The Publisher in the Value Chain 2009 Edition

Eoin Purcell

This is what I said before
Back in 2006 I wrote a piece called The Publisher in the Value Chain. It was a response to a post by Rob Jones over at Snowbooks. The bones of the case I put forward was in the conclusion:

In publishing the price of writing a book was always low, but now the price of making a book is to all intents and purposes free too. Publishing it costs nothing now if you use a trick like and very little if you use self-publishing services like Xlibris, or even The Publisher will still be needed to absorb the risk because the risk has not going away, it is just changing, shifting and moving along the value chain from printing and design to marketing and distribution.

A few pieces recently have offered alternative interpretations and, times have also changed so I thought it was an apt time for thinking this through some more.

What has changed: Distribution
Well to begin on the digital and ebook side with we now have the models of distribution that we lacked in 2006. I’m not saying that this didn’t exist in 2006, because they did, rather than the last 2 and half years have seen the arrival of mass market type offerings in these areas.

Apple’s iPhone Apps (available from their App Store which is part of their iTunes service) have proved to be excellent platforms for throwing books at people and developers have mind the public domain for free (and paid for) content to supply to interested parties.

This market has only truly been made possible by the enormous success of the iPhone itself. In some senses too the ebook/iPhone Apps publishing market is an accidental creation unlike the music downloads and iTunes which was a deliberate strategy.

Amazon has launched the Kindle and just this past week bought Lexcycle makers of the Stanza App. They have previously launched their own iPhone app to try and capture some of the market that Apple sneakily and rather unexpectedly took from them (well I’m sure that is how they see it!)

There is also the very often overlooked Sony Reader that nonetheless seems to be doing alright and recently entered a partnership with Google to present 500,000 public books on the Reader.

And that brings us to Google itself whose Books Search project has reached an almost incredible position compared to its 2006 incarnation. With some 7 million books scanned and an agreement close to being locked in (though there are some problems with this deal from many viewpoints, lots of which elicit my sympathy) GBS is a beast that cannot be ignored, even if the two most successful distribution models to date are Apple’s and Amazon’s.

But leaving aside the questions it is pretty clear from this brief survey that a whole ecosystem for distribution is being created ebooks and digital content.

What has changed: Marketing
The change here is not as convincing I would suggest as it has been in distribution. Several very excellent sites have started to aggregate both information and readers. LibraryThing is my favourite bit other such as Goodreads, Shelfari and newer entrants like Book Army and FiledBy. Michael Cairns has a good post on this type of Curation as he calls it.

What hasn’t changed?
But the truth remains and is perhaps even more true that as I noted in 2006 by way of Mark Cuban:

Because in an ala carte world, the cost of reaching an audience is outrageous. And consumers arent ready to pay the freight to receive that programming.

As I have said before, the movie market is ala carte. Look at which content rises to the top in terms of revenues from consumers and visibility. The content from the biggest companies who have spent the most money to market .

In the book world, our products cost less than movies, but one movie visit (no including the extras) costs about the same as a decent book (though most paperback fiction is slightly cheaper). The revenue per title is considerably lower than most studio’s revenue per movie so our marketing budgets are commensurately lower, but our strategies are pretty much the same. Reach large audiences and spend money to get them to buy your books.

Visibility and discoverability are still the essential parts to the jigsaw. No-one, except perhaps Google who are indexing the content of all the books they scan, is in a position to change the game on this point. Certainly not the single author whose only hope is that a good blog and outreach will result in attention. For one in ten thousand of fewer it may well achieve that as Seth Godin eloquently points out, the 9,999 who miss out never even get heard of!

To market a book you still need money, you still need a distribution system that shuffles deadwood from warehouse to store (and back when necessary) yes in certain limited cases Print-on-Demand will float but for books that are selling by the thousands that is hardly a viable way forward. You need a sales force and you need know how. You need post release press attention that dedicated pr associates have drummed up and high profile editors have garnered by way of long term contacts.

In short you need someone who spreads risk across multiple authors so that taking a bath on three and losing a little on four can be offset by winning on one and breaking even on two.

Google might yet change the game, but that change will only be as random as internet popularity always is. What is more as Pete Waterman might explain in depth, Internet Stardom does not equal big paychecks!

And even if they do, authors will still need a partner to exploit the opportunities created by attention. They’ll need the ability and contacts I’ve just described or else the attention will go to waste. It may be that Amazon, Google and apple will step up to the plate but right now, that link is Traditional Trade Publishing.

Conclusions for 2009
And so, two and a half years on, where is the publisher in the publishing value chain? I think that Mark Coker has it partly right when he compares Publishers to VCs in his blog post over at Smashwords. We are the financiers of all the risk. That much has not changed.

Where he gets it wrong is in his follow up post about how the risk and the reward has shifted towards the author. The author cannot afford to absorb this risk and so he/she will fail to reap the reward.

The mantra of Cuban, remains accurate and doesn’t look like changing any time soon.

Clinging to the end of the value chain!

12 thoughts on “The Publisher in the Value Chain 2009 Edition

  1. Hi Eoin, I appreciate the shout out. I hope my follow up post didn’t imply that increased risk means increased odds of success. Quite the contrary. Like with all things risk related, greater risk means greater odds of failure as well. And you are correct, underfunded authors face even more difficult odds in this brave new world of publishing without the resources, connections and expertise of a commercial publisher. But it is what is is, and authors will have to make do with the new realities. Luckily, low cost and free tools are out there to give them a shot at getting their book out there and marketed. Getting out there alone is no guarantee of success. However, for the talented few authors – indie or otherwise – who can prove large commercial markets for their books, more and more will aspire to become their own publishers.

    1. MArk,

      I think you are right about the wanting to aspire to being their own publishers and I’m fairly sure for the top end that will happen! But how will they get to the top end? I suspect that publisher will play a part there!

      1. I love publishers too! No doubt, a good publisher represents the fast track to the high end. And while some successful authors may choose to go solo, many others will want a publisher (+ others in the value chain) to handle all that publishing-as-a-business headache that gets in the way of writing the next book, like publisher editing & revision feedback, proofreading, cover design, layout, positioning, marketing, pre- and post-pub sales, distribution, fulfillment, customer service, and all the other things that good publishers do.

  2. Interesting post and great links, thanks! Off to read and absorb it all… eventually I think my mind may be changed about wanting to sign with a traditional publisher, but it still looks as if that day is a long long way off yet.

      1. Right, Eoin, find me a publisher who will actually allow simultaneous free online and e-book downloads per my ‘free culture’ ethos, and I might just consider it … heh heh, fat chance! (At the moment I’m awfully sick of copyediting and proofreading in preparation for the imminent serialisation of Corvus. But I’m very pleased indeed that a professional BBC actor, who supports this very ethos, is going to be reading all of the podcasts – and yes, pro bono!)

  3. Very interesting post, Eoin, and one that I, in my amateurish status (!) agree with wholeheartedly. It’s all down to visibility and distribution. At a recent literary festival I listened to three publishers discussing the current market and it was sort of entertaining and depressing. My thoughts about it are in a post entitled ‘Meet the Publishers’, in case it should tempt you to read it!

  4. As one of those indie writers who has decided to go it alone, I can only say that I have no regrets. Anyone who asks me gets a very sobering reply much like your summary, Eoin: don’t do it unless you are prepared to do a LOT of self-touting yet still remain largely invisible. But you see, I don’t measure success in commercial terms – obviously not a viable model for a publisher. And my rewards? Well, I get to write (and yes, publish, if you mean by that make available to someone other than my husband/kids/best friend) exactly what I choose.

  5. Excellent blog Eoin – I need the likes of you to have half a chance of keeping up with what is going on in this crazy industry. I haven’t popped in for a while and am now ploughing (in a good way) through the 26 posts on my RSS thingy.

    Anyway – a bit of help please. Have you any recommendations for info on finding a company that will actually produce and distribute an e-book for me – I’d rather like to get on this Kindle, iphone bandwaggon at some point!



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