (or discover the author) through Amazon? Or maybe Goodreads?

Oh yeah, Amazon owns your ass.

##

Amazon, even at 20 years old, is a new business, and a new way of doing business. We can point out parallels to the past (and I have) but even after taking into account the ‘internet’ part, Amazon is still running a business quite unlike anything that has come before.

Monopoly (or monopsony) doesn’t quite fit as a description for what Amazon is doing — obviously, because from 1890 (or maybe 1911) most companies have been very circumspect about even looking like a monopoly.

So maybe we need a new word. Amazonification of a market, “related to or resembling Amazon’s transformation of book markets from 1998 to 2011” — or maybe “bezopoly” would be better. ‘Monopsony’ (currently much in vogue in this discussion) wasn’t coined until 1933, so there’s certainly a precedent for it: new vocabulary for new realities. Ignoring for a moment whatever term we’ll use for what it is – it’s easier to describe what Amazon isn’t, and Amazon is not a book monopoly.

Amazon will likely always face competition — at the very least, the indy bookstores as a group, and Apple in ebooks, and whatever-fills-the-barnes-and-noble-sized-hole that seems inevitable at this point. Outside of the book market, the two other large e-tailer competitors (eBay and Rakuten) are joined by at least two huge competitors for digital content sales (Apple iTunes and Google Play) and three huge competitors for digital services (IBM, Google, and Microsoft). Smaller competitors are also constantly nibbling around the edges, either selling their own product online or completely inhabiting a niche (think ThinkGeek, in this case, or direct-from-manufacturer sales).

In a world where Walmart is still seven times as big as Amazon, it’s kind of hard to make the argument that Bezos runs a monopoly (monopsony, bezopoly, whatever).

but what Amazon will never face off against is another ‘Amazon’ — the barriers to entry are too high: you can’t build a billion-dollar distribution operation overnight. While eBay and Rakuten are both huge online retailers, neither can assail Amazon in the book market. Barnes and Noble still sells $6 Billion in books (and assorted non-book cruft) but their website is a small fraction of that and nowhere on the scale of Amazon.

Amazon’s ‘lock’ on the avid readers can be seen as even more important

Amazon doesn’t have 100% control but it has enough:

  • and when Amazon stopped acting like Amazon (for example) in the Hachette dispute, where Amazon stopped taking preorders, stopped discounting, and shifted from two-day delivery to taking a week or two (or more), both Hachette and other trad-publishing stalwarts cried foul, saying that for Amazon to stop pleasing readers on their behalf was unfair and somehow anti-competitive. The unstated admission is that Amazon owns the readers — or at least, there was no easy way to reach Amazon’s readers without Amazon.

Amazon has the book business locked up, not through a monopoly on books but by focusing on readers. Amazon is the single biggest bookstore and likely always will be. Amazon is more than that, of course, but a huge portion of their public image is invested in books (…and specifically targeting readers as customers is also good business). It would be hard to argue that a company as customer-focused as Amazon would do anything to make anyone (any customer, anyway) unhappy — at least while Bezos is in charge. But Amazon still ‘owns’ us in ways we tend to forget about.

Is Amazon’s monopoly on the readership bad? Let me be the first to welcome our new benevolent book overlords. But the key phrase is still, “at least while Bezos is in charge” — at some point, the company will change. If you’re an Amazon customer (we’re all Amazon customers, including Kindle-published authors) my best advice is to enjoy it while you can, but keep an exit in view (or at least, in the back of your mind).

From post-World-War-II until the mid-1970s the Book-of-the-Month Club was the ‘best thing ever’ for readers. Then in the 1980s the mall bookstore chains were the ‘best thing’; in the 1990s and early aughts it was the Big Box Book Superstore. Prices have gone down, selection has gone up, and customers were happy — until the next big thing came along.

If Amazon lets it.

The best thing we could hope for, in my opinion, is Amazon as a “common carrier” for books, where publishers and authors get to compete with each other while having equal access to Amazon’s locked-in base of rabid readers. The reader becomes the product that Amazon then ‘sells’ to publishers — well, I suppose it would be more accurate to describe it as access to readers, since even after the door is open you still have to convince the readers to buy from you as opposed to buying literally any other book on the planet.

It’s not in Amazon’s interest to do this, at least not for free — but we can see hints of how it might work just by noting how Amazon treats its large network of 3rd party sellers (for everything other than new books or ebooks). We should shift our thinking away from Amazon-as-retailer and toward Amazon-as-network-provider. Instead of acting like a wholesaler and ‘making’ Amazon buy the books from you for resale, petition for access to the Amazon’s ‘network’ and sell your books directly to Amazon’s readers. If Amazon will let you — my whole point is that Amazon’s real monopoly is on the readers — and I think Amazon will always want to stand in that final space between reader and seller, no matter what the rest of the book industry looks like or how we get there.



A Secret History of the Paperback

filed under , 8 September 2014, 22:09 by

A Secret History of the Paperback:
and how not everything that happened to publishing since 1935 is going to repeat itself with ebooks.

##

I’m going to start with three pull-quotes from The Oxford Encyclopedia of Economic History, Volume 2 [while published in 2003 — well before the current ebook thing, and certainly citing scholarship that is much older than just 2003 — I find this information very interesting given current debate.]

“Cheapness meant that a best-seller of the 1850s might sell fifty times the copies of one in the 1810s. Paper had constituted 50 to 66 percent of the cost of a book in 1800 but was only 7 percent by 1910, and leather covers were replaced by cheaper cloth. …
By the 1860s and again in the 1880s, proliferating titles and longer print runs had occasioned such competition among booksellers that many were squeezed out of business. Publishers complained that there was too much competition, too low prices, and too few outlets. Once again their response was price fixing.”

“The volume of book production increased substantially during the twentieth century despite the fact that for some commentators, particularly from the 1960s on, the advent and rapid development of new electronic technologies suggested that the demise of the book was imminent.”

“Following World War II, technological developments spurred book production. Photocomposition and offset printing enabled higher print runs (100,000 copies and more) than ever imagined, prompting what observers called the ‘paperback revolution.’ The paperback format was now used for light fiction as well as for the second edition of hardbound books. Their cheap price and ‘disposable’ quality encouraged book sales.”

Yes, I thought it important to include the dig about 19th century publisher price fixing — but also note it follows booksellers going out of business and book markets tightening. The larger point here is that paperbacks weren’t quite the price revolution portrayed by some; book prices had been falling for over a century.

I found this article buried in a ten-year old economics textbook by using a Google Books search — which is kind of off topic here but also illustrates how far we’ve come. Thanks to Google (and perhaps irritating to OUP) I can embed the search findings below.

[The Oxford Encyclopedia of Economic History, Volume 2 isbn 0195105079 pub date 2003 edited by Joel Mokyr]

The paperback was not a sudden or seismic shift, or one that magically jumped into existence on 30 July 1935 — I’ll use the Penguin date because Amazon did * — and I’m not just talking about the ‘paperback’ formats that predated the ‘pocket books’ of Penguin and American competitor Pocket Books.

Decades of innovation preceded the mass-market paperback of the late 1930s — the first steam-powered presses emerged in the 1810s, to be replaced about 30 years lated by even faster rotary presses that replaced the piston-like flatbed press with a continuously operating rotating drum. On the pre-production side, Linotype machines significantly improved typesetting, starting in 1884, while parallel developments in lithography led to the introduction of offset printing (for paper) in 1904.

All these developments were driven not by the needs of book publishers but by the newspapers, which greedily adopted every technology that increased the speed and volume of print — and which lowered costs — in the drive to expand their business and reach. (Historic circulation numbers are hard to come by but we see newspapers doubling—at least—over the first half of the 19th century, and on toward hundreds of thousands for big city papers, as exemplified by the circulation battles between Pulitzer and Hearst.) The demands of newspapers drove the technology not only of the presses but also the paper — and anyone with a shelf-full of cheap, yellowing paperbacks knows the look and feel of newsprint-grade paper.

Cheap paper, fast presses, and perfect bindings (invented in 1895) combined in the 1930s to give us an affordable paperback.

…almost.

There are three other magic ingredients to consider. First was volume: unit costs go down the more units you print, and Penguin stockpiled 200,000 books for their initial launch (20k copies each of ten titles) [source] — an unprecedented bet in an era when even a bestseller like Ernest Hemingway only got initial print runs of 10,000 hardcovers. The bet paid off, of course (and Penguin would actually sell 3 million books in its first year). Second, the newsstands (“news agents” to my Anglophone readers who don’t speak ‘murican) in train stations and on street corners everywhere represented a much larger sales channel than the small, and infrequent, bookstores of the era. (I don’t know why this is occasionally presented as a ‘hurdle’ the paperback publishers had to overcome, or a huge innovation; the newsstands were already selling cheap print—as fiction magazines—and had done so for decades).

And the final reason Penguin paperbacks were so cheap was the fact that paperbacks were reprints of books that had already been published by others. Of the first 10 titles Penguin chose, the original year of publication ranges from 1912 to 1929 — each at least five years old and highlighted by the inclusion of the debut novels of established authors Hemingway and Agatha Christie. Penguin didn’t have to invest in new manuscripts and herd authors along through a drawn-out editorial process, they just had to typeset the books and print ‘em off (with a kickback to the original author/publisher; how much you want to bet that—at least at first—the paperback rights went for a song).

The first work of original fiction to debut in paperback didn’t come along until 1950 — and around that time, hardcover publishers were claiming up to 50% of the royalties on paperbacks, squeezing on one side, while competition in a crowded market squeezed paperback publishers from the other. The switch to paperback originals was probably inevitable; it was friction from the ‘legacy’ publishers (of 1950) that prompted it.

[If you’d like to compare the 10-15 year gap between reprints and originals in the new format, I’ll note that Kindle Direct Publishing launched concurrently with the first Kindle device in 2007.]

##

Paperbacks were an advance, both in terms of accessibility (price points and physical availability) and visibility for books. The equivalent of the mall bookstore in this era was on the first floor of your downtown department store [sources: 1900, 1920, 1949] and so, were of course limited to places that had department stores, and downtowns — and in the late 30s, there were only 500 bookstores in the U.S., “which did not exist everywhere and more closely resembled antiquaries’ shoppes than the current megamarts” [source]. It’s not that Americans did not read, but the primary vehicle for fiction was the magazine (and I’ll also throw in full-page serial weekly comics in the newspapers as an aside) as well as the 3,500 public libraries. The paperback model that became mainstream in 1935 didn’t hide books in a dusty shop corner or a behind a library circulation desk — the books (for the cost of a pack of smokes) were on a rack at the five-and-dime, and on the newsstand next to the magazines and newspapers people were already used to buying daily. And in America at least, the paperbacks quickly adopted the lurid covers that (for some) also defined the format.

I don’t know that I see the same benefit from ebooks. Yes, like paperbacks, the format is cheaper to produce (though that cost is not zero). Ebooks also get full marks for ‘accessibility’, considering you can just download one to your phone. Where ebooks do not quite match the true revolutionary potential of the paperback is in expanding the market. Paperbacks *blew up* the market for books — finding readers where they lived, and transitioning a pre-existing magazine fiction market to the new format, vastly expanding the profile (and sales) of genres like sci-fi, mystery, westerns, and romance.

What we’re missing in the ebook revolution is that “pre-existing magazine fiction market”, its half-century of material that fed into paperback racks, and the valuable experience a generation of authors had publishing there — a farm team, feeder system, or escalator (pick your metaphor) into pulp paperbacks for the 1950s, 60s, and 70s. We, and by ‘we’ I mean everyone, managed to largely kill off magazines in the decade before the Kindle launched. For ebooks to really impact the business in the same way paperbacks did, we’ll need to find (or invent) something like the magazine fiction market of the 30s and 40s, and find (or invent) ways to get book covers in front of eyeballs the way the spinner racks and magazine stands used to. (lurid optional; I really dig those pulp covers though)

Web sites are literally freakin’ amazing and book sales sites like Amazon are the brave new future of bookselling where nothing ever really goes out of print and any title is available — if you can find it. 10 million book listings is not only unprecedented but jaw-dropping when you stop to think about it. But (and you knew a ‘but’ was coming) Amazon doesn’t transform the reading audience like Penguin, Pocket, and Fawcett did. The people going to Amazon are already readers. Those who already buy books, and buy the most books, are the early adopters on the digital platform and the most vocal of its advocates. A web site is not going to put a book out there for discovery — or an impulse buy — in the same way that a Penguin paperback of 1935 did. In fact, web sites tend to bury books (really bury books when search algorithms and results are manipulated) in a way that’s different, even, from the bad luck of bottom-shelf placement in a corner in a 20,000sq.ft. bookstore.

Paperbacks moved books from an expensive luxury and lifestyle statement out to the places where people actually lived — a migration that began with train stations and street corners and eventually settled into the B.Dalton/Waldenbooks era of mall bookstores and from there to the late 1990s and early 2000s big box stores — in 2005 we reached a peak of roughly 1500 ‘book superstores’ run by the chains and that, honestly, is about as good as things will ever get (for physical books). Paperbacks, the revolutionary format of 1935, had been absorbed by publishers and the book trade (with mass-markets and trade paperbacks accounting for roughly 80% of books sold) and made bookstores better, arguably made book publishing better, and certainly made reading both more accessible and more popular over the decades, even with competition from television.

Ebooks threaten to reverse that, moving books from an everyday commodity back to a lifestyle statement and comparative luxury. Yes, an ebook may be cheaper at $9.99 (or $2.99, or 99¢, or even free) but to read an ebook, you need a smart phone, a tablet, a dedicated ereader, or a computer — and a credit or debit card. These appliances get cheaper all the time, but from 2007 right up to last year, we’re still talking about an investment of $100 or so. (Yes, please tell me about Amazon&iTunes gift cards and second-hand ereaders from ebay plus free phones on contract and all the other work-arounds — but admit that it’s all a bit more costly and complicated than a paperback for six pence or a quarter.)

Ebooks still have a long way to go, in my opinion, and I also have more than a few reservations and lingering questions about the format. I also think Amazon has a bit too much control over the new format, more than I personally am comfortable with. Additionally (and once again in my opinion) the *real* format shift was in 1993 with the new “printing press”, the World Wide Web. Ebooks feel like a step sideways, not forward, though any model that results in paychecks for authors can’t be all bad. Just like technological changes in printing that began in the 1840s eventually gave us the Penguin paperback of 1935, the massive shift in publishing that began in 1993 will eventually result in a similar revolution. (I just don’t think the 2007—or 2014—ebook is it. And even with the accelerated pace of technology today, compared to the 19th century, I don’t think 10 years is enough time yet to see exactly what that change will be.)

I’d also like to note I used Google Book Search to find five sources, ranging from public-domain sources as old as 1900 to the citation that started this article, from a textbook/encyclopedia from 2003 (more recent, yes, but equally unavailable in practical terms). That’s a power shift and democratization of information on par with the Carnegie libraries of 130 years ago; not every change in media is about formats.

##

* For those of you who like book trivia: German publisher Albatross beat Penguin to the ‘modern’ paperback by three years, though Albatros did not attempt the (then) massive print runs that Penguin did in ’35. However, I’ll note that Albatross innovated the trim-size and those iconic, color-coded covers (minimal, with typography and logo but no illustrations) now deeply associated with classic Penguin. How much ‘Penguin’ copied from ‘Albatross’ I’ll leave to your own judgement. I’ll also note that Tauchnitz Editions predate Penguin by nine decades — though the Tauchnitz books were never sold as paperbacks per se; the books were intended (by the publisher) and purchased as unbound books in a ‘wrapper’ with the understanding (at least until the 1930s, when Albatross snapped up Tauchnitz) that the editions would be rebound at purchaser’s cost by a local binder (turning them into hardcovers). Not all of the Tauchnitzs were, of course, though ironically this makes the paperbacks rarer and (potentially) more valuable than a leatherbound hardcover version of the same book.

Those interested in the some of the primary sources I used should check out the Mental Floss article, How Paperbacks Transformed the Way Americans Read by Andrew Shaffer (which is linked above but you probably missed it) and A Short History of Paperbacks by Oliver Corlett [from the Independent Online Booksellers Association newsletter, The Standard vol.II no.3 December 2001, and archived online]. And if you’re still with me at this point, you should also read The Stigma of Paperback Originals, Joanne Kaufman, WSJ, 23 September 2010 and Soft Target: Have reports of the paperback’s death been greatly exaggerated?, Katie Arnold-Ratliff, Slate, 20 June 2013.

Most (but not all) of the Wikipedia links I used above on the paperback format:
http://en.wikipedia.org/wiki/Penny_dreadful
http://en.wikipedia.org/wiki/Dime_novel
http://en.wikipedia.org/wiki/Serial_(literature)
http://en.wikipedia.org/wiki/Pocket_Books
http://en.wikipedia.org/wiki/Printing_press#Industrial_printing_presses
http://en.wikipedia.org/wiki/Rotary_printing_press
http://en.wikipedia.org/wiki/Linotype_machine offset printing
http://en.wikipedia.org/wiki/Offset_printing
http://en.wikipedia.org/wiki/Newsprint
http://en.wikipedia.org/wiki/Bookbinding#Modern_commercial_binding
http://en.wikibooks.org/wiki/Bookbinding/Perfect_binding

And finally, this post was touched off a couple weeks back (hey, research takes time) by the, interesting, open letter Amazon published at readersunited.com.



Making Books

filed under , 28 August 2014, 14:39 by

I was trying to finish up a draft on paperback publishing and got sidetracked on a research tangent:

Books: From Manuscript to Classroom circa 1920

Oxford University Press and the Making of a Book, 1925

Railway newspaper stand and printing Penguin books in the 1940s

Making Books, 1947

Lithography (1940-1949)

Newspaper Publishing Process: “Newspaper Story” 1950

Learning to Set Type, 1959

Typesetting & Linotype, 1960

How Books are Made & Repaired: “Bookbinders” circa 1961

How a Book Is Made – Episode 6: Printing the Book (uploaded 2013)

The Well-Built Book, Copyright 1998, (but I’m thinking the orig. film is actually 1989-1990)

The Well-Built Book from Dianne Morris on Vimeo.

How Do They Do It? How books are made. (2005-ish?)

Book Printing and Manufacturing- A Guided Tour (uploaded 2012)

Digital Printing, Courier/HP 2011

Courier from Steve Franzino on Vimeo.

Digital Printing, Timson/Kodak 2012

6 minutes to print a book, Espresso Book Machine, Darien Library (uploaded 2011)

How much does all this cost? [for a single-color, 256 page book]

Pricing:
Quantity : Cost : Cost/Unit
5,000 : $10,689 : 2.17
7,500 : $14,255 : 1.90
10,000 : $17,817 : 1.78

This is a summary of costs, excluding shipping.

The manufacture of books — the subject of all those videos embedded earlier in this post — is an amazing technological marvel, and because of all the processes and inputs involved, it seems like the printing of the physical object should be the number one contributor to cost. However, by the time plates are made (or files uploaded) at the printer, the book is already finished. The act of physical printing — of making copies — isn’t as cheap as the act of making digital copies, but the difference is only $2-5.



Books are different, and special.

filed under , 30 May 2014, 20:14 by

Organic Asparagus runs about $5 a pound. Maybe less, maybe more (and in season of course). Not everyone has a local CSA to deliver organic asparagus, or a farmer’s market where they can pop down on a Saturday morning and buy a bunch, but other Asparagus Options exist. And if bloggers are blowing up websites arguing over asparagus, Organic vs Not, Domestic vs South American imports, well… I’m not seeing it.

SD Memory cards cost between $5 and $40 (or more) and the cards are available from different manufacturers and can be purchased online and in stores. I don’t even have to go to a specialty retailer; I can pick up a 4GB card from my local supermarket – no special trip, just toss it into the basket next to my organic asparagus, and maybe a impulse-buy DVD (from the checkout aisle) and altogether, I’ve spent $15: DVD, SD Card, Asparagus.

Steaks are also in that price range ($4-$20 a pound, available in store or online) and so are door knobs ($10-$50) and spatulas ($5-$20) — as are shoes, come to think of it (flipflops cost less than $5, and sure you can tell me about $200 shoes, but who buys those? ) [/SARCASM TAG]

And Books, of course.

Commodity good, runs about $10 a pound*, entirely fungible**, of note as a minor form of entertainment. We’re all familiar with books, but unless you’re a high schooler and you’ve just been assigned one – it’s hard to see why they merit further mention.

* (£13, €16 or ¥2200 a kilo)

** I don’t judge. …but, for my own sake, I’m going to link to this definition of fungible even though we all already know what it means. Because we’re smrt.

If, all of a sudden, the #4 manufacturer of SD memory cards got into a dispute with Amazon (or any other e-tailer – OR ALL other e-tailers) it might only merit a section C page 32 blip in the newspaper*** and no one outside of the manufacturers’ immediate circle would likely know or care. We’d just buy the next card offered.

*** kids, ‘newspapers’ were web pages printed out on cheap broadsheet paper and delivered daily, or twice daily, to homes: ask Grandpa about ‘em. Ask him what ‘comic strips’ looked like when he was a kid while you’re at it.

Asparagus doesn’t rate a whole slate of full-bore editorials from 500+ newspapers, newswires, magazines, blogs, and TV network websites. Shoes are more expensive (and the margins are better) (and more people buy them) but we don’t spill nearly as much ink (physical or digital) arguing about *shoes*.

Amazon doesn’t enter into a very public and very loaded negotiation with Adidas or Jimmy Choo. If a buy button (or a pre-order option) disappeared on sneakers, no one would notice. (OK, someone would notice…)

This is just my take on it [strawman]: but it seems to me that many would-be pundits want us to think of books just like we see memory cards — fungible commodity goods. Buy whatever. “You like teen vampire romance? Well, the vampires are out but try werewolves, we got plenty of those. Like cozy British mysteries? We’re working on getting those back in stock, but here, try these cat mysteries.”

Books are just the double-A farm team for *real* media anyway; nothing is worth a damn unless and until we make a TV show or movie out of it. “Oh sure, you can read if you want but I don’t know why you waste your time — hey, flip through this impulse-buy DVD bin, top 100 films of 199x, 3 for $10.”

A book wholesaler is arguing with a book retailer over which side of the table the scraps fall. Whoop whoop. [/strawman]

As widespread as this view is (in NY and LA offices, and some living rooms) Books are obviously different.

Shoes? “I’ll keep looking.” – Asparagus? “Maybe I’ll try the farmer’s market” – Spatulas? [see, there’s no quote here because no one thinks about spatulas] – Movies? “Where is the movie playing?” [no judgments, just a factual inquiry into where the movie is showing, so we can consider options]

But as soon as we learn a book might be unavailable, or worse, that we might have to wait to read it, even as much as two weeks! — or [horrors] might have to figure out some back-up place and way to buy it — well now the internet melts, people choose sides, authors and readers sharpen their debating knives, loose packs of rabid quibbles range the boards, and everyone is right while everyone else is wrong and facts and details — and common sense — are the innocent victims.

Because books.

##

You can stop here. I won’t judge.

I’ll make one final note: Even If Hachette stopped shipping to Amazon entirely, Amazon would still be able to source the physical books from Ingram, Baker & Taylor, and other book distributors and could fulfill customer orders with an additional delay of about 48 hours, at most. So the negotiation is all about the ebooks, and who gets which slice of how much margin; though I’m sure Amazon’s discounts on physical books is part of that mix. The rest of it is posturing on both sides, with some dissembling on Amazon’s part (“we don’t know when we’ll have the books”) and smug confidence that ‘public sentiment’ is on their side, on the part of Hachette.

And now I’m going to get wonky, and even more trivial and tangential.

##

Hachette v Amazon is all just business, and negotiations like this happen all the time, but the response so far feels a lot like the old ‘lit-geek vs. computer-geek smack-talking in the campus coffee shop’ I recall from college.

“What about the culture?”
“Get with the future, man.”
“The future is books.”
“…well then, the future is on sale for 35% off, free shipping with Prime. Oh, hey, I spilled some future in my Kindle, all kinds of future in here.”
… …philistine.

Amazon often elicits this style of knee-jerk response — because books.

But also: because Amazon. Enough people are threatened by Amazon that Amazon gets painted as a bad guy, and Amazon consistently ranks at the top of customer satisfaction surveys, and those two points aren’t necessarily contradictions.

But even with all the misperceptions and assumptions people make about Amazon, that fades to insignificance when we stop to look at the assumptions most people make about books and bookselling.

Let’s start with the business: Amazon may cut off Hachette, or (less likely) Hachette might drop the axe — a major supplier of content and a major reseller of content are fighting and the end result, to the consumer, is less content available from a preferred source. Would we be as worked up if, say, a major media company just pulled the plug on our TV over a contract negotiation? I think the answer to that is actually, no:

2000 Time Warner Cable v ABC/Disney
2003 Cablevision v the New York Yankees
2004 Comcast v Viacom
2004 Dish v Viacom
2009 Dish v ESPN
2009 Time Warner Cable v Fox
2010 Dish v The Weather Channel
2010 Cablevision v Scripps Networks (Food Network & HGTV)
2010 Cablevision v News Corp/Fox
2011 DirectTV v News Corp/Fox
2012 DirectTV v Viacom
2012 Time Warner Cable v NFL
2012 Dish v AMC
2012 DirectTV v the New York Yankees
2013 Time Warner Cable v CBS
2014 DirectTV v The Weather Channel
2014 Comcast v Viacom

Sometimes these disputes make the news because (some) viewers are going to miss a playoff game, or the Academy Awards, or the season premier of Mad Men. Otherwise the blackouts are of little note, especially if we’re not the in the market affected. The companies certainly don’t care; Time Warner lost 300,000 subscribers last year but shrugged and smiled. Yes, getting ‘public opinion’ on your side helps, but it’s just another bargaining chip and companies can spin it.

If we look outside of bookselling, we can see that ‘everything, always’ is by no means the usual model: stuff is on Hulu but not Netflix, or on HBO and no where else. Films and shows come out on DVD but aren’t available streaming anywhere – and occasionally, vice versa. Even in a landscape littered with dozen-screen cinemaplexes, somehow the movie we want to see is never showing anywhere local, and we have to drive 15 miles. (This always happens to me.)

But no one blames the theaters, just like no one blames Netflix, HBO, or Showtime for making original programming, and no one [EXCEPT ME] gets bitter or bothered when Netflix and Hulu have a less-than-optimal selection (though perhaps we’ve all spent 3 hours browsing for something to stream on a Friday night without actually watching anything). Screens, large and small, are just islands and way-stops in the Big Content Ocean, and we’re all used to migrating ‘cross platforms and ‘twixt companies to find something to watch.

No blogger looks at a movie showing the next county over, and extrapolates that Hollywood is going to have to capitulate to Regal, because Regal controls the market. Media and markets are of course separate, of course — you know, *except* for books.

The reader expectation is that every bookstore is going to have a copy of any book the reader can name — because books. When the local 4,000 sq.ft. shop doesn’t have it (or even the 25,000 sq.ft. big box) the immediate response is, “Well, I’ll just get it from Amazon” with the unspoken addendum, “and I’m never bothering to shop here again”.

Let’s talk numbers — but not dollars: Items.

A “supermarket” grocery store might have between 40,000-60,000 items.
Walmarts and Super Targets add onto that, and stock 100,000 items.
A large hardware store/home improvement warehouse might have 120,000 items [it comes down to lots and lots of small nuts and bolts, in every dimension]. And we’re not counting every nut – that’s 120,000 types of items, stocking multiples of each.
Your local IKEA only stocks 10,000 or so items — Yes, 3 football fields (and Swedish meatballs) but a Walmart or Super Target has more SKUs.

Do you have that in mind?
The Ikea Maze?
Canned goods on shelves 6 feet high and down both sides of 60ft-long aisles?
Wandering the warehouse-sized sales floor of Home Depot, lost, looking for a left-handed metric counter-clockwise-threaded sonic screwdriver adapter? (that’s what 120,000 items feels like.)

That’s just retail. Let’s consider ‘content’. Video content is most popular (an assumption, but a safe assumption I think):

There are 2,885,994 titles in the IMDB database (as of this morning) — though of course that’s ridiculous as individual TV episodes each get pages — it’s better to look at the breakdown and note that’s ~309,000 feature films, 122,000 documentaries, 82,000 TV series listings, another 100,000 or so of TV movies, miniseries, and specials, and some direct-to-video crap (120,000 – each a gem and a delight, I’m sure) — Big Round Numbers, that’s 1.1 Million video options, of which most are out-of-print or collectible —with a light sprinkling of stuff so new it’s not out on DVD or online, and occasionally, not even in theaters yet.

…and the ‘Movie+TV Universe’ that you probably have a mental concept of is likely just a tenth of that — 100,000 movies and shows, new and old, even including anime and imports and MST3K and the Star Wars Christmas Special and weird stuff — and the other 90% is so ‘out there’ you’ve never even heard of it, not even to point and laugh at it. Does that match up to your experience, and sound fair? 100,000 movies and shows, or about 45 years of binge watching (likely much more – multiple-season TV shows are going to take you longer to binge).

[I’ll just note here that Amazon bought IMDB in 1998. Information is power.]

(I’m building up to it, stick with me here…)

100,000 is a whole Walmart. 100,000 is every thing ever that you could possibly think to stream online. 100,000 is the number of spectators in attendance at the Michigan-Ohio game (or Tennessee home games, for you SEC fans). 100,000 is the population of Peoria, Illinois – which I always reference out of tradition when these sorts of things come up. The uber-hipster neighborhood of ur-hipster Brooklyn is Williamsburg and it has, you guessed it, 100,000 hipsters in it.

Your local Big Box Books (might as well say Barnes & Noble, no need for the euphemism anymore) has…

60,000 books in it (yeah, not 100,000) — add on the music/DVD dept. (if your local still has one) and all the non-book crapware and we’re up to 100,000, though. A B&N is smaller than Walmart because books are smaller, and pack nice-and-dense compared to almost all other retail; and you know, at $10 a pound it’d actually be a good business to get into — except for, you know, Amazon and reality.

I’ve been working on a good ‘best estimate’ of the actual number of books out there for years now, and I can never find two sources that agree. However, the general consensus is that at least six million books are in print (actively supported by publishers, with stock on hand) and another six million or so are out-of-print but still available from distributors, available used, or some few cases available print-on-demand — so that’s at least 12 million books (in English) out of at about 129 million books total [source, 2010] and another million or so get added each and every year — not including an untold number of books (we’re gaining on multiple millions) that have only been published digitally.

Forget 129 Million – go back to that smaller number, 12 Million: four times the total listings on IMDB (which includes every individual TV episode), equivalent to 100 Home Depots, each nut-and-bolt a 200 page novel. 120 Walmarts. 200 grocery stores. [furniture is bigger, even flatpacked, but] 1200 Ikeas — and we’re only considering one copy of each book

Your local bookstore is expected to carry every book ever. See, this isn’t even an ‘unreasonable’ expectation on the part of the shopping public because there’s never any thought put into it: bookstores sell books, and in 2014, that means every book ever.

every. book. ever.

How does Amazon do it? What’s the magic? 65 U.S. Distribution Centers — whole damn warehouses — with another 9 planned.

…And this is perhaps the sweetest backhanded compliment we pay to the booksellers who have worked for decades to find, order, and sell us books: There is a casual, everyday assumption that they can match that, and can match prices. This is an expectation we have of no other retailer — the unmatchable scale of the task, and unthinking gall of it — at the very least, “special order” has a much different connotation (and usually, a mark-up) outside of bookstores.

No one strides confidently into the Buick dealership and asks to order a 1954 Studebaker, but that’s an every day reality for bookstores.

It was breaking my heart, in the last year that I worked at the bookstore, when avid teenage readers started coming in asking about books their friends were reading on Kindles, and I had to explain that not only did we not have the books in store, there wasn’t even a listing, and no way on earth or in faerie for us to order them — the kids were looking for paperbacks.
(Worse, in a way, was finding a paperback listing for just one book, coming out months from now because a publisher ‘picked up’ an ebook author, when the customer was looking for all 4-5 books in what they knew was a series. My explanation fell flat. The book business is complex, and front-line book retailers should be pitied.)

For physical bookstores, though ‘every book ever’ has been the constant background murmur (and default retort) for at least two decades – after two decades of Amazon the customer base is getting tetchy.

“You don’t have it?” [sniff] “Well I guess I’ll just order it from Amazon.”

1998 (or maybe 1999) was the Golden Year for bookstores (even though the peak came later, in 2005) — in 1998, the mall stores were still open, Patterson was still writing his own books, Harry Potter was on book two and the films hadn’t ruined anything yet, and epic fantasy fans were enjoying the second book of A Song of Ice and Fire with Martin on track to release a book every other year. [“HA!”]

Amazon was an option for the savvy, but more of a footnote than a terror.

In the 15 years since: author advances have been shrinking, print runs are smaller, the ranks of independent bookstores were decimated by Barnes, Borders, and Big Box bookselling — and then Borders went out of business on us. The number of places to buy, and the shelves dedicated to books, have both been curtailed. Whether we shop at Amazon because the stores suck or the stores now suck because of Amazon: there is a feedback loop in operation that is negative for physical storefronts (and increasingly, physical formats).

Into this charged atmosphere: we insert a (routine, everyday) business negotiation between a manufacturer and a retailer.

Except books are different. Just because. I can’t explain it (any more than I have— I at least tried to). We invest emotions in books. We tie up our identity with books. We take sides, we want to argue and we want to fight, and while the ranks of readers may be small compared to the population-at-large — apparently readers are handy with words and we like to write. (who knew?) It’s only a tempest in a teapot, but there’s a great echo in here and we all like the tea.

The current discussion doesn’t matter much, and the resolution will be between Amazon and Hachette and they’ll come to terms without our input but we really can’t help ourselves.

Because books.



A Once-in-a-Century Opportunity to Re-invent Publishing, and Books

filed under , 28 May 2014, 20:11 by

The working title for this article was, “These Days, Monopoly is Just a Board Game.”

I started to argue that Amazon wasn’t and isn’t a monopoly, but then I also managed to argue myself out of becoming an Amazon Cheerleader. Since I was looking into anti-trust statues and case law (spoiler: it’s dry) we’re going to wade into that half of the post first. But stick with me; I hope by the end I’ve also convinced you of the promise of that over-ambitious title up there.

I’ve set up a shortcut for those that want to skip Supreme Court Case precedents (no blame attached) and get to the second part: click this link

Also, I’m not a lawyer: just throwing that out there before we get started.

##

“Proponents of Amazon’s lower pricing strategies argue that Amazon is the underdog in the publishing monopoly, not the other way around. But the fact remains that Amazon is a company that singlehandedly controls 30% of the market share of the entire publishing industry. And unlike its competitors, it has a publishing arm, a distribution arm, and a retail arm.”
Amazon strongarms publisher, won’t allow pre-order of new J.K. Rowling book : 24 May 2014, The Daily Dot

“Amazon’s strategy against Hachette is that of a bullying combine the size of WalMart leaning on a much smaller supplier. And the smaller supplier in turn relies on really small suppliers like me. It’s anti-author, and in the long term it will deprive you of the books you want to read.
“Final note: some time in the 1980s the US Department of Justice’s anti-trust lawyers changed their focus from preventing monopolies from forming to preventing companies from colluding to preserve their margins (‘price fixing cartels’). As a result, Amazon very nearly gained a monopoly of ebook sales; they’re still around the 85-90% mark in the UK, and peaked at over 80% in the USA. (The irony of the DoJ-Apple iBook store settlement is that the DoJ went after the market incomer with the higher prices and 10% market share, rather than the near-monopolist who was using predatory pricing to drive their competition out of business.)”
Amazon: malignant monopoly, or just plain evil? : 26 May 2014, Charlie Stoss

“People have a choice on where to buy books. Amazon being the biggest bookseller on the planet doesn’t make them a monopoly or monopsony. If readers demand Hachette books, Amazon has not prevented them from being sold. There are thousands of other retailers who sell Hachette titles.
“I have five books published through Amazon’s Thomas & Mercer imprint, and more than a dozen self-pubbed through Createspace. Guess what? Indie bookstores and B&N don’t stock my paper books. And they are allowed to make that choice. And I don’t publicly whine about it.” …
“And there is a big difference between sales and profits. But no matter how you slice it, Hachette isn’t a helpless neophyte. They have power and capital and lawyers and have been around for almost 200 years. Amazon has the power advantage here, because they have customers Hachette wants access to. If Hachette wants to reach those customers, it will either accept Amazon’s terms or withdraw its catalog. And if Amazon can’t stand the idea of losing Hachette’s sales, it will back down.”
Fisking Charlie Stross: More on Hachette/Amazon : 27 May 2014, Joe Konrath

##

“The Rule of Reason is a doctrine developed by the United States Supreme Court in its interpretation of the Sherman Antitrust Act. The rule, stated and applied in the case of Standard Oil Co. of New Jersey v. United States, 221 U.S. 1 (1911), is that only combinations and contracts unreasonably restraining trade are subject to actions under the anti-trust laws. Possession of monopoly power is not in itself illegal.
“The Rule of Reason can be therefore considered a complement to per se illegality. Under the latter, the action, without consideration for circumstances, is illegal. Under the rule of reason, the circumstances in which the action was committed must be considered.” …
“On the same day, the Supreme Court also announced United States v. American Tobacco Co., 221 U.S. 106 (1911). That decision held that Section 2 of the Sherman Act, which bans monopolization, did not ban the mere possession of a monopoly but banned only the unreasonable acquisition and/or maintenance of monopoly.”
— Wikipedia: Rule of Reason – see also the entries for Standard Oil Company of New Jersey v. United States and United States antitrust law

I also like the finding (in other cases) that ‘geographical market division’ is straight up illegal, and I wonder how that could be applied to, say, cable companies in an argument. Do the cable companies collectively form a price fixing cartel more pernicious than, oh, I don’t know, Apple and 5/6ths of the Big Six publishers?

The phrase used is “illegal per se“ — in and of itself illegal, ‘inherently illegal’ —
“The United States Supreme Court has, in the past, determined activities such as price fixing, geographic market division, and group boycott to be illegal per se regardless of the reasonableness of such actions. Traditionally, illegal per se anti-trust acts describe horizontal market arrangements among competitors.The illegal per se category can trace its origins in the 1898 Supreme Court case Addyston Pipe & Steel Co. v. U.S., 175 U.S. 211 (1898).” – wikipedia

Cartels are illegal, a monopoly in-and-of-itself isn’t (in 1911).

Modern day Justice Department lawyers (in my opinion, burned in 1999-2001 when the Microsoft monopoly case amounted to a whole-lotta-nothing) have been skittish, loath to prosecute, and have also taken a very narrow view of antitrust laws: Monopoly power when exercised to deprive consumers of “the benefits of competition” is illegal — and the US Dept. of Justice sees the price charged to end-consumers as the only yardstick to measure that by. (The final price is only one benefit of competition and healthy markets, but whatever.)

It would also seem that players in an industry can collude all they want, too — so long as they do so in the open, in public view, and have excellent lobbyists. This is the reason the cable companies can all charge $90 a month, and raise rates every year, while offering neither better service nor more programming options. The mistake that Apple and the publishers made was attempting the old fashioned back-room deal: They should have hired more lobbyists, set up a think-tank or two, and then debated the ‘issue’ in back-and-forth newspaper editorials and NPR interviews; heck, the CEOs could legitimately spell out the whole deal, in the context of a cable news appearance. After six months of that, they could legitimately claim Agency Pricing was just ‘natural’ and the way ‘everyone’ was doing business.

Or at least, that seems to be the MO of the Cable Cartel — in my opinion.

##

Coke isn’t a monopoly, because Pepsi.

Visa isn’t a monopoly, because Mastercard.

McDonalds is big and profitable and ugly, but isn’t a monopoly.

Walmart is pernicious and certainly isn’t playing fair in several ways, but they do not have a monopoly.

We, as individual consumers, may not like some very successful firms because we dislike how they do business — or object to the business entirely — and so we don’t eat at McDonalds or shop at Walmart or drink either brand of fizzy diluted corn syrup.

De Beers is a straight-up monopoly — (not that this will ever be an issue, but) if I ever find myself needing a diamond ring, you can bet your ass I’m shopping vintage, or even going to a pawn shop, and if need be having the stone reset, rather than giving them any money.

Even when consumers exercise choice (free market, etc.) there are always times-and-places where some non-Monopoly with plenty of competition still ends up being the only choice. Cable TV and Broadband Internet are two lovely examples — as I can all but guarantee you have only one choice for each, and it’s the same company. For rural US customers, away from the coasts, Walmart may not just be the only discount department store, but the only grocery store for miles.

Walmart is a monopoly to the folks out in Podunk and West Bumble, though those folks are often glad to have them there. The options that existed before were both limited and more expensive. I still don’t think Walmart is ‘doing good’ but they’re serving markets, and if all we consider are outcomes and prices (and not awful practices) then Walmart deserves (some, slight) praise.

Amazon isn’t a monopoly… right?

Amazon has ‘competitors’ in the book market, and the small electronics market (that’s their real retail bread and butter), and online streaming video, and music downloads, and cloud computing services, and small goods (anything that fits in a box). Amazon has barely started in the grocery delivery market — a market which doesn’t even exist yet, honestly* — and in a number of other fields-of-competition, Amazon is in 2nd place, 3rd place, or worse. There is no way** to call Amazon a monopoly

* natural monopolies in markets where no active market previously existed have also been addressed by the courts; we’ll get to that eventually.

Amazon is much more than a bookstore these days anyway. No matter how small a percentage of the business, though, Amazon is always going to sell books — because books are the key to everything else:

“[B]ook markdowns are extremely visible. Sellers can tout their low prices compared to what’s on the back of book covers, the price publishers want to sell it for. And that can be a convenient psychological device — especially if you’re a big retailer with lots of other stuff to sell. ‘When the customer sees a book at 40, 50 percent off,’ Teicher says, ‘the presumption is that everything else that that retailer is selling is also equally inexpensive.’ And books bring in some pretty attractive consumers. ‘Book buyers are good customers,’ Teicher adds. ‘They tend to be slightly more affluent, they tend to be consumers who shop and therefore are always in the marketplace for other products.’”
Why books always seem to have a discounted price : 8 May 2014, Marketplace

Amazon can and should price books however they want. They do the same for MP3 players, hard drives, digital cameras, headphones, blenders, kitchen wares, blu-ray players, electric razors, board games, golf clubs, auto parts, and industrial shop equipment.

Amazon is just doing what every retailer does, though: sell at a discount. Nearly every manufacturer or supplier has a MSRP — notably the “sticker price” on the window of a new car; publishers aren’t the only ones who print the price on the ‘cover’ — and nearly every retailer ignores it.

Sometimes the items are discounted right out of the gate — especially on the fourth Friday in November. Those of us who shop for clothes know that the retail ticket price is only there to make the eventual clearance/close-out discount seem that much more attractive. If you’re shopping for a TV set, I’m willing to bet that the MSRP is also the in-store list price on 90% of the new models on display; there will be one “flyer” item on sale, to get you in the store, and of course last year’s models are discounted (to 15% margin instead of 50%).

There was one notable retailer exception: book stores. Book stores charged the price on the book. Books as a commodity are different, though — the exact same book will be available in at least two formats, with a price differential between ‘prestige’ hardcovers and the soft cover. Having two paperback versions (‘trade’ and ‘mass-market’) further clouds the picture, as do remaindered hardcover books. It is technically possible to walk into a bookstore and find a $6.98 hardcover, a $8.99 mass market paperback, a $18.00 trade paperback, and a $28 ‘new’ hardcover all of the same book, same words on the inside and everything, with only a matter of size and paper quality (or the detail of a remainders auction) to differentiate them.

So books were being discounted; the publisher just found a very convoluted way of doing it, and the booksellers were more than willing to play into it. Customers know the score, and they buy — or wait, and wait — depending on the current format and asking price, and their enthusiasm for the book.

Book stores used to be an exception in that they “always” charged the cover price — but only up until the chain booksellers began to routinely and without exception discount their bestsellers, not because of online prices (not at first) but rather to compete with the likes of Costco and Sam’s Club — which were selling the headline, bestselling authors’ books at discounts of 30% or more. That was in the early 90s, before Bezos had turned his bookstore into a behemoth. Amazon didn’t invent the discounted hardcover, they just had lower overhead, and so they could do it even better.

Amazon entered into the book market, where pricing and formats were already a muddled mess, and then further complicated things: by organizing a network of 3rd-party resellers of used books, by lowering their own margins on all books including the backlist, and (the clincher) by choosing to list all editions—new, used, remaindered, 3rd party sellers, paperback, hardcover, and collectible signed first editions—on a single product page. “Oh look, this book is only $2!” exclaimed thousands of customers simultaneously, even if they then went on to buy the book for $5.99 or $18.79 or $65.

Customers’ perception of [physical] book prices had already changed by the time the Kindle launched in Nov. of 2007 — and immediately sold out. Others had tried to sell ebooks online, and ebook readers pre-date the kindle by 10 years but Amazon had an edge: their customer base consisted of early adopters, avid readers, folks comfortable with or at least willing to try new technology if it meant they could save money, and folks affluent enough to drop $300+ on a gadget — no, those last two points aren’t a contradiction: I think the mindset is that books are a commodity good so of course you buy for the cheapest wherever you can find ‘em, but a gadget, especially the best-in-class gadget, is a one-of-a-kind (and potentially, a must-have) so price is no object. (‘Best in class’ and a price insensitive fan base is Apple’s whole business in a nutshell.)

The major selling point of the kindle was $9.99 brand new bestsellers; the initial price on the Kindle was $399. Enough people did the math and figured it was still cheap at that price. It shouldn’t be surprising — Amazon didn’t launch Kindle without knowing their market. When you have a database of the customers who buy at least two New-York-Times-Bestselling books a month, and can send them an email, you’ve already done that math.

[more on ‘$9.99’: NYTWashington PostAmazon itself]

Amazon launched into a market that didn’t really exist, and so quickly became the only major player worth talking about. Barnes and Noble (fatally?) took two years to enter that market, and Apple now famously only entered the market in 2010 as an ‘add-on’ and initial hook for their new iPad — and when they could stack the deck in their favor. So it should be no surprise that Amazon is the major player, with 60-75% of the ebook market (or more, and growing).

** And at what point could we say Amazon is a monopoly?

Of note is the 2nd Circuit Court decision United States v. Alcoa, 1945 —
“Judge Learned Hand held that he could consider only the percentage of the market in ‘virgin aluminum’ for which Alcoa accounted. Alcoa had argued that it was in the position of having to compete with scrap. Even if the scrap was aluminum that Alcoa had manufactured in the first instance, it no longer controlled its marketing. But Hand defined the relevant market narrowly in accord with the prosecution’s theory. Hand applied a rule concerning practices that are illegal per se. It did not matter how Alcoa became a monopoly, since its offense was simply to become one. In Hand’s words,
[blockquote]‘It was not inevitable that it should always anticipate increases in the demand for ingot and be prepared to supply them. Nothing compelled it to keep doubling and redoubling its capacity before others entered the field. It insists that it never excluded competitors; but we can think of no more effective exclusion than progressively to embrace each new opportunity as it opened, and to face every newcomer with new capacity already geared into a great organization, having the advantage of experience, trade connections and the elite of personnel.’[/blockquote]
“Hand acknowledged the possibility that a monopoly might just happen, without anyone’s having planned for it. If it did, then there would be no wrong, no liability, and no need to remedy the result. But that acknowledgement has generally been seen as an empty one in the context of the rest of the opinion, because of course rivals in a market routinely plan to outdo one another, at the least by increasing efficiency and appealing more effectively to actual and potential customers. If one competitor succeeds through such plans to the extent of 90% of the market, that planning can be described given Hand’s reasoning as the successful and illegal monopolization of the market.” – wikipedia

In the end, the 1945 decision was mooted by changing markets —very much like the Microsoft/Internet Explorer decision in 2000 quickly became irrelevant as other browsers ate away at IE’s market share — but Alcoa and Microsoft were both subject to court oversight after being found guilty, and oversight continued until the market caught up. Apple and the courts are still arguing over what “court oversight” might mean in the ebook-pricing case.

[The publishers already submitted to court restrictions when they settled the case before trial. They have to renegotiate their contracts, though the court allowed that these negotiations should be staggered. Hachette is the first of the five on the schedule; say, how is that going?]

Let’s take a second look at “the possibility that a monopoly might just happen, without anyone’s having planned for it. If it did, then there would be no wrong, no liability, and no need to remedy the result.”

See: the 1st Circuit Court decision, Fraser v. Major League Soccer, 2002 —
“The Court of Appeals upheld the jury’s finding that the plaintiffs did not prove that Major League Soccer illegally monopolized the market for player services, and failed to prove the product market and geographic market, because MLS competed with other soccer leagues in the U.S. for players, and MLS competed with soccer leagues in other countries.
“On the charge of a reduction in competition under the Clayton Act, the Court of Appeals held that ‘the creation of MLS did not reduce competition in an existing market’ because no active market for Division 1 soccer previously existed in the United States” – wikipedia

I don’t know what soccer player salaries have to do with author royalties, but I think we all can agree that MLS—which owns every individual team, not just the league—is a de-facto monopoly on US Soccer and that likely does affect 98% of player salaries, no matter what the court found at trial.

However: “the creation of MLS did not reduce competition in an existing market because no active market for Division 1 soccer previously existed”

The same could be said for ebooks in 2007.

On the other side of the coin, the Alcoa decision — where control of part of a market (ebooks for example; just throwing that out there) can be considered as separate from the overall market (all books) — might just be a precedent if someone chose to apply it. Of course, any and all actions taken by Amazon in pursuit of book market share is just “good business”. For Amazon to act differently would be stupid. Bezos is not stupid.

In fact, I’m sure that Bezos knows the distribution centers he’s built in the last decade, combined with the ease of one-click shopping, an engaged and enthusiastic customer base (of readers!), integrated hardware/software that includes dedicated e-readers, andoid-ish tablets, and apps on everything, along with razor-thin margins and customer retention programs like Amazon Prime, all represent very high barriers to entry. The ability to drop a few or a hundred million to buy out a nascent competitor certainly doesn’t hurt. It seems obvious to buy an online bookseller like Abe Books — but more vitally, Amazon is being proactive in acquiring any developing network of readers, including both Shelfari and Goodreads. The business is being won not just in market share but in mind share, and having a lock on enthusiastic readers is apparently worth at least $150 Million (for Goodreads, the purchase price of Shelfari wasn’t disclosed).

“It insists that it never excluded competitors; but we can think of no more effective exclusion than progressively to embrace each new opportunity as it opened, and to face every newcomer with new capacity already geared into a great organization, having the advantage of experience, trade connections and the elite of personnel”

##

Following the precedents, the Apple ebook case makes sense in its own way — price fixing and cartels are definitely illegal. Monopolies in and of themselves are not.

Any theoretical Amazon case would also be a huge mess because you’d have to argue about who Amazon’s customers are: sure, on the surface, Amazon’s only book customer is the end reader — but if Amazon [eventually] controls 90% of the ebook market, wouldn’t an author’s only way to reach those readers be through Amazon? Isn’t the author—attempting to use Amazon’s services to reach Amazon’s reader base—a customer too? Amazon buys books from publishers — but if you’re a [dead tree] genre fiction publisher and Amazon accounts for 50% or more of your overall sales, online or off, who has the power in that relationship? What are your options outside of Amazon?

By placing itself across the whole book industry — and playing different roles in retail, distribution, and publishing but not controlling any of the three — Amazon in a way insulates itself from accusations of monopoly while also becoming a much bigger and more formidable adversary than it might have been otherwise.

In November of 1998, Barnes and Noble (with about 15% of the book retail business) proposed buying Ingram Book Group, which at that point had 11 distribution centers and shipped books, audio books, and magazines to stores nationwide — including to Amazon. While each was the number one competitor in their field, both Barnes & Noble and Ingram still faced strong second-placed competitors, and both parties promised that the merger wouldn’t affect Ingram’s existing distribution deals or customer relationships. The buy-out was dropped in 1999, about six months later, over fears the FTC would axe the deal; the respective companies felt dragging the process out any further would only damage their image, and potentially, their business [and certainly: B&N’s stock price].

[Additional reading on that: AP, NYT, CNet]

Would the union of book retail with book distribution have destroyed competition? — Apparently it didn’t; after 1999 both B&N and Amazon brought distribution in-house (spending hundreds of millions in the process), handling the majority themselves and buying direct from publishers instead of middlemen. But in 1999 the “major” player in book retail (with 15% of the market) was effectively blocked from consolidating its position by anti-trust fears.

And Amazon has 30% of the book market, but isn’t considered an anti-trust candidate by anyone except those suffering from ‘Amazon Derangement Syndrome’.

##

[Enough droning on about Amazon.]

Could the publishers be making major changes to the way they do business? Aw Hells Yes. Amazon is devouring the business like a pack of cheetahs because the old school, New-York based publishing business was and is very inefficient, a half-broken system that was in no way improved by the consolidation of imprints, and the consumption of New York publishers by Big Media conglomerates.

If I were to launch a publisher today, it would not be in Manhattan — well, Manhattan, Kansas, maybe, but not New York. The ghosts of Max Perkins, Book Row, and the Algonquin Round Table seemingly haunt the business —or perhaps, it is the publishers who cling and won’t let go, not the ghosts who are refusing to leave. We’re constantly lamenting either the demise of literacy, of literature, or just of good taste. (that link is a 1959 article in Harper’s on the decline of book reviewing)

So lets rethink this a bit and reframe our mental image of publishing:

By the 1930s, rotary presses, offset printing, and hot metal typesetting had industrialized the manufacture of books, to the point where a paperback could be sold for just 25¢ (in 1939, inflation adjusted $4.15) — while simultaneously, the market for fiction in magazines (high-brow and low) fostered at least three generations of writers, the end result of which we see in Pulitzer Prizes, Noble Laureates, and (even better) the glorious era of Pulp. The modern day publishers were all born in this era (as previously, there was no way to profitably make the books—copies of books, in the manufacturing sense) and in a way, they are all still stuck in it.

Now, the word processor, digital publishing, and social media have again revolutionized the manufacture of books — In publishing, It’s 1879 All Over Again, and every blogger is a newspaper onto themselves, every online author their own very small magazine or press, and every existing, accepted business model should be assumed to be wrong until proven otherwise.

But instead of seeing the revolution take off (like it has in other areas of tech), enterprising small publishers and aspiring authors still have to contend with the weight of the Book Establishment: the media conglomerates, their gatekeepers, and a self-appointed literary police force that values laurels and prizes over fun and pulp. The Established Book People control every approach to the market: breaking free from the slush pile and into publication to begin with; access to shelves in bookstores, or even better, front-of-store placement; getting your book reviewed by nationally-distributed newspapers and magazines, or even better …Oprah.

How does one crack into this market? Do you have to, anymore, to ‘make’ it as an author? If you go online, is Amazon your only way, or just the only way to reach Amazon’s (numerous and book-hungry) customers? To date, only Pottermore has begun to explore (and exploit) what is possible — though of course we could argue that Rowling is in a unique position to do so. In time (5 years? 10?) others will definitely follow. The next G.R.R.M. will not be a greybeard with an existing publishing contract, but will instead use Facebook, Twitter, Tumblr, and [The Next Great Social Media Thing that Hasn’t Been Invented Yet] to pull readers into a totally independent website, to read appendices and argue minutia on forums and to buy, buy, buy digital copies of the books.

Rowling and G.R.R.M. had a lot of help though: movies and cable TV gave a boost to properties already pretty famous and selling themselves out in the bookstores. 99.999999% of new authors won’t be able to take the same path (or sit on Oprah’s couch, let alone Conan’s) but the idea of doing it all yourself shouldn’t be discarded just because we can’t all win the lottery. Maybe the next G.R.R.M. will get his start writing fan fiction — maybe she has already done so, and just needs a push to go from posting on others’ web sites to building and hosting her own. Sure, reader-outreach and fan interaction might ‘live’ elsewhere (twitter&tumblr, perhaps) but you’ll need more than a few @handles and an Amazon landing page if you want to control your own destiny.

For authors that don’t do it themselves? To go back six paragraphs, “If I were to launch a publisher today” it would be a website, not just an imprint — and the small editorial staff would include writers to maintain the blog, programmers to build the platform, and some social media savvists (yes I just made up that word and invented the job) to find and capture fans — and the staff would be given a mission to curate a small niche of publishing — or a large niche, or a whole genre, but whatever: our target is a target, and we’re aiming for both the authors and the readers. IF I could buy the Analog or Asimov brand names: we’d be off and running, yesterday.

So long as I’m wishing: Give me the modern-day John W. Campbell or Lester Del Rey and let’s do this already. Pitch it as a tech startup to con the VCs acquire some startup capital to pay the bills the first two years and *do it*.

If Vox, Whalerock, Ziff Davis, Conde Nast, or First Look Media want to get in touch with me about starting this new hybrid website-magazine-imprint, I can be on a plane and at your office on Monday. Have the contract ready for me to sign; no takebacks.

##

Publishing is ripe for disruption. Amazon found a couple of cracks and are working the wedges to split off their chunk of the market. Amazon is very successful at what they do; they are the first of a new kind of book company — currently more retailer than publisher, but doing just fine with their house imprints and also, more than willing to share parts of the infrastructure with others (authors; but authors direct and not their publishers) (at least: so far).

Amazon is monopoly-ish but the Justice Department has given them a pass (and will continue to) so long as Amazon isn’t “abusing” their position to raise consumer prices. Anything else that Amazon does, including making publishers squeal, making B&N obsolete, and stomping (or buying) any upstart that even looks like it might be eyeing Amazon’s business: that’s all fine.

HOWEVER,

And this is aimed at the Amazon Cheerleader Squad,

Amazon’s dominant market position isn’t a good thing, in my opinion. It’d be great (and I’d certainly be less apprehensive) if there were a strong, and growing, and decently-popular alternative to Kindle Direct Publishing to threaten Amazon and keep them honest. A Pepsi to their Coke, or a Discover Card (or even a Square) to their Visa/Mastercard hegemony.

I think it’s fine to use Amazon, but one shouldn’t be enamored by it. In the current publishing landscape, Amazon has every potential to become a de-facto book monopoly — a utility like AT&T, maybe, something you don’t notice and with flat rates that everyone gets accustomed to using — but being a comfortable and familiar monopoly doesn’t make it less of one. If you think of Kindle Direct Publishing as a book utility service (which is more of a poetic analogy than a direct one, but I find it fits) and recall the abuses of pre-breakup AT&T, or perhaps that other de-facto monopoly, your local cable company — maybe you’ll pause for just a moment before encouraging everyone to jump on board.

Additionally, there is nothing Amazon does for you that you, as an author, can’t do for yourself. Sure, one can buy into Amazon’s Kindle Ecosystem and that’s great — it’s easy and seductive.

But if you argue that Publishers don’t deserve 95%, or 85%, or 75% for formatting, editing, production, and distribution when one can easily contract that out (for an upfront, one-time fee – not ongoing chunks of the revenue) and the parts that can’t be contracted out have been made obsolete by ebooks…

…then maybe you can also see my argument that Amazon doesn’t deserve even 30% if you’re the one marketing the book, finding fans on facebook, slowly building up your backlist and ‘brand’ — and you only direct them to Amazon because you haven’t set up your own website yet. (for an author, yes, 70% is way better than 5-17% — even the 35% Amazon offers for books outside the KDP Select program is better — but 100% and 100% control should be the goal, right? …right? )

Genre authors who are at the forefront of the Kindle Revolution might want to start reading web comics, and learning about how comickers are monetizing. Some of them even print and sell hardcover books, direct, at a profit, …without Amazon — and that’s after they give away the comics for free. There is a lot to think about here.

##

Like I said, it’s 1879 all over again and we’ve been given a once-in-a-century opportunity to re-invent publishing and books. A whole world of options is out there and a possibly brilliant future awaits.

But we can also learn from the past: let me tell you, no one in 1914 was arguing that Sears & Roebuck was the future of publishing just because they had revolutionized retail with direct-to-customer shipping, were leveraging the possibilities of the network (rail network) to ship faster and cheaper all the time, used massive volume to keep margins and prices low, and their ability to reach and inform millions of customers (through their catalog) was unprecedented, nation-wide, and ubiquitous.

Have it shipped direct and save 70 percent off new fiction!

Publishing was re-invented by the packagers and the pulps, not the establishment players. The revolution was led by the people serializing fiction to sell magazines, and the 25¢ paperbacks sold outside of bookstores — dozens, and then hundreds, and then thousands of independent players, of which only a handful were successful (those became today’s imprints, handed around like poker chips by media conglomerates) but all of which were making and selling books. The first editors and publishers learned on the job, and often were the authors themselves; we are being given the same opportunity.



Amazon's Generosity

filed under , 26 May 2014, 11:39 by

Amazon:


Counterpoint:
“Amazon offered a choice. Not just for writers, but for consumers who wanted larger selections and didn’t want to pay luxury prices for books. (Publishers didn’t just control who got published, they also controlled the prices of their titles. What other industry prints a price on its product?)”
Turow & Patterson: A Plateful of Fail with Extra Helpings of Stupid

see also: Five+ years of me angsting on Amazon

##

Amazon is not a Great Evil, hellbent on destroying publishing.

Amazon is a business, and is using their market position to be even-more business like.

Is that evil? Yes, actually, I think abusing your market position to extract profits without providing additional value is kind of evil, but apparently I’m alone on that — and just because Amazon isn’t attempting to extract the extra money out of their customers (yet), I’m told my opinion doesn’t matter, or worse, that I suffer from Amazon Derangement Syndrome for pointing out the obvious.

Are publishers any better?

The major media conglomerates that currently own the publishers aren’t. A publisher who can’t add value (production and marketing support) to a book certainly isn’t entitled to take a large percentage of its profits. But is the model bad? I think it was working up until the 80s, and then a lot of things happened before Amazon got started [consolidation, shifts in book retail — including the rise of first the mall chains and then the big box stores, the ‘elevation’ of genre fiction, and the multi-media tie-in] and Amazon stepped in to abuse the exploits readily available because the book business was (from a “business” standpoint) “broken”.

If Amazon is “good” and the publishers are “bad” — then what’s the third way?

If it is all just business, then any well-run business should be able to provide services to both readers and writers in ways that do not require the publisher’s scale and clout to get shelved in bookstores, and don’t rely on the size of Amazon’s customer base and on Amazon’s generosity. If it’s ‘stupid’ to ignore Amazon because “that’s where the customers are” then you’ve merely traded one pair of gatekeepers (the acquiring editor, the chain book-buyer in New York) for a different set of gates, and all the gates are owned by Amazon.

Sure, for an ebook Amazon will pay an author up to 70%, assuming the author adopts Amazon’s preferred pricing structure, but why does Amazon charge 30% at all? If it’s only about hosting the data, it looks like 1 GB of storage and 5 GB of data transfers (customer downloads, in this case) would only cost me 17¢ a month using Amazon’s own Web Services — that’s 17¢ for the data (…per month, and I’d only be charged for what I use), so I guess the other $.72 (on a $2.99 kindle book) is sales commission? For listing the book on Amazon’s website?

Except… the web site is automated, too. The author fills out the book metadata, decides which keywords and categories to use; the customers submit the reviews. Amazon is just providing the server space and the download (for 17¢ a month). Customers find the book using search, or by browsing — which means relying on Amazon’s algorithms and hoping that there isn’t some dumb reason Amazon would want to hide your book from the search results, or to keep it off of top 10 or top 100 lists.

Amazon makes money on Kindle books in aggregate so it doesn’t have to support any one author, or any one category or genre of books, or even provide any support at all so long as the website is up and the servers are running.

Amazon deserves credit for setting up the system (and for leaving the lights on for the rest of us, I guess) but it doesn’t do anything; the sales commission it earns is for providing access to its customer base, a de-facto social network of millions of readers who have self-selected — for reasons of cost and/or convenience — and are the fraction of readers that are both more technically savvy and most willing to try digital options (because they did, when they first chose to try Amazon).

Amazon may “only be 30% of the market” but represents at least 75% of the ebook market, because that’s who their customers are. Amazon only takes a 30% cut — for books under $10 (a pricing scheme they enforce, and they take 65% if you choose to deviate from their guidelines) — for a service that costs them pennies on a closed platform they control. Amazon only provides the listing, the author is then responsible for the marketing, and for generating enthusiasm in their readers. Some authors are very successful on Amazon’s platform and that’s fantastic — but no one has asked them the question: now that they have a reader base, do they need Amazon?

Amazon processes the payments, so that’s nice (and the hosting and distribution of files) and of course there are interactions and synergies that come from being listed next to other authors and books — benefits that outweigh the trivial fact that other authors are technically the competition. But I can just as easily push books from my website — in fact there are Wordpress plugins that can turn any blog into a store. Sure, it’s a lot of work — but the arguments against publishers (“I can hire a proofreader, and an editor, and a cover artist, and someone to format the ebook for me… hell, I’m doing all my own marketing anyway… why do I need a publisher?”) can also be applied to Amazon (…now you need to hire a web programmer, and a web designer, but the rates are going to be similar to a good book editor, and once a solution and/or model is in place many authors will be able to copy it, or parts of it).

I repeat myself for emphasis: If Amazon is “good” and the publishers are “bad” — then what’s the third way?

If it is all just business, then any well-run business should be able to provide services to both readers and writers in ways that do not require the publisher’s scale and clout to get shelved in bookstores, and don’t rely on the size of Amazon’s customer base and on Amazon’s “generosity”.

Monopoly, monopsony, whatever… Amazon is not the final solution, but gets a lot of the credit (and a lot of goodwill) for having “solved” the book “problem”.

All I see is a single player that has gobbled up too much of both book publishing and book retail. Amazon’s Generosity should not be taken for granted, or assumed to be limitless. I suppose the advice to authors should be: get in now, while the getting is good, and hope you can make your roll before the rules change and Amazon, in its great indifference, rolls over you.



I wonder if the historical model I should be researching is RCA, not Pocket Books?

filed under , 20 April 2014, 14:40 by

“Thinking of ebooks and printed books as comparable is like assuming that anything conveyed by means of the written word is a poem; plays, novels, stories, film scripts, letters, shopping lists and text messages exist too. Publishers have got to stop thinking of their digital products as ‘books’, and start imagining more expansive ways of communicating information. Until then, the digital revolution hasn’t even begun.”

‘The ebook revolution hasn’t even begun’ : Gaby Wood, 30 March 2014, The Telegraph

##

I wonder if the historical model I should be researching is RCA, not Pocket Books? The argument could be made that the Consolidated Amazon Book Cheetah™ currently thinning the fat, slow publisher herd have more in common with General Electric of the 1910s and 1920s than with cheap pocket paperbacks that appeared in 1939. GE built the devices (RCA radios) while simultaneously developing the content and networks (NBC Red and Blue) that drove demand. The later success of television rode piggyback on the real revolution that had taken place decades earlier.



The Fallacy, and the Truth, of "Big Publishing"

filed under , 25 February 2014, 20:35 by

[blockquote]

“In the last 20 years, two multi-billion-dollar bookstore chains rose — and one fell. A hell of a lot has changed in 20 years.
“In 1994, Viacom owned Simon & Schuster and was buying Macmillan USA; now in 2014 Macmillan (via the original UK root) is back in the US book business – but under the imprimatur of privately-held German firm Holzbrinck. Viacom spun off S&S, as the publishing arm of CBS. Hachette Book Group USA (Hachette Livre being the bookish face of French multimedia conglomerate Lagardère) was born in 2006 with the French purchase of Time Warner Books — and more recently Hachette has also added on Disney’s Hyperion. (Hyperion, I’ll remind you, was built by Disney from scratch in 1990.)
“Rounding out “The [old] Big Six” – HarperCollins is only 25 years old, assembled from parts by Rupert Murdoch’s News Corporation over the course of the 1990s. And everyone is shadowed by the Randy Penguin merger: the imprints of Random House already read like a directory of 1947 New York publishing houses; added to Penguin’s haul the new Penguin Random House is set to publish half of all adult trade books (or more). That merger isn’t even a year old yet.”
[/blockquote]
Forbes: Please Hire Someone Who Understands Books, or Math, or Both : Rocket Bomber, 11 February 2014

Up until last year, we used to talk about The Big Six – the six largest US publishers: Random House, Penguin, Hachette, HarperCollins, Simon & Schuster, and Macmillan — In 2013 The Big Six became The Big Five (or alternately, Randy Penguin and the Following Four) after Bertelsmann and Pearson came to an agreement to merge their subsidiaries (incidentally, the two biggest US publishers), Random House and Penguin Putnam.

OK, first: Randy Penguin and the Following Four is a great band name. But more importantly: what [now] gets referred to as The Big Five are just the publishing arms of major international multimedia conglomerates — so far in this post I’ve name-checked Viacom, CBS, Holzbrinck, Lagardère, Time Warner, Disney, News Corp, Bertelsmann, and Pearson — the publishing houses get handed around like poker chips by media giants who [editorializing here] just don’t give a shit about print anymore, but hey, it’s still a multi-billion-dollar industry and everybody else has one “so I guess we need a publishing arm, too”

Publishing is worth (rough numbers) $27 Billion, but that’s only in the very-low-two-digit-billions, so to a Viacom or 21st Century Fox or Time Warner, the whole book thing just isn’t worth futzing with. Each of those entities has—when given half a chance—sold, spun-off, or otherwise dumped a “Big Six” publisher and retained the ‘real’ media assets … in 2013 Disney bought Marvel (technically a publisher) but the $4 Billion price tag was for characters and “IP” and what is now a blockbuster movie studio, not the floundering funny-book business. The year after Disney bought Marvel, you might have noticed they sold off their actual book division, Hyperion, in favor of concentrating solely on ABC/Disney (and soon-to-be Marvel and Lucas) tie-in product. Fox has similarly shed its News Corp skin, taking the TV and Movie studios and leaving the publishing behind. CBS is stuck with S&S only because they were cast aside with them back when Viacom split. Time Warner (which has been Time Warner since 1990) (and which sold off Little, Brown and Time Warner Books in 2006) even has plans to spin-off the Time Inc. magazine distaff branch and soon (mid- to late-2014) the last vestige of dirty, dirty print will be purged from Warner Brothers’ balance sheet — except for Batman and the other ‘DC Entertainment’ characters.

##

From 1989 to 1998, if you mentioned “the Big Six” to someone working in publishing in New York, they’d assume you were talking about accounting (or maybe poetry). The Big *whatever*, as a term, is too recent — and definitions are fluid.

[source: Google Ngram]

“New York Publisher” was (and occasionally still is) the disparagement of choice when talking about corporate inflexibility, but more and more we were actually talking about media giants and corporations, not about publishers per se. The Big Six emerged in the late 90s (note, not a historic and ever-present phenomenon) and were part of the larger media consolidation then taking place between movies, TV, cable… and yes, the internet and video games, too: AOL Time Warner and Vivendi Universal, anyone? Man, the aughts were weird. Book publishing, as ‘ur-content’, got swept up into the whole mess. The fit was often bad.

Books, newspapers, comics and magazines—what we call publishing—are the red-headed stepchildren of media, of note only in context. HBO gets all credit for Game of Thrones, Harry Potter is a Warner Brothers property, Lord of the Rings is New Line Cinema, Walking Dead is an AMC TV show. Marvel Studios had an immaculate conception in 1996, springing forth from nothing, whole and wholly-formed, into a super-hero movie desert and eventually becoming so popular that there were even popular comic book adaptations of the movies.

On the TV side, we also have Justified, Bones, Orange Is the New Black, and House of Cards — and hell: Roots, Shogun, this is nothing new. Masterpiece Theater has the occasional original story (nod to Downton) but for decades its bread-and-butter was literary adaptation.

This is a looooong aside (and trivial, or trivia, or both – you can skip it), but having done the research I had to include it: Two-thirds of all books that hit #1 on the bestseller list for the past century were made into movies — another 10% made the jump to TV, so three-quarters have been adapted.

The exceptions are kind of fun to note:

  • Mr. Britling Sees It Through by H. G. Wells, 1917
  • Strange Fruit by Lillian Smith, 1944 (eventually, an Oscar® nominated short in 1978, but not a feature-length adaptation)
  • The King’s General by Daphne du Maurier, 1946
  • The Source by James A. Michener, 1965
  • Trinity by Leon Uris, 1976
  • Chesapeake by James A. Michener, 1978
  • The Covenant by James A. Michener, 1980
  • The Matarese Circle by Robert Ludlum, 1979 (…is in development hell – though at one time both Tom Cruise and Denzel Washington were attached)
  • The Partner by John Grisham, 1997 (optioned)
  • The Testament by John Grisham, 1999 (optioned)
  • The Litigators by John Grisham 2011 (optioned)

There’s a batch that haven’t been adapted, but we could argue that doesn’t matter because others in the series* have been:

  • The Silmarillion by J. R. R. Tolkien, 1977
  • The Mammoth Hunters by Jean M. Auel, 1985
  • The Cardinal of the Kremlin by Tom Clancy, 1988
  • The Plains of Passage by Jean M. Auel, 1990
  • Desecration by Jerry B. Jenkins and Tim LaHaye, 2001

And the TV movies and mini-series:

  • Wheels by Arthur Hailey (Book 1971, on TV in 1978)
  • Centennial by James A. Michener (1974, TV 1978)
  • Noble House by James Clavell (1981, TV 1988)
  • It by Stephen King (1986, TV 1990)
  • The Tommyknockers by Stephen King (1987, TV 1993)
  • Scarlett by Alexandra Ripley (1991, TV 1994)
  • The Street Lawyer by John Grisham (1998, TV movie 2003)
  • For One More Day by Mitch Albom, (2006, TV movie 2007)

The Talisman by Stephen King and Peter Straub (1984) was being developed as a mini by TNT but never made it to air

Out of the whole list (and for more info on that, I’d direct you to Matt Kahn and his site, where he not only lists the Publisher’s Weekly #1 Bestsellers for each year, he’s also slowly reviewing each and every one) there are only four I couldn’t find more information on:

  • The Brethren by John Grisham 2000
  • The Summons by John Grisham 2002
  • The Broker by John Grisham 2005
  • The Appeal by John Grisham 2008
    …but it’s Grisham, so I’m sure these have been optioned even if it wasn’t internet-link-generating-news at the time.

And of course, there are the pair of bestsellers from the early 1980s: the bestselling book in each of these years were novelizations of movie scripts: E.T., The Extraterrestrial in ’82 (by William Kotzwinkle) and Return of the Jedi in ’83 (by James Kahn). If pressed for a date when publishing died, I’m picking 1982.

My point — yes, I had one — is that books and publishing are, in the corporate view, just the minor leagues. Even big names like Stephen King, John Grisham, and J.K. Rowling are just the ‘farm team’ for the real business, which is making movies and TV. Books are a static property to be strip-mined, not a resource to be conserved — or hell, a vibrant product that can be nurtured and will multiply if given even the slightest bit of care and feeding. The major media companies, and the publishers they’ve hobbled, can’t be bothered.

Amazon gets some credit here. But…

Well, Amazon gets credit for throwing Miracle-Gro® on a field of weeds and wildflowers — the seeds were there already, there was even some minuscule growth — indeed, this was a field that used to be tended by the pulp magazines and rack paperbacks.

[And honestly, I’d feel better about e-books and the new self-publishing Revolution if it were like the pulps of decades past and not a wholly-owned subsidiary of Conglom-o. But that’s my bias…]

##

We talk about Traditional Publishing like it’s a single thing, a single model, or a single company. It’s not. To claim that all publishers are the same is to equate The Big Five with Osprey, Harlequin, Regnery, and Soft Skull. The big “New York” publishers are actually run out of Gütersloh, London, Paris, and Stuttgart — of the two remaining “New York” publishers, one is more concerned with their (Hollywood-based) TV programming and the other’s major asset is financial information firm Dow Jones.

If anything, Amazon has managed to flourish because first, consolidation squeezed the publishing industry practically dry, and then the new corporate owners criminally neglected it.

##

For perspective, check out Publishers Weekly’s list of The World’s 60 Largest Book Publishers, 2013 – which not only is a global list but also incorporates the huge educational/textbook and financial reporting sectors (Reed Elsevier, ThomsonReuters, and Wolters Kluwer are the major players you’ve never heard of, each with about ~$5 Billion in revenue — not gross sales, revenue) — and we really should be talking about Scholastic as one of the [new] Big Six — and Europe and Japan are massive book markets, and the eventual digital book solutions in both might impact the digital book market in the US. Of Course Amazon is a player, but not the only one. (The side battle in Brazil is also of note)

I’d love if some of the “new book” self-publishing evangelists addressed the Fall of Publishing (1982-2006) in their arguments, and perhaps would explain why their new corporate overlord is in any way better than the old ones. It would be one thing if we were advocating for a creators’ collective to advocate rights for all designers/producers/writers against the many companies and web sites who seek to exploit authorship – but instead I only see efforts to pit the new model against the old one for internet ‘points’.

Who owns a kindle ebook? More importantly: what happens to a kindle ebook if Amazon stops hosting it? Prodigy and CompuServe were the shit in 2000, and in practical terms, were also ‘the internet’ for their user base. Amazon seems different (but awfully similar) but once again we’re looking at a walled garden and 2015 in practice isn’t all that different from 1985.

Dollars are great, I need more myself. But if the discussion is about business models and propagation of books, I need more than hagiographies of KDP and some by-the-way statistics based on web-scraping. Let’s talk about the future of publishing, not the panning-for-gold in the effluvia of a commerce-site-cum-social-network. Talk to me about how this all works in 2024, or 2034. Amazon is Fantastic, but can’t be the only player: tell me what’s next, and how to participate.

If your imagination fails at KDP, then your imagination fails. If “big publishing” is what you’re against, then tell me what you are for. Howey, what’s next?



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