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This is the 2nd of a 4-part post spelling out what I would have said if I had appeared at the Annual General Meeting of the UK Publishers Association on Wednesday, April 28, and not been cancelled by a volcano. Part 1 set the stage, spelling out how much change can take place in 20 years. This post offers a vision of the world of information and entertainment (or what we today think of as the world of “content”) 20 years from now. Part 3 will suggest what a publisher’s role can be in the new paradigm and Part 4 will take a shorter view, looking at the change we should expect in the next 2 or 3 years.

If we accept that 20 years is time for things to change a lot and with the belief that the pace of change in the world of information and entertainment is accelerating because of digital technology, here’s a view of what happens to content, audiences, and what will pass for “publishing” 20 years from now.

I’d expect that 20 years from now, the “local” hard drive will be relatively unimportant: a relatively short-term “emergency” cache for the rare moments when you aren’t easily connected to the network (the internet.) Data — all data, including everything you think you “own” — will live in “the cloud.” Kids in 2030 will find it as quaint to think of not being able to get at your files except by getting to your own computer as kids today would think it was to not be able to call somebody unless you could find a phone booth and they were at home (which was the situation 20 years ago.) Local storage may be seen by some as a virtue, but it is a virtue manufactured of necessity. It’s actually a hindrance. We will very shortly expect to get at all our files at any time based on a password or an iris scan or a fingerprint or some combination thereof (depending on our need for security.)

And we’ll access those files through a multiplicity of devices, which by then will really just be screens of varying descriptions with online access. There will be big ones that hang on our walls for us to watch movies on and to put a Picasso in when we’re not watching a movie. There will be small ones, foldable ones, and ones that come in rolls where you can use whatever roll width suits your immediate purpose. With your password, you’ll be able to use my screen for your data, just as you can use my computer to get at your gmail account today. There will be screens you can write and underline on which will store your markings (to share or not, as you choose.)

(I don’t want to get into the fact that we’re working toward converting a phone conversation into having the hologram of the person on the other end in the room for your chat, and I don’t know enough to know the timetable for that, but maybe we’ll get there in 20 years too!)

When screen technology progresses sufficiently, the idea of using paper will become a total anachronism. Paper won’t record and store your notes or annotations; screens will. For any volume of content, paper gets heavy. Screens don’t. If you could call anything up on a screen in your pocket that you could get today on paper, why would you want the paper? Nobody will, except for the artistic value that is associated with antiques. Paper won’t even be as good as a screen for your grocery shopping list. (I am imagining that my wife would be able to add an item or two to the screen list I have folded in my back pocket while I’m walking to the store.)

Even illustrated and coffee table books will be just about defunct, except as pure works of art. Screens will be able to deliver better image quality with more flexibility: to blow up the image, or rotate it (which you can see in the “Elements” ebook on the iPad today.) Screens can deliver you the accompanying text on top of the image for you to read it and then “take it away” for you to see the image alone. Books can’t do that.

Now, if this becomes true, it obviously changes the face of publishing. If distribution of all content is digital, and it is hard to see why it would not be, then the list of businesses that exist today that won’t exist in 20 years is a long one. Bookstores will exist, but they’ll be curiosity shops carrying used books and perhaps a handful of printed-on-demand newer items for the few print-pervy holdouts that remain (and 20 years from now, there will still be some.) It is hard to see survival for newsstands. Printing may still exist for packaging, but it won’t for newpapers, magazines, or books (except for the handful printed-on-demand.)

The change for publishers, though, is far more profound than a simple change in delivery mechanism would suggest. Publishers, indeed all commercial media in our lifetime, have been defined primarily by format. Some do books; some do magazines; some do newspapers. Others called producers do movies or television or radio. The capital and skill set requirements for a format effectively channeled the media company. For the most part, big media was not topic- or subject-specific; it was format-specific.

But when the exchange between publisher and content consumer becomes a file, rather than a book or magazine or movie or TV show, then format becomes irrelevant. A file can hold any of the formats we have historically thought of: text, photographs, diagrams, maps, video, audio. A file can also hold games and productivity software. So the publisher that is limited by the formats of the 20th century will not be competitive in the cloud-and-screen based media exchange of the future.

Wrapping our heads around the transition from physical media to digital gives some clues to how publishing and publishers will have to change to survive, but there’s another aspect of the web development we can expect over the next 20 years that is just as important. We call that the shift from “horizontal media” to “vertical.”

We’ve seen that media have been defined by format. The companion thought is that media have rarely been defined by topic or subject. Whether you’re talking about CBS or the BBC, The New York Times or the Times of London, or Random House in either country, the subject of the content is not limited. These companies will cover news, sports, public affairs, science, every academic discipline at some level, and pure entertainment. Except in the spheres where publishing exists in service to or as an extension of another establishment (educational, academic, professional), the primary identify of most publishers of scale is by their format, not their audience.

But we already see that the Web has changed that. Even superficially-”horizontal” brands on the web — Huffington Post and Gawker being two examples that are popular in the US — serve pretty specific interests (politics and celebrity, respectively, in these two cases.) And there are far more examples of new successful web brands which are subject specific: on sports, politics, women’s interest, health, crafts, cars. These businesses are built, first of all, on repeat visitors to a particular web site. But when they’re smart, they add user-generated content which turns into databases. They have lengthy comment strings to their blogposts which attract an audience of their own.

And they are building the publishing brands of 2030.

When we lived in a world of physically-produced and hand-delivered content, barriers of cost and scale effectively kept content scarce. It is no longer. Anybody who creates any content today can make it available to the world for no incremental cost if they have a web connection. Lots of professional content creators — individual and institutional — feel it is in their best interest to make content available without charge on the Web (sometimes with advertising support; sometimes not.)  A consumer 20 years ago couldn’t read good writing and watch videos all day about whatever is their favorite subject for free unless they went to a library, where access would be bureacratic and cumbersome. A consumer with a web connection today surely can. All of this inevitably reduces the price anybody can charge for a competing piece of content in any form.

Here’s the important point for publishers to take on board. Content is being devalued by technology. This is inexorable. It is not anybody’s fault. It is not in anybody’s power to change it. The price consumers will be willing to pay for content is going to go down because of the laws of supply and demand. It is true that professional content creators can benefit from efficiencies and cost savings offered by the same technologies, so the loss of revenue doesn’t necessarily translate into an equivalent loss of income or profit. But the general direction is one way: down. Businesses that depend on monetizing the content they create will continue to be increasingly challenged over the next 20 years as they have been over the last 10. This won’t end well for the formula of creating content and selling it.

But if the price of content must inexorably go down because of the laws of supply and demand, publishers should look at what might go up for the same reason. And what will become more valuable over time is the audience looking at the content. Content won’t be scarce and command revenue, but human attention will. As the world verticalizes, the owner or controller of the web community that has (for example) the gardeners will be the one to decide what new gardening content is needed. However it is montetized — by standalone sale, or as part of a subscription, or supported by advertising, or underwritten by a sponsor — the control will belong to the entity that commands the eyeballs.

What all of this means, taken together, is that the successful publisher of the year 2030 will own a web community which is both a principal source of content and provides the audience for it. The community will not be content-centric alone; but we aren’t getting into that in more detail right now because sketching out the whole concept for “vortals” is “out of scope” for this exercise.

The publisher who owns “knitting”, or perhaps “knitting sweaters”, will develop and curate the content and control access to the audience just as surely as a major publisher has controlled access to bookstores shelves or a newspaper publisher to newsstand sales in our lifetimes.

Without bookstores and without any general marketplace dedicated to the sale of “books” as a format, the idea of a General Trade Publisher will have no meaning.

That’s 20 years away so publishers have some time to get from “here” to “there”. But they won’t get “there” by staying “here.”

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The shift from horizontal paths to audiences to vertical ones is a hard concept for people who have grown up in book publishing to accept. Most resistant, judging from the questions I get when I talk to book publishing audiences, are those who see book publishing as being about “writerly” books: “non-genre” fiction, belles lettres, memoirs that don’t have a particular historical or current affairs hook.

When I tell publishers “you must focus, you must specialize in niches so that you own vertical audiences”, the inevitable question is: “what about fiction?”

Two articles picked up by today’s publishing news aggregators, each in its own way, refer back to that question, although one of the articles is not about a book of fiction.

Boyd Tonkin, a UK columnist who comments on the book scene for The Independent, observes that “the collapse in advances paid to and earnings expected from serious authors has made many far-from-obscure names feel the chill of full-time writing in a sharp cyclical slump.” Tonkin notes that it has been this way before: Proust and Henry James relied on unearned income; Joyce and D.H. Lawrence had to get help from patrons; Kafka had to work a day job.

But the message is clear and sobering. Many writers who have made a decent living, or even a lot of money, from book advances and royalties will start having to do without, or do with less.

The same chill that has frozen publishers’ spending on established authors is affecting their willingness to take chances on something new as well. That’s the story author-producer Tom Matlack wants to tell. He and his partner came up with a pretty nifty idea: assembling a collection of first person stories by men about manhood. Their proposal, shopped by “the best agent in the business” (whoever that is, and by whoever’s definition of “best”) was rejected by 50 houses. So they’ve built their own web platform, produced a companion documentary film, and are publishing the book themselves this Fall.

The piece describing this endeavor for the Huffington Post is a bit self-centered (this experience convinces Matlack that book publishing is in worse shape than any other media, because they were so dumb as to turn down his book!) And it is a bit naive: he says publishers take “85% of the royalties”, which, one presumes, he calculated because the author’s share normally tops out at 15% of the retail price (out of which also must come the 50% or more for the distribution channel and manufacturing costs, as well as book development and publisher overheads.) For some reason, he and his partner have chosen a distribution route that seems to ignore both Barnes & Noble and Amazon as well. (He’s explicit about excluding B&N; doesn’t mention Amazon.)

Aside from the fact that one might expect the 50 publishers to have reacted differently if the web activity Matlack created and the documentary film he’s launching had been part of the proposal shopped by “the best agent in the business”, his experience does suggest a lack of imagination among the publishers (they couldn’t have created the film; but they damn sure could have created the web activity!)

Both of these experiences say the same thing to me: publishers are finding it increasingly difficult to market books. They are still highly dependent on intermediaries to reach the public, so they try to anticipate what will move those intermediaries as well as what will move the public. That’s like trying to throw the football through two tires swing from tree limbs with the tires swinging in different arcs. You need to wait for the ideal moment and you have to make a perfect throw. It’s tough.

Tor and Harlequin don’t have the same problem. As long as they stick to their sci-fi and romance knitting, they have ways to reach the public and influencers of the public directly. Increasingly, the retailer intermediaries will trust them to do that, so, in effect, the two tires are moving in synch for them.

And that brings me back to the question I get when people ask me how to apply “vertical” to books that don’t seem to fit the paradigm. The first answer I give is “work with the world of the story.” If the novel is about alcoholism, find the web communities that care about that. If it is about adoption, find the right communities for that. Every piece of fiction is about something; use the community of interest in whatever that is as your springboard.

That answer doesn’t please a lot of people. So I have another answer. And that is “I don’t know.”

But I do know that the horizontal book-based marketing and sales infrastructure is vanishing. The review media is fading and, for the first time in my lifetime, bookstore shelf space in the US is shrinking (and at the very same time, ironically, more and more books are competing for the space.) As vertical subjects move to the web, it is harder for bookstores to sell travel books, cookbooks, computer books. If a store loses sales in a bunch of niches, they might not be able to pay the rent to keep the store open. Then they’re gone for fiction too.

The writers Tonkin talks about sympathetically and the publishers Matlack condemns are all suffering from a problem not of their making. Unfortunately, the natural forces that are creating the problem are not providing a natural solution.

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