Publisher's to Hold Back E-Books

[John McFetridge]

From an article in the Wall Street Journal:

Simon & Schuster is delaying by four months the electronic-book editions of about 35 leading titles coming out early next year, taking a dramatic stand against the cut-rate $9.99 pricing of e-book best sellers.

A second publisher, Lagardere SCA's Hachette Book Group, said it has similar plans in the works.

"The right place for the e-book is after the hardcover but before the paperback," said Carolyn Reidy, CEO of Simon & Schuster.

The article is here.

I don't know much about book marketing, but this seems wrong to me. I would like to see every version of a book available at the same time - give the customers the choice.

[Edward G. Talbot]

That booksquare article Joh Dishon posted the link to seems dead-on to me. It explains why books are not like movies.

This is one more in a series of short-sighted publishing industry decisions. Assume I don't want to spend $18 on the hardcover - either because of the money or because I prefer e-readers. If the author is good enough, well sure I'll wait. But I'm much more likely to either not buy it at all or take it out of the library.

The philosophy that my fellow authors at podiobooks.com has seems like the right one on a high level - provide the content however people want to consume it. That's being customer focused. Certainly we can argue about the details or pricing and how best to do it, but publishers are shooting themselves and authors in the foot here, a pretty common phenomenon in the business.

Sometime in the next 3-6 years a couple of the majors will go under. The survivors will eventually adapt. I can't say for sure what the future will look like because unlike with music, consuming books in a different form is a fundamentally different experience than reading paper. But the role of publishers and agents as the sole gatekeepers will be rapidly diminished. I actually suspect that eventually, hardcovers will become less common aside from books that are certain to sell, and bookstores will start to have POD presses on site as technology improves and that becomes feasible. That would greatly reduce storage, shelf space and distribution cost concerns. The technology is not there yet, but it's only a matter of time.

And once that happens, the sky's the limit. A bookstore could make any book available to a customer at any time. Aside from the hardcovers (and hardcover POD will be coming at some point, too, though I think that raises quality concerns), they'd never be out of stock and they wouldn't have to restrict their inventory to traditionally published books. The marginal cost of printing a typical 300 page trade paperback would be 2-3 bucks and the rest would go to the author, the bookstore, the publisher and possibly a small amount to a "distributor", whose role would change to an online one.

Audiobooks are even easier - the technology is there right now for bookstores to create decent quality burned CD's. E-books will logically remain mostly online, but once they are embraced, I see a role for them to be sold via traditional book stores as well - essentially it will cost a store close to nothing to offer them.

Hmm, if only I could raise some venture capital, maybe I could do something with this. . .

[John Dishon]

There is the Espresso Book Machine. If this thing ever becomes popular, book distribution will forever be changed.

[Edward G. Talbot]

Hi John -

Thanks for that link. That is of course exactly what I'm talking about. So the first question is, what is it going to take for it to be worthwhile for a bookstore to buy one of those machines? The answer is that they need to be able to make enough money back on the books they sold. Right now, they couldn't. There are a few different paths this thing could take to get there, but aside from one or two large publishers deciding to embrace the concept, the most direct way would be for a startup with major VC backing to form a publisher big enough to attract some reasonably big names. By cutting out all those expenses, they would probably be able to offer better deals to authors and bookstores than anyone else can. At first, they'd have both a traditionally printed trade PB and the in-store POD option. They could make a deal with the espresso book machine company to get the units significantly cheaper in bulk and give stores the ability to buy or rent it.

Bookstores would benefit from it, as would authors. Obviously traditional publishers would pretty quickly start to suffer if this happened and they didn't follow suit. So would B&T/Ingram. Agents wouldn't suffer necessarily (maybe this new press would require agented submissions, who knows), but my guess is that a segment of them would resist it. I suspect that the publishers and distributors would use a combination of carrot/stick to exert a lot of pressure on stores to not do it and that might succeed in causing problems. But bookstores and publishers alike are suffering and if the new entity enticed enough big names, I think their attempts to stop it would fail.

In the long term, the "print on site" model will happen because it is a superior model in every way except for preserving the power/profits of the status quo. The only way I can see it not happening is if even better technology/options come along or everyone starts reading on something like a kindle. The idea of printing 5000 trade paperbacks up front, shipping them around the country, storing them, and usually pulping 30-70 percent of them is so ridiculous that it would be dismissed out of hand if presented as a brand new process.

[Pepper Smith]

I think hardback POD actually exists already. It's just a lot more expensive, and not as common.

[Edward G. Talbot]

Yes, you are right, Pepper. My thought is that when people buy a soft bound book, they assume it is not particularly durable. A hardcover, though, many people are going to want to keep for a long time. A POD-type hardcover created on demand at a store may not going be as good quality as an offset one. But I'll freely admit that this could all change, that's just my take current take on it.

[doug anderson]

The bizarre thing about corporate publishing is that they frequently do things that are, from a business point of view, foolish. There is a marked lack of imagination in people who are obsessed with short term profit.

[John McFetridge]

Well, that's certainly not unique to publishing. When every decision that's made means millions of dollars people are going to be pretty cautious. Shareholders care about quarterly reports.

But I think people sometimes get too hung up on the physical book, that's really a small part of the industry. Publishers aren't printers.

The POD is all well and fine but we'll very likely still see the same 2% of books availabe selling 98% of the copies. When a much-hyped Twilight kind of book comes out you'll go to the store with the espresso machine and the kid behind the counter (always that kid behind the counter in The Simpsons, so use that voice here) will tell you he can print up the obscure Inuit noir novel you want as soon as he finishes running off four hundred copies of the teenage vampire book. You can just wait in the Starbucks for a couple of hours.

[Edward G. Talbot]

I tend to think of it as lack of risk-taking as opposed to lack of imagination. And I think the reason is that their fundamental business model is archaic - because of the nature of the industry and the barriers to change, they have not needed to change it. But they know full well that their hold on profits and the market at this point depends on the old model staying mostly intact. It's actually pretty logical for their behavior to reflect preserving the status quo, even above actual profits.

I actually think some of them (maybe most of them) see the handwriting on the wall that the whole model is starting to turn on its head. But they don't know what to do about that. Even beyond our flawed model, publishing inherently is a conservative kind of business, in the true sense of the word conservative. That's why over the past year or two, you've seen all kinds of odd behavior like the Harlequin thing, etc. The future of this thing is unpredictable even to those of us who have embraced change - for them it's gotta be terrifying.

[I. J. Parker]

Just had a chat with my agent who resists my putting a trilogy on Kindle. Her argument: publishing is in a state of flux, but once the book's on Kindle or another electronic format, the print publishers will lose interest. As for what's happening to publishing, it seems to be a wait-and-see situation. Very frustrating!

[Edward G. Talbot]

Your agent is unfortunately right if you are trying to sell the same book(s) you are putting on kindle. The only exception would be if you sold over five or six thousand copies on kindle for a reasonable price (say 5 bucks), you might possibly win over publishers. A few authors have succeeded in landing book deals for a book after they attracted big audiences for free audio downloads of the same book, but the ones who attracted major publishers had tens of thousands of people downloading the whole book. I've had close to 4000 downloads my first book, but I'm still not putting that fact in my query letter to agents for my second book. All they have to do is go to my web site to find out, so I'm far from hiding it, but unless they specifically ask authors to address marketing strategies in the query, mentioning it is more likely to hurt than help. Publishers don't want to hear it and there is a stigma of course.

Which if you think about it is really dumb - proving there is some kind of audience for an entirely different book is somehow a negative?

[I. J. Parker]

I don't think the stigma concept applied here. It's more a matter of print publishers wanting e-rights also.

[Edward G. Talbot]

I see. Publishers want as much as they can get. It's one of the things they do that does make quite a bit of sense, as frustrating as it can be.