The Business Rusch: Challenges For Big Publishing (Changing Times Part Three)

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The Business Rusch: Challenges for Big Publishing

(Changing Times Continued)

Kristine Kathryn Rusch

Misinformation presented as fact irritates me.  It always has. My training as a journalist came at the hands of the World War II journalists—the guys who essentially invented television and radio news—as well as some hardcore investigative reporters.  Thirty years ago, even the smallest news organization wouldn’t print (or broadcast) information that didn’t come from at least two verifiable sources.

Nowadays, with the 24-hour news cycle, such caution is almost laughable. But it means that so-called journalists report assumption, opinion, and rumor as if it was fact. Sometimes the correct information is hard to find; it’s not often served up in an organized form so that everyone can locate it.  But often, the correct information is just a mouse-click away—should anyone bother to look for it.

The true news junkie like me knows that she must vet her own sources of news for accuracy—going with the companies, newspapers, and organizations that still rely on the old model, the one that requires verification. But a true news junkie—or information junkie—should care about fact-checking and accuracy.  A true news junkie should also know when a source has an excellent area of expertise, and when that same source has no expertise.

Why am I telling you this in the middle of my series on changing times in publishing? Because I’m trying to get a handle on the blogosphere, which is what led me to do these posts in the first place.

There are a number of bloggers who report their own statistics well.  They’re experts on the new wave of publishing.  They’re making changes in the publishing industry by being honest about things like sales figures on Kindle and money writers can earn.  However, most of these bloggers (including the most well-known) know nothing about the actual publishing industry, even though a number of them have published books with Big Publishers for years before deciding to publish books in the new electronic publishing model.

I am going to refrain from going on a long rant here about writers failing to understand the very business they have decided to work in.  My husband, Dean Wesley Smith, is already tilting at that windmill by writing, on his blog, an entire book length series called Killing The Sacred Cows of Publishing, designed for new writers and established writers alike.  If you don’t understand traditional fiction publishing and you work in, or want to work in, that field go to Dean’s blog and read.  You won’t agree with everything—I find a lot of the comments in the comments section unnecessarily strident—but you will learn something.

No one vets blogs.  Blogs, even more than the 24-hour cable news cycle, are filled with misinformation snuggled up against absolutely essential information.  Bloggers are less afraid of lawsuits than the people who run the mainstream media, so even more misinformation gets through.  And blog readers seem to accept all of it—even the contradictory information—as truth instead of realizing that most of what’s being written about publishing out there by established, professional writers is often wrong.

How you filter the information? Be wary.  Double-check the facts yourself.  Or ask yourself this: Does the writer have experience in the area she’s writing in? Or does she only see it from one angle?

Before I go further in this post, let me give you my credentials in publishing.  I co-owned a publishing company twenty years ago.  I’m part owner of another, and I advise a few more on a regular basis.  I edited books and magazines with national distribution for ten years.  I worked in the lower levels of a textbook publishing company.  I worked sales for my own companies.  I have been a professional writer of both fiction and nonfiction for thirty years now.

And I’m a studier.  I gather information from various sources and present it.  I believe in learning.  When possible, I’ll link to the source of my statistics.  I will do my best to state my opinions as opinions.  When I’m discussing the future of publishing as I am here, I am guessing, like everyone else who writes on this topic.  My guesses are based on experience in many corners of the industry.  (Not all—I don’t think anyone has hands-on experience in all aspects of the industry.)

Does that mean I believe I’m right about these upcoming changes? Of course.  Does that mean you should believe I’m right? Of course not. As I said above, take everything you read with a grain of salt.

There is no question about it: Big Publishing is in a bind right now.  Times are tough for every industry, and publishing is no exception.  Most of the problems in publishing, however, don’t come from the new technology. They come from old habits, customs, and ways of doing things that have locked Big Publishers into expensive business practices which have needed changing for a very long time.

Before you read any further, remember that this is the third post in a series of posts.  If you haven’t read my first two posts, please do so now.  (Post One: Changing Times; Post Two: Understanding Publishing).  For one thing, you’ll need to go back just so that you’ll know what I mean when I’m discussing Big Publishing.

Many bloggers, particularly the well known pioneers in electronic publishing, are predicting the death of Big Publishing.  They believe Big Publishing will collapse and many are so convinced, they give a date—December of 2012.  This whole idea has many flaws, the first being the Big Publishing is a monolith—a single stupid entity that can’t incorporate change.

First of all, Big Publishing is not a monolith.  Every publishing company is different, and every publishing company’s agreement with every writer is different, not counting the agreements with the subcontractors and the others involved in the business.

What writers—and readers—forget (or, indeed, don’t know) is that the publishing industry is a large, multibillion dollar worldwide industry.  Many of the major publishers here in the United States are owned by conglomerates based in other countries.  These conglomerates are huge and often have other branches to their business: in other words, they don’t make all of their money on publishing.  They have other divisions, which enable one division to take a loss during a period of great change without bringing down the entire conglomerate.

Often, you’ll see these large conglomerates sell parts of their businesses that are no longer profitable according to the conglomerate’s standards.  By the standards of another conglomerate, that part of the business is profitable, which is why so many corporations get bought and sold or merged or acquired or whatever the term is for that particular deal.  Again, we’re not dealing with a monolith here, which is why I’m being so general.

Why is this important for readers and writers? Because large conglomerates have cushions.  They’re designed to absorb losses in one division while that division makes changes because profits from another division cover the expense.  (Of course, we all know that large corporations can fail—witness Enron and Bear Stearns—but such failures are usually caused by something outside the corporation combined with mismanagement [and often malfeasance] on a grand scale.  To my knowledge, no company in publishing faces such issues—and if it did, it would be an isolated case, just like Enron was.)

Big Publishing will weather these changes, but internally, many of the publishing corporations might look different ten years from now.

Why is Big Publishing facing a challenging decade?  It’s not just the rise of electronic books.  Electronic books, when looked at as a unit, are really just a tiny portion of the changes that Big Publishing has to face.

Big Publishing faces challenges for the same reason other large corporations are facing challenges. The economic climate is the most difficult one publishing—indeed any business—has faced since the 1930s.  The 1930s forced publishing to make all kinds of changes, some of which we’re still living with, and I’m sure this new economic climate will force even more changes.

Right now, Big Publishing spends too much money on the wrong things.  Overhead and expenses are too large—not because Big Publishing is stupid, but because it made some bad choices and some terrible gambles.  It also has history weighing down its balance sheets.

First, let’s talk about the terrible gambles.

Contracts, Rents, and Mortgages.  Those of  you who work for corporations understand that corporations don’t negotiate short-term deals with important suppliers.  Corporations want to lock in the best deal for the longest time.

Publishing corporations have deals with all of their suppliers and jobbers, companies that supply everything from paper to typesetting services, from shipping to warehousing.  These deals, in the form of contracts, were made before the bad economic climate hit and may run anywhere from two to ten years.  In 2003, the two-year contract (renewable on the same terms) was considered a bad deal; the ten-year contract was the good deal.

But publishing is changing rapidly, more rapidly than anyone could foresee.  The contracts made seven years ago are out of date, expensive, and unnecessary. Worse, printing and binding contracts often specify amounts.  Meaning the publisher has to guarantee that it will print at least x amount or the prices will go up. (If a publisher prints less than the guarantee, the printer has the right to raise the price.)  The publishing company is not just locked into a long-term contract for a rate it no longer wants to pay, it also is locked into a certain amount of production which might not be realistic in today’s economic environment.

Many of these contracts have a fee for canceling the contract. That fee is often equal to one third to one half of the total amount the publisher would pay over the life of the contract.  It’s easier (and cheaper) for the publisher to wait until the contract comes up for renewal and decide not to renew than it is for the publisher to cancel the existing contract.

Realize now that all jobs in publishing that are not done inhouse have such contracts.  These jobs vary from publishing company to publishing company. (For example, some own their own printing presses, others have their own shipping divisions.)  But every (Big) publishing company uses outside services for some aspect of their business, and every (Big) publishing company is tied to long-term contracts for those services.

The same goes for rent/mortgages.  Most of Big Publishing, at least for fiction, is located in New York City.  Worse, most of Big Publishing is located in Manhattan which, at last check, had some of the most expensive real estate in the country.  It’s easy for outsiders to say that Big Publishing needs to move out of New York, and occasionally companies do.  But those are the lucky ones. Because the leases on some of the big buildings in Manhattan run on 30-year cycles—again, to lock in good rates.  And of course, mortgages are just as bad if not worse.  New York’s real estate market lost more than ten percent of its value in the past two  years, so the publishers who thought they were smart when they bought their buildings instead of leasing them could be (and I don’t know this for certain) as underwater as many small homeowners throughout the United States.

Add to all of that the weight of history.  I should really call it the cost of history.


Remember that I mentioned above that this is the worst economic crisis to hit publishing since the 1930s?  And remember that I showed you last week that publishing’s function is not to make books but to distribute them so that they reach the most possible readers?

Well, in the 1930s, the Depression hit bookstores hard.  People had less disposable income, and didn’t want to spend it all on hardcover books.  Pulp magazines had their heyday in the 1930s partly because they were a cheap way to consume fiction—and most respectable bookstores would not let a pulp magazine cross their threshold.

Rather than lose the distribution source in outlying areas like Iowa or Oregon, publishers hit upon a great idea: they offered bookstores the opportunity to return unsold books for full credit.

That sounds counterintuitive, especially in a depression, but it’s not.  Big Publishing works on something I call the produce model.  I’ll explain this in detail in a later installment, but here’s the short version:

Every month publishing comes out with brand new product. Shelf space is limited in every single brick-and-mortar bookstore.  Big Publishing makes the bulk of its money during the first few months of a book’s existence.  So if a book sits on a bookstore’s shelf until the book sells and that sale takes six months to a  year, the bookstore and the publisher lose money.

Better to dump the old inventory on a monthly basis—for full credit for unsold items—than it is to have the inventory sit on the shelves and grow “stale.”

This returns policy—so shiny and innovative in the 1930s—kept bookstores alive. Publishers did not decide to do this in a unified fashion. One publisher did it, followed by another, followed by another. The policy allowed publishers to distribute their books all over the United States and made sure the publishing industry survived the Depression.

The problem is that getting rid of the returns policy has proven to be nearly impossible.  Bookstores like the policy.  In fact, the bulk of their business is built upon it.  And Big Publishing cannot unilaterally stop the returns policy.

Because, as I said above, Big Publishing is not a monolith.  If publishers were to have a meeting and decide to discontinue the returns policy unilaterally, they would be subject to anti-trust lawsuits as well as other suits.

In the past few years, several publishers have experimented with no-return books.  One publishing imprint was even based upon a no-return idea.  But it hasn’t worked.  Publishers keep hoping that someone will be successful selling books without returns, so that they could then follow along, just like they did when they instituted the policy in the 1930s. So far that hasn’t happened.

What does the returns policy mean for readers? It means this: Returns, for the sake of accounting, are figured at 50% of the print run.  So every book sold must carry the expenses of one other book.  In other words, the expenses of each book sold are twice the actual cost of manufacturing and distributing that book.

Because of the weight of history and the terrible gambles that the publishing industry has made over the past twenty years, the publishing industry’s costs spiraled.  When costs increase, you can only cut so much before you lose quality. Publishing first responded by trimming book lines (but they were limited from doing too much by production contracts). Then publishing cut nonessential personnel. Then it cut editorial staff.  And then it couldn’t cut any more.

So it made a bad choice.

Price increases

The purchase price for a paperback book has risen dramatically in the past decade.  In the late 1990s, the average paperback sold for $5.99 and people complained.  Booksellers in particular believed that the best price point for a paperback was under five dollars, but publishers believed that readers wouldn’t notice the difference so long as they saw that five right after the dollar sign.

Now the average paperback sells for $7.99.  Some recently purchased paperbacks on my shelf have prices as high as $9.99.   The latest John Grisham hardcover has a list price of $28.95 which is much too close to $30 for my tastes.  I usually buy Grisham in hardcover, but I did not buy this book because of the price, nor did I buy his short story collection in hardcover because of the price.  I bought his short story collection in paperback and I just bought his latest hardcover in a Kindle edition.

I do fork out too-close-to-thirty-dollars for the occasional hardcover for an author whose work I know I want to keep, like the latest Peter Robinson mystery, but I’m getting very selective.  And I’m a voracious reader.

The higher the price the more cautious people get about their purchases.  It’s a never-ending cycle, proven in pricing studies time and time again.  Add to that limited availability, reduced distribution, and less diverse book lists (meaning fewer unusual books), and publishers still saw a decrease in revenue despite the price increases.

Now do you understand why Big Publishing is in trouble?  The publishing industry has been on this precipice for the past twenty years and believe me, the smart people who run publishing companies have been struggling to find solutions.  Some companies have moved out of New York when their leases came up for renewal.  Others updated their technology or reduced the quality of their paper product (thinner paper, cheaper boards for the hardcover, changing bindings).

Until recently, no Big Publisher changed its business model.  And honestly, a change in business model was what Big Publishing had to do to stop the slow strangulation that was occurring within the industry.  Again, anti-trust considerations came into play, but more importantly, the heads of the publishing companies report to stockholders.  And a change of business model would cause catastrophic losses in the first few years of the new model, losses that the conglomerate would have to absorb.

Enter electronic publishing—which is, as the bloggers say, a game-changer.  But it’s not a game-changer the way that the bloggers believe it is.  Electronic publishing will enable Big Publishing to change its business model.  In other words, electronic publishing won’t cause the demise of Big Publishing.  Electronic publishing will save it.

And…I’ll defend that controversial statement next week.

I wasn’t kidding when I called this topic the elephant in the room.  I didn’t use that phrase just because I was ignoring the obvious; I also used it because of the word “elephant.”  This is a vast topic, one that needs discussion in detail, which I’m going to try to do.

As I’ve mentioned in the past, I’m using the new publishing model to write these blogs.  I rely on you readers to keep me at the keyboard instead of getting an advance from a Big Publisher. This new method allows a lot of give and take.  So, in addition to donations to keep me in tea and chocolate, please forward or link to these blogs, and send me your comments and e-mails.  I appreciate it all.

“The Business Rusch: Challenges For Big Publishing” copyright 2010 by Kristine Kathryn Rusch.

27 thoughts on “The Business Rusch: Challenges For Big Publishing (Changing Times Part Three)

  1. First time at your website. This is great. I’ll be back. I’ve been curious about the effects of electronic information and data distribution on traditional outlets (beyond the obvious downward pressure on newspaper sales). I am also a voracious reader and now have a new author to follow (I like your direct style). Thanks again.

  2. Me, either, Kris. Not to mention promo spots in the conglomerates’ news and social shows, as well! Done cleverly, it can be very inside joke-ish for fans, but at worst, it’s just nice, straight, wall-to-wall promo. Oh, the horror. 😀

  3. Hi 🙂
    Thank you very much for the in-depth analysis and informative posts. I’ve been following them with admiration & learning quite a bit. I just wanted to thank you, and I am looking forward to your next installment. I wish every author, reader, publisher & agent would read these posts.
    All the best,

    1. Thanks, Rob. Feel free to forward as long as you leave the copyright info on everything. I’m doing this for the information–and the more it gets out there, the happier I am. 🙂 Much appreciated.

  4. I agree on the problems the big pubs face and the buffer they have; another reason publishing houses were acquired by conglomerates (as you know Bob) was to verticalize the media: take book/publishing content and make tv shows/movies out of it, all in-corporation (or in-conglomerate).

    The big pubs who survive will have figured out a way to leverage their distribution and brand muscle onto an electronic platform, as well as cutting the dead weight of contracts/expenses and shuffling off the returns system (which is automatically nonexistent in ebook sales, as well as in the near future of high quality POD or collectors’ editions print books).

    I’m definitely amused and not too annoyed by the way ABC is promoting its show CASTLE, about a mystery writer solving mysteries, by releasing actual (and bestselling, lol) mystery/thriller novels under that character’s name, for one example of the use of the in-conglomerate media use.

    1. Exactly, Sam. Not to mention Rizzoli & Isles, which always has adds for the latest Tess Geritson [sp?] book running along the bottom of the screen. I wouldn’t mind me some of that.

  5. Great post, Kris, and having just seen an exhibition on Katherine Graham at the National Portrait Gallery (and hearing *her* comments on the responsibilities of any news organization to vet its facts as well as her willingness NOT to go with a story if it couldn’t be verified many times over), your post couldn’t have come at a better time for me.

    One of the problems I see in vetting blogs stems from something I gleaned/noticed from that conference I went to a few weeks back–i.e., bloggers tend to quote one another. For example, a point that was rammed home, repeatedly, was that reviewers visiting, say, another reviewer’s or an author’s site, should check to see which blogs that reviewer or author reads. (Smacks to me a little of wandering into someone’s house and checking out their bookshelves before deciding if you’ll talk to them.)

    But what this all comes down to is that if you want to be accepted in a certain blogging community, you have to demonstrate a willingness to read what other bloggers consider to be “good” blogs (i.e., *authoritative* or *respected* or *influential*–whichever fits). The way you prove this? Go to these same blogs, see what *they’re* reading and quoting and commenting upon, and then do the same.

    Now, if that isn’t a setup for a closed community that endlessly recycles the same information–true or not–I don’t know what is. In a way, what they’re doing is creating what appears to be objective news by a process of selective omission: a quieter form of commentary but still just opinion.

    The reason I mention this is I think it’s important for people to figure out how they decide which information is true or authoritative or authentic. (And, yeah, I’m aware that those aren’t synonyms. I’ve known some VERY authentic sociopaths.) Clearly, what you trust and then take as truth depends heavily upon your prejudices: what you’re predisposed to believe. Just last night, I listened to one guy trash all “liberal” newspapers–the usual suspects–in favor of “truthful” news organizations, which seemed to come down to the WSJ and Fox News. Now, I can see the WSJ; it’s a very fine paper, which clearly labels what it considers news versus opinion and commentary; and, best of all, I can always double-check numbers and stats. (Me, I’ve got a friendly economist in my hip pocket that I’ve grown to trust over the years because his predictions largely turn out to be correct and something I can check. So when he weighs in on something I’ve read in the WSJ, I tend to listen.)

    I *don’t* have the same trust in, say, Fox News (or, to be fair, MSNBC) because there’s a huge difference between news and commentary, which are frequently conflated into interviews that involve, oh, name-calling and yelling and asking people if they’ve been hypnotized. Oh, for the days of David Susskind . . .

    Now, have I created a somewhat closed community for myself–say, my economist friend as a reality check against the WSJ or The Economist or fill-in-the-blank? Yeah. Will I challenge my friend when I read something that contradicts what he says? Sure–because then it’s up to him to argue, objectively, why he’s right and the other person’s wrong (or vice versa).

    Why is all this important–to me, anyway? How does it relate to blogging? Because many blogs are commentaries masquerading as news and information. (Duh. I know that should be obvious–and some venues are way more transparent than others–but you’d be surprised how many people conflate the two.) Wading through all that also feels more difficult than before probably because there are more choices. I’m not saying choice is bad; I think choice is fabulous. But if you limit yourself to a single community, then be aware that your choices–while they might seem large–are really small. If your community only references itself, then it’s like a snake eating its tail. The view behind will be the same as the view ahead, which isn’t the same as being true or accurate.

    Which then gets back to your points: that if you want to really understand something, you have to be willing to do the legwork involved to get at the facts. Sometimes, this means looking hard at where someone’s getting his or her information–and *that* frequently means breaking away from what a community might reference as being authoritative–and which will, if you do so in public, sometimes piss off people in your blogging community. Now, whether you decide to take on someone in public . . . well, that’s up to you. But don’t swallow stuff from people who are supposed to be in the know simply because they’re big names or supposed to be in the know. Dare to look somewhere else and then somewhere else again–just to be sure.

    If that’s clear . . .

  6. Kris, I too am enjoying the series and looking forward to next weeks post.

    It is very thought provoking to consider that ebooks can be the thing to save big publishing. I’m sure that will be based on if a company is willing to change. I’ll bet not all of the publishing companies in the 1930s survived, and for some it was because they were not willing to change.

    I’m not sure if this will be included in your posts, but technology is fast paced and changes constantly. I’m sure as e-readers continue to evolve that more options in how content is presented will emerge. I can see some add-ons similiar to bonus features on DVDs today.

    For example, I remember the Choose Your Own Adventure books my kids read about 15 years ago. These could make a comeback via hyperlinks with e-readers, and not just for kids.

    Also, how about a name pronunciation guide delivered in the writers own voice? That would be good for some SF/F novels with alien sounding names.

    Historical background notes? These can be very interesting if say an author sets a mystery novel in the late 60’s in Chicago, or such.

    Just some thoughts on how technology may enhance the content beyond just the story.


    1. Good points, Alan. I have some thoughts on things like that for my own work, and am setting aside some notes/projects for future “enhanced” e-books. I think this is quite an exciting time for all concerned. Thanks for the comment.

  7. First off, awesome post, with insights I’ve never actually found anywhere else.

    Second: “I hear a lot of complaints about “greedy publishers”, in ignorance of the plight of publishing, and that what’s at stake isn’t greed, it’s survival. The question isn’t how much a company *can* make – it’s how much is *has* to make to stay in business. The second question has a simple answer. Un fortunately, the answer to that question is sometimes *higher* than any answer they can find to the first question, and they’re in trouble.”

    It’s this concept right here most people ignore in regard to anything. I work for an insurance company (one of the largest) and just this morning, we were going over some more details of implementing reform. In every state that doesn’t REQUIRE child-only health plans, all the insurance companies are exiting, even when they used to offer them. Why? Because those plans pay out millions of dollars each year for high-risk kids and with only high-risk members, we’d be talking several thousand dollar premiums a month, which just isn’t right for anybody. Insurance companies would go out of business in months on that model.

    And that’s something I think everybody ignores when they start calling “greed” and “we need change!” They conveniently forget that publishing and insurance and every other stigmatized industry is trying to SURVIVE that change.

  8. Well, for those publishing companies with “cushions” in the television industry, there’s good news.

    Many television groups posted very good profits this year… of course, the FOUR BILLION spent by politicians might have had something to do with it.

    As a freelancer, I had more work this year than the past two years combined. I get the feeling the purse strings are being loosened.

    1. I’m getting the same feeling, Randy. I sold more books to publishers than I did in the past two years.

      I was wondering if all that $$ flowing into TV ads had an impact. When most people saw those ads, they got annoyed. Me, I saw dollar signs and thought that the people who were making out like bandits here were the folks who got the ad revenue. Rather like the California Gold Rush: The people who made the money were the shopkeepers and bar owners, not the folks working the mines. 🙂

      Thanks for that.

      1. Redesigning an entire industry from the bottom up–which is what we’re looking at with publishing (and several other industries in this new economic reality–costs a lot of money. And it’s lost money.

        When the foreclosure crisis hit, I mentioned to my husband that the country was in for a world of hurt because banks and mortgage companies couldn’t afford new workers to process the failing loans. Think about it: the banks/mortgage companies were losing money, and needed help processing the losses. When you lose money, you can’t justify new employees to your shareholders. So while this robosigning crisis is worse than I imagined, I am not surprised by it. Anyone who understands big business saw some form of this coming.

        Which I will get to in next week’s post. (She writes, drawing out the cliffhanger further.) Thanks for the comment, Megs.

  9. Kris said: “Jeez, you said in one paragraph what I planned to say in an entire post. (Of course, that won’t stop me….)”

    LOL! I sure HOPE it won’t stop you! Otherwise, I might have to start censoring my comments. I’m really enjoying this series. Every bit as illuminating as THE FREELANCER’S GUIDE. This is fascinating stuff, Kris!

  10. No surprise on the lack of accuracy in the blogosphere, and the causes run deeper.

    The famous cartoonist Jules Feiffer did a cartoon years back, where the narrator talks about the news as presented by different segments of the press, and what was emphasized and what was buried, and concluded “Free press? We’re a nation of trade journals!”

    And so we are, but I don’t consider that a Bad Thing – you need that diversity of presentation for an informed public. It’s like a comment by an illustrator on working from photographs: “I start with ten photos, and I paint what’s in between.” News is like that: no one source will give you a truly comprehensive picture, and you need to check more than one to get a real idea of what happened.

    The web makes possible a plethora of news sources, but that’s as much a weakness as a strength: it makes it possible for folks to cherry pick to get news that matches their preconceptions and ignore the rest.

    And that’s the problem. We all start with such preconceptions, and are usually uninclined to change them unless something like hard experience forces us to do so.

    I see this a lot in comments about publishing elsewhere. I’ve been trying to provide some facts of life about how publishing works, what it costs to produce a book in *any* format, and why a lot beliefs about what an ebook ought to cost are wishful thinking at best, as no publisher trying to sell at that price would stay in business. The responses, all too often, don’t quite call me an outright liar, but do dismiss my comments, because they don’t accord with what the other person wants to believe. I haven’t quite said “Ebooks won’t be as cheap as you want them to be. They *can’t* be. Tough. Deal with it.”, but the temptation has been strong.

    I hear a lot of complaints about “greedy publishers”, in ignorance of the plight of publishing, and that what’s at stake isn’t greed, it’s survival. The question isn’t how much a company *can* make – it’s how much is *has* to make to stay in business. The second question has a simple answer. Un fortunately, the answer to that question is sometimes *higher* than any answer they can find to the first question, and they’re in trouble. I suspect some publishers fall into that category now, and I expect further consolidation.

    1. Good points, Dennis. I expect further consolidation as well. Of course, we’re anticipating next week’s post. 🙂

      I don’t mind the amount of misinformation from the blogosphere. I mind when it comes from people who present themselves as experts when it’s clear from their posts that they haven’t bothered to research the very business they worked in for more than a decade. A lot of these folks make great points about self publishing ebooks, side by side with completely ignorant ideas about Big Publishing. Then these complain that the major publishers and booksellers don’t take them seriously. The major publishers don’t take them seriously because they’re wrong about something easily researched–and something they should understand from working in the business. Very irritating, especially when it hurts their good arguments.

  11. Kris, I really appreciate the careful and thoughtful analysis. I actually agree with your last sentence.

    Steven Saus said: “Again, I hope you’re right, but I’m not seeing the signs that they [big publishing] grok it.”

    Steven (great name, btw ), I am sure you’re right, but the key is, it takes only one or two industry leaders to figure it out. Once company X and Y figures out how to make $ by adopting a new policy, the whole alphabet will eventually follow. I’m sure there will be imprints, prolly even whole pub houses that perish in the shake up (or will change hands), but many will win through. I think good things are coming.

    And if anyone is in a position to give out informed speculation on what the future might look like, it’s Kris Rusch and Dean Smith .

    –Steven Mohan, Jr.

    1. Thanks for the vote of confidence, Steve. 🙂 And you’re exactly right about how it’s going to work. Jeez, you said in one paragraph what I planned to say in an entire post. (Of course, that won’t stop me….)

  12. Well, December 2012 isn’t relevant, because according to the Mayan calendar, the world’s going to end anyways. Seriously though, nice post, and I look forward to reading next week’s. I think it’s possible for ebooks to save publishing, but only if the companies are smart about it. So I’m eager to see what you have to say.

  13. Thank you for this in-depth history of the publishing industry – and how we got to where we are. I’m really anticipating the next installment now, because I don’t share your optimism.

    It’s not just the mis-steps I’ve seen – things like digital offerings of all books in a series but the middle one or bad formatting of eBooks – but what appears to be a difficulty in grasping the differences possible with the media.

    For example, a recent (NY published) fantasy romance I read had strange spaces in the middle of words. It took me a while to realize it was due to a search-and-replace for the dashes from the layout of the full-justified print book. I had another (much more published than I) author tell me last night where an editor said that a digital omnibus volume of a series was impossible “because the spine would be too wide”.

    I agree that some (if not all) of the publishing companies will survive in some fashion. How well they’ll survive – or how much they’ll be publishing – might be a different story. Again, I hope you’re right, but I’m not seeing the signs that they grok it.

    1. I’ll get to the reasons for all of the things you’re seeing right now, Steven. They have nothing to do with the future of publishing and everything to do with adapting to new technology. That will change, believe me. (And already is, among the smaller companies.) Again, writers and readers only see a tiny aspect of the entire publishing industry and then apply that aspect to the industry as a whole. It doesn’t work that way–and I’ll get to it next week.

      I know, Livia. I almost made a joke about the Mayan calendar, then decided against it since I was being so serious in this post. But when I first heard the December 2012 date for the death of publishing, I just about laughed myself out of the chair.

      Glad you both are looking forward to next week. I ran out of space this week to make my argument, so I figured it was better to wait.

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