Publishers vs. E-Books

 Posted by at 10:27 PM  Tagged with: ,
Jun 012010

400 more years! 400 more years!

I’ve known for some time that the large print publishing companies are not fans of e-books. Many people wondered how publishers could be so silly, pricing e-books above (sometimes well above) the price of paperbacks, delaying e-book releases, providing simple OCR scans of paper books (instead of properly formatting or often even proofreading their e-book releases), blocking useful features like text-to-speech and lending, and infesting e-books with invasive copy protection (DRM) that annoys legitimate users. But I knew it wasn’t that publishers didn’t “get” e-books … OK, it wasn’t just that publishers didn’t get e-books: they are actively trying to forestall e-book adoption as long as they can. Why? Because there are 6 huge, multinational publishing conglomerates on top of the current food chain, divvying up the lion’s share of the $25 billion/year book industry, and a change as dramatic as the switch to e-books threatens to shake up their industry. Some publishers, by undergoing lots of painful downsizing, restructuring, giving up large New York offices, and doing some long-term thinking at the expense of this year’s profits, might remain relevant in the publishing landscape of the future. But not all will. So I’ve said before that they are forestalling that day of reckoning as long as they can. (They must understand how typewriter manufacturers and buggy-whip makers felt.)

But I’ve never before seen them admit it. See, they’ve always claimed to be in favor of e-books, since it’s clear that more and more authors and readers (their supposed allies and customers) like them. But now, David Shanks, CEO of Penguin Group (one of the “Big 6” publishers) came right out and admitted that We need to protect as long as we can the apparatus that sells physical books.

UPDATE: As another example, Nan Graham, the SVP and EIC at Scribner (Steven’s King’s publisher) created a nicely-crafted hardcover, and explained that “We hoped that a handsome object would slow the migration to e-book for King.”

In other words, it’s not about innovating, or even keeping up with changing times and technologies. They’ve stopped pretending they’re doing this for authors. They’re no longer claiming that they’re just trying to “preserve the value of e-books” or create “sustainable pricing” — for the authors, of course. They’ve finally admitted they not only don’t care about the readers, but they’ll do whatever they can to hold onto their position, at the expense of authors and readers and progress. As I said all along, it’s really just about protection. Not protecting literature or the future of books, just protecting themselves and their bottom lines.

When big publishers (like Jonathan Galassi) start talking about how they need to “maintain the value of time-honored roles,” I think it’s safe to say the writing is on the wall. (Although they probably get a sympathetic look from alchemists, blacksmiths, and cave-painters.) Companies that look to the past and seek to maintain the status quo don’t even notice the innovators (the Amazons and the Googles) as they rush past them and into the future.

As one last example of the “e-books are the enemy” attitude, consider this exchange between author Scott Turow and Galassi:

Turow: “Why did publishers agree to allow e-books to be available at the same time as paper books?”

Galassi: “It was a mistake to let Amazon put out e-books simultaneously and charge the price it did [$9.99]. It will have a negative effect on the paperback.”

So, there you have it. It was a mistake to let the largest bookseller in the world sell books to readers who wanted to buy those books (publishers should have delayed them and charged readers more instead). Why was it a mistake? Because it was bad for readers? For authors? No, bad for the paperback. Which really means: bad for the current crop of the Big 6 publishers, whose entire business model isn’t about selling literature, it’s about moving paper. The only thing that confuses me is, if they clearly care more about paper than they care about authors or readers, why are we supposed to care about what happens to them?

  2 Responses to “Publishers vs. E-Books”

Comments (2)
  1. Well said, David. And thanks for the links! They make the salient points pretty darned clear. I found you on the Kindle discussion group recently, and with all the discussion there on this subject—largely due to Penguin—it’s good to see this set out so well. There’s no question we are in the midst of a market struggle; I hope that the large publishers realize that they are, in the long run, fighting a losing battle.

    It could be said that the ‘cover price’ of paperbacks (and hardcovers, for that matter) has been an effort at price fixing. The only thing that has saved the publishers from being accused of that is the fact that retailers have always had the right to sell paper books at a discount if they wish. Now, with the ‘Penguin-driven’ system, retailers like Amazon will not be able to do so. And ebooks under those agreements end up being one of the only things sold in our economy that are restricted in this manner.

    It also seems ridiculous that authors will actually make less through this method than through Amazon’s original marketing method. Readers everywhere should be against that!

    How long this situation will be allowed to survive will be interesting, especially if it continues to spread.

    • Thanks for coming by and leaving your thoughts! I agree that publishers are fighting a losing battle, but I fear they are afflicted with the same short-term mentality the banks and lenders were. When CEOs are judged (and given astronomical bonuses) based on this quarter’s results, and they can make enough money based on a good year or two to be rich for life, why make long-term plans, do what’s best for the good of the industry, or invest money to modernize when the results won’t be seen for many years?

      Fortunately, Amazon (and Jeff Bezos) are known for long-term thinking, and it’s serving them well. I’ve heard Bezos say (I’m paraphrasing): “Many companies look at how they can improve what they do. We look at what our customers need (whether we currently do that or not), and figure out how to give it to them.” And they do, even if it takes 10 years of investing in a completely new area (like making electronic devices such as the Kindle).

      While I’ve certainly held dreams of being traditionally published for many years, as an author, I wouldn’t be thrilled if I were signed to a long-term deal with a publisher who was trying to kill e-books and giving me lower and lower e-book royalties, while indie authors are about to get 70%.

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