Category Archives: Musings on the Publishing Revolution Underway

Trash Talking

No, I’m not here to trash paper. I’m here to discuss different usages of paper and the ones that are more likely to become quick trash.

The recent Digital Book Printing Conference hosted by Book Business was a very interesting event with plenty of great presentations, facts, and figures. In particular, Marco Boer of IT Strategies kicked off the event with interesting slides about the trends for printed paper. Among other things, he noted that there were 16 trillion printed sheets/pages in 2007 and that number as measured more recently is 11 trillion. These pages are the pages we encounter in our daily lives as newsprint, magazines, books, and direct mail (catalogs, etc.). Newsprint and magazines fell precipitously during the recession but have hit a plateau in recent times in what could well become a new level of manageable stability.

This was an event about digital printing, which means in many cases printing lower quantities economically to improve efficiencies and reduce waste across all business segments. And Marco’s research estimates an ongoing 3% annum decline in this overall page count (11 trillion pages is still huge). His research also estimates that by 2020, 16% of all books will be printed digitally versus the favored and familiar offset method. (Personally, I think a lot of that depends on what happens with major retail book distribution. If megastores fade away sooner than later, then smaller runs become more of the norm for what will also be smaller publishers.)

The current trending towards digital book printing seems to be driven in part by the widening gap between the occasional blockbuster, which clearly needs to be printed offset, and the rise (or decline) of many more titles selling in smaller numbers, which makes digital printing economical. Stated conversely, this is precisely what helps keep those titles alive and in print. Much of the conference talk was about how inkjet book printing is now the rapid growth segment for printers and equipment providers, which included Canon, Kodak, and HP at this meeting.

What I found myself pondering following this presentation was the distinction between paper that is used for a sustainable amount of time, versus paper that is quickly trashed. Let’s call it Quick Trash Paper (QTP for all you acronym lovers). I’m talking about the actual consumer time spent with the printed paper. This thinking is partly shaped by my time in the defunct 35mm film and photo era, where we could make money producing lots of mass consumer prints (50,000 a night in one of ten plants alone in the U.S. on a busy summer night), but where the consumer actually only liked a handful of the 72 photos printed (double prints, remember?). This is some serious global Trash Talking! Quick Photo Trash (QPT). And it’s gone.

So let’s try and rank the waste of the remaining 11 trillion sheets of printed paper by category of usage. This is speculation, I have no facts. Worst has to be direct mail and catalogs, right? This is the only item of the four categories (books, magazines, newspapers, and direct mail) that in many instances has not been requested by the consumer. It’s push marketing, old-school mass-market style. It’s still effective and used as a driver of substantial business to the online store. The main uncontrolled variable for the marketer is the cost of postage, which the postal service tends to raise frequently. But from an environmental impact point of view, it just feels lousy emptying my P.O. Box, as I lean over the blue recycling bin at yet another post office (full circle recycling), depositing 99% of it into the trash. But I understand, all it takes is a 2-3% response rate and that catalog is paying back and covering a lot of fixed overheads. My hunch is this is one of the more stable paper sheet categories out there now, but one that may fall precipitously with the next recession, whenever that is. It’s real out-of-pocket money that can shift in cash-starved times back to ecommerce and social media drivers.

Next up in terms of consumer lifespan for a printed sheet is newsprint. Daily newspapers have contributed the most to the five trillion pages of lost print, and sadly journalism may have gone into the fire with much of it. But, again, it typically enjoys a consumer lifespan of one day, maybe a few days, but then is tossed, recycled, or if you live up north as I do, burned. (I have discovered some great articles while rolling paper for my woodstove, only to spare that sheet for subsequent reading.) But it’s far better than direct mail, because the customer actually asked for it. Paid for it.

Magazines have been in steep decline yet they at least hang around longer. Glossy printed magazines can be found months later. Old issues of Life and National Geographic are highly treasured items. So one might think magazines would hold the current plateau, same as what is happening with the printed book. This has a lot to do with the content of the magazine, ever-present and fast changing news faring far worse than an excellent foodie or style magazine.

Which brings me to the best usage of paper of these four categories: the printed book. People don’t buy print books and burn them in woodstoves. If a book is being burned, well, that’s a whole other sad story. No, print books are cherished possessions that last for years, that are carefully shelved and moved time and time again, the better ones with emotional attachments eventually passed along to heirs.

Five years ago, when I started what was to be an ebook-only literary fiction publisher (Publerati), I quickly heard from readers that they wanted a book to hold. “Can’t you just hold your Kindle?” I begged. The Espresso Book Machine provided me an immediate early-adopter solution, one scaled to my “narrow-casting” needs, and one I feel has tremendous potential as book retail changes. The good news for me as an entrepreneur writing checks from my own account is it appears that digital book printing of lower quantities is now opening even more new doors. I expect I will walk through some of those doors in maintaining low inventories of our books.

So many thanks to Book Business for hosting this event, where I learned a great deal, including some things that will help me grow my small publishing business. Printed books do make good sense, and digital book printing promises to reduce waste and create a more sustainable business model across the entire supply chain.

Do you agree that consumer time spent with the printed page will eventually dictate its usage by business category? Will there be a coming uproar against prospect mailings of catalogs over the holidays or will economic conditions determine its fate? Will some newspapers make it as digital dailies with Sunday and Wednesday print editions? Same for magazines? Ten years from now. What do you think? Does the amount of time spent with the paper produced matter?

 — Caleb Mason

The Changing Face of Publishing

(This first appeared under a different title on the Book Business Website.) Let me preface this by saying I run a literary fiction micro-publisher operating much in the mold of how full-service traditional publishing has for years, although because my overheads are so low, I pay my authors 50% of print and 70% of ebook royalties, something I realize large publishers cannot do.

As self-publishing continues evolving, it strikes me that traditional publishers are losing one of our most important services for authors: bookstore distribution. The very distributors publishers have relied upon for years are hedging their bets (and expanding their revenues) by tapping into the self-publishing market. For example, both Ingram and BookBaby offer authors distribution to chain and independent bookstores. And the Espresso Book Network continues to expand a new retail solution for bookshops, libraries, and others. Not to mention the obvious: more and more consumers simply prefer buying print books and ebooks from Amazon.

More than just distribution, though, these new upstarts also offer the production tools needed to easily produce print books and ebooks. So there goes the production expertise competitive advantage of many publishers.

I realize many authors ardently support their publishers. I also know many are frustrated that their royalties are not higher, especially for ebooks. Traditional publishers and reviewers mostly dismiss self-published titles as “trash,” but what happens when established authors with large followings decide to go out on their own? Did you see this week that five of the top ten bestselling books sold by Apple come from self-publishing?

Any author can buy editing services. Any author can hire a book PR firm with social media expertise and mainstream media connections. And now any author can gain distribution to all the places their titles are currently sold.

There are many good authors frustrated at how fast they are forgotten in the Big Houses who pump out thousands of titles per year. I would think a lot of authors would rather hire the editorial and marketing services they choose on their own dime, using a portion of the extra royalties they receive from self-publishing at both book launch and as part of a sustained multi-year effort. To take complete control of their own book’s destiny, as opposed to assigning it to a company operating with high employee turnover and low morale. (Take a look at the recent Glassdoor ratings of the Big 5 as an indication of current employee morale.)

I believe this threat is greater for books than it would be for some other product type. Authors pour everything they have, over many years, into writing their beloved books. Giving their babies away to others is a big risk, especially for those who feel burned or overlooked in the past.

All it takes to demoralize an author working with a Big 5 publisher is to lose your editor in a layoff. Without that internal champion, you are sunk. The ensuing organizational chaos that follows just makes it more painful. This is a huge gamble on a co-dependent relationship where neither side typically feels great about it all the time.

The big strategic question for publishers is increasingly becoming how much does an author need to pay you to provide equal or better services available from somewhere else? Right now, the number they are paying is larger than the newer markets demand. The one big advantage of traditional publishing to authors is the royalty advance. But the few big names are getting more and more while the rest are getting less and are in essence being asked by the publishers to fund those large advances with their reduced 25% ebook royalty rates. How long will they put up with this?

So what should publishers be doing that they aren’t already? I realize many are working to establish their own direct-to-consumer businesses, which is a good start. But I am a skeptic when it comes to this, probably because my career working in five different industries trying this same thing has demonstrated that people like to shop where people shop frequently. The supermarket. Or Amazon. Or the local indie bookstore. Remembering to buy once or twice a year from a manufacturer with their own unique reseller site is inconvenient. And in my experience, the costs to the manufacturer (in this case publisher) become actually higher than the margins they provide to resellers offering a variety of products. Those resellers own the majority of the customer transactions. The tech and staffing requirements to run an in-house direct marketing and IT team will surprise most who are new to that business model.

How about providing a sliding scale royalty on ebooks based on performance, same as done in contracts for print? 25% for ebooks up to a certain number sold, 40% after that. But I doubt this will happen and also am not sure the margin is there. The poor author, giving 15% to an agent and then 15% to themselves. The publisher and resellers are getting most of the slim retail margin for themselves. Which is why I feel the current rules of the old business are not sustainable going into the future. So do you let others disrupt you or try and do it yourself?

Worst of all for publishers, they don’t own the content they deliver. They are completely at the mercy of their authors’ decisions on how they choose to publish going forward. Contrast this with a software publisher who owns the product they make and sell. So, in the spirit of looking for new ways to survive, why don’t publishers focus more on offering content outright and sell it under their own name. The Random House Book of Birding. Random House is the author, the staff produces the book, just as software engineers do for Apple and others.

I post this in part to make sure publishers are paying attention to the services their distributors and laid-off editors and marketers are providing through new channels. This is precisely what I saw in the photo industry as customers and staff moved from Kodak and Polaroid to Epson (first digital camera), Adobe (editing), and HP (ink and paper). And then, of course, Apple, Samsung, Facebook, Instagram . . .

 

New Ways for Authors

(This first appeared on Book Business, under a different title.)

One of the most fascinating aspects of new technologies is how they open doors for new business models. And this is very true in the evolving world of book publishing.

The book publishing model has many challenges, most notably how the established system of author advances, large superstore pre-orders, and returns limits what will be published. Consolidation has made it more difficult to gamble on new authors, so a significant portion of publishing has become about pumping out more of the same from the well-known writers with celebrity status.

Let’s face it. The best authors throughout history were not celebrity personality types! Writers and readers tend to be people eager for the contemplative life. I have been cringing while reading recent audience-driven articles about producing shorter works to feed increasingly distracted tastes. Great works have not been created to feed reader tastes. They have been written because the author had something important to add to our understanding of human existence.

I’m basically an optimistic pessimist, which means when all hope seems lost, mankind rises to the occasion with something better. And for many authors, publishers, and readers, I think print-on-demand is that meaningful, lasting innovation (along with ebooks).

I recently had an email from a reader who bought a Publerati novel through the Espresso POD network and the feedback was revealing to me. “I was surprised how high-quality the book is. I thought it would be a comb-bound pamphlet.” Wow! This reminded me of when digital photo first came on the scene and was just assumed to be inferior. (Side note: I am fascinated by the twenty-somethings I meet who are reviving vinyl records. They will pay more for what they perceive to be better quality. Innovations always confront a nostalgic backlash, I suppose. Or said another way, it’s cool to be retro and “not popular.”)

So maybe we need to overcome some consumer concerns around the quality of print-on-demand editions. That will take a more concerted industry campaign. The first thing I did was make a new page on the Publerati website with a quality statement along with a list of locations offering our titles. You can see it here and I welcome comments on how to make this better.

But the big opportunity of POD is to save the many excellent writers whose books will never sell in the huge quantities that the consolidated publishing industry needs. And in the POD model, these authors don’t necessarily require an advance. Why should they? Let’s get paid for what we produce, not what we have the potential to produce. Publishers have been burned time and time again with that hyped second novel that was a dud.

By only printing what each local market will support, we have a more responsible and sustainable business model. There is no need to prematurely mark an author’s book out-of-print to stem unexpectedly high returns. Now, the author’s book can be available for as long as the publisher wants and for as long as the reader wants. Isn’t that a much better system? Is that not a benefit publishers can offer mid-list and potential breakout authors?

When I see HarperCollins providing front list titles through the Espresso Book Network, I know change is underway. Change is always underway, but we can only see it after it has happened. The benefits to those on the front-edge of change are disproportionately high. Customers remember “who did it first” and their loyalty can be an immense barrier to entry from imitators slow to the new game.

POD publishing is already opening many new doors. What we cannot see from here is how fast this change will occur and who the early winners will be. I’m hoping many of these winners will be authors who can take more control of their publishing destiny. Enjoy the ride!

#ebookschangelives

The more I read and hear from near and far, the more I realize that ebooks are changing many lives in positive ways.

Many writers no longer have to endure years of agent rejections before publishing their work. Many readers are discovering new authors because they like ebooks and like paying less than what the popular authors ask.

At last, there is a great new place for the less popular people to hang out, a place so big, it feels like infinity.  It’s the world of digital.

Publishing consolidation continues to make publishers more cautious about trying something new. They are surviving on the Donald Trump books and blockbuster novels from well-known established writers. There’s that word again: established. As in establishment. Increasingly becoming the common enemy that might possibly be the only way to reunite our country. But that’s what they do best and whom they serve best. “You get the customers you deserve.”

Worldreader is demonstrating daily how ebooks are changing lives in remote regions of the world. Not just ebooks, but digital reading. On phones. On network-connected screens that overcome the heartless barriers of geography.

Civilizations no longer need that one great river or port to flourish.

The new Nile of our times is the Internet. And this is great news for a better future. Which is why we are launching our new hashtag:  #ebookschange lives. Please come visit us in this new world, on Twitter, Facebook, and unknown worlds to come.

#ebookschangelives

Announcing “Publishing Outsights”

Someone made the mistake of asking me for my opinions on book publishing. So I will be offering them through a new blog on BookBusiness called “Outsights on Publishing.”

Why the name? It’s my sincere hope that I can share something of value to others based on my many years working in the book industry, photo industry, mapping and GPS industry, and tourism industry, each different in their own unique ways but with similar challenges brought about by rapid rates of disruption from unexpected places.

My latest post concerns the possible negative impact on publishers’ profitability due to small gains in print book sales offset by much larger losses in ebooks. The big question in a world of disruption, is how many of those former ebook readers bought an ebook from Amazon or another source outside the AAP-measured traditional book industry?

Anyone have any reliable way to measure that?

Will Ebooks Eventually Replace Print Completely?

I was invited to debate the pro side of this argument at an Oxford Debate and would like to share my transcript here. The point of an Oxford Debate is to change more minds than your opponent, while arguing unambiguously for your side.  Here is my transcript for the Opening Argument and Closing Argument. Enjoy!

Eight-Minute Opening Argument

Good evening and welcome. I’ve been asked to convey a quick public service announcement. For those of you who arrived by horse and buggy, the city fathers, faced by the heightened threat of cholera, urge you to please help divest the city of that foul ailment on which pestilence delights to feed.

My name is Caleb Mason and I’m the founder of the literary fiction imprint Publerati. We publish titles that might not have the large audiences the remaining Big 5 publishers need to keep their lights on. Our books are available through all ebook channels, and many also as print-on-demand editions through the emerging Espresso Book Network.

Ebooks will eventually replace print books and let me tell you why. I break this argument down into three categories: Benefits to the Reader; Benefits to the Business Model; and Benefits to Civilization.

First benefits to readers. It’s now possible for anyone with a regular telephone, smartphone, tablet, or computer to purchase any title at the exact moment they want it to read immediately. Think about that. But even more, an infinite number of readers can enjoy that same title at the same time! Imagine the impact this is having on evolution.

Future generations will look back and wonder how life was possible where a person would get in a gas-polluting car, drive to a bookstore, and not find the book they wanted. Did those people buy something else instead? Was that book they wanted never read as a result of them forgetting? How many book sales were not made for those authors?

But more than just access, ebooks improve the reader experience in ways print cannot. We can now enlarge fonts, reading later into life. You no longer lose your place in the book. I often wonder how much of an author’s painstaking work goes unappreciated because the reader dozed off and lost their place. Ebooks open to your place automatically. My favorite feature is the built-in dictionary. There is no longer any reason for not looking up a word’s meaning. And you can store the book securely to access wherever there’s internet access. No more forgetting the print book when on vacation.

Secondly, are the benefits to the book business model. Right now, an author is paid only 10-15% of a print book’s net sale price. That net price, in the case of a $20 dollar book, is around $12 on average, after the bookstore keeps 40-50-% of the retail price, so the author gets around $2.00 per print book sold. But the real inefficiency happens in how physical books are distributed and what this means for authors. Let’s say the publisher ships 100,000 copies to Barnes and Noble for the holidays of that exciting new masterpiece Rupert Murdoch is so thrilled about, Romance and Vampires: The Legacy of the Kardashians. The publisher thinks this big opening order means demand will be high, so immediately roll the dice and reprint another 50,000 copies. In March, after the holiday blur, cash-strapped Barnes & Noble — who by the way is only surviving by adding non-book merchandise to their remaining stores and whose coming demise will further benefit indie bookstores in the near term already helped by Borders’ closing — Barnes and Noble tells the publisher they only sold 50,000 copies and plan to return the other 50,000 to avoid paying for them on the invoice now due. The publisher has two choices: take the returns and lay off more staff, who are kind of confused since they just got holiday bonuses based on rosy but bogus sales projections, or declare the work out of print, which means they are not responsible for those returns.

The big loser here is the author, whose print edition goes prematurely out of print. Ten years in the writing, only twelve months from print publication to death.

Thirdly, is the impact ebooks will have on civilization’s march of progress. I envision a future where the sprawling malls of our time will be turned into lovely parks after all the unnecessary and unhealthy mall shopping is gone. Already millennials are consuming far less fossil fuels than previous generations, in part because they shop online and not at brick and mortar. How much gas have you wasted over your lifetime going back and forth to malls, buying and returning?

We can either whine about these changes or position ourselves to be part of the better future. The problem is the gods gave us two great gifts to make life bearable: rationalization and denial. So we all cling to our comfortable pasts. And the hypocrisy among many writers, who post anti-Amazon messages on Facebook while 40-50% of their total royalty income is coming from them, is astounding to me. If you feel that strongly, have your publisher include a no-Amazon clause.

Yeah, right.

But most important, having every book available digitally will improve human knowledge. For those of you who arrived via horse and buggy, think how much civilization has improved because you can now board a flight and be in London tomorrow morning. Imagine what the Victorians would think! Of course, back then, the retail button industry did everything it could to keep the new zippers off their shelves. Nowadays, the AAP, the advocacy group for the publishing industry, will tell you ebook sales have dramatically slowed. Raising publisher ebook prices as a collusion tactic to protect their paper business probably had something to do with this. Yet the AAP doesn’t even measure all the self-published titles or any book without an ISBN.

But even within the AAP measured pool, in 2014, 510 million ebooks were sold, matching the number of hardcovers. $5.96 billion dollars of print and ebooks were bought online, versus $3.86 billion in physical stores. And 33% of all paid ebook sales made on Amazon were self-published, so not reported by the AAP at all.

The publishing industry is also not measuring the rapid rise of reading on smartphones. In a recent Nielsen survey of 2,000 people, about 54% of ebook buyers said they used smartphones to read their books at least some of the time. That’s up from 24% in 2012.

This reminds me of when I worked in the photo industry, as it transitioned from film to digital. Their industry association only measured themselves. Kodak. Poloroid. Those two former giants are gone, thanks to Apple, Samsung, and Facebook. The main lesson is change always comes from the outside.

There has been some bogus research publicized on how people keep track of the chronology of what they are reading better on paper than a screen. Not to get bogged down, but the oft-cited Norwegian study had only two participants who regularly used Kindles, so most of the participants were probably uncomfortable with the Kindle itself. It’s like asking a driver of a regular car to get into a Tesla and start driving! Another study done at UPenn found that students retained information better when reading on a Nook. So if you believe Monsanto when they tell you their research concludes that pesticides are safe, then by all means continue dining out on these ridiculous reading studies.

And what about those children and teachers in developing nations, such as the ones being served by Worldreader, to whom Publerati donates a portion of our sales? In 2014, over one million hours of reading took place in Africa on the regular non-smart phones the people already have. Prior to the advent of ebooks, the typical library contained only a handful of print books.

Worldreader also provides free ereaders, mostly donated by Amazon, to African schools, along with ebooks from many publishers, and the literacy rates have vastly improved as measured by control studies. This democratization of knowledge is good for all societies, not just our privileged one, where paying $30 for a hardcover novel seems reasonable to the chosen few, but not to me. My goodness! That’s three or four big-screen movies!

In summation, we might not be around to see this ebook-only future, which will eventually come, but I remind you the key word in debate here is eventually. The world will be a better place without us, without our horses and buggies, without our shopping malls, without our gas cars. Thank you.

Three-Minute Closing Argument

 I’ve laid out my argument for why ebooks will eventually replace print books, divided into the three categories of benefits to the reader, benefits to the business model, and benefits to civilization. But let’s take a look at what’s been going on during our brief time on this planet. During my lifetime, the biggest event has been the development of personal computing and connecting all these computers to the Internet of Everything. With the rapid proliferation of mobile computing, now we are all connected to the Internet of Everything wherever we go. The wrist watches of Dick Tracy have arrived!

The digital network is everywhere: inside our homes and expanding to our appliances. Wifi is being installed in cars. Our heart defibrillators are monitoring us over the Web. Everything outside the digital network could be in peril in the future. Only the most connected people will make it onto the next Noah’s Ark, with their Google-delivered God Alerts!

In the majority of cases, revolutionary change has not been something the established industries could either prevent or take advantage of. Rand McNally once printed two million U.S. road atlases just for the summer. Now they cling to near-obscurity, replaced first by Garmin GPS and then smartphone location-based services. Huge inventories of entertainment content have rushed online: music, movies, and books, and the number of physical retail locations selling these items, and the distributors once serving them, are disappearing. Television viewership is declining and future generations will puzzle at how quaint it must have been to wait an entire year to see one movie, The Wizard of Oz. Already we can choose what to watch, when we want, via Netflix and other services.

News reporters are being replaced by each of us as eyewitnesses on all the scenes of the world as they happen, armed with phone cameras, Twitter, and Facebook. Don’t get me wrong, I believe in the future of journalism, where opinion leaders make unique arguments and investigative journalism tells a story no one else can tell as well. But straight reporting of real-time news is not something print can keep up with. Authors do matter and whether they are remarkable journalists, cartoonists, or novelists, they will continue to be hugely important in the digital-only future.

Large volume content catalogues such as music, movies, and books are best delivered digitally direct to you. No single store can stock all the titles we want. Which is why ebooks will eventually replace print books. The print book distribution infrastructure will collapse as seen in other categories including photo stores, record stores, and software stores, like Circuit City and CompUSA, both long gone. Pay attention to the latest Barnes and Noble news and stay abreast of this major gating event for books. We might cling to the old business model, but it has not been good for the planet, for other less fortunate people, or many shut-out authors who write very well, but do not (thankfully) have the mass appeal of the Kardashians.

Please remember to clean up after your horse on the way home.  And thank you.

Another Way to Help Indie Bookstores in the Digital Age

Did you know you can help several leading indie bookstores add to their bottom lines by ordering select Publerati titles from their Espresso Book Machines?

The Espresso Book Machine is a networked print-on-demand service producing high-quality trade paperback titles in minutes. Let’s face it, with close to 60% of all print and ebook sales being made online these days, indie bookstores need all the competitive advantages they can find. Print-on-demand books can be picked up in store or mail ordered and are a great new way to help indie booksellers tap into the vast network of online titles, which simply cannot be stocked in preprinted inventory the way large online resellers do.

Here is a list of U.S. bookstores with an Espresso Book Machine. Help support them and Publerati by ordering one of our titles for store pickup or mail order.

The Tattered Cover in Denver, CO; the Harvard Bookstore in Cambridge, MA; Prose and Politics in Washington, DC; Powell Books in Portland, OR;  Schuler Books, Grand Rapids, MI;  Boxcar and Caboose, Saint Johnsbury, VT;  McNally Jackson, NYC; Third Place Books, Seattle, WA.  Machines can also be found in select Barnes and Noble and Books-a-Million locations.

The current Publerati titles available through this growing international network are: Normal Family by Don Trowden, Thanksgiving by Ellen Cooney,  An American Gospel by M.T. Daffenberg, and Dancing in the Kitchen by Susan Sterling.

Publerati only publishes literary fiction and believes that ebooks and print-on-demand are important ways to maintain the viability of this genre going forward. Check out our titles and unique goodwill business model here.

 

One Small Publisher’s Experiences with the Espresso Book Machine from On-Demand Books

The following blog post first appeared on the Teleread Website:

As a small publisher of literary fiction, I am very grateful to have a retail resource like Espresso On-Demand Books.

Publerati will have three titles available through the Espresso Book Machine Network this spring, and although there are a number of unique challenges to marketing and selling books this way in the current retail climate, I remain optimistic that this, or something similar to follow, will be an important part of future print book distribution. The three available titles are Normal Family by Don Trowden, Dancing in the Kitchen by Susan Sterling, and Thanksgiving by Ellen Cooney.

The first thing one has to accept is the eventual disappearance of most standalone bookstores.  Ouch.  I know, that hurts, and as a former bookseller myself I wish it were not so, but all the trends of the past ten years in book and other retailing (e.g., music, software, photos, DVD movies, florists, post offices) point to this reality.

In a future world where only the bestsellers and illustrated books are preprinted and sold mostly not through bookstores but in mass market channels like Target, supermarkets, and Amazon, how will the rest of the industry’s titles make it into print? How many standalone classes of retail trade can you think of in this day and age of the “huge general store”?  Why should books be any different and deserve their own dedicated space in the era of the store-within-store?

I wonder how Big Publishing will distribute the needed quantities of preprinted books when Barnes & Noble is gone. B&N is already barely surviving due to selling more non-book items, while quietly closing underperforming stores, so this trend is established. These trends don’t just simply turn around and change direction suddenly because we hope they will. The only way B&N might survive is to become a general store themselves, with less merchandising space given to lower margin books. Which is what they have been doing and so have indie bookstores. For years.

My experience with On-Demand Books has been excellent.  I received the necessary advance training to learn how to format and upload our titles correctly. Because the machines are so groundbreaking and mostly under-utilized in these early days, the operators at the various locations have been open to hearing from me as a small publisher and working together on store signings and promotions. There is no way I would get similar attention from the current physical book channels.

As a publisher, this changes how books are discovered in a similar way to ebooks.  I don’t have the opportunity for “stumble-and-find” retail book browsing, which I know is very important.  So I have to direct market to my own list of ebook purchasers and opt-in newsletter subscribers  the news that they can now go anywhere in the world where an Espresso Book Machine exists and request a printed copy.

I believe in the digital-first, print-second approach for the future of most entertainment content. Pay less for a digital copy and then only buy a print edition if you want to own it. You know…hold it. Sleep with it. MP3, vinyl. Whatever you’re into.

For Publerati, having all our literary fiction titles available through the most popular ebook channels and then also in print at retail via Espresso On-Demand,  constitutes a new business model I can believe in for the future. And one great benefit of this new efficiency is we can pay our authors the bulk of the royalties while also donating to literacy charities like Worldreader.

— Caleb Mason

Bringing Instincts Back to Book Publishing Acquisitions

The following is an article written by Publerati Founder Caleb Mason that appeared in the December issue of Book Business Magazine:

There are agents and editors working in book publishing who may love a new project under consideration but realize they cannot justify it given the likely modest sales. This is especially true for first-time novelists, but also for other midlist authors who have been published before and are running out of options as the trade print marketplace continues to narrow around bestsellers.

Editors have lost much of the power they once wielded to marketing and sales. It used to be easier to operate on a hunch, to believe in the merits of a riskier work and “push it through.” Some of publishing’s biggest success stories have been the surprise, low-advance breakout titles. That is much of the fun of working in publishing — the Vegas aspect.

As publishers consolidated into larger media groups with other more profitable business units, the pressure to operate less on instincts and more on “science” was inevitable. This trend towards evaluating product ideas based on what sales and marketing thinks the market can support is common within most industries today. The conflict between a business unit product manager championing a new idea and the sales and marketing people challenged with selling it has been a tension created precisely to improve accountability.

Meanwhile, entrepreneurs I have known all share one common belief: if the market can actually identify what it wants, then the product potential is already limited. A trend is gone as soon as you can spot it. Which leads me to why I feel ebooks offer large publishers a great way to rebalance how they operate back towards the hunch method.

Why not create ebook imprints focused on editorially-championed titles, hoping that some books will find larger audiences than marketing and sales predicted. This becomes a form of affordable test-marketing for publishers (their own R&D) and allows them to bring their editorial expertise to authors who may deserve to be published, but not under the riskier hardcover and paperback advance payment pathways. Forget about crowd-sourcing and contests; do what you already do well but confined to the ebook realm. More breakout books in the publisher system would be good for overall business health, especially as the print and digital readership mix continues unfolding in ways no one can predict.

— Caleb Mason

 

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