Toward the end of the management class I teach at NYU’s M.S. in publishing program, we cover three cases, including one on Harlequin at the time it is considering a launch of Mira, a trade imprint.

To that point, Harlequin had been known for series romance fiction, much of it sold directly to consumers. There is ample evidence in the case that the market is changing to favor single-title romances and named authors, and Harlequin assembles a task force to consider its options.

Ramping up single-copy sales is complicated by many factors, including a multi-year trade distribution deal that Harlequin had made with Simon & Schuster as part of an agreement that settled a “romance war” between the two firms. At the time the case is written, S&S is one of the dominant publishers of single-title romance novels.

I teach the case to draw together structural lessons taught throughout the semester. It’s a good opportunity to apply Michael Porter’s “five forces” framework. It’s also a preview of 2010’s interdependent publishing world.

Generally, students recognize the significant differences between a direct and a trade model, but very few discuss the sales and margin impact of a long-term agreement with a distributor whose interests diverge from Harlequin’s. I give them a break: they are students, at NYU to learn, and supply-chain analysis is hard.

They are also playing with Monopoly money: no harm, no foul.

Flash forward to 2010: Amazon is busy making the entire book business a “direct-to-consumer” model. This isn’t new; they have been doing it for 15 years. By most accounts, the company is now the largest retailer of physical books and the dominant player in the digital space.

What are Amazon’s priorities? It doesn’t hide them. In 2007, Amazon founder and CEO Jeff Bezos described a company that is “congenitally customer-focused” whose enduring priorities are selection, low prices and fast delivery.

Compare those priorities to the ones in place at most publishing houses. It’s easy to see where interests start to diverge. And if you apply Porter’s framework to Amazon, you quickly see why the company has become publishing’s best-known and most significant frenemy.

A direct customer focus has paid off for Amazon. Customers describe buying books from Amazon in ways that they seldom do when talking about bricks-and-mortar stores. And like it or not, the sense that books should and can cost less is now ingrained in our consciousness.

The recent controversy involving an agent selling exclusive eBook rights to Amazon (you know the one) has focused largely on royalty rates, the role of agents and the exclusive nature of the deal. I think that debate misses the point.

The publishing supply chain has shifted. The interests of the company best positioned to benefit from those changes are not aligned with those of most publishers today.

Publishers can defend, change or co-opt, but they can’t stand still. Issue all the press releases you want, but realize this isn’t about eBook royalty rates. It’s about Amazon.

This post was originally published by Magellan Media and has been reprinted with Mr. O’Leary’s permission.

Brian O’Leary is founder and principal of Magellan Media, whose clients include major media firms as well as smaller and not-for-profit entities with significant publishing and media commitments.

The year 2010 will undoubtedly be the year of “e,” but it’s not going to stand for e-book; it will stand for experimentation. Experimentation with contracts, rights, formats and distribution channels; experimentation that will certainly include e-books, and rightfully so, but they won’t be the central focus — for publishers nor readers.

“E” is for Experiment (Not eBooks)

Six months ago, when exponential eBook growth was the dominant meme, I called for taking a step back from the hype to focus instead on the far more important ”e” — experiment.

Since then, eBook sales have modestly declined every month since peaking in January (May’s data hasn’t been posted yet as of this writing), but there have been some encouraging signs that publishers realize the key to their long-term viability doesn’t hinge on any particular device, but on a willingness to experiment with new business models, sales and marketing channels, and yes, a variety of digital formats and workflow strategies.

Following is a roundup of notable posts, some more recent than others, and a couple of new DBW WEBcasts that focus on how publishers can navigate the digital transition that is simultaneously disrupting established business models while creating amazing new opportunities for those willing to experiment, take calculated risks, and rethink where “the book” fits in the digital era.

Adapt to recover, warn publishing chiefs
Bookseller News Team

“Our business needs to change, regardless of whether there is a recession or not. The economic situation has merely hurried the process along . . . To be honest, I don’t anticipate the market ever returning to pre-recession levels in its current form.”

Barnsley, whose company saw sales fall 13.3%, the largest drop among the top 10 and despite Hilary Mantel’s Booker-winner Wolf Hall, explained it had been necessary to take “a lot of cost out of the business”, including cutting the number of titles published by 20%. “We are focusing more on profit than on market share [now at 7.3%],” she said. “Most publishers over-publish for today’s market.”

The Future of Print
by Kassia Krozser

I cannot predict when the shift from mostly print to mostly digital will happen. I suspect it will be like a patchwork quilt. Print becomes more valuable when it becomes less disposable. We will happily invest in quality because what we buy is something we want to preserve — and display — for a long time. I think we interact with different media in different ways. I’m not a smell of books person, but I am a tactile person. Different types of content (the wrong word here, but nicely umbrella) demand different types of interaction.

Print and digital are different experiences. It’s not good or bad or right or wrong. It’s what the book, the story within (be it fiction or non-fiction), requires. Some stories can be told in every format possible. Some must be purely digital. Some demand the pace of print.

The iPad, Transmedia, and the Future of Publishers
By Guy LeCharles Gonzalez, Chief Executive Optimist, Digital Book World

If the iPad fulfills its promise of changing the way we interact with digital content, the question of territorial rights for eBooks and the temptation to split eBook rights from print deals could become even thornier as the book becomes just one of a variety of platforms available to authors in a transmedia world, and “Transmedia Producers” become the preferred gatekeepers.

While there are some in the publishing world who appear to have seen this shift coming — including Open Road Integrated Media, Movable Type Literary Group, and Random House — developing new business models to take advantage of cross-media opportunities, can any of them compete with a truly collaborative approach that’s a far more natural fit for film producers?

Where does the book, and the publishing supply chain devoted to it, fit in a transmedia world?

Creation & Design: What Kids Want From Tech
By Kim Gaskins, Director of Content Development, Latitude

It’s no surprise that gaming is popular with kids. But creation and design? Yep – unsung favorites. Thirty one percent of technology ideas proposed by children were a tool or platform for creating something (a Web site, a game, a video to be shared, a physical object, etc.).

“Artistic creation and design were common underlying principles for a large subset of the kids’ technology concepts, with truly incredible diversity across disciplines. Kids wanted to be 3D game designers, Web designers, fashion designers, landscape designers, industrial designers, musicians, ‘traditional’ artists – and then, of course, the study itself was an exercise in imaginative creation,” said Reinis.

Publishers Need to Fail Better, Cheaper, Faster
By Rebecca Smart, Managing Director, Osprey Publishing/Shire

If you perceive that your only environment is that encompassed by your current supply chain then you’re only going to adapt to changes in that environment – so the response to the digital challenge viewed in this way would be to create and sell e-books. If you put the consumer at the heart of your thinking you can consider instead each group of customers you serve and what they might want on top of what you already provide, how they might want you to serve them differently in the future. More to the point, you can ASK them, listen and respond.

The best way to ensure that experimentation takes place is to push leadership out through your company. Those closest to the consumers are those best-equipped to come up with the ideas for future experiments. One of the experiments beginning at Osprey right now is a digital-only project in a new niche which was conceived and is being driven by two of our marketing team.

A Clear, Easy Roadmap for Change
By Edwina Lui, Director of Content Management and Strategy, Kaplan Publishing

Experimentation:  The (Pseudo) Scientific Method

If you recall those bygone days of high school (or college) science laboratory sessions, you know that the key to testing a hypothesis or making a new discovery is experimentation via the scientific method.  By carefully laying out a plan for the experiment, testing its permutations, and studying the results, all the mysteries of science could be uncovered as a finite list of conclusions.  If only publishing were so predictable.

Still, those long-ago lessons hold true, and trial-and-error often yields the most effective learning experience.

1. Mini-Pilots:  When you plan for change, think big, but when you implement, think small.  Running a small pilot as your first step will minimize risk and keep your current business on track.
2. Failure IS an Option:  In fact, failure is nearly a given.  Without the benefit of clairvoyance, you’re bound to stumble at some point.  Expect failure and embrace it—there’s much to be learned from what went wrong.  Study every backwards step and make sure your staff knows that their fates don’t hang on the success of a pilot project.
3. The Pre-Postmortem:  Not only is the term postmortem a bit morbid, putting off a project assessment until the pilot is ‘dead’ may yield you nothing but flies (sorry, I had to go there).  Discoveries and insights can occur at any point.  Capitalize on those eureka moments and keep your pilot project adaptive.
4. Agility:  Are you tired of that word, yet?  Building off the previous point, make sure to remain nimble in your pilot.  Unexpected insights crop up throughout a good pilot, and you should be ready to modify your goal, rather than doggedly pursuing a potentially outdated goal.  (What do they say about best laid plans?)  More importantly, identify a stopping point, which may or may not be the planned ‘end’ of the experiment.  You may reach a good stopping point halfway through a pilot, and be ready for the next stage.

Additionally, we have two upcoming DBW WEBcasts focusing on areas of publishing where the willingness to experiment has been a necessity for years – role-playing games and comic books — and the lessons learned are invaluable for ALL publishers.

By Emily Williams, co-chair, BISG Rights Subcommittee

Traditionally, one of the serious advantages big publishers have offered authors is international reach. They have professional rights departments savvy in the ways of markets around the world, who can place any book to which the publisher controls world rights with a compatible house abroad. The foreign publisher buys the book on the same terms as the US publisher – advance plus royalties – and the US publisher collects its piece of the money and kicks the rest back to the author.

Smart agencies then figured out they could provide the same service and keep more of the money for their clients, and many of them developed their own rights-selling arm. This rights business is a specialized niche and requires not just familiarity with the book market in other countries, but a solid understanding of which publisher does what in each territory, as well as the kind of personal ties with foreign editors that it takes to place a book with the right person and persuade her to buy it.

If a publisher can’t sell rights to a book – as US publishers have been complaining about the UK in the past few years, and Canadians about the US – or can’t find a buyer at the level it wants, it still has the option of exporting copies directly, at least in those markets where readers speak the same language.  Traditionally, this too has required the heft of a big publisher, one with the capacity to work with large printers and send shipments of books across the ocean, with the packaging and pricing that meets local requirements, and get those books into the hands of booksellers and libraries in the target country.

But what if, instead of shipping hundreds of books over the ocean or trucking them across borders, you could instead just email a file?  Would you still want to sell rights and split the profits?

Would you still need a publisher?

Technology is creating new options for reaching international audiences with both the fast-growing eBook format and with the print books that still make up more than 90% of the market.  This in turn creates an alternative to the established business of rights sales: direct, disintermediated access to readers in other countries.

I first learned about Baker & Taylor’s TextStream service during a conversation with a librarian in California who was frustrated at the quality of some of the Spanish-language books he bought from Mexico.  Baker & Taylor, which happens to be exceptionally good at serving the Spanish-language book market here, floated the idea of working with the Mexican publisher to print editions for the US market using their TextStream POD service instead of shipping the Mexican edition across the border. This would not only take care of the librarian’s quality concerns (TextStream can print in the durable library format), but could potentially save the publisher lots of money in shipping costs.

The difference with using a self-serve POD supplier is that the book becomes part of the B&T catalog, which makes it available to over 40,000 retail and library customers in 120 countries.  Ingram’s Lightning Source has similar POD capabilities and can also print in different languages and reach wholesale, retail and bookstore customers in 100 countries.

"By the end of 2012, we’re saying half of all the sales potential can also be reached with the product without a local nexus: no requirement of local inventory or any shipping or revenue collection facility beyond your digital distribution and print-on-demand partner."

In a post earlier this year, Mike Shatzkin forecasted that with eBook sales rising so fast, half of US book sales (print and eBook) could take place online by 2012. In a later post he expanded on the opportunities this offers foreign publishers, who could potentially reach half of the US book market with no local nexus, via eBooks and – more importantly given how dominant print remains for now – via POD.

Selling direct sidesteps one of the most contentious issues in the English-language rights world.

The fight between US and UK publishers over who will control the rights to sell into the open market has only gotten more thorny with the arrival of eBooks, which cross borders with far greater ease than print books.  Shatzkin postulates that the ability to sell direct may end this dispute because UK publishers will no longer need to defend territoriality as a business strategy. I agree that it could put an end to some open market battles, but not because publishers will give up on territorial rights – rather because they won’t have to.

With Lightning Source and TextStream operating on both sides of the Atlantic (TextStream is currently US-only but they’ve hinted at expansion plans), UK and US houses could publish directly into each others’ markets without ceding control over their titles or making any concessions.

The big news may be not what flexibility digital publishing options offer to publishers, however, but rather the opportunities it opens up for authors and agents.

Agents on both sides of the Atlantic are under increasing pressure from publishers to sell World English rights to their books, ostensibly for all the joys corporate synergy has to offer, but also so the fight over open market and eBook rights can stay in-house.  An agent who is unconvinced by a local house’s ability to sell an author’s book abroad now has a third option beyond finding an overseas publisher or sitting on the rights.

With eBook publishing, the line between professional and self-publishing is already blurry.  As for the 90% of the market that remains print, the author now has the option of entering into a non-exclusive POD agreement that allows the book to be stocked by any interested bookseller or library while still leaving the door open for a future rights sale down the road.

Now, there are some big caveats here.

As Kobo’s Michael Tamblyn pointed out during our WEBcast, Book Rights: Headed for a Borderless Future?, what is simplest from a rights standpoint is not always best for the book or the author.  Making a book available is not the same as selling it, and when it comes to marketing and promotion, having a local publisher on board with connections to retailers and media almost always trumps an international sales strategy.  There is also all the boring but essential stuff publishers usually take care of, not least of which are the identifiers (see ISBNs) and accurate metadata (BISAC codes, good flap copy) without which a book will disappear into the online ether, never to be found again.

Still, under some circumstances going direct clearly has its appeal.

Last week, the widow of Harold Robbins, an international bestseller at one time, announced she would reissue 12 of Robbins’ out-of-print novels through self-publishing services provider AuthorHouse, in a combination of digital, hardcover and paperback formats.  The release is mum on international markets, but AuthorHouse has a UK branch and distributes through both Ingram and Baker & Taylor.

"We will take our 700 clients, see what rights are not allocated to publishers, and establish a company on their behalf to license those e-book rights directly to someone like Google, Amazon.com, or Apple." - Fifteen Percent of Immortality, Harvard Magazine

Then, on Monday, an interview with uber agent Andrew Wylie revealed that he is unsatisfied with the terms publishers are offering for eBooks, and he is thinking about bypassing them altogether, instead creating a company of his own to publish and market eBook editions of his clients’ backlist titles.  Not even the extraordinarily shrewd and international Wylie can overcome all the challenges of selling books direct to international readers (I’ve heard funny stories of agents in his swank London office calling tiny bookstores in rural France trying to set up an author tour), but with 700 clients and a rich trove of backlist titles, he’d not want for interested partners, and tech giants like Google, Apple, and Amazon have the reach to connect his authors with readers (of English) around the world.

When it comes to other languages, even more eBook rights are up for grabs.

Foreign publishers in many territories did not start to buy eBook rights until quite recently, and book contracts with foreign publishers are generally of a much more limited duration (5 to 10 years vs. life of copyright in the US). There are some complications involving acquiring the rights to republish the translation of a book – translators have rights too! – in eBook or POD form, but there are also increasing numbers of non-traditional publishing partners around the world eager to leverage the new technologies and make a name for themselves.

Agents who teach themselves to make the most of the internet’s borderless potential not only to make their clients’ books available, but also to connect them with readers, will be in a position to bypass publishers – whatever the country – who are slow to make the digital transition, and to keep a bigger share of the money from sales flowing back to their authors.

Emily Williams is co-chair of the BISG Rights Subcommittee and a former literary scout who currently works as an independent publishing consultant.

In the past few years, across dozens of publishing and media conferences, each category along the publishing value chain has been interrogated—content development, product design, marketing, promotion, and (perhaps above all) distribution—and each has been found to be ripe for re-engineering.

The function of the agent has arrived late to that disruptive discussion, I suppose because the agent’s function has traditionally fallen outside the publishing value chain, a vaporous figure who hovers over the content at its acquisition and inconsistently emerges thereafter. After all, what value does an agent actually bring to a given property?

When one charts the path of a work of literature from ideation to incarnation in the marketplace, one hardly remembers who first matched the artist with her publisher. But recently, the agent has taken his turn in the spotlight, awaiting the judges’ critique. In a couple of thoughtful posts by Victoria Strauss and Jane Friedman, and in a particularly lively Twitter conversation initiated by Colleen Lindsay, the industry mused about the possible adjustment of an agent’s compensation, due to the possibility that in Publishing 2.0, an agent might bring quite a lot of value to a property after all.

With agents now in the conversation—as they were effectively during the Digital Book World conference earlier this year—it’s important that we state what really constitutes the agent’s problem: Though the agent’s function in the publishing value chain has changed considerably, the agent’s position in that value chain has remained the same.

I would suggest that before we can discuss how better to compensate an agent for his or her ever-expanding work, we must fundamentally alter our placement of the agent in that value chain. As long as the agent continues to be seen as taking primarily a sales position, there can be no more than a nominal adjustment of an agent’s compensation. And as long as there is no substantive adjustment of that compensation—whether in terms of increased commission percentage or openness to alternative means of payment for author services—there can be no wholesale, widespread augmentation of the agent’s activities to better match the industry’s needs.

And the industry is badly in need of what an agent—freed from the previous paradigm’s constraints—can offer.

Rather than resting, invisible, alongside the content in the acquisition category of the chain, the agent must evolve into the work’s inseparable acolyte, accompanying the work across subsequent categories in the chain—development, marketing, promotion, and branding. While publishing is grappling with the consequences of disintermediation in the value chain, I recommend an Agent’s role is one of radical mediation in that same chain.

To make my point, I’ll risk overstatement: the agent—more than the publisher, even more than the author—is best suited to stand alongside the work through a variety of categories along the value chain, to ensure the work’s proper development and shape, and to shepherd its arrival into the communities ready to appreciate its virtues.

• If due to the requirements of their job, editors are able to edit less, agents respond—either editing themselves or bringing in third-party consultants and co-writers.
• If due to the volume of a house’s list, a publicist is unable to discover, awaken, and motivate a title’s audience, agents respond—calling their own press contacts, designing author events, or bringing in outside publicists and media managers.
• If publishers are unable to spend the time and money to build long-term, audience-building, brand-growing strategies for their authors, agents respond—crafting multi-year, multi-book, transmedia programs for their authors, in partnership with app developers, gaming engineers, and community managers.
• And if the Bookscan numbers and a shrinking imprint destroy the chances of an author’s second or third or fourth or tenth book, agents respond—seeking out alternative means of producing work and engaging readers.

There is a lot of slack in publishing these days, and agents are picking up most of it.

And they should. Agents are uniquely positioned to focus on authors as a venture capitalist focuses on start-ups.

If agents do their job correctly, they will know their author and his or her work more intimately than any editor or publicist or publisher. They will know that author’s realized audience and potential audience better than the author will know it himself. They will see the uneven arc of a long career more clearly than anyone at a publishing company who may or may not be around 18 months from now.

They are the only player in the game who can radically mediate.

For many years, agents have been engaged in many of these activities on behalf of their clients, but now such work cannot be abberant or occasional or haphazard. It must be regular and required. Radical mediation must become an agenting methodology.

It will mean a better publishing world for everyone: for authors, it means representation that is not deal-centric, but career-centric; for editors, it means engagement with agents that is not antagonistic but collaborative; for publishers, it means less pressure to do what you’re not good at and more freedom to do what you are good at; and for readers, it means more publishing minds better focused on finding you and introducing you to a book they know you’ll love.

I don’t claim to know how best to adjust the payment schedule to better compensate an agent for his or her considerable efforts; that’s not what this post is about. An increase of commission to 20% sure seems like a start. An openness on the part of the trade organizations and keen watchdog groups to alternative modes of income seems a good beginning, too.

And we agents would certainly discover some ballast in our endeavors by embracing an entrepreunerial spirit less reliant on past conceptions of the agent. But before we can determine what should change about an agent’s compensation, we must interrogate our shared assumptions about an agent’s function and consider adjusting the limited—or non-existent—position an agent has held on the publishing value chain.

If this happens it will be because a number of agents are stretching farther than their compensation currently supports. Like a new hire anxious to win a promotion, we will do more than our current job title requires of us. But by doing so, we are gathering industry influence, and building brand equity for ourselves and for our clients, and developing audience loyalty.

For now, and for a while yet, that will have to be compensation enough.

Jason Allen Ashlock is the Founder of Movable Type Literary Group, a literary agency that seeks to meet the needs of an industry in transition by serving authors and publishers at each point on the creative continuum, that long line that leads from an inchoate idea to its incarnation in the marketplace.

Last year, I wrote a piece in Writer’s Digest (September 2009) about the future role of agents. I had three key points:

• Agents need to innovate on contracts to keep themselves, as well as their authors, alive through the transition. Richard Nash has the right thinking in this area.

• Agents need to partner and focus on the long-term goals of an author’s career rather than a specific book sale. (Though, as this post will discuss, the current agenting model does not support this.)

• Agents need to develop new business models for themselves because no one will be able to stay in business “the old way” given the greatest change in the history of media.

Victoria Strauss over at Writer Beware wrote a lengthy post (reprinted here) addressing the issue of whether agents are now underpaid at the 15% commission rate, given how much work they are expected to do aside from make a sale.

She ultimately recommends that agents could/should charge 20%, and allows that agencies may legitimately start offering fee-based services (for non-clients), as well as publishing arms.

The 20% commission rate isn’t going to solve a thing. It’s like putting a Band-aid on a gushing wound. It won’t save anyone whose business is at risk.

Regarding services and publishing operations: I couldn’t agree more, though I think the distinction between clients and non-clients is going to evaporate FAST.

The amount of money that’s floating to books (and to content in general) is diminishing. That’s because there’s a TON of supply, and not so much demand. There will be less money to go around for all, but probably just as many people will be interested in writing and authorship.

Publishing cannot possibly sustain the current status quo.

And that current status quo is: Agents can only get paid when they make a sale, and that is the only way they should get paid.

This has to change if the role of the agent is going to have any value or meaning in the future for authors (except for those bestselling authors, whose royalty checks will presumably continue to fund the old model).

Either agents provide a valuable service for non-bestselling authors, or they don’t.

I think they do. And as Strauss mentions, you can find agents now who are launching alternative models for serving authors outside of the traditional commission relationship. Check Keller Media or Diversion Books (Scott Waxman). You’re going to see more of this. A lot more.

Agents are ideally positioned to be career advisers/managers, or professional consultants. Their role will change, and how clients/authors pay them will change. And as long as transparency is maintained, agents need the leeway to run their business in new, innovative ways, without being unfairly labeled as an illegitimate operation, or as taking advantage of writers.

Undoubtedly there will be much confusion in the years ahead as things transform, and writers will need as much education as ever to form the right partnerships for their career. But agents need to be empowered and given room to innovate as much as the authors.

We can’t develop future business models around fear and protectionism.

This post was originally published at Writer’s Digest’s There Are No Rules blog, and has been reprinted here with Ms. Friedman’s permission.

Jane Friedman is the Director of Content & Community Development for the Writer’s Digest brand community, including Writer’s Digest magazine, Writer’s Digest Books, and the Writer’s Market series. She is the author of the Beginning Writer’s Answer Book and blogs on the industry as part of the Writer’s Digest community at There Are No Rules. She is a vegetarian, bourbon-drinking editor, at least mostly sane, living life forward, even though you can only understand it backward.

A recent article at Inside Higher Ed, “Taming the Textbook by Market” by Steven J. Bell, takes yet another look at the ever-increasing price of textbooks and posits yet another solution to the problem. As he writes: “What if instead of being forced to buy a $160 textbook, your students had access to a compendium of online resources handpicked and customized by you [the instructor], and available at no cost to them, unless they preferred to purchase a low-cost, print-on-demand copy?”

What if, indeed?

Typically these discussions about textbook prices take place around the beginning of the fall semester and in the past have focused on a couple of standard, ever-recycled solutions:

• Legislate textbook prices (good luck with all that!)
• Require teachers to use any given textbook for at least three years before adopting a new one/edition (doubly good luck there!).

But Bell is onto something;: with the proliferation of digital content online it seems reasonable to assemble Curricular Resource Strategies (CRS), a term popularized by Mark David Milliron, that would allow more flexibility in the classroom for teachers while offering reduced costs to students. I mean, really, what’s not to like? After all, as Bell suggests, textbook publishers and college bookstores will still have a piece of the instructional material revenue stream via students ordering print-on-demand copies of books as they feel the need.

Well, as an old college English teacher—that was my previous incarnation in my ten-year run-up to being a textbook publisher—I do have some thoughts on all this, much like many of the people who commented on Bell’s article upon its publication.

First, most faculty members want to spend their time actually teaching as opposed to assembling an ever-evolving set of online materials for use in their classes. Bell does admit that is a certain allure for teachers in being able to select a textbook and then move on to other more pressing concerns—grading papers, prepping for classes, endless committee meetings—but he feels a couple of hours effort by a faculty member should prove worth the effort.

The reality is, however, that the actual amount of time it takes to assemble solid instructional materials is not hours but, rather, weeks or months.

Also, there is a permanence in hard copy texts that isn’t available when a) hooked to an electrical outlet or b) on a Web site that can be here today and gone later today. Finally, one reason textbook publishers exist is because they are vetting the material included in any book, and that keeps instructors from having to find and check every single source of information from scratch.

Second, Bell also supposes that textbook publishers and college bookstores will have a place in his envisioned CRS world via selling POD copies of textbooks for $25-$30 each when individual students feel the need to buy a hard copy. The simple truth is that neither publishers nor bookstores can survive on the margins from selling POD books, especially given the significantly higher unit cost for a POD book vs. one produced as part of a larger offset print run. (Plus, the greatly reduced margins from selling POD books guarantees that publishers would have no money at all the develop digital materials in any way, shape, or form.)

Sure, Flat World Knowledge is trying something exactly along these lines—digital editions of books are free while POD copies are available to buy along with study-guide ancillaries—but, to be honest, a close look at their business model just doesn’t reveal it to be self-sustaining. To me and my textbook publishing colleagues, they seem more like a start-up designed to get a visible name in the market before being sold out to an established publisher to flesh out their own digital offerings.

Third, there is also the tacit assumption that publishers and bookstores work together to set the obscene prices that students have to pay. Unfortunately, publishers have no control over what bookstores charge for books . . . so any book, even a short-run POD edition, can have the price jacked up once it reaches the bookstore.

For example, we recently worked with a local college to produce a textbook bundle—textbook plus date planner—that would have a retail price of $60. This means we would discount the book 20% to their on-campus bookstore (owned by a national chain) to $48 which they would turn around and sell for $60. Instead, the bookstore immediately marked up the retail price to $82, 70% more than wholesale and 30% above suggested retail. So, really, everyone in the chain here got the short end of the stick except for the bookstore.

Fourth, Bell suggests that both scholarly publishing and textbook publishing are a process by which faculty give away their content just to buy it back via periodicals in the library or textbooks in their classes. Now, I would not argue that periodical subscription rates are a problem almost as great (or even greater) for university libraries as textbook prices are for students. However, the payoff for scholarly publishing while not financially-based in the short run is exactly that in the long run as it allows professors to earn tenure (that is, keep their job). And, as well, in textbook publishing instructors are paid on either a work-for-hire or royalty basis, the return on which—even when selling several hundred or more copies a year—is a real incentive to develop these materials but not give them away.

Altruism tends to work on a haphazard case-by-case basis whereas instructional materials and/or curriculum need to be done with a comprehensive scope and scale on an ongoing basis.

Finally, one last thing I have to ask is, what’s so wrong with the individual voice of one subject matter expert?

As Matthew Crawford notes in his Shop Class as Soulcraft there is this ever-popular idea that the collective wisdom of the crowd—such as having a million snippets of information bundled together—is inherently preferable to one well-versed subject matter expert who has spent his/her entire life immersed in a particular subject. You know, when higher education costs as much as it does, I don’t particularly want a “guide on the side” who “facilitates” my teaching of myself as opposed to the “sage on the stage” who provides a depth and breadth of knowledge that’s taken a lifetime—not an afternoon browsing Google links—to gain command of.

This is also one of my gripes with one of the central ideas of Disrupting Class which thinks the textbook industry will be unraveled by teachers/kids/parents generating tutorial apps for students to use: just like posting a rant to a blog doesn’t make you a polished writer, thinking your child isn’t getting a good (enough) education doesn’t make you an expert in either a given subject matter or pedagogy or digital instructional design.

Look, hats off to Steven Bell for attempting to formulate a solution to a real problem and start a new conversation using his outsider’s perspective as a librarian. (And I would highly recommend his blog The Kept-Up Academic Librarian.) However, it’s that same perspective—one that is not versed in the realities of book publishing or the quotidian realities of instructors—that has led to some errors in analysis in his argument.

So what do I think is going to happen?

First, the big textbook publishers have too big a financial interest (and too many resources and too much leverage) to just watch their market (and $$$) evaporate right in front of them. Rather, I think enhanced eBooks—there’s a phrase that’s all the rage these days!—will allow publishers to keep their market share while doing something that they’ve craved for a long time: cut bookstores out of the equation completely by way of having students buy directly from publishers themselves.

Will prices ultimately go down? Not a bit . . . but profit margins, once again, for publishers will go up.

And hey, why not?

That’s just Economics 101.

This post was originally published at TSTC Publishing’s Book Business Blog, and has been reprinted with Mr. Long’s permission.

Mark Long is the Publisher in charge of TSTC Publishing, the publishing arm of the Texas State Technical College System. A long-time college English instructor, he oversaw the formation of TSTC’s book publishing division in 2004 whose charge is to produce low-cost (and high quality) technical and academic textbooks, technical career guides, and emerging technology forecasts in areas projected to impact higher education in Texas.

“We need to be sure books don’t become a commodity.”

–Oren Teicher, CEO, American Booksellers Association

“It would be terrible if the booksellers ran out from this event and said ‘this is it, it’s over.’”

–David Shanks, CEO, Penguin Group USA

I walked into last week’s Book Expo America excited about seeing old friends, meeting new friends and looking for new opportunities, and on these points the show was a complete success for me.

On Tuesday morning, I attended the “Opening Plenary: A CEO Panel On The Value Of The Book Presented by ABA and BEA,” and I’m not sure what I expected, but I spent a lot of time visualizing some of the panelists as Statler and Waldorf, the curmudgeonly Muppets. Author Scott Turrow, the incoming President of The Author’s Guild, may not have actually said “get off my lawn,” but that’s what it sounded like to me.

There are many complex and serious issues publishers have to tackle as the digital book world gains market share, so I was hoping to hear fresh ideas as to how we as an industry could continue to run parallel businesses, both traditional and digital. Unfortunately, trotting out the same tired lines about piracy, windowing and pricing did not help shine a light on the path into the future,  nor did it set the right tone for the rest of the conference.

Of course, the panel wasn’t all a disappointment. My favorite positive comment came from Penguin’s CEO, David Shanks, and I’ll have to paraphrase him, but in discussing pricing he suggested that to compensate for the lower prices of eBooks we’ll need to sell more books and went on to talk about embracing any mechanism that brings books to more people.

More people reading more books in the manner of their choosing? Yes, please!

Esther Newberg, EVP, International Creative Management, noted that “word of mouth still means something.” In my humble opinion, word of mouth is everything. Not addressed by this particular panel was that how word of mouth has dramatically shifted from booksellers to readers. Putting aside the notion of electronically receiving a galley via NetGalley, I’m sure I’m not alone when I head over to GetGlue or GoodReads, and reach out to my friends on Facebook or Twitter. (I live in a town without a good bookstore, which is increasingly more common.)

Speaking of word of mouth, Verso Digital’s Jack McKeown presented updated results from their “2010 Survey of Book-Buying Behavior,” and found that 45% of those surveyed were willing to give their email address to bookstores for relevant marketing. Indie booksellers should be jumping on this opportunity!

The “Designing and Executing an e-Strategy for Authors: A Publisher and Agency Perspective” panel offered one of the most important takeaways that is applicable to booksellers and publishers, too: Social Media, like all marketing endeavors, requires a strategy. You can not simply put up a Facebook Page and hope they will come; you need to develop and cultivate an audience, and treat them with the same respect you would treat a live audience: listen, engage and provide value or entertainment. Do NOT repeatedly hawk your wares!

Also, different platforms are, in fact, different. If you would dress differently for a backyard swim party than you would a fancy ball, please get to know each platform before you jump in. Tailor your message to appropriately fit each platform.

During the “Rights, Royalties & Retailers: What Works?” panel, Cursor founder Richard Nash declared, “The age of abundance makes copyright irrelevant. Owning a well really meant something before bottled water. A right is useless if there is no demand for it.”

He presented his proposed new model which will feature 3-year contracts, and expressed confidence that they would be renewed as long as the publisher is holding up their end of the bargain. “That doesn’t mean after three years, you lose your author,” he noted; “you renegotiate.”

Scott Waxman, a literary agent, is taking a similar approach with his own experimental start-up, Diversion Books, where he is offering 5-year contracts on a profit-sharing model, and securing world rights. He’s already signed 20 authors, “with 30 more in the hopper.”

Nash and Waxman’s new initiatives are ones to watch as they become a reality in the coming months; it will be exciting to see how they evolve and hopefully invigorate the publishing industry.

Out on the exhibition floor, while noticeably smaller and leaner than past years, I am glad to report it was still a challenge to make your way through it all! I was also impressed by the “IDPF’s Digital Zone” where several tech companies were showing off their shiny toys and some pretty neat technology in the crossroads between content creators and readers. In particular, I spent time at Firebrand Technology’s booth – which hosted both Digital Book World’s Roundtable WEBcast and Laura Dawson’s #ISBNhour Twitter chat – as well as checking out Kobo and iScroll.

A particularly fun highlight for me, having nothing to do with the open bar, was the 7×20x21 event put together by Ryan Chapman and Ami Greko. I especially enjoyed the presentations by Clay Shirky and Nick Bilton, and since I believe they will be posted online soon, I encourage you to check them out for yourself.

It was also fun to see/meet my Twitterstream In Real Life, and that, on top of everything else, that made it a great event.

The overall mood at BEA 2010 was probably best summed up by one John Hanlon, from “N/A,” labeled as such because he was not yet a bookseller, though he is looking to open up a new indie bookstore in Williamsburg, Brooklyn. It was his first time attending BEA, and he found the panels informative, the crowd flow a bit chaotic, and he left feeling hopeful about the future.

I did, too.

Babette Ross is a publishing industry professional who enjoyed a long career at Random House, including her last position as the Associate Director of Sales Administration. She collaborated with 44 imprint marketing departments, liaised with the IT department, and created and maintained databases which facilitated inventory, fulfillment and tracking of sales materials. She is currently looking for a new job and is excited by all the possibilities the digital world is bringing to publishing and marketing.

“I think we fit well into this new world. And I’m not so anxious. I’m curious to see, actually, where it lands. But, as an independent bookseller, we’re certainly staying in the conversation. And if 10% or 8% of the books are e-books, that’s fine. There are still a lot of other books to sell, and we will–we will be selling both e-books through our websites and in our stores, and also we will be selling lots and lots of what I’m calling physical books, because that’s really where the market still is the strongest.”

–Cathy Langer, lead buyer, Tattered Cover Book Store

I’m still processing everything about this year’s Book Expo America – the conversations, the debates, the new ideas, initiatives and partnerships – but arguably the most important takeaway for me was a simple one: people in publishing seem to be getting excited about publishing again.

Last year’s BEA felt like a dark cloud was hanging over the entire industry (not to mention over BEA itself), and there was an awkward combination of panic and resignation underlying every conversation about “the future of publishing”. This year, while there were several moments that left me shaking my head in disappointment, there were far more that made me feel like the industry had finally turned a corner and was taking a more proactive role in shaping its own destiny.

While much attention has been given to unfortunate comments made by the likes of Jonathan Galassi and Garrison Keillor, I’d argue that they represent a rapidly shrinking minority, so entrenched in their personal viewpoints that they’re unable to see the big picture. Meanwhile, the majority, far too many of whom are silent or marginalized in public forums, have started to fully embrace the dramatic changes as an exciting time for innovation and reinvention.

Along with Langer’s very pragmatic quote above, three others really summarize my feelings about this past week:

• “The age of abundance makes copyright irrelevant.” – Richard Nash, Founder, Cursor
• “Publishers have done a TERRIBLE job of articulating the work they do and the value they bring to the author/book.” – Dominique Raccah, Co-Founder & Publisher, Sourcebooks
• “It helps the living make a living, and as a byproduct, will help the industry sustain itself.” – Ed Nawotka, Editor, Publishing Perspectives

One year ago, Nash was perceived by many as a radical maverick; today, his ideas about Publishing 3.0 feel more evolutionary than revolutionary, more pragmatic than provocative. His call for drastically revamping the way publishers deal with copyrights and contracts was even echoed by Brian DeFiore, who offered an inspiring manifesto during the “Do eBooks Hurt Authors?” session that I’m hoping he’ll publish somewhere. It has been an underlying theme of many of the conversations happening around eBooks for a while now, but it’s slowly moving to the forefront.

On the panel with DeFiore, Raccah made an excellent case for the value publishers offer authors in a world where DIY resources abound and “disintermediation” has become a fixture in Buzzword Bingo games. Publishing is about so much more than the distribution of physical books, and the sooner publishers themselves remember and embrace that fact, the sooner the tone of the conversation about the future of publishing will shift to more positive ground.

And finally, Nawotka’s 7×20x21 presentation called for “teaching literature backwards,” putting the emphasis on contemporary literature and authors, and tracing their lineages back to the classics, as opposed to the traditionally siloed focus on just the classics. It’s a deceptively simple concept that can and should unite everyone in the industry – from authors, agents and publishers, to bookstores, libraries and educators – with the end result being a more robust and engaged readership, today and tomorrow.

BEA wasn’t perfect by any stretch, but many of its problems were its own, mostly fixable, and not really reflective of the health of the industry it serves. (Important note, that last point.) If the conversation moving forward becomes more about the logistics and less about the necessity, that’s arguably a win for everyone involved.

As you’re preparing for the holiday weekend and the unofficial beginning of Summer, take a minute to reflect on your own takeaways from BEA this year and share them with us. If you were on the show floor, or attending various panels and presentations, and experienced things that countered some of the negative commentary that will inevitably get more press coverage, be sure those who weren’t there in person get the full picture.

What one thing made you especially excited this week?

After the eruption of Iceland’s unpronounceable volcano disrupted the London Book Fair last month, Publishing Perspectives’ editor Ed Nawotka wondered why “no one is trying to find a way to teleconference people in or to schedule online chats,” and asked if there was any interest in a virtual book conference.

This is something I’ve been thinking about for a long time.

Technology and bandwidth have advanced to the point where it is entirely feasible to mount a virtual trade conference, one that would be fully participatory for traditional and e-book publishers, booksellers, librarians, educators, literary agents, authors, book-related exhibitors and their technology counterparts – plus the most important attendee of them all, readers; all from the comfort of their homes, offices or commute. Virtual trade shows are a common practice in many other industries, and there have already been a couple of virtual book fairs including Virtual Children’s Book Fair and the Poisoned Pen Mystery Writers conference which included a number of live and on-demand webcasts of “more than 50 panels and presentations featuring over 65 mystery and crime authors.”

While both examples are relatively modest, it proves it could be done, and the model can be scaled upwards for a full-fledged virtual book expo that participants could attend in their bathrobes!

While the main event itself could be of short duration, it could easily morph into a 24/7/365 marketplace centered around books and authors, publishers, booksellers, bloggers AND readers; a kind of “Second Life” for the book publishing industry. It could be a combination website, bazaar, and social gaming environment where real business is done, books are bought and sold, but with a high fun quotient limited only by the technical skills of art departments, web designers and graphic artists, and the boundless imagination of the publishing industry.

What do you think? Is publishing ready to go beyond eBooks and take the digital transition to the next level?

Richard Curtis, president of Richard Curtis Associates, Inc., is a leading New York literary agent; founder of E-Reads, an electronic book publisher; and a well-known author advocate. He is also the author of numerous works of fiction and nonfiction including several books about the publishing industry and is a former president of the Association of Authors’ Representatives.

While Cory Doctorow’s publishing experiment has hit numerous snags along the way, ego and reality arguably being the two most significant, J. A. Konrath’s Kindle experiment has resulted in what he’s referring to as an “historic” deal with Amazon.com, who will release the next book in his Jacqueline “Jack” Daniels series, SHAKEN, under their rapidly evolving publishing imprint, AmazonEncore.

Amazon.com, Inc. (NASDAQ: AMZN) today announced that AmazonEncore, Amazon’s publishing imprint, will release the newest book in bestselling author J.A. Konrath’s Jacqueline “Jack” Daniels series, “Shaken.” The AmazonEncore Kindle edition of “Shaken” will be available in the Kindle Store www.amazon.com/kindlestorein October, and the print version of the book will be available in February 2011.

J.A. Konrath is the author of the Jacqueline “Jack” Daniels series that includes “Whiskey Sour,” “Bloody Mary,” “Rusty Nail,” “Dirty Martini,” “Fuzzy Navel” and “Cherry Bomb.” All six titles are available to purchase in both print and Kindle format on Amazon.com. Konrath has also written under the names Jack Kilborn and Joe Kimball. He has published over a dozen books using Amazon’s Digital Text Platform (DTP), and has been featured in numerous articles and blog posts as an author who is making a living off of Kindle.

Last October, in a rare case of transparency, Konrath posted Kindle sales figures for both his traditionally published eBooks via Hyperion, and the eBooks he’d self-published via Amazon’s DTP, and while the comparison favored his self-published eBooks, he wasn’t ready to declare the revolution had begun.

Ebook rights began as gravy. I can picture a day when the print rights are the gravy, and authors make their living with ebooks.

Yes, it’s still far off. And yes, print publishing is in no danger of going away anytime soon.

Fast-forward a mere seven months, though, and Konrath has seemingly changed his mind.

“There will be a clear-cut winner in this revolution,” he declared. “The winner will be the group that deserves it the most: The Readers. Together, Amazon and I are giving readers what they want–inexpensive, professional ebooks. I’ve been saying for over a year that readers don’t want to pay a lot for ebooks, and I’ve been posting lots of data and numbers to back-up that statement. I now have a publisher who agrees with me.”

Konrath makes several interesting points in explaining his decision that every publisher should take note of:

1) “I signed a print deal with a company that can email every single person who has every bought one of my books through their website, plus millions of potential new customers.” Publishers with direct connections to their readers are better equipped to compete in a digital book world than those who only sell through intermediaries.

2) “Amazon is smart, savvy, and pays attention to my suggestions. The Kindle version of Shaken is going to be released for $2.99.” Not $9.99 or $14.99, but closer to the $1.99 he had so much success with on his own.

3) “It’s easier to release an ebook than a print book.” Amazon is releasing SHAKEN in eBook format four months before the print edition.

4) “I have no idea if the book will actually be stocked in any of the chains or indies. And, frankly, I’m not concerned.” The ability to market directly to millions of customers who have either purchased Konrath’s previous books or books similar to his is more appealing than traditional distribution.

5) “My terrific agents have been involved from the very beginning of negotiations, and have been essential in getting me a very favorable contract. I couldn’t be happier.” There’s still a place for agents in the digital book world.

6) “I thought it would make a bigger splash to write a book specifically for Amazon. I like making splashes.” Authors have egos; feed them well.

Will SHAKEN be remembered as the shot heard ’round the industry, or is it an exception to the rule, an isolated deal pulled off by an unusually savvy author?

What do you think?