Monthly Archives: September 2014

Why I Believe in the Future of Print-on-Demand Books

Back in 1995 when I worked in the photo industry, where the existing infrastructure in 35mm film, cameras, and long-life photo paper worldwide amounted to billions of dollars, many of the people working in that industry were dismissive of digital photography and the future of print-on-demand retail kiosks. The costs were prohibitive, the machines were too expensive and unreliable, and retailers would not want them. The list of reasons denying their future viability was extensive.

Today, one finds tens of thousands of these machines in chain drugstores, supermarkets, and mass merchants, albeit producing far fewer prints than in the 35mm heyday of wholesale photofinishing labs pumping out 50,000 rolls a night, guaranteed next-day or free just to add to the pressure. Back then, research showed the typical consumer was pleased with three good prints out of a roll of thirty-six (talk about progress, now they can see what they are getting before printing). That was a lot of photos that went directly into the trash or were stuffed under the bed in a shoebox, before ending up in the trash when future generations wondered just who the hell everyone was back then and why anyone would care.

The success of modern onsite digital photo machines is in great measure due to their role in bringing customers into stores knowing they will buy other goods while there. If you look at a Walgreens today, you will notice they continue to promote two services on the exteriors of their buildings: pharmacy and photo. I HAVE to go into a drugstore or supermarket every week; I DO NOT HAVE to go into a bookstore for months unless I want to buy a printed book in that way. (Sadly, in my experience lately, better independent bookstores are stocking fewer and fewer titles to make room for merchandise I do not care about, so increasingly I shop for books online or at Goodwill, the local bookstore of our time.) Sigh.

So now we enter the era of change for books, similar and also different to the photo industry of twenty years ago. We have early innovators such as On-Demand Books with their Espresso Book Network for printing high-quality paperbacks in minutes, and I expect they face an entrenched group of interests eager to maintain the status quo, hoping they will “simply go away.”  I believe there is nearly as much waste and inefficiency in printed books as there was with those old unacceptable (but accepted then!) “three good photo” stats in the days of 35mm film, when you could not possibly know what you were getting until you held the paid-for print in hand, excitedly flipping through them clandestinely in your car like a lotto ticket scratcher on a bender. (And apparently it was so important that those three good photos arrive the next day!)

I wonder how many books truly need to be printed on the paper they consume. Why not read a book digitally first and then if you love it and want to own it “forever” (or until your kids chuck it once you move on), buy a hardcover or paperback edition, along the lines of what happens with the books we call “classics.” (You know, like Fifty Shades of Grey, which the publishing industry rescued from the seedy world of self-publishing, thank God.)  Owning a print collection of the The World’s Great Novels or the The World’s Great Thinkers makes sense to me; owning a novel or celebrity biography that is just okay or a colossal disappointment to many (which happens all the time, just scan the reviews of the Pulitzer Prize-winning novel The Goldfinch as one example) strikes me as a huge environmental waste of perfectly good trees.

If you look at the space in a Rite Aid or the Photo Center of your supermarket, you will see most have room for a print-on-demand book machine. On-Demand Books recently announced that a hoped-for relationship with Kodak fell through, but Fuji is in fact the company with the most installed photo machines, precisely because Kodak was slow to the new game, hoping their existing 35mm infrastructure would not collapse as quickly as it did. And they had the largest global infrastructure invested in the century-old ways, racing to get those thirty-three bad prints back to you, whereas Fuji and Konica exited those businesses more rapidly instead of making further investments to gain short-term new business. The book machine at mass retail cost-justification is different than what the bookstore faces, in that drugstores and supermarkets are always looking for stores-within-stores to bring customers in more frequently and raise the average total amount spent, so the machine payback does not need to be as stringent as in the standalone bookstore scenario.

The purpose of these book machines, which will come down in price over time and become more reliable to operate, is to attract more overall business to your store. Fuji, Xerox, and Konica have large field-service organizations already servicing copiers and photo machines in mass market locations, so they can add the book machine to the list of reasons they need to be in the stores (e.g., supplying more paper, getting paid “per copy,” installing and servicing their latest machines, making money off  lucrative service agreements).

I believe this business model will be far better for society, including for many authors, who via the current business practices see their books declared out-of-print prematurely to avoid wasteful publisher returns from retail, a truly preposterous way of doing business. As bookselling consolidated power to the large chains and publishing conglomerates, the time a book other than a bestseller was given to prove itself on shelf was a matter of months, obviously not sufficient time to support a non-bestseller book launch.

Print-on-demand will eliminate the truckloads of books literally bought by the pound on pallets from publisher warehouses to be remaindered and trashed. Those making the case for how special writers are versus other product producers should witness that humbling spectacle.

I expect what will happen over the next ten years is standalone book superstores will be forced to close their doors in increasing numbers if not completely, which will continue the shift of book distribution into food, drug, and mass merchant retail outlets, as well as online. Amazon might buy RadioShack, and install a bunch, who knows?  Print-on-demand machines will become more affordable and offer wider publisher selection to match online inventories, as the machines make their way into mass merchants. The books that truly deserve to be pre-printed will continue that way through fewer and fewer independent bookstores, as well as schools and libraries—children’s books and art books most notably—while fiction and non-fiction titles will continue migrating to digital first, with more print-on-demand in the mix.

As was the case with Kodak, the largest and most channel undiversified of the current publishers will face the fastest declines when the transition accelerates, given their disproportionate stakes in old infrastructures. And similar to Kodak and Polaroid twenty years ago, I can hear them dismissing this line of thought as I type. The two greatest gifts the gods gave man: rationalization and denial, are also two of the most dangerous. Book people, of all people, should know this.

Publishers, unlike Kodak, at least control a great deal of terrific content, so their challenge will be more about managing the distribution shift over time, as well as eventually being forced to pay their authors better royalties in order to keep them from fleeing. If you accept that statement as a given, then they also will need to earn more per copy sold than they do currently, which I believe ebooks and print-on-demand can help them accomplish. Paying a reseller 55-60% of a book’s cover price right off the bat simply does not leave enough operating income to sustain most publishers or authors.

— Caleb Mason, Publerati