Agents

Go Read This | Fast-Paced Best Seller: Author Russell Blake Thrives on Volumes – WSJ.com

There’s so much in this piece I have to take two extracts. This quote in particular is incredible:

“Being an author is like being a shark, you have to keep swimming or you die,\” he says. “People don\’t want to wait a year and a half for the next book in the series, they want instant gratification.”

But there’ lots more, like this section:

To ward off the sloppiness that inevitably comes with such speed, Mr. Osso pays two editors and a proofreader to comb through his books for errors and typos. His content editor, Dorothy Zemach, a freelance editor who used to work for Cambridge University Press, says it can be taxing to keep up. “There are evenings when my husband says, ‘Don’t check your email, there will be another book from Russell,’ ” she says.

via Fast-Paced Best Seller: Author Russell Blake Thrives on Volumes – WSJ.com.

The trend towards author services is so unstoppable now that it I becoming increasingly important that those providing the service are accredited and capable. This has got me thinking lots again about the author/publisher/agent triangle and how things might change in the years ahead.

 

On Publishing Mergers & Strategy

I have been mulling the Penguin Random House deal for some time now. In fact, I wrote most of this post about ten days ago or longer. I’ll be honest enough to admit that my failure to post my thoughts was as much due to work commitments as it was to a conscious decision, even so it has been useful to wait (as is often the case, we too often underestimate the value of inaction).

I’m glad I waited because it’s quite remarkable what you can discern when you stay out of the flow of an issue. Firstly it meant this post comes in the wake of Peter McCarthy’s wonderful piece When Elephants Mate: Thoughts on the Potential Penguin Random House which explores the merger in wonderfully telling detail and is a must for the interested. Secondly, it comes in the wake of this piece of news News Corp., CBS in Talks Over Merging Book Businesses. Both pieces have been useful in underlining my thinking.

I’ve felt, watching and reading the reactions of tweeters, journalists and thinkers, that there have been three clear waves of response to the news. The first wave of response was mostly surprise (not without some humour and a considerable degree of fun as people contemplated names for the possible merged outfit (my own was definitely Random Penguin). Some discussion pondered the sheer scale of the entity, the number of imprints, staff, buildings  books and authors it would encompass. Best described as the shock and awe stage I think.

The second wave echoed with fear; fear of the powerful combination that the first wave only began to consider, fear of reduced options for writers, agents and readers, and a fear of the changes this new entity would bring to an industry that seems of late to be in constant flux. The fear and loathing stage seems an apt description for this stage.

The third, more considered wave, saw discussion of the merits of the merger in terms of what it equipped the larger entity to do, the power shift relative to digital interlopers and other publishers not to mention the chances for success. In general this wave of discussion was an attempt to put the events in context, consider the implications and look to the future. The dealing with reality stage I pegged it.

To most of those discussions I felt I had little extra to add. One area however seems to have been curiously overlooked in the discussion to date, the fact that we are seeing two very different strategies in action here and strategies that are making value judgements on entire industries. And what are they?

Well the first is a clear strategic decision to move out (and definitively so) of the trade publishing industry. That’s what Perason has done. Make no mistake about it, it wanted shot of trade publishing, and saving the prize of the Penguin brand for use in other areas where it might be useful (like its educational publishing segments) it got shot of it (intriguingly it is also rumoured to be keen to sell the FT though those rumours seem to have been put to bed more recently). What interests me is that Pearson isn’t out of publishing, just trade publishing. So it made a decision based on its read of  its abilities, its resources and its weaknesses. Probably the likelihood of future profits and the environment of the sector had a large bearing too.

Pearson’s takeaway from that analysis was that even with the most recognisable brand in trade publishing, they’d rather be out of the game, than in it. When you let that sink in, the fear and loathing stage doesn’t seem so unreasonable.

Of course, in counterpoint, Bertelsmann made a very different decision indeed. Penguin Random House is now a Bertelsmann beast, majority owned by the company and, I suspect, likely to be wholly owned by it at some point. Bertelsmann has doubled down on trade publishing. As if to confirm the company’s strategic decision it purchased the remaining stake in Random House Mondadori. Bertelsmann sees value in trade publishing, so much value it has gone to the trouble of building the largest English language trade publisher in the world.

It begs the question, “Which one of these huge companies is correct?”

Of course, it doesn’t necessarily have to be a zero sum game. Both parties could well have made the correct decision for their own enterprises and simply assessed their abilities and their desired return on capital very differently. As we line up for the follow on round of mergers that the dealing with reality wave has suggested is likely and recent reports indicate are indeed in the works, we should be looking at what strategy the parents of these trade publishing giants are pursuing and how that will impact the shape of things to come.

We are living in interesting times, or whatever that means!

Go Read This | Agents have to do it, but their new service offerings change the publishing ecosystem – The Shatzkin Files

Interesting note from Mike Shatzkin this:

Many of the agents, but not Waxman with Diversion, are specifying that their services are only for existing agency clients. That’s a good way of putting a toe in the water and it’s a good way to minimize the concern of publishers. But it’s not likely to last as the policy for any of them that do this kind of work successfully. If their ebook publishing services actually work and the business is shifting in that direction, why would you turn down an opportunity that came from outside the client base. Why would you turn down the opportunity to offer the same suite of services to all the clients of some other agency that doesn’t want to build this themselves? (That’s an opportunity almost certain to arise for all of them.)

Publishers are also working on self-publishing services. Distributors have been noodling for some time about packaging these services for agents. Knight has promised to do a lot, including a substantial per-book investment, for 15% of the revenue. Are any of these other players now going back to the drawing board to reconsider their pricing? I would think so.

via Agents have to do it, but their new service offerings change the publishing ecosystem – The Shatzkin Files.

No New Normal – The Value Web

For some reason this has been a very hard post to write. It’s a rather strange situation for me as in essence what I’m writing about is really a very basic idea. Maybe it is because I’m afraid that people will misunderstand it or take the wrong message from it. Which if I’m honest means I’m not writing it clearly enough. Oh well! Here goes nothing.

~~~

I want to write about this very simple idea:

That as the impact of digital distribution begins to be felt along the trade publishing value chain, what will emerge is not a NEW VALUE CHAIN as much as a new VALUE WEB, an environment that sees, not one way to generate value in the industry but many ways of doing so. What’s more, this state will persist because no particular method will emerge as the single ‘way’ of trade publishing (if that term even retains relevance), at least not for some time to come.

Everyone (at this stage) thinks that the trade publishing value chain is endangered. They’ve even created a word to describe it, disintermediation. And Everyone is right.

What I think they tend to ignore is the way in which the value chain is endangered. It’s not a simple change that we are experiencing, it’s far more dramatic and complex then is often imagined.

Until recently, the trade publishing value chain looked something like this:

Author > Agent > Publisher > Distributor/Wholesaler > Retailer > Reader

Some people fear that Amazon or Google or Apple will make a big move and the result will be something like this:

Author > Amazon/Google/Apple > Reader

And there’s some real danger of just that happening. You only have to look at how companies like Apple and Amazon have facilitated self-publishing and in so doing excised huge swathes of the old chain from certain sectors of publishing. Certainly on Amazon’s part the ambition to disintermediate the publishing industry has been obvious for some time, at least if you were paying attention, it was certainly clear long before they made this announcement, but sometimes it takes BIG HEADLINES to make people pay attention.

There’s an added complication in that authors themselves (or some of them at least) might just wish for something that looks more akin to this:

Author > Reader

And what’s to stop that? After all there is no reason why using Paypal or some other selling tool, an author could conceivably sell ebooks directly to readers and maybe even turn a small trade by doing so. You could argue that Amazon’s Kindle Direct Platform is a close approximates of that, but I think the platform ownership position of that player means its role is greater than just a service provider.

Hold on tight
But, and it’s a huge but, despite all this evidence of disintermediation there is absolutely no reason to believe that one way of reaching an audience or one way of delivering value will win out for ever and in every instance. For example:

  • Random House has just disintermediated the agent by doing a deal directly with Tom Sharpe for digital rights, and that is by far NOT the only way in which publishers, big and small are finding new ways to operate in the digital era.
  • Bricks and mortar bookstores, despite being at the coal face of the digital wave, are not against a bit of disintermediation themselves. B&N is quietly disintermediating everyone in the self publishing world (just like Amazon is) via Pubit service for their Nook platform. You should expect to see them take their print publishing arm (Sterling) even more seriously then they already do after Amazon’s announcement.
  • Agents are building direct channels to consumers and publishers, long the supposed victims of the piece are beginning to find direct selling attractive and capturing audiences to (hopefully) turn into readers.

The point being that as this digital distribution wave of change washes over the industry, it will radically reshape the value chain in unpredictable ways.

For some titles it will force authors to make hard decisions, it will reduce the predominance of publishers (or at least the traditional ones) while elevating the role of platform owners like Amazon, B&N, Apple and maybe even Google, but for some titles it will broaden the role of publishers and if they are lucky and smart maybe even the surviving booksellers.

All of this will happen despite, or perhaps because of the fact that, the actual slice of value captured by each player changes in size and shape. Publishers will be forced to cede more revenue to authors, the idea that 25% Net is a defensible long-term ebook royalty rate is a farce best forgotten about quickly.

Agents may find their 10% under threat too, especially on backlist titles, unless they offer something more valuable then just conversion, after all, their authors are pretty much able to upload a file to a platform for conversion themselves.

Authors themselves will face greater competition both from the increased numbers of writers (Good and Bad) facilitated by digital distribution and the existing databases of ALL titles ever published digitized and available for distribution. If most authors already have low incomes, then they will get lower. Though I’d also expect the winners to become even more gigantic!

As the influence of bricks & mortar retailers wanes, especially the chains, so too will their ability to demand such high levels of discount. I’m pretty sure the platform owners will be able to squeeze most players for a greater share of the revenue. How powerful they will become remains dependent on just how easy it becomes to read a file you buy one place anywhere (currently easier then I’d have imagined).

None of them will go away though. For some books, print will remain a huge segment of the market and bookstores or supermarkets will remain the best place to sell them and traditional publishers will probably remain the best home for such books. For others, the author’s platform will be large enough to justify a going-it-alone route, but even for the biggest authors, for the right book. partnering with an agent, a publisher or a platform owner might be the right move. That’s where the web comes into play.

The tidy chain discussed at the start begins to look, and will be in real life, a whole lot more complicated.  Instead of a publishing value CHAIN, we have something more akin to a value WEB. Different actors can work together on different projects depending on their needs at a given time. And that means title-by-title projects, agents taking on roles more akin to producers (or publishers or retailers or maybe all of them doing so but not on every title). Of course for large parts of the business the platforms and self-publishing will suffice, but overall, the change will be dramatic and will, I think, look something like this:

It’s not all going to be plain sailing
Of course there are going to be losers. The least well positioned players in the game are wholesalers and physical bookstores. Their roles are uniquely challenged because of the shift in format from physical to digital. Yes, as I have said, some print market will persist but what size and shape that will have in twenty years time is anyones guess, what we DO know is that it will be smaller and because of that we’ll have fewer physical bookstores, but how that shakes out we cannot be sure.

I’m sure too that we’ll see casualties among the publishing houses that currently thrive. Some because they make bad decisions and fail to adapt and some from just bad luck. Other will lose market share and fall under the wing of other players, maybe they’ll be publishers too, or maybe they’ll be retailers or platform owners.

The funny thing about this disintermediation business is that the only clear winners are at the ends of the old chain, writers and readers. The writer’s win is tainted by the knowledge that though their options, the costs of and their routes to publication will have expanded greatly, their chances of earning a living from writing will have decreased rather dramatically too.

Readers on the other hand will be faced with a surfeit of choice, less of a problem then most people imagine, but still an issue if too much time is wasted in filtering through those options. On the other hand they can expect to see the price of individual pieces of content to fall, especially when the creator, however talented and however the web has coalesced to deliver that content, is an unknown.

Is Feidir Linn,
Eoin

Go Read This | Ed Victor sets up publishing imprint

UPDATE: I neglected to include the link to The Bookseller whose original reporting I quote below. The link is now included!

As if the signs were not clear enough that the world of trade publishing is changed forever, Ed Victor comes along and proves it pretty definitely. It’s not the scale, which is modest, more it is the fact that this kind of operation is but one of many sure to crop up over the next few years. They makes sense, they will no doubt bring in more money for agents and authors and they are fine ideas.

From an author’s perspective I wonder on the 50/50 split of proceeds though. For one, the new operation will be by far best business at an agency in terms of margin (after all, once the digitization costs are repaid the money coming in will be almost entirely profit). What’s more, Victor makes clear no extra staff will be recruited and agencies don’t have the overheads a publisher does. Given that and given the likely emergence of a 50/50 split with publishers, why would an author settle for 50/50 with their agent?

In any case, fascinating move:

The agency is not taking on any new staff, but will work with digital production company Acorn to create and distribute the content in the correct format. The agency has also retained J K Rowling’s joint publicist Mark Hutchinson to market the titles through social media sites.
The titles will all be available on online booksellers including Amazon.co.uk and the iBookstore, with Victor confirming he intends to adopt the agency model. He said: “I think it will all be on the agency model, we’ll give up 30%, then we will give up another percentage to Acorn”. The POD side will be through Gardners, with print carried out by Antony Rowe.
He said net receipts will be divided on a 50/50 basis between author and agency, once production costs have been recouped out of the first receipts. This is in contrast to the 25% royalty rate understood to be offered by most major publishers.
Victor described the lines separating different roles within the industry as being “blurred”, and, looking ahead, comparing publishers and agents’ ability to compete in a changing industry, he said: “I’m certainly lighter on my feet and maybe that’s the answer for the future.”

Via - Ed Victor sets up publishing imprint | The Bookseller