HarperCollins launches a new-style imprint; we consider the future of book publishing

There were stories this past week in the Wall Street Journal (by Jeffrey Trachtenberg, one of my favourite journalists), New York Times, Publishers Weekly and elsewhere about a new imprint of HarperCollins that will be quite radical in its practices — radical for any of the big six publishing houses.

Heading the new as-yet-unnamed imprint will be the former head of publishing at Disney. Robert Miller’s new imprint has the features that I’ve been preaching about in my workshops for indie authors and in my consulting to publishers:
- no returns (!)
- multiple editions (POD print, eBooks and audio to get into all those long tails of distribution)
- collaboration in financing with authors (the author subsidizes start-up costs by foregoing any advance; the author does not get any royalty, but gets instead a share of ‘profits’).

The first and third are, of course, not “new” — that’s the way publishing operated for hundreds of years, up until the early 20th century.

Whether or not the end of returns will catch on across the industry is in doubt, though an end to this wasteful practice won’t do more than ease the inevitable decline of the big publishers over the next ten years. It will be interesting to see how the death flailing of the big publishers plays out. Monumental change in publishing is a given and will unfold in lock-step with the turmoil in newspapers, music, films, TV, radio — in all media actually. We’ll see retailing morphing significantly, with the rise and fall of behemoths and little shopkeepers as well. Sadly, local bookstores will fade away just like the CD music stores now closing everywhere, and the video rental shops that are beginning to falter. Ten years from now the major form for “book” content will no longer be in book format, of course. Instead it will be in eBook and audio.

I don’t give Amazon’s Kindle much hope at all as a platform for either eBook or audio. Instead, smart cell phones will sprout expandable screens: possibly a fold-out like PolymerVision’s Readius (but not with e-ink which is only black and white, and can’t show video), or something that inflates or pops out and is backlit with a tiny laser projector (like MicroVision is building to put inside cell phones). Once we have larger, colour, video-capable screens on our phone/music/email/gaming/gambling/porn/medical records/PC/whatever device, capable of displaying full-size magazine and book pages in crisp clarity, who would ever use an expensive printed book, magazine or newspaper? “Expensive” because costs for the printed product will steadily rise with environmental/resource pressures on paper, printing, shipping, etc. We can expect demand for printed books will rapidly taper off, just as happened to vinyl records. Demand for the “content” will not diminish, of course; rather, the demand for content will move to the newer technology platform.

For anyone who doubts this will happen quickly, I offer the example of the encyclopedia. Does anyone have a printed set in their house anymore? And is anyone still using the first-generation replacement: Microsoft’s Encarta? The answers are no and no, because everyone is using Wikipedia now — and hundreds of thousands are creating the content! This all happened fairly quickly — over a span of about ten years. In 1993, Microsoft bought Funk & Wagnalls and released Encarta as a free promo; Wikipedia started in 2001. (Encyclopedia Britannica essentially went out of business in 1996, due to Encarta‘s launch only three years before. Britannica was founded in 1768. Two and a quarter centuries of business presence counted for naught in face of new technology.)

The warning in this is twofold: firstly, the delivery platform will inevitably change, and secondly, there is little value in being an old-style producer of content (“publisher”). Being an old-style giant can be a disadvantage — it is hard to have strong traditions, a huge infrastructure AND also be nimble.

What role will POD play in this rapidly-morphing publishing world?

I foresee print-on-demand will have two key roles ahead:

  • as a transitional, then residual, print technology and
  • as a gathering point for all that old “book” content, ironically for not-printed editions.

In the former role, when the market for printed books is reduced, POD simply becomes the only viable way to manufacture most books.

To explain some terminology: All books are currently printed from digital files in PDF format, with some manufactured on laser or inkjet devices in short quantities of between a single copy to many hundreds — that’s POD or print-on-demand, and is often associated with printing after an order is received from an individual consumer. Currently, if a publisher wants larger quantities, to stock on bookstore shelves, and to enjoy a lower per-unit cost, the manufacturing happens on an ink-and-water printing device called an offset press. When the demand for printed copies falls below a threshold of about 1,000 copies, it is no longer economically advantageous to print offset, so POD becomes the default manufacturing technology. As overall consumer demand for printed editions shrinks, it will becomes no longer feasible to pre-stock bookstores, so the printing-after-the-order potential of POD also comes into prominence.

From other stories last week in Publishers Weekly and other media, it is clear that Amazon’s BookSurge POD service and Ingram’s Lightning Source Inc. [LSI] are battling now to be “the” POD hub, with publishers’ margins being the collateral damage in this senseless war. Amazon is threatening publishers who don’t migrate from LSI to Amazon’s own BookSurge service; the threat is removing the “Buy Now” or “Add to shopping cart” buttons at Amazon.com from LSI-produced titles. Amazon is shooting both publishers and itself in the foot — Jeff Bezos must be hiring strategists trained at the Pentagon. It is hard to imagine a dumber public relations or strategic move.

I suggest POD’s greater longer-term importance will be in the second role: as the wholesalers of millions of digital PDF files that will be displayed on those next-generation cell phone omni devices. Amazon’s path into this next role is complicated in that the Kindle can’t display PDFs, and few content creators (currently called book publishers) trust Amazon to serve them honourably. Amazon’s latest rudeness with publishers is eroding what was left of that trust. Ingram isn’t everyone’s sweetheart either, but they are known as a book wholesaler who isn’t tied to a single retailer.

From my vantage point, the optimum outcome will be created only if the various POD printer/wholesalers can get past their capitalistic Egos and collaborate on a network of POD facilities. There simply isn’t going to be enough print business to warrant opening more dispersed print plants without pooling the jobs, and assigning the work to the nearest plant. This, however, would require Amazon, Ingram, Libri (owners of BoD.de in Germany) and other corporations to embrace the concept of sharing we all learn (poorly) in kindergarden classes. A volume of at least 100,000 copies printed per month is required to economically operate a POD plant. With collaboration, one could imagine POD plants opening across Europe, Asia, Australia, Africa, South America … and the current publishers enjoying a respectable transition to the next era of publishing.

Back in 2004 and 2005, when I was CEO at Trafford Publishing (the original POD author services company and operator of a 100,000-book per month POD print plant in Victoria, BC), I tried in vain to get BookSurge, LSI and BoD to join us in establishing common standards for print files, as a first step toward building trust and collaborating. Alas, I could never get buy-in from all three companies.

Let’s all hope that Jeff Bezos and John R. Ingram and others will see the light soon and begin talks toward a future that is gentler and kinder for everyone in the publishing industry. My fingers are crossed. :-)

thanks, cheers, Bruce Batchelor

2 Responses to “HarperCollins launches a new-style imprint; we consider the future of book publishing”

  1. dejah says:

    So, in short, broke little guys (authors) will not only subsidize international corporations, but they will also get a lesser cut of the dough! Ye ha! This is SO revolutionary!

    Writers, at least ones who are not idiots, won’t go for no advances. Nor will they go for a percent of net (which can be cooked in all sorts of ways) rather than a percent of cover. Those sorts of arrangements ALWAYS work out to the publisher’s benefit and to the author’s screwing.

    Yeah, color me excited right now.

    NOT.

    We’re not that dumb.

  2. administrator says:

    Hi DejahVu — [oddly, that name seems familiar :-) ]

    Thanks for your comment. I agree totally with your sentiment (being saddened and upset by developments). Nonetheless I can’t agree with your premise about authors not going along with this new imprint at HarperCollins. There must be over a million manuscripts circulating in hopes of getting a contract from any publisher. Many of these book proposals are excellent. HarperCollins will have no problem getting new authors to climb on board with hopes of getting some exposure and notice by reviewers.

    Did you know that the average advance given in the USA these days is only $1,500.00? And that most books do not earn out their advances? Sad but true.

    My understanding (hope) is that HarperCollins will be paying the author a LARGER cut because the author has not received an advance against royalties. By the way, few contracts presently pay on List Price basis — instead the author gets a percentage of “NET SALES”. So the author getting 10 percent of Net is getting about 5 percent of List or Cover. I agree with you that it is VERY dangerous to be getting a percentage of a poorly-defines “profit”. As you point out, “profits” can be cooked in a wicked accountant’s cauldron any which [witch] way.

    Hang in there, Dejah! There’s some hope that authors might actually come out BETTER because of all the changes to come.

    thanks, cheers, Bruce

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