July, 2012

The ebook marketplace is about to change…a lot


Now that the DoJ’s response to the public comments has made it overwhelmingly likely that the settlement it negotiated with Hachette, HarperCollins, and Simon & Schuster will be accepted by the Court, it is time to contemplate the changes we’ll see in the ebook marketplace in the next couple of months.

The settlement requires the three affected publishers to inform retailers working under agency agreements that they can be released from them. Ten days is alloted from the time of the Court’s acceptance for that to take place. Then the retailers have 30 days to terminate their agreement and then the publishers have 30 days from receiving that notice to actually end it.

So the process could be almost instantaneous, if the publishers served notice immediately, the retailers responded immediately, and the publishers reacted to the response immediately. Or it could take as long as 70 days from the Court judgment, if everybody used the entire time alloted by the judgment.

Assuming that Amazon acts with competence and alacrity in its own interests (and I’d expect nothing less), the entire process could take no more than 40-45 days with them. (Each retailer can be on its own clock.) That should liberate Amazon from most pricing constraints on the three settling defendants’ books by the middle of September.

There’s a bit of confusion in the settlement language here. In the same paragraph, IV-B, that lays out the 10-day, 30-day, and 30-day requirements as described above, it also says that 30 days after “entry of the Final Judgment” (the starting gun for everything), the Settling Defendants take “each step” required to terminate or not renew or extend the agreement. Or maybe the language makes sense to a lawyer but I’m just confused. It seems like they’re asking for results before the first 30-day period would have expired.

The settlement, which ostensibly does not eliminate agency agreements (although it clearly eviscerates them), requires that any new agreements not allow publishers to dictate final sale prices by the retailers, except to cap them (in an unwieldly way we’ll consider below in more detail) and also disallows any “most favored nation” (MFN) clauses protecting any retailer from the impact of other retailers’ pricing decisions. These restrictions are specified to last for two years for each retailer, starting from the date the old agreement’s price-controlling clauses are mooted, whether by the agreement being terminated or by the publisher notifying the retailer, in writing, that the offending clauses will not be enforced.

It is back to the drawing board for new agreements. Ostensibly they can be “agency” agreements by which the publisher sets a price and pays a commission for sales based on that price. But since agency agreements were actually attractive because they achieved what is now deemed illegal price parity across the marketplace, these publishers must be rethinking the efficacy of the model. I would be.

So new contracts will be needed between the three settling publishers and all the retailers. And they’ll need to be crafted, negotiated, and signed within a maximum 70-day window.

Anybody responsible for this who remembers what a combination marathon-and-sprint these negotiations were in 2010 won’t be planning any 2-week vacations over the next few months.

There is one big fat joker in the settlement. The publishers are allowed to negotiate agreements limiting the retailers from discounting from the publishers’ (now) suggested prices. The settlement allows the publisher to prohibit discounts on their books which in the aggregate over one year exceed the margin the retailer has earned on those books.

In principle, that isn’t complicated. Retailer A sells ebooks with a retail value of $1 million in a year and would earn $300,000 in commissions. They have to charge customers at least $700,000 for those ebooks, or they’d be in violation of a contract that the settlement allows the publishers to negotiate.

In practice, monitoring and enforcing that might be a nightmare. It requires either reporting or tracking of ebook sales and the prices at which they’re transacted which is far more robust than what has been required or done so far. But even with perfect data, it’s still extremely difficult to assure compliance, particularly if a retailer is inclined to “spend” its whole allotment of discount margin. The wording of the settlement would seem to require allowing discounting that exceeded the margin earned over the course of the year, as long as the cumulative discounts were under the stipulated cap at the end.

What that also means is that retailers can’t work with price-matching bots alone. It isn’t sufficient for Retailer A to monitor Retailer B’s pricing and automate meeting or beating it because Retailers A and B aren’t selling the same quantities of each publisher’s other books and therefore don’t have the same “budget” for discounting. This is a game of three-dimensional tic-tac-toe. The retailers have to watch each other and, at the same time, watch how their discounting to consumers stacks up against the allowances they are earning through above-cost sales for each of the three settling publishers.

And the publishers need to watch the sales of each of the retailers, presuming they are provided with data they don’t now get to allow it, to make sure each one is staying under its cap.

We can’t make too many assumptions here. The settlement rules allow a publisher to negotiate a discounting cap based on total margin, but they don’t require a retailer to agree to it. And there is no acceptable punishment specified for a retailer breaking the cap, so that will have to be worked out in the negotiations about to take place (if they haven’t already started).

One thing the DoJ was completely right about is that the whole agency idea breaks down if it isn’t applied across most of the Big Six. Random House demonstrated that for the first year of agency when they stayed out and reaped an immediate double bonanza. By sticking with their wholesale pricing model (by which the retailer gets 50% off a wildly unrealistic ebook price that would be almost impossible to sell very many copies at), they got more money for each copy sold than they would have under agency (by which the retailer only gets 30% but of a much lower, realistic, selling price). And, at the same time, Random House ebooks benefited from the aggressive discounting (led by Amazon but matched by other ebook retailers) at which their high-profile titles, alone among the Big Six competitive set, were offered to the consumer.

In fact, it was made clear by Apple to the publishers when they were recruited for the iBookstore that the store would only open if at least four of them signed on. Apple was probably thinking that without having a critical mass of top-flight titles, their store would have no appeal and not be worth operating. What publishers may have been thinking about is that if were a lot of Big Six titles being discounted because they weren’t covered by agency rules, the ones that weren’t would be at a tremendous competitive disadvantage.

It seems that the necessity for concerted action to make agency work is a core element of DoJ’s thinking that collusion was required to implement it. But the specific allegations of collusion (the Picholine meeting that took place long before anybody was thinking about agency or an Apple bookstore and the various instances where publishers are alleged to have told each other whether they were in or out of the program) seem very weak, particularly when you acknowledge that they all knew “four or no store”.

Something that one comes away with from reading the settlement language is that we might see some very different terms in the replacement contracts. DoJ’s suspicions were aroused by the great similarity among the agency contracts and they seem to be asking that they not look so similar when they are renegotiated.

This could drive any number of changes. Publishers could return to a wholesale model. Publishers could try to change the agency commission, now uniformly fixed at 30%. It even seems like publishers are being told that the commissions don’t have to be uniform across retailers (although negotiating different terms would seem to violate the spirit of the Robinson-Patman Law that a previous generation of publishers grew up believing required them to give the same terms to all like sellers. There is a R-P exception for contractual relationships, however.)

In fact, there is language in the settlement agreement which seems aimed at stopping publishers from even revealing the details of these agreement in case one of their competitors could find out. (One might assume an agent with clients at more than one house would be able to figure out the commercial terms from their royalty statements. Actually, one would assume that a responsible agent wouldn’t be waiting for a royalty statement to find out.)

So the settling publishers have to negotiate new deals. The other agency publishers (Macmillan and Penguin who are fighting the legal battle and didn’t settle and Random House, enjoying one more big delayed benefit from having stayed out initially which is that the collusion argument certainly can’t be stretched to cover them) will have to rethink their pricing as they see what happens in the changed marketplace.

It is a safe prediction that one of the stories of Christmas 2012 will be the extent to which the agency publishers dropped prices from what they were permitted to charge to meet competition, driven by Amazon.

Remember that the permissible discounting constraint is an annual number. There are any number of strategies Amazon could pursue (and I wouldn’t presume to be smarter than they’ll be about choosing the right one), but if they chose to press their opportunity to the max this Christmas, they could cut prices to the bone – way below “cost” — and figure to make up the margin in the 9 months that will remain the first year of the contract.

Whatever they do, the agency publishers will have to respond in their pricing too.

It’s an equally safe prediction that a consequence of that will be that fledgling authors living at the lower price points will lose market share. That will not be obvious and nobody will actually notice.

Of course, B&N and Kobo also have to figure out a pricing strategy and a means to execute it.

Apple has to completely rethink what it will do as a retailer because publisher price-setting has been severely crippled and they never seemed to want to do it themselves.

And I have to think again about whether my conviction that publishers need to sell direct to the end consumer stands up in a world where Amazon is free to turn its pricing guns on any competitor and make them look like extortionists no matter what price they charge consumers for their ebooks.

44 Comments »

Explaining my skepticism about the likelihood of success for a general subscription model for ebooks


In a prior post, I observed that the apparently-successful subscription offerings for books were in niches. And I said I believed that a more general subscription model wouldn’t work for ebooks the way it has seemed to work for music (Spotify), movies and TV shows (Netflix), and audiobooks (Audible).

By that I meant two things. First of all, it will be impossible for any aggregator to secure the rights to anything like enough of the most appealing titles to deliver an offering comparable to what’s succeeded in other media. But even if they did, that kind of offering wouldn’t deliver nearly as much value to the book reader as general subscription offerings do in other media.

The latter point is based on intuitive speculation. The former is based on an informed view of the commercial realities.

Let’s briefly reiterate the case about consumer appeal. The number of songs, movies, and even audiobooks a subscriber might use in a month (the normal billing period for any subscription, so a relevant unit of measurement) dwarfs the number of books most people would read or refer to. And the heaviest readers — people who read several books a month — are often in genres (romance, science fiction) that already have subscription offerings. They don’t need a more general one.

So the price a subscription offering can command for general ebooks is almost certainly lower in relation to an individual book purchase than the price that can be charged in other media in relation to purchase. That was reflected in the thinking of the fledgling company that got me started writing these posts. They wanted to go to market with a subscription price of about $5 a month, which is less than Spotify, Netflix, or Audible!

(I may disagree with them about the overall viability of the subscription idea, but at least they recognize the necessity of a truly bargain price point.)

But it will be very hard for them, or anybody else, to put together a title base sufficiently appealing for that offering to work commercially.

Big books that consumers know about and want drive them to the points of acquisition for the title. When bookstores talk about how sales are going, they almost always cite the particular books that are driving traffic to their stores (or bemoan the fact that there haven’t been enough of them). That’s why booksellers heavily discounted Harry Potter titles the day they came out and why Book-of-the-Month Club and Literary Guild promoted the availability of the biggest bestsellers they had rights for in their advertising.

Everybody in trade publishing understands this effect. Publishers “overpay” for big books because they know the control of them provides critical leverage dealing with bookstores and wholesalers. BOMC and Literary Guild would bid up the prices for rights to predictable bestsellers beyond what the books would “earn” in royalties on book club sales to gain the value those books had bringing members into the Clubs.

When consumers tie themselves into a subscription service, the power equation shifts for those people. Some of the power of the titles that brought in the consumer is transferred to the owner of the subscription service. If there is enough of value to keep the consumer from looking elsewhere for more content, that can provide great leverage.

It creates enough leverage that Audible can flip the 70-30 model and pay publishers 30% of the attributable revenue for digital downloads of their audiobooks. Since they are the content providers for both iTunes (Apple) and Amazon (their parent company), they have an effective monopoly on audiobooks sold that way. Any publisher that doesn’t want to agree to that split for the subscription business, and I know of at least one very big one that doesn’t, effectively has to live without most of the digital download market for their audio titles.

There have been expressions of dissatisfaction with the payment formula by which Spotify compensates the owners of the songs in their service. But how could there not be? With a combination of free and very low-cost offerings, Spotify is delivering music for far less cost to the consumer than purchasing a collection would require. (There is, theoretically, compensation on the back end because the subscription fee has to continue to be paid to maintain access, whereas older consumers — like me — get a lot of “free” listening to the music we purchased years ago.)

But less cost to consumers means less revenue to be divided by creators. And book authors can’t expect to collect on “repeat reads” the way music creators can collect on “repeat plays”.

So, from an author’s perspective, putting content into a general subscription service threatens to build up the leverage for a market channel that will almost certainly find it less necessary in the future to pay high prices for incremental content.

Simon Lipskar at Writers House, which represents a significant number of major bestselling writers, sees subscriptions as an inherently bad deal for successful writers. In our conversation about this, he echoed my thinking by saying, “Subscriptions by definition transfer the brand value of the author to the brand of the subscription service.”

Users of subscription services, he explained, are attracted to the services by the presence of authors they want to read. But once they are members and paying a monthly fee, their dollars are earmarked for the service rather than to the acquisition of individual discrete books by individual authors.

From Lipskar’s perspective, which is the author’s perspective, “these services act as a very expensive distribution model, inserting themselves between the publishers who license books from authors and the readers who read them, often taking a much bigger piece of the pie than traditional retailers.”

(This point by Lipskar makes me recall my Dad’s — Leonard Shatzkin’s — disdain 50 years ago for the “other” methods of selling consumer books — book clubs and direct mail — because they did, indeed, require more of the consumer’s dollar to execute than selling through stores did. Dad liked “efficient” and he’d argue until the cows came home that bookstores, including returns, were a remarkably efficient mechanism for distributing consumer books. This, of course, was long before the Internet. He started saying it before there were bookstore chains or national wholesalers.)

Lipskar can imagine a subscription service more along the lines of the traditional Book-of-the-Month-Club, in which readers are aided in their discovery of titles by a curatorial/editorial process that helps to select quality titles and, even more important from a commercial perspective, in which the reader’s monthly fee just funds a discount on a discrete monthly purchase.

Lipskar says that for a subscription service to be embraced by authors and publishers, the economics would have to favor authors and their publishers to a much greater extent than the models currently on the market. On that note, the one thing he said he simply could not imagine would be good for authors (or publishers) on any level would be the “all you can eat” model like Spotify, which he believes has spawned a broad feeling within the music business to be a very effective means of transferring the financial value of music from the creators to Spotify.

All the big publishers know that continuing to sign up the authors is what provides the oxygen that keeps them alive. The biggest threat from Amazon is not that they’ll extract another point or three of margin — although that is definitely a continuing concern — but that they’ll reach a point where their market share is large enough to enable them to start signing up really desirable authors on a regular basis and pull them from the rest of the distribution ecosystem. (It is worth noting that Barnes & Noble and Kobo and Apple have as much at stake in that regard as the major publishers do.)

Because of that, major publishers will never do anything that would distress the major agents. It doesn’t really matter whether a close reading of a contract would give a publisher the “right” to put an author’s work into a subscription service. If the publisher believes the author’s agent would react adversely to them doing that, they’ll be very disinclined to do it.  And some agents might well react adversely to their doing that for any book, not just one under contract to that agent, because agents for big authors who think the way I’m describing don’t want to see subscription services enabled at all!

So that’s why I believe that fledgling subscription services have practically zero chance to get major publishers to commit major books to their pool of available titles.

Of course, there is one entity that might make subscription for general books work and that’s Amazon. They are actually already trying to pull this off even though their efforts have apparently been unanimously rebuffed by the biggest publishers.

The Kindle Owners Lending Library (KOLL) is offered to “subscribers” to Amazon Prime, the retailer’s overall package of “loyalty” benefits offering that start with free shipping. KOLL allows a loan of an unlimited length, so it is, in effect, a cat’s paw for an ebook subscription program.

Amazon is only now able to offer a robust selection in that program because of a combination of its willingness to spend and the ebook contracts it has with most publishers aside from the Big Six, as well as a very large pool of self-published titles in Kindle Direct Publishing KOLL has not — so far — noticeably damaged the ability of the publishers to sell their “branded author” ebooks successfully. The ebooks from successful authors are still benefiting from a “power law” distribution of sales (things tend to move that way in the Internet world) that favors the biggest SKUs.

Amazon has marketplace clout that dwarfs that of any fledgling with a great idea and they went to great lengths to build up a robust title repository for the KOLL debut. Still, when they launched in November 2011 they only had 5,157 titles which they said included “over 100 current and former New York Times Best Sellers”. It wasn’t an impressive selection.

But the wholesale purchasing terms under which Amazon acquires the ebooks of all publishers except the Big Six apparently enable Amazon to lend any title it wants to, as long as it purchases a copy to lend each time it does so. And it is in the ether that Amazon offered publishers a lot of money to put titles into this program. They have an impressive list of publishers whose work they are offering — including Scholastic, Norton, Bloomsbury, Grove/Atlantic, Workman/Algonquin, F+W Media, Lonely Planet, Rosetta Books as well as their own publishing imprints — but there’s no way to know how many of them went for the deals being offered or which ones are included simply because Amazon is buying a copy of any ebook from them each time a customer wants to borrow one.

And while agency pricing rules are definitely a barrier that makes it more difficult for a Big Six publisher to participate, there seemed to be no burst of creativity on any publisher’s part to figure out a way around it.

So Amazon is, in effect, conducting an experiment testing my theory that a general subscription offering won’t be a powerful magnet. For now, the test is to see how many of the Prime customers find it possible to live largely or entirely within the selection of titles that KOLL offers them, and particularly whether they are weaning those customers away from the higher-profile offerings of the Big Six. Perhaps we’ll see Amazon extend the reach of KOLL sometime by offering a Kindle feature package that is cheaper than what Prime has to be to offer free shipping. I’d sort of expect that. Wouldn’t you?

Will Amazon have an argument to make in a year or two, to publishers or to authors, saying that there is a substantial pool of desirable readers they that they can only reach by participating in KOLL?

They might.

But can anybody else but Amazon put together the combination of the audience and title base they have, piggybacking as they are on Prime and willing as they are to buy an ebook just to lend it once to demonstrate that they can?

I doubt it.

It was been called to my attention by Pam Boiros of Books24x7 that in my prior piece I gave Safari Books Online credit for pioneering the subscription model and the payment by metered usage and that actually credit for both should go to Books24x7. Safari came along a few short years after Books24x7 had started the model which they operate today across a wide range of verticals, serving a mostly institutional customer base. I thank Pam for refreshing my memory, which was the source of the information. Safari is still a great service and the closest thing to a trade subscription model outside the single-publisher efforts, but they followed a path that was originally cut by Books24x7.

4 Comments »

A helpful questionnaire for any publisher to figure out if its permissions policies and practices make sense; many don’t


A year ago last March, the Book Industry Study Group hosted a conversation aimed at uncovering what were the key transitional issues publishers needed to deal with in the current decade. I was not part of that effort, but I chimed in with my two cents in a post in which I said that getting rights databases straight was the most critical concern that, by my observation, was not being adequately addressed by most publishers.

The underlying point of the piece was that publishers will find that revenue opportunities for licensing pieces and fragments are an expanding opportunity while they will see sales of books themselves increasingly challenged.

Over many years, trade publishers have evolved with “permissions” activity, which is where much of this fragment licensing falls, being managed separately from “subsidiary rights” sales. The latter, although declining with the great reduction in book club and paperback licensing revenue over the past three decades, is still seen as a revenue center.

The former is seen as a “cost”. Although it frequently involves granting permission to use a small amount of content for free, it has been a growing revenue opportunity because of digital change. In addition to wholly new uses like for apps and websites, textbook publishers, for example, now often need rights for a “family” of products, mostly electronic, that surround a textbook. But “permissions” in many — probably most — trade publishers is still seen primarily as a cost to be managed, not a revenue opportunity to be seized and nurtured.

This is leading to costly disconnects and increasingly widespread frustration. Our clients at Copyright Clearance Center, who provide tools to automate what has always been an overwhelmingly manual process, see this every day.

They see many publishers whose requirements when they license rights from others are not matched by the offers they’re willing to make when others want to license rights from them.

They see publishers incurring costs handling permissions requests manually that far too often exceed the revenue those permissions can generate, even though there are automated tools that can make those permissions profitable.

They see a growing clerical burden, both in managing an increasing number of permissions to be granted and in securing an increasing number of permissions now required (because trade publishers are needing a variety of digital licenses they didn’t need before either), with no strategic assessment of how that should be addressed.

In response to an increasing awareness at CCC that most publishers don’t have an articulated view of these changes, or any particular idea about how these things are working in their own shops, CCC created a questionnaire that allows any publisher to do a self-assessment of their licensing and permissioning activity. As we were offering some help developing it, I realized that the questions spell out things every publisher ought to be thinking about. So I got CCC’s permission to reproduce it here.

1. Do you know how much it costs you to process a single re-use request with your current procedures?

2. Does your average permission fee, including zero dollar licenses, cover the cost of each transaction?

3. Is your total number of permission requests and corresponding revenues growing year over year?

4. Are you sure that the requests you answer are the most important and lucrative ones and the ones that you don’t respond to are the less important ones?

5. Are the requests that don’t get processed quickly enough for licensees to be able to use your content growing in number?

6. Have you recently reviewed the processes you use when publishers request permissions from you?

7. Is your permissions granting managed entirely by internal staff?

8. Does your organization consider rights and licensing a strategic priority?

9. Do you have a process to summarize and share the information about permissions requested and granted more broadly in your organization (i.e. with sales, marketing, editorial, etc.)?

10. Have you analyzed your permissions and licensing revenue and usage data alongside of your direct sales revenue and usage data?

11. If yes, do you do this routinely?

12. Do you incentivize your rights and permissions managers to meet a revenue goal or efficiency goal?

13. Do you pre-price your permissions and revisit your pricing annually or semi-annually?

14. Do you require prepayment for republication rights?

15. Would a service providing consolidated tracking, reporting and payments for your permissions be worth exploring to reduce your costs and organizational strain?

16. Is there any permissions granting activity within your organization but outside the rights and permissions department (i.e. permissions granted directly by editors or the sales department?)

17. Have you compared your policy and process on granting rights to what you want when requesting rights?

18. If you answered Yes to Question 17, do these policies align?

I urge publishers to think through this list of questions for their own organizations. The entire activity of responding to permissions and secondary licensing requests has gotten far too little thought to date.

One tool offered by CCC is its RightsLink service, by which a click-thru opportunity “at the point of content”  enables automated licensing for many reuse cases. As Alfredo Santana, the Associate Director for Global Rights Operations at John Wiley will explain at our “Book Publishing in the Cloud” conference on July 26, the up-front work of putting in RightsLinks pays for itself very quickly when it is implemented. Are you going to join us at the event?

********

It has nothing to do with the subject of this post, but I wanted to acknowledge with thanks and without delay the letter published yesterday in the Wall Street Journal by Senator Chuck Schumer (D-NY) entitled “Memo to DoJ: Drop the Apple eBook Suit”. It is probably a lot to expect that any of this can reverse the course of the coming Court decision (due in early August) but it is a further sign, as I think the letters from the public will prove also to be when they’re published at the end of the week, that the arguments of the industry against the “price-fixing” hysteria are starting to be heard. I took my own crack at that in a speech last week.

2 Comments »

Subscription models seem to me to be for ebook niches, not a general offer


Another fledgling ebook retailing venture came through our office this month touting a subscription proposition. I told the entrepeneur “I’m skeptical of the subscription model for ebooks,” and he said, “I know”.

We had a great chat, but I’m still skeptical. When I say that, I mean I’m skeptical that a general offering subscription model can work.

There certainly is a logic to subscriptions, particularly for those who think the book business should learn from other content businesses. Cable TV really started with subscription and then only later moved to pay-per-view, which is more like the ebook sales model (but not exactly). We have Netflix for movies and TV, Audible for audiobooks, and a host of services for music, the most successful of which seems to be Spotify.

I have a Spotify subscription, even though I don’t use it much. Perhaps foolishly, I’m comfortable spending $119.88 a year (which is what $9.99 a month comes out to) to have access to just about any song I might ever want to hear instantly when the urge (or suggestion) to hear it arises. (Spotify very seldom disappoints me by not having the song.) And that’s even though most of my listening needs are satisfied with the 6,000 or so songs I have in my iTunes repository of which the best 1,000 are on my phone.

Spotify was cited by the entrepreneur I met as a motivation for him to start his ebook subscription business. As he correctly pointed out, “sharing a playlist” with a fellow Spotify subscriber enables them to immediately — with no additional cost or friction — “consume” that music. Sharing an iTunes playlist with somebody just leads them to having to make purchases which, quite aside from the money, put time and (a considerable) effort between receiving the playlist and enjoying it.

So, it is posited, this logic should apply to books. With a host of very explainable exceptions, I’m not sure it does, at least not anytime soon.

I’m fresh off a speech in Washington about what the DoJ doesn’t understand about publishing. The answer, if boiled down to a single word, would be “granularity”.

According to the MPAA, North American movie releases for 2007, 2008 and 2009, were 609, 633 and 558 respectively. There are foreign films and perhaps some below-the-radar indie films that must be added to that number to reckon what’s being made available, but it gives you an order of magnitude.

The Big Six publishers average more than 3,500 titles a year each. And there is far more production of titles beyond the Big Six in publishing than there is production of movies beyond the Hollywood studios. It would be very conservative to estimate that there are 100,000 new professionally-produced book titles a year intended for consumers. (Many more are published for professionals or as school or college texts and were you to add in self-published ebooks, which sometimes reach big audiences, they would multiply that number.)

Commercial releases of music would fall in between movies and books in number, but much closer to movies.

That’s the short answer as to why most people share music and movie experiences with far more friends and acquaintances than book experiences. It is also the short answer to why people outside the book business just can’t grasp it; each one of those books is a separate creative and commercial endeavor, down to having its own contract, its own development path and schedule, and its own marketing requirements.

(It also helps explain why many people who use libraries for some of their reading don’t use it for all. No library will have all the books a voracious patron would want to read.)

In the days before Amazon.com and digital books, there were two kinds of subscription services that worked for consumer books.

Book clubs offered price deals and curation (help with selection) but it was the price deals that really attracted members. Before ubiquitous bookstores (which arrived in the 1980s), Book-of-the-Month Club and The Literary Guild got the highest-profile books distributed to consumers who would have had a hard time getting to them (as well as those near bookstores who just wanted the convenience of mail delivery.) As bookstores spread, the Clubs found that “niche clubs” (around mysteries, science fiction, or subjects like gardening) were apparently more profitable than the big general interest clubs. (“Apparently” is a highly operative word, but the explanation of that will wait for another day.)

The other subscription concept that worked was the “continuity series”. The market leader there was Time-Life Books. These books were about a particular subject (World War II, say) and they were “packaged” specifically for the series and not available in stores. Continuity relied on the combination of intense subject interest and the “collection” mentality: somebody who started collecting the series didn’t want to have holes in their collection.

Both models were pretty much blown out of the water by online book purchasing which suddenly made every book available for home delivery to everybody everywhere.

In specific niches, subscription models can work very well. The granddaddy of them on the digital side is Safari Books Online, originally conceived and built by O’Reilly in partnership with Pearson. Safari serves a community of programmers and has a huge collection of instructional and reference books which they can use on the job. Most users of these books dip in and out of them, rather than reading them straight through. And they frequently like the idea of checking out what several books might say about a problem they’re tackling.

Safari pioneered the model of dividing the publishers’ share of the subscription fees by metering usage. The more your book is viewed, the more money you get from the pot. And since users of Safari will almost always find the answers they need within the service, leaving your book out means it won’t be found and used. Since at least some of the time Safari usage could lead to a sale of the book itself (even if not very often for most books), that discovery element is lost along with any Safari-generated revenue if the book isn’t included in the database. A publisher should feel pretty confident that they aren’t losing many sales being inside Safari.

(The model that looks like “all you want for a price” to the purchaser and like “pay per use” to the content owner in even purer form than Safari does it is the deal offered by Recorded Books for its digital downloading service for audiobooks to libraries. There are other subscription models in the library space; it is a distraction to the point of this post to get into them which is why they’re not covered here.)

O’Reilly saw at the beginning that their books alone wouldn’t be the strongest subscription offer so they were open to participation by others from the very beginning. Safari is exceptional in at least three ways: they are bigger than one publisher; they are built on a professional user base; and they deliver value primarily through chunks, not end-to-end reads.

But if a publisher is strong in a niche, a subscription service can work for them too: Baen Books (science fiction) and Harlequin (romance) are two niche publishers who have sold subscriptions successfully. (In fact, Harlequin recognizes sub-niches, further segmenting their audience for better subscription targeting.) The Osprey-owned sci-fi house, Angry Robot, offers subscriptions. eBooks by subscription are also part of the model for Dzanc, which does more literary books (fiction and non-fiction; they’re really less niche-y, except for “quality”) and it will be interesting if they can make the “quality” paradigm work the way “romance” and “science fiction” do.

Sourcebooks is a general trade publisher, but they have a robust romance list. They’re trying to establish a club and community called “Discover a New Love” which operates more like the old BOMC: subscribers can choose one of four featured titles each month in addition to getting other benefits from discounts on other books to early looks at some titles.

Subscriptions are offered in the children’s ebook area as well. Disney Digital Books has a monthly subscription service, as does Sesame Street eBooks. In both cases, the model is browser-based delivery rather than downloads.

F+W Media is a publisher that works across many verticals (niches). They had two big head starts. One is simply being vertical. They have audiences that are defined by their interest, which has been the key to making a subscription offer work in the book business. The other is that they were once publishers of magazines and operators of book clubs, so they have experience with direct customer contact and managing those relationships. They also had a lot of names. And F+W is managing subscription offerings for many things other than ebooks.

Most of F+W’s communities have been non-fiction (subject-specific) and they offer subscriptions for content in art, writing, and design. But they are also venturing into the romance market now and their Crimson Romance offer is an “all you can read” model. Baen introduces the wrinkle of releasing a novel in stages to subscribers, like a serial.

And we note in the recent reminder that the TED conferences started doing ebooks (sort of: only within an iOS app) that a subscription model is part of their thinking too. Once again: in a niche. The app that enables them to manage subscriptions is powered by The Atavist, which is another attempt to build a following for a publisher distinguishing itself by its content choices, like TED or Dzanc, rather than around already-established consumer clustering (romance, sci-fi, or a topic like writing or design.)

It is worth noting that there are “all you can eat” subscription offers and ones that are limited but which offer discounts on further purchases. That variation exists in other media too. Spotify is one price for everything; Audible and Netflix meter your use and you can pay more if you consume more.

There’s a pretty strong pattern here to the subscription offers we see.

They’re usually done by publishers. (Safari isn’t a publisher anymore, but it was started by publishers.) That means they’re working with the publishers’ margins (bigger than an aggregator’s margins). Controlling the product flow means they can make good use of intereaction with their audience, learning through data and conversation what they should be doing next. And, most important of all: from a product offer point-of-view, they’re focused.

They’re precisely the opposite of Spotify or Netflix or Audible who all want every single song, movie or TV show, or audiobook they can lay their hands on.

So, what about a more general model for ebooks?

It hasn’t happened yet and I don’t think it will anytime soon, despite the ambitions of my recent visitor. The challenges of putting together the title base for one are daunting and, as I hope this post makes clear, so is providing and demonstrating persuasive value.

I can see only one player that might be able to pull off a more general subscription offering in the near term. (You can guess who that is.) The “whys” of that will be the topic of a future post.

One thing that is pretty certain is that when there are many publishers offering subscriptions in their niches (and someday there will be), they’ll each be powered by a Cloud-based service of one kind or another. None will be asking the IT department to create the software to handle it.

I will admit that I haven’t programmed anything specific about “subscriptions” into the “Book Publishing in the Cloud” program we’re running on July 26, but if that’s what any attendee wants to find out, they’ll have a great opportunity at our “Conversations with an Expert” session to get the answers. Almost all of the speakers will be available during structured chat time, as well as representatives from the great companies that are sponsoring the event. 

32 Comments »

Royalty Share CEO Bob Kohn alleges DoJ violates the Tunney Act


According to Bob Kohn, an attorney and the CEO of Royalty Share, the Tunney Act very clearly requires that the Justice Department publish (and it was thought originally that this meant “print”) all the public comment they got within the alloted comment period. Kohn says that’s what the law states clearly, as upheld in a prior Court decision.

That period ended on June 25, a deadline which the government missed. Kohn wrote a letter to the court on Monday to keep the DoJ accountable to the public. It looks like the DoJ backed down yesterday, asking the Court to give them until July 20 to publish comments, at least two weeks before the government files a motion with the judge on August 3. This was acceptable to Kohn, as it was consistent with what he asked for. But he still maintains that the DoJ has been in violation of the law since June 25.

To DoJ’s response that what is asked is too demanding — that they need time to review the responses and prepare them for publication – Kohn says “the DoJ can’t have their cake and eat it, too.” He points out that the law allows an extension for DoJ to publish the responses, but only by asking for and receiving an extension in the public’s time to submit responses. If the DoJ didn’t like the law as drafted, Kohn says, they have had 30 years to ask for changes in the law and they never have.

Since it appears that the vast majority of the 800 letters received came near the end of the public comment period, it would seem that an extension might have served the public interest.

But it wouldn’t have served the DoJ’s interests. And it wouldn’t have served the interests of those who want to use what looks to me like a trumped-up allegation of collusion to ratify the settlement agreed to by three companies (two of which have parent companies that own TV stations and have very good reasons to avoid picking fights with the government that licenses them).

(At the time of a publishing industry fundraiser for Obama on June 18, it had been reported that there were 150 responses. Reasonable people at the event disagreed about whether that number was impressively large or not. That apparently four times that many came in during the last week should grab anybody’s attention.)

I said a “trumped-up allegation” of collusion. Two points stand out to me in making that characterization.

One is the inclusion — nay, the trumpeting — of the Picholine dinner in September 2008 as evidence of the conspiracy to implement agency pricing. The evidence in favor of DoJ’s contention is that all six big publishers were in the same room. But the evidence against it is that, at that time, nobody except perhaps a small number of people at Apple knew there would be an iPad, an iBookstore, and an agency model implemented 18 months later. In a word: this “evidence” is ridiculous.

The second is the juxtaposition of the fact that Apple told the publishers “unless there are four, there will be no store” (my attempt at memorable phrasing) with the “allegation” that publishers were asking (and telling) each other whether they were in or not. If Apple told them that — which I contend was only revealing to trading partners a pretty obvious and sensible business decision — then the publishers had no need to confer with each other. So suggesting these reports of what one publisher might have said to another proves “collusion” is only slightly less ridiculous than the Picholine “evidence”.

Since these two elements comprise the most frequently-reported and -cited elements of the collusion case, I think the characterization of the collusion case as “trumped-up” is a reasonable one

Perhaps it is because I’m a Democrat, but I don’t see “collusion” between DoJ and Amazon as the most likely explanation for the suit and the disaster the settlement could engender. What I see is a failure of understanding of what the publishing business is and does, the role publishers and retailers play in it, the impact the Internet is having on it, and what the inevitable impact of forbidding publisher-set pricing will be.

I tried to lay that out clearly in a talk I gave last Monday at George Washington University’s fifth annual Conference on Ethics and Publishing. I think the slides are pretty self-explanatory. I hope you’ll give them a look.

I want to repeat only one point from that speech here. Amazon’s behavior is self-serving, but it is not evil! It is both futile and wrong to blame something in Amazon’s character for the industry’s troubles. Amazon’s shareholders are not primarily interested in the health and well-being of the book publishing ecosystem; they are primarily interested in the growth of Amazon’s value. It is the job of everybody working there to do what they can to enhance it, within the limits of the law and their interaction with their trading partners.

But it is our job as a society, and the DoJ’s job, to think about what the rules of the road should be to deliver what is best for all of us. I have no doubt that if the rules, for example, required retailers to respect all publishers if they wanted to sell on the Agency model and not pick and choose which ones can, Amazon would still do fine.

If this settlement is accepted, I’m pretty sure very few of their trading partners or competitors will.

There’s a lot at stake. It is bad enough that DoJ has pushed the industry in a direction that strengthens the strongest player. It is worse that they’re doing it in a way that is tending to stifle and reduce the impact of public comment. And if, as Kohn alleges, they are doing it in a manner that clearly violates the letter of the law, that would be adding considerable insult to devastating injury.

We had our first free Publishers Launch Conferences webinar yesterday previewing our Publishing in the Cloud conference that will take place on July 26. What was really cool was that a huge percentage of our audience stayed through the entire hour. That tells us that the subject of cutting costs and extending capabilities through Cloud service offerings is one that many in publishing need to know more about.

We’re still offering a deep discount ($150 off the $495 full price) through the end of the day on Friday. An impressive roster of speakers and sponsors, most of whom will be available for the “Conversations with the Experts” session, means that all our attendees will be able to get personalized answers about whatever is their concern.

8 Comments »

Publishing in the Cloud is the next big important subject


Much of the change we are living through in publishing is plain as day to see. The shift from print to digital, like the shift from stores to online purchasing, is evident to all of us, inside the industry and out.

But there’s another aspect of the change that is not nearly as visible and that’s around systems and workflows. Publishing, even in the pre-digital age, was a systems-driven business. The big companies are producing 3,000 to 5,000 titles a year: each one with its own unique contract, metadata, editing requirements, and (in most cases) market. I like to observe that “each book published presents the opportunity to make an unlimited number of decisions, which must be resisted.” Most of the time the systems don’t help so much in making the decisions, but it takes a lot of support just to keep track of them all and report them to each person who needs to know!

Over the years, the companies with stronger systems have tended to acquire the companies with weaker ones. It doesn’t always work out that way, but it has most of the time. And over the years there have been stories about when publishers almost lost their business because systems broke down. The original Macmillan (now a division of Simon & Schuster) almost died in the 1960s when they fell so far behind on returns processing that they couldn’t properly dun bookstores to pay their bills. In the late 1980s or early 90s, Penguin had a warehouse crisis that was a similar existential threat. A friend of mine with a process-oriented consulting practice really made his year working on that problem.

In the digital age, systems are once again front and center. Every publisher is facing new requirements and seeing the parameters change for the old ones. Most of a trade publisher’s revenue, for at least a while longer, comes from print but the digital side is where the growth is. Systems have to support both.

Until recently, publishers ran on systems that were, primarily, housed on their own computers, either created or heavily customized by their own IT departments, and the operators in the publishing house (editors, production people, marketers, salespeople) were at the mercy of their IT department queues. If they wanted something done, they had to get on line for tech support.

And smaller publishers doing 50 titles or 100 titles or 200 titles a year had to make do with less robust, less customized, and often less capable systems even though their outputs also required thousands of decisions to be tracked and they are no less affected by the shift from print to digital.

But this is changing. Or maybe we should say it has changed. The new systems in publishing are Cloud-based. They are frequently referred to as SaaS: software as a service. They don’t live on a company’s own computers but are hosted by the service provider. They often don’t require an IT department to customize them and they certainly don’t require an IT department to keep them up to date. And the best news of all is that they are cheaper to acquire and faster to install in a company’s workflow than the systems of the past.

Within this change, there is enormous opportunity. Big publishers can sidestep the tricky question of scaling down their print-based systems and scaling up their digital ones. Small publishers can now use systems and workflows that give them capabilities equivalent to their much larger competitors.

But nothing comes pain- or hassle-free and neither do Cloud systems. Executives in big companies find their IT-led systems configuration challenged. When an operator in the production department decides they need a Cloud service like Dropbox to move files around, they don’t need to get IT support to put it in. But IT departments are still responsible for providing support and integrating all of a house’s technology. So “unsanctioned technology” starts to abound and IT departments don’t like that.

They might also not like the fact that Cloud systems could result in cuts to their budget and headcount. Can non-technical executives feel comfortable that their IT departments will look at cost-reducing Cloud systems the same way the CEO or CFO would?

In smaller companies, Cloud systems are a much less ambiguous benefit providing, as they often do, capabilities a smaller house would never be able to afford as a stand-alone system. But without an IT department, how do you know which Cloud offering is best? And how does a company without much in the way of inside tech knowledge and almost no surplus labor cope with implementation?

It was these questions that moved us to stage our first technology-centric Publishers Launch Conference. It is called “Publishing in the Cloud” and it will take place at Baruch College on 25th Street and Lexington Avenue on July 26.

Our conference really has three groups of resources for attendees: big publishers, smaller publishers, and suppliers of Cloud services. For the most part, the publishers will speak from the stage and the suppliers will be available at breaks and during a 2-hour “conversations with the experts” session when both the suppliers and the speakers will be available to talk in small enough groups so that all the conference attendees can get their own specific questions answered.

Some context and stage-setting will come from my Publishers Launch Conferences partner Michael Cader, whose Publishers Lunch and Publishers Marketplace enterprise has been a heavy user of Cloud services, which he will explain. Ted Hill of THA Consulting, who was the one who first clued me to this topic, will sketch out the landscape, segmenting the service offerings, spelling out the suppliers in the various niches, and providing a “checklist” for publishers looking into these services. And our Platinum sponsor TCS, Tata Consulting Services, did a survey of hundreds of companies using Cloud services from which they will deliver useful insights.

Looking at this from the perspective of big publishers, we have Ken Michaels of Hachette and Yuvi Kochar of The Washington Post. Michaels will kick off the day with his take on why Cloud services are critical to publishers at this time. Michaels is the Chair of Book Industry Study Group, so he speaks from an industry-wide perspective. In fact, he was instrumental in persuading us that the overall topic of Cloud services for publishing was worthy of an all-day conference, which it never had before.

Michaels will also talk about tools that Hachette developed because they needed them and they didn’t exist which they are now able to offer to other publishers on a Cloud model.

Kochar is the CTO of The Washington Post companies. He uses a Cloud model to distribute both internally-developed and outside services to his constituent companies, which include the newspaper and Kaplan Publishing. Kochar will talk about his company’s service model and the organizational structure it takes to make sure things will all work a level removed from the solution provider.

Another presentation from a large company discussing an implementation will be from Alfredo Santana of John Wiley. They have just put in the RightsLink capability offered by our global sponsor, Copyright Clearance Center, to automate the licensing of permission requests directly from the publisher’s website. RightsLink, which is used by many top publishers, can be a big labor-saver and revenue-producer, but it takes planning and work to do a proper implementation, particularly at a company like Wiley that has such a range of markets to serve.

And we’ll have a panel of big publishers, including Ralph Munsen of Hachette, Rick Schwartz of HarperCollins, Bruce Marcus of McGraw-Hill, and Chris Hart of Random House discussing “The Changing Role of the IT Department”, addressing the many issues I referred to earlier in this piece.

We have two speakers who have a broad view of the challenges smaller publishers face. Rick Joyce of our global sponsor Constellation serves the needs of more than 300 publishers who use their services and, among other things, rely on them to vet Cloud offerings for them.

Michael Covington will call on his previous role with the Evangelical Christian Publishers Association where he was responsible for vetting and inking partnerships with various cloud-based service companies such as Firebrand Technologies, Metacomet, and Bowker.  Now serving as the Director of Digital Content for David C Cook, an international non-profit which publishes trade books, music and curriculum for the Christian church worldwide, Covington will also discuss the opportunities and challenges publishers face in moving from legacy systems and “tribal knowledge” to a “Service Oriented Architecture”.

Andrea Fleck-Nesbit of Workman has an interesting case history to talk about. Workman is taking the Title Management capabilities developed as an in-house system by its Canadian distributor and helping turn it into a hosted offering so they can use it too.

Covington and Fleck-Nesbit will be joined by Patricia Gallagher of Liberty Fund and Bonnie Russell of Wayne State University Press, both of which have just completed their own switchover to a Cloud service for core functions. As a panel they will extend the discussion about smaller publishers finding and implementing Cloud services.

For two hours in the afternoon, our attendees will be able to meet with our expert speakers and our sponsors in small groups to facilitate more focused discussions, In addition to CCC, Constellation, and TCS, event sponsors for “Publishing in the Cloud” include Firebrand Technologies, IBM, Klopotek, and Virtusales.

Cloud computing for publishing is a big subject and an important one that has gotten no focused attention before now. We think our conference will give our attendees, and the industry, a quick start getting a handle on the opportunities and how to take advantage of them.

On this coming Wednesday, July 11, we will have a FREE 1-hour webinar on this subject. Michael Cader and I will be joined by conference speakers Ken Michaels of Hachette, Rick Joyce of Perseus, and Ted Hill of THA Consulting as well as by John Wicker of TCS. The webinar will touch the high spots of this very important topic. And, as I said, the webinar is free!

7 Comments »

What retailers know that publishers need to know


The Wall Street Journal ran a piece last week about what the ebook retailers know about how we are all reading. In fact, all the ebook retailers who manage ecosystems that include apps for using their platform on multi-function devices can see every move their consumers make. We all have the sense that they know something on a per-customer basis because they recommend what we should read next when we visit or through emails they send (and even that gives some consumers the heebie-jeebies). The piece focused on the analysis of aggregated data way beyond just purchases to understand the interaction between many readers and books.

Much of what was cited in the article would be intuitively assumed. Readers of fiction tend to finish the books more often than readers of non-fiction and to read them more continuously. Readers of genre fiction tend to read the books faster. Readers of literary fiction tend to have more than one book going at a time.

This kind of stuff, in my opinion, actually doesn’t help a publisher or a retailer much more than sales data at the ISBN level already can. Barnes & Noble reports launching Nook Snaps (shorter books) for non-fiction, it is implied in the piece, because they observed that readers often quit non-fiction books before they’ve completed them. But there’s already plenty of data in all retailers’ databases about the performance of shorter works. Kobo started as “Shortcovers”, thinking they’d be the pioneers of shorter stuff. There are independent efforts to publish shorter books like Byliner and The Atavist.

And, of course, there are Amazon Singles. Research by Laura Owen at paidContent points to some robust successes there, with over 2 million Singles sold in a year and at least a handful of authors making some pretty decent money from them. In other words, anybody monitoring the sales of shorter works or cheaper works can draw their own conclusions about how they sell without regard to data about the consumption patterns for longer books.

But the Journal piece did suggest one kind of data that is extremely worth noting: when consumers show heightened interest in a particular author (by reading that author’s book faster and with fewer interruptions than others) or declining interest (by reading more slowly or abandonment before completion) in one that has had prior success.

It isn’t actually the retailer that is most in need of that data; it is the publishers who will bid on the next book by the author who most need to know that.

And that brings us to the crux of the matter which is mentioned, but only lightly touched upon, in the story: only Amazon (so far) is really both a retailer and a publisher.

This has been on my radar screen for a long time. It was several conferences ago — well over a year — that I asked Michael Tamblyn of Kobo to talk about “what retailers know that publishers would want to know” about ebook consumption. Kobo, which works hard to promote its publisher-friendliness and willingness to share data, readily took up that challenge.

Then last Fall I was counseling a purveyor of ebook sales data about how a service that I thought would be of value to publishers. “Aggregate the usage stats from the ebook retailers.”

“Why would they give them to me?” he asked.

“Because, if they’re smart,” I said, “they won’t want Amazon to be the only publisher who knows what retailers know. Books Amazon signs up might well be lost to them for sale; they want publishers to keep signing up all the important books. To the extent that this data can only be used by a publisher and they aren’t using it, they’re well served if the data is used well by publishers who look to them for distribution.:”

Then, as the Journal story reported, Jim Hilt of Barnes & Noble excited our audience at Digital Book World last January by promising that B&N would share data with publishers going forward. I took that as confirmation of my judgment about smart retailers. There have been false starts on that promise since then, but the Journal article says that B&N is now sharing analytics data with publishers.

Hilt cites the case of a series where interest from the readers seems to be flagging and suggests it might be a hint that publishers should juice it up, perhaps by adding a video. Of course, he has the analytics data and I don’t, but I wonder if that’s the right reaction. Do videos get clicked on and viewed? Would they add interest or create a distraction?

I’d suggest there are three responses more likely to be valuable. The pretty obvious one is to lower the price of the ebooks. (Surely the retailers’ analytical capabilities would show the efficacy of that pretty clearly.) I suspect one thing retailers see more clearly than publishers is the price-banding of their customer base. To the extent that’s true, you can revive a tired backlist title by introducing it to a “new audience”, those who buy in a price-band and don’t consider books above it.

Another would be to change the configuration of the offer, such as putting three (or more) books together for a special bundled price. That would gain some attention for the “event” value of a new edition, as well as presenting a price-offer.

And the last, totally in the hands of the publisher, would be to offer the author advances based on a lower sales forecast going forward or to stop publishing him or her at all.

What would be of even more interest to a publisher, and almost certainly something that Amazon has set to be flagged for their publishing arm, is when a less-known author or book is being read very avidly. That would signal an opportunity for a publisher — one the author herself wouldn’t know about, even if she checks her sales figures and ranks regularly.

One conjecture that would seem to be worth confirming is that ebooks make continuous series, or multiple ISBNs that form a reasonably seamless and continuous story, more commercially attractive than in the days of print. The Journal story opens with B&N’s observation that the first thing most readers of the first book in The Hunger Games series do when they finish it is to order the next one. And, of course, they can start reading it right away.

We already know that ebooks are lifting genre fiction over literary fiction and all fiction over non-fiction in relation to print. If the series is lifted by comparison to the print-in-store past, it would suggest some changes in the creative output (novels that leave plenty of hooks for successor books rather than ones that neatly resolve all the loose ends) and dealmaking (publishers wanting stronger option clauses and, perhaps, more multi-book deals even for first-time authors.)

Successes like the self-published “Wool” by Hugh Howey might be instructive. We spent some time learning about it last week in conversation with Howey’s agent, Kristin Nelson, as background for our Publishers Launch Hollywood conference on October 22 (at which we’re hoping that Howey will appear). “Wool” is a novel compiled from five novellas. Howey and Nelson have publisher deals in place in 10 markets including the UK and Brazil (with sales in Germany and Russia imminent) and the movie rights have been sold to 20th Century Fox. But Howey is doing so well with his self-publishing ebook sales (and a handful of print sales through Amazon’s CreateSpace) that he has so far turned down six-figure offers from US publishing houses.

Howey introduced what is now his phenomenon as a single novella on Amazon without particularly high expectations. A combination of reader reaction and Amazon’s response to it, promoting him in various ways, led to Howey writing further installments as novellas. Eventually, five of them were collected into an “omnibus”, which is the novel “Wool”.

I suspect that some good analytics at Amazon led to the promotion which contributed to Howey’s success, which he has extended to other ebook platforms. I also suspect that at some future time Amazon will adjust their tactics so they give their publishing arm a crack at an author like Howey before they promote him into stardom.

It is worth noting that during the time that Howey’s writing, his readers, and Amazon’s marketers were combining to create what might be a new commercially giant mega-saga, he wasn’t publishing on the Nook or Apple or Kobo platforms. Only after he proved that “Wool” was actually a sensation, did he even bother to make his work available through the other retailers.

I think I might find a lesson or two in that if I worked for any of Kindle’s competitors.

Now Howey is working on his next two novels, which will also be issued as a series of novellas before they are collected. He’s no secret to anybody anymore.

I’m involved in two events this month about very different topics that will both profoundly change publishing.

I’m speaking at George Washington University at their 5th Annual Conference on Ethics and Publishing on July 9 about the danger to the publishing industry posed by the DOJ’s suit and the settlement agreement apparently about to be ratified by the Court. 

And on July 26, we’ll hold our “Publishing in the Cloud” conference at Baruch in Manhattan. We see “hosted software” as a key tool for publishers to cut their overheads and pre-production costs (as they will have to) by almost unimaginable percentages in the next few years. Our conference is the first dedicated to this topic for publishing and we’ll be hearing from publishers large (Hachette, HarperCollins, Perseus, Random House, Washington Post, Wiley) and not-nearly-so-large (David C. Cook, Liberty Fund, Wayne State University Press, Workman) about how they’re employing these new capabilities. A great roster of sponsors will not present from the stage, but our  “speed-dating” and “expert session” format will enable all attendees to get their very specific questions answered both by the people they’ll hear present and from many of the suppliers who provided them the capabilities they will have talked about.

 

9 Comments »