mike shatzkin

Go Read This | The future of bookstores is the key to understanding the future of publishing – The Shatzkin Files Pt. II

I’ve already linked to this, but it warrants a second link. If you want to understand the basic problems facing book publishers in 2014, then read this post. In it, replace the large publishers and niche players that Mike refers to with small general players and consider how the trends and realities he discusses endanger them. It’s both illuminating and unsettling:

But that’s today when the online-offline division may be near 50-50 overall and is 75-25 for certain niches. If those numbers become 75-25 and 90-10 over the next five years, the bookstore market really won’t matter that much to most authors anymore. Whether through self-publishing or through some fledgling publisher that doesn’t have today’s big publisher capabilities but also doesn’t have their cost structure, authors will feel that the big organizations are less necessary than they are now to help them realize their potential.

via The future of bookstores is the key to understanding the future of publishing – The Shatzkin Files.

When Mike talks about the challenge publishers will face in retaining authors, I’m struck by how his thoughts reflect those I wrote back in 2006 (Authors Will Drive Change) early in my blogging about this ongoing shift we’re all a part of:

What’s more you can package your content in any variety of ways. Make a podcast or your poetry and push it on iTunes. Act out your play and upload it to YouTube or your preferred location. It is easy to do it all now and to do it well. Maybe the cost of a decent designer or video editor will take a summer to save for or a winter of being cold avoiding buying new jumpers but the costs are so achievable it is exceptional.

The point is that publishing is no longer just about books and even more it is no longer about waiting for a publisher to decide your work is good enough for print.

Options abound and as more and more writers realise that they will take advantage of it. E-books will push this change even more. There is no reason why authors’ royalties should be the same on e-books as they are for paper books and in many ways there is no reason why the authors cannot sell e-books themselves rather than through a publisher. Why should you sell a paper publisher your digital rights when there is no need?

Of course the real growth in power for authors is with two groups; the super successful authors who already command high advances and special treatment, and those who were never going to be published anyway. In both cases options abound for changing the current model.

Where things are less easy to decide is the mid-list. Here, as bookstores fail and ebook sales gravitate towards the winners and the margins, there may be difficult years ahead for those who fall into either the average writer space or the average sales space.

None of that solves the headaches publishers face!

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Go Read This | Publishers do need to sell direct, but here are five things they should at least be started on first – The Shatzkin Files

In many ways this issue highlights both the complex decision-making processes that lie behind things that are highlighted as faults among large publishers (and in so doing offers if not a defence, then at least an explanation for seemingly bizarre decisions) and the core problems of these publishers (that they are at once too large to move easily and too small to challenge their existing partners on tech or ecommerce grounds).  There’s much to ponder in this post as you would expect with Mike:

Because Random House didn’t have that blind spot, they were, first of all, aware that their conversion rate on clicks to Amazon was very high, much higher than they would expect to get themselves if they tried to encourage consumers to buy direct. So the capture of more margin per sale would be at the expense of losing many sales. But, in addition, the extra margin can get burned up pretty quickly with the costs of running a direct-sale operation. One that provides solid user experiences, customer service, and other now standard eCommerce practices anywhere near today’s customer expectation is expensive — more so when it isn’t your primary business. eCommerce is a huge distraction, especially when it is executed by the folks who are also your digital marketers! That, or additional head count (which further lowers margins), would constitute a publisher’s choices.

via Publishers do need to sell direct, but here are five things they should at least be started on first – The Shatzkin Files.

Author, Niche & Power Shifts: What Pottermore MIGHT Point To

Mike Shatzkin has a fine post about the implications of the Pottermore move in terms of publishers and DRM:

Without DRM, as Berlucchi explained, anybody can sell ebooks that can be read on a Kindle. Once Pottermore decided they could live without DRM, they faced Amazon with a very difficult choice. The ebooks were going to go on Kindle devices whether Amazon wanted them there or not. Either they could ignore them or they could play along. I am sure the “play along” deal includes compensation to Amazon for the sales they refer (as it does B&N and, according to a quote from Redmayne, other distribution relations and affiliations will be enabled going forward.)

In other words, in a refreshing change from recent history, the content owner was able to present Amazon with a “take it or leave it” proposition. They decided to “take it”. They were wise. The game was changing either way.

I’ve long felt that the power balance between authors and publishers has shifted and will shift further as digital change drives home a point I made most clearly in my essay No New Normal: The Value Web (and reiterated here on Futurebook):

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.

And even earlier (2006) when I wrote about Authors Driving Change:

E-books will push this change even more. There is no reason why authors’ royalties should be the same on e-books as they are for paper books and in many ways there is no reason why the authors cannot sell e-books themselves rather than through a publisher. Why should you sell a paper publisher your digital rights when there is no need?

I think Mike is right to say that Pottermore marks a decisive point of change. It is the point at which owning the brand becomes essential, the point at which the 25% slice for the author stops being enough and the changed power balance between author and publisher begins to bite really hard.

If publishers hope to use author brand and scale to attract readers direct then they need to persuade the authors to work with them. That’s gonna take money and a whole new approach to working with the author. I expect we’ll see more of that.

The other change I believe it will drive even further is that of Niche or community driven content publishing. If selling without DRM enables big  publishers to flourish as retailers (or for that matter niche publishers with scale in a single niche), then there is even more incentive for them to pull readers together in communities of interest (or rather to build stores that appeal to those existing communities of interest) and sell content to them directly rather than spending all their marketing on pulling them to a mass appeal site that only offers them content that works for that reader by chance event or a well placed cookie!

So I see Niche coming back with a vengeance, and community at its side, perhaps even a third horseman in the shape of an industry newly engaged in open standards, weak DRM and a willingness to innovate. That’s rather exciting if you ask me.

Publishers, Stop Being Craven, Forge Your Own Future

For some time there has been a funny dichotomy in the publishing industry worldwide.

On the one hand publishers have decried the growing influence of powerful tech companies from outside the industry. Google, Amazon, Apple all fall into that category (Amazon aside from being an impressive online retailer is also an amazing tech company). They are feared and despised both as huge outside firms with enormous capabilities and cash compared with publishers and also as companies driving the industry in a direction it wasn’t keen on going.

On the other hand, various parts of the industry have gushed about the latest moves by these companies, Apple’s launch of the iPad as a media’s saviour, Google EBooks as a game changer or now, Google’s One Pass as a way to beat Apple’s new and restrictive trading terms for content bought in App by consumers.

Perhaps the only exception to this has been Amazon who, despite being one of the most innovative and reader friendly companies in the business, has been routinely lambasted. Even it’s clever and effective popularization of ebooks and ereading was seen as a BAD thing. Amazon, it seems, can do no right!

Well I’m sick of it. I tired of hearing the industry complain and point one minute then jump up and down in happiness at the anticipation of NEW things SAVING content the next. I’m tired of bad strategy decisions prompted by poorly thought out positions. I’m really bored with people arguing about why this or that needs protection and honestly I don’t care what Apple does next.

Lots of sensible people have been talking about what publishers should be doing to make their OWN way towards a sustainable future. Mike Shatzkin has written about it, so has Brian O’Leary, Don Linn and Kassia Krozser, many, many others have too. But none of it seems to impact the mainstream discussion.

  • Here’s a simple truth: the web (in particular digital distribution of content) is undermining the existing economic model for publishing
  • A second: the author is gaining power vis-a-vis the publisher
  • A third: the existing system cannot persist, the parts of the industry that don’t change, will fail
  • And a last one: YOU are responsible for your own future and it’s time you stopped waiting for someone else to make it happen

Digital content WILL dominate the future*. You don’t have to like that, but you DO have to accept it. When you accept that you’ll begin to see that the systems behind publishing need to change rapidly or else you need to create a new organisation to work within the new rules (and economic realities).

It’s time for the industry to stop worrying about Apple, Amazon and Google. It is time for the industry to just forget about all of them and to decide how it is going to bring stories to readers in a way that keeps it relevant, interesting and hopefully profitable or else to decide that it is going to grow old and die gracefully. In either case, I’m pretty sure it’s time to shut up and do it.

~~ ~~ ~~

*By that I don’t mean print will go away, it won’t, but just as letters have been superseded by email, phone calls and text messages, it will become less important. It will though, have a fascinating and interesting future and it may well be that it’s where your future lies if you decide to pursue certain strategies, but that is YOUR decision.

My 2010 Publishing Heroes

Last year I chose some folks who I though had made 2009 interesting in publishing terms and I believed would do the same in 2010. I think I was broadly right about them. You can see the 2009 list here. For 2010 I’m doing the same.

Richard Nash ~ The Risk Taker
Nash is moving ahead with Cursor a new type of publishing company based on communities, authors, shorter contracts and generally many of the ideas that have been floating around books for a few years now. He’s fiery, inspiring and willing to take a gamble (and be wrong too). He has spoken several times over the last few years about where publishing is going and he never fails to offer rich and convincing arguments to back up his point of view. I’m hoping he’ll be successful, not least because his first imprint community is called Red Lemonade!

Gareth Cuddy ~ The Doer
Sometimes you need people who just get down on the ground and shift dirt. IN many ways that is what Gareth Cuddy has done in Ireland. His DirectEbooks has been selling ebooks for some time now and as he would no doubt concede himself, right now the market is not mainstream, but it is getting there. He’s been pushing for more Irish publishers and small publishers to get into epublishing and through his EpubDirect service he’s offering publishers a decent way to get digital fairly quickly.

Rebecca Smart ~ The Changer
Osprey really shouldn’t be cool (except maybe to military history nerds) but it is. It has created an online community for military history buffs and pioneered direct marketing methods that keep the company engaged with its readers and released a book on Zombies (complete with accompanying video). It recently bought the apparently unconnected Angry Robot Sci-fi imprint from HarperCollins and have shepherded it to great success. Much of this is down to Rebecca Smart’s savvy leadership and ability to drive change. She’ll no doubt say that the great staff behind her at Osprey are as much responsible and I think she’d be right, but even the best Army needs a good general.

Mike Shatzkin ~ The Thinker
Mike is pretty darn smart. What’s more, he’s pretty darn good at putting his thoughts down in a clear, concise and accessible way. If you don’t read his blog, you really, really should. As one of the brains behind Digital Book World (a conference I’ll sadly not be attending this year) he has managed to start the in-depth conversations that US Trade Publishers NEED to have if they are to survive the shifting playing field of digital publishing.  For that alone and the pleasure of reading the posts he shares so freely, he makes the list.

The FutureBook Team
The last choice is always a hard one when one is creating a small list. So I’ve cheated and chosen a team. I’ve done this for a few reasons. Firstly I think FutureBook (a blog and conference run by The Bookseller) came to life quickly, embraced the web rapidly and grew by engaging in a fashion that felt very web native and very focused on community and providing value. Secondly I felt that in doing that they provided a critical hub for debate and discussion about ebooks outside of the US but in the English language. It made ebooks real for many publishers and booksellers outside of the US and that was pretty useful in a year that has been dominated by digital developments. So well done to Samantha Missingham, Philip Jones et al, a fine job, well done.

Go Read This | Publishers, brands, and the change to b2c – The Shatzkin Files

Yes! Yes! Yes!

A brand that is in between these two is “Dummies.” It definitely creates a meaningful shortcut for a consumer; they recognize it and it tells them “this book explains the basics on the subject in a way that requires you to bring almost no knowledge to it for it to be useful.” But because Dummies covers many subjects under the sun, it would be difficult to make use of it for audience-gathering or direct marketing the way Harlequin is employed.

You wouldn’t “subscribe” to new offerings, sight unseen, from either Penguin or Dummies. That means that, in at least one very important way, those brands aren’t as useful as Harlequin. Why? They’re too broad. General Motors wouldn’t ever have sold nearly as many cars if they called all the cars “GMs” to create a megabrand and had lost the distinction between Chevrolet and Cadillac. Trying to create “one big brand” if it captures unrelated content or unrelated audiences could be “one big mistake.”

My own theory is that publishers have to completely re-think their imprints in light of the need to move from b2b to b2c. Imprints at big houses are almost always silos with no discernible b2c meaning. In fact, the names of smaller houses, because smaller houses tend to focus on subject areas, can more readily have meaning to consumers.

via Publishers, brands, and the change to b2c – The Shatzkin Files.

Oddly enough my Pecha Kucha session at TOCFrankfurt last year touched on this. I’ve only the slides, must see if I can track down an audio version,

Go Read This | There’s only one Seth Godin, but there are other authors who might emulate him – The Shatzkin Files

A rather good piece by Mike Shatzkin on Seth’s move.

Publishers should have remembered the axiom that you should be careful what you wish for. This was, perhaps, the beginning of the unbundling of the publisher’s suite of services to the author. It used to be that the publication of a book was the platform and the publishers’ publicity and marketing efforts worked to capitalize on it. This was all part and parcel of the package: paying an advance; editing and shaping the book; putting it into a distributable (printed and bound) form; getting it known; and, of course, getting it into a store where a customer could buy it.

via There’s only one Seth Godin, but there are other authors who might emulate him – The Shatzkin Files.