Reports of Traditional Publishing’s Death Are Greatly Exaggerated
This post is a response to Bob Mayer’s last post on this blog, Was March 2012 the month Traditional Publishing died? I admire Bob and I’m glad he’s one of our expert bloggers, but I happen to disagree with him on this issue. I hope my response inspires a friendly debate among us and those in the industry. I welcome your feedback and comments.
Is the book publishing business as we know it dead or dying? If you believe everything you read, you might think so.
I might be in the minority opinion among publishing business observers, but I happen to think that it’s a vibrant business going through a difficult transition from which it will emerge stronger than ever. And, yes, most of the big players we see today will survive intact.
This belief is why I came to Digital Book World five months ago (to the day). I left a position at Dow Jones covering careers, another topic I’m passionate about, for the opportunity to cover an industry that is among the most dynamic and exciting in the whole world of business.
I didn’t come here to bear witness to the last gasps of the great publishing houses.
Aside from my self-serving conviction that traditional publishing must not be dead, I think there are some very legitimate business reasons that the publishing business will be around in something recognizable to its current form for a long time.
I have three reasons I’d like to put forward here:
1. Publishers earnings. Most major book publishers have closed their 2011 accounts and the results were solid. In 2011, Borders closed, Barnes & Noble reduced shelf space by 20% and many independent bookstores closed – yet the major publishers that publicly reported financial results mostly maintained revenues at levels similar to 2010, doing so through great increases in e-book revenue. E-books, for most companies, carry a high profit margin; e-books helped drive increased profits at these companies.
As Mike Shatzkin has said, these large publishing companies are led by smart executives. They’re in the process of figuring out how to transition from being purely print publishers (business-to-business concerns) to being hybrid print-digital publishers that market and sell directly to consumers. As long as these businesses have a good cash-flow, they have the chance to make the right investments to ensure future profitability.
2. Publishers as curators. At the annual meeting of the Association of American Publishers last week (read about it here, here and here), Malcolm Gladwell closed the show with a keynote about why he thinks publishers are relevant. For him, it’s about being gatekeepers of quality.
While it’s a miracle of modernity that anyone can publish (imagine the stir Martin Luther could have caused if his distribution platform was more than a church door), much of what is published is probably not worth reading – wait for it – given the chance of reading something better.
That thing that is better is what publishing companies strive to provide. Sometimes they’re successful, sometimes not, but, at this point at least, they lay claim to most quality book content.
Marcus Leaver, in his keynote at the Publishing Business Conference, echoed Gladwell’s sentiment: “The world does not need another book,” Leaver said.
3. Sales, marketing, distribution, logistics, accounting, investment, etc. Hachette spelled it out in an internal document leaked to Digital Book World in December. The gist of it is that large publishing companies have put great resources behind the publishing functions listed above and generally do them better than individuals or smaller companies – at this point.
All of this could change overnight. Much of it already has. Social media, for instance, has put individuals on equal marketing footing with large companies – at least in the realm of Twitter and Facebook.
Let’s also take into account the example of print distribution. It’s basically impossible to get a book into most bookstores, let alone on a front table, without a publishing operation. I’m unaware of any self-published authors making hay at bricks-and-mortar Barnes & Noble stores today.
Until print distribution is less than, say, 20% of the business (and it’s doubtful that this will happen any time soon – if ever – across all publishing segments), it will still be critically important for authors who want to reach the largest possible audience to work with publishers.
I have confidence that there will still be a place for large companies to perform these functions in the next five years at a minimum.
So, Bob, others, what do you think?
Printing press photo via Shutterstock