Posts Tagged ‘Business Model’

By Elizabeth Burton, Executive Editor, Zumaya Publications LLC

Most bookstores still don’t consider eBooks “real.” They see them as a sales gimmick (hence the “bundled” concept where an eBook and a print book are sold together). They aren’t geared mentally to coming up with the kind of marketing ideas for eBooks they can for print because in many cases booksellers don’t read eBooks, have no intention of reading eBooks, etc., etc., etc.

When they start thinking of eBooks separately from print, as if it were, say, a line of stationery or a fancy bookmark, they’ll be in a better position to take advantage of the potential revenue stream. The problem is, most of them also seem to hate the idea that books are products, so there’s a second layer of resistance to that concept.

In this sense, eBooks are more like music than books. It’s not about the tactile pleasures of turning pages or sniffing ink. It’s about entertainment, period. I’m not talking about multi-media digital books here–just the entertainment we avid readers derive from reading in and of itself. The joy of words and stories and characters.

Both booksellers and mainstream publishing have the same basic problem: they’re trying to fit eBooks (and, to a lesser degree, on-demand printing) into the status quo, and it won’t work. I sighed during Digital Book World’s recent webinar discussing how indie booksellers might benefit from eBooks  and POD, when a representative from Vroman’s commented several times that the Espresso Book Machine costs $100K, and how it would take ten years to make that back, by which time the technology would have changed drastically.

Yes, an EBM is a big investment, but like every major infrastructure investment the idea is to come up with ways to maximize revenue to provide a good return. For example, small community organizations that lack big budgets but would love to be able to have a cookbook to sell as a fundraiser. They might lack the funds to pay for even a digital short run, but having the file loaded on the local EBM would mean they could obtain as many copies or as few as they wanted at any given time.

However, in discussing the issue, everything the gentleman from Vroman’s said practically screamed that he wasn’t getting beyond “how we do things now” to “how we could be doing other things and making money.”

From my perspective, of course, the frustrating point was that once again a means by which my authors could gain entry into bookstores was rejected, even though that means addresses all of the previously applied arguments against stocking our books–notably our general refusal to accept returns. I’ve often wondered how many small bookstores who rely heavily on credit from returns have actually calculated the cost of pulling them from the shelves and packaging them.

A small bookstore willing to invest in an EBM can literally increase their stock by thousands of books very few other bookstores have.

If the goal is to make money, then how is having the ability to recommend little-known titles and produce the book in 15 minutes not an advantage? And if, as the booksellers insist repeatedly, they exist to connect customers to new and undiscovered authors, why is there such resistance to expanding their horizons to include established, reputable publishers with books of proven quality solely because of the way those books are produced?

The Harlequin Horizons subsidy press uproar, in particular the response of the writers’ groups, was no surprise to those of us in the POD trenches. Everything about digital publishing challenges the status quo–and the emphasis there is on “status.”

Getting that New York publishing contract has become the brass ring for writers, and many of those who manage to get theirs seem to feel as though anyone’s managing to attain the goal any other way somehow diminishes their accomplishment.

Do I think the Horizons business was handled badly? Unquestionably. Do I think it’s a good idea? Absolutely. It’s hard making a buck in publishing, and business decisions have to be made on the basis of what’s good for the company, not whether said decision is going to violate some artificially derived “standard” of the industry established by third parties.

After all, if all the publishers go out of business, all the authors will have to–dare we say it?–self-publish.

My goal as a writer is to be read. If I make money at it, too, that’s all the better, but I don’t feel I need the approval of anyone other than the people who buy my work and read it and enjoy it. If other writers feel the need to barricade themselves behind arbitrary standards and insist those standards are the only “real” path to publication, they’re welcome to do so.

The irony is that, since I’m also an acquiring editor, I know full well how heavily personal tastes determine what books get past those vaunted guardians, and as a publisher I know how commercial viability has to be considered. I’m also aware that the determination of what’s commercially viable is as subjective in many ways as defining a great book.

When I’m presented the argument that self-publishing or print on demand are de facto vanity publishing, I usually refer to an anecdote about Abraham Lincoln.

Lincoln was once called upon to defend a man accused of breaking into a neighbor’s chicken coop and stealing chickens. There was no solid evidence against the alleged thief, but the victim of the theft and the prosecutor insisted there was no doubt he was guilty because everyone knew the defendant was a thief.

When it came time for Lincoln to cross-examine the accuser, he asked the man, “How many legs does a cow have?“

“Four, of course,” the farmer replied.

“And if we called the cow’s tail a leg, how many would it have then?”

“Why, five,” said the farmer.

“Well, no,” Lincoln said, “it would still only have four, because calling a cow’s tail a leg doesn’t make it one. And calling a man a thief doesn’t make him one either.”

The jury’s verdict? Not guilty.

Yes, POD and eBooks have allowed subsidy presses to sprout like toadstools after a rain, but authors and booksellers who dismiss the technology as if it defines end results are limiting not only the possibilities for previously unpublished writers but their own as well. Calling a legitimate publisher who uses an inventory-free business model a subsidy press or an author mill solely because they operate differently from the mainstream model doesn’t make them either one.

Elizabeth K. Burton is a former journalist, published novelist and editor who in 2003 was plunged head-first into the business of digital publishing. Zumaya Publications LLC in Austin TX has published more than 100 works of fiction and nonfiction printed on demand and available in non-DRM ebooks.

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by Guy LeCharles Gonzalez, Director of Audience Development, Digital Book World

Yesterday’s webinar, Indie Booksellers and the Digital Transition: Opportunity Knocks?, was an enlightening conversation that covered a number of timely topics — from bundling print and eBooks to bookstores as a “third place” — and attempted to answer the ultimate question: how can publishers be better partners?

Debbie Stier, SVP/Associate Publisher for HarperStudio and Director of Digital Marketing for HarperCollins moderated a lively conversation with a panel of veteran independent booksellers: Stephanie Anderson, WORD (Brooklyn), Patrick Brown, Vroman’s (Pasadena, CA), and Bridget Warren, Vertigo Books (College Park, MD).

Among the topics addressed was Clay Shirky’s idea of bookstores as social hubs, wherein he proposed “turning some customers into members, patrons, donors”, aka the NPR model. Brown’s response was succinct:

“Clay’s piece was interesting as a sort of think piece on theoretical bookstores of the future. I don’t really think that it’s all that feasible to implement many of his ideas for a bookstore that’s on the ground right now…

That tends to be how a lot of people go about it. They’re like, ‘Well, if I had a bookstore, this is how I would do it.’ But you don’t have a bookstore right now.”

Shelf Awareness has a great recap of the session, including some answers to “What can publishers do to help indies?”

Warren suggested, “Integrate sales so the reps we know and trust sell e-books. Publishers need to make sure their reps are comfortable selling e-books, and ease pricing disparity for indies.” Anderson wished for “Better communication, more openness, more back and forth. We have the same goal: we want people to buy good books.” Brown said, “Publishers [need to] recognize how important we are to the ecosystem. Shelf space is advertising space.”

Some of the highlights from our attendees via Twitter:

Kirtim reason harper studio doesn’t bundle? no major retailer does it #dbw is this the opportunity for indies?

DigiBookWorld “The bundle sounds easy, yet no one seems to be able to make a shopping cart that bundles a physical and digital product.” @debbiestier #dbw

DonLinn OR Books had a bundle of digital and print for GOING ROUGE. Sold only a couple of hundred copies. #dbw

KatherineBoG I’ve had ppl express interest in having hard copy of book + e-version. Unfortunately all who’ve said that to me are kindle owners. #dbw

katerados #dbw – interesting correlation b/w apple’s itunes dynamic pricing and ebook pricing. Get the early adopters at premium price?

changinghands #dbw Yes, online e-book purchases will be the norm. Our job to encourage customers to buy digital from indies. Price disadvantage crippling.

WendyHudson #dbw Does anyone here use Symtio cards in their stores?

Kirtim I would think Symtio cards would help towards a bundle idea -maybe just a barcode on the p-book? #dbw

changinghands #dbw Why is public expectation for e-books set at $9.99? Jeff Bezos decided for all of us. Fellow travelers who link to Amazon complicit.

thebookjournal #dbw so seeing as we can’t sell Kindle format ebooks, do we really stand a chance?

Kirtim interesting how convo for #dbw is no longer about content but about bundle and pricing. Seems a huge advance from a couple years ago.

WendyHudson #dbw I want a POD machine as soon as it’s feasible, but $, size, and staffing are big issues.

bookateur #dbw Espresso can be leased vs. outright buy.

emmittc was told by andrew pate with ondemand books (espresso) in october that they are “not currently leasing”…..#dbw

Kirtim Titles in Hamilton, Canada and University of Alberta have espresso and rave #dbw/news/7079.html#dbw

KSchechner More on indies using the Espresso Book Machine: http://news.bookweb.org

KatherineBoG Interesting: @bookavore’s argument that indies must make ebooks a local experience vs Sherman Alexie last week that it’s impossible. #dbw

ca_gordon Mobile devices allow people to bring the internet & social networks with them to stores with a physical inventory. via @vromans #dbw

KatherineBoG “use mobile technology to take advantage of our physical space” ex. foursquare. @vromans #dbw

KatherineBoG “Social media is a way to remind people of how wonderful it is to actually be in the store” @bookavore #dbw

DigiBookWorld “We have to focus on the things we can do that software can’t.” Patrick from @Vromans #dbw

changinghands #dbw Disagree with Patrick. Doing the things software can’t and incorporating the new not mutually exclusive. Do both.

The archive of the webinar is available here.

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By Phil West, Principal, Luminaria Media & Public Relations

Proponents of digital books don’t need much convincing to understand the possibilities that digital instructional materials would bring to students. In addition to the obvious advantages of digital text over printed text — such as being able to edit science and social studies texts to keep up with current events and new developments — digital text can integrate with new and emerging technologies more effectively and seamlessly than printed text.

Thanks to legislation authored by Texas State Rep. Scott Hochberg (D-Houston), and passed by the Texas State Legislature this May, the Texas Education Agency has been given the ability to create a repository of digital instructional content for the state’s K-12 students. Given that the TEA is about to issue its first RFP calling for content, the state could deliver e-books and other digital instructional materials to its students as early as the 2010-11 school year.

Hochberg notes that the new law offers an immediate and significant cost savings to taxpayers, as Texas alone spends close to $500 million to replace and update its worn out textbooks each year.

Hochberg estimates that the content makes up only 10 percent of that figure. He notes that even when figuring in costs to distribute content, provide books for those school districts opting for print-on-demand books, and loan and/or purchase computers for school districts wanting to utilize online content, the cost savings would – even using the most conservative estimates – slice the current textbook allotment for state students in half.

If the $250 million in savings isn’t incentive enough, the legislation brings with it the potential for computer software, video, and other learning technologies to be integrated with digital instructional content. Hochberg, who is particularly interested by this aspect of the legislation, noted, “By separating the content from the physical textbook, we create unlimited opportunities for teachers and entrepreneurs to find more effective ways to present this material.”

“This can be for instruction what the iPhone is to cell phones,” he added. “You want something to turn a math problem into something that has connection to the kid’s world? There can be an app for that! Or how about something to give parents a nightly report of what concepts their children are having trouble learning and where to find help? There can be an app for that, too.”

The potential new direction for textbooks in Texas — and for other states prone to following Texas’ lead in the textbook arena — isn’t without its naysayers, including hesitations from the State Board of Education, who worry that they’ll be ceding control over what gets taught in Texas.

Hochberg counters the State Board of Education’s position by noting, “Teachers are putting together their own digital materials from the web every day.  By building a state-certified digital content library, we can gain the advantages of digital, without giving up the content review that Texas has traditionally held at the state level.”

And at least one editorial board, The Longview News-Journal, frets that though they don’t want to be thought of as Luddites, “we do believe there is a real value in teaching children how to read and learn with real books printed on real paper.”

Yet, as Hochberg points out, in a world with printed textbooks, decisions about what to teach children are impacted by the amount of time it takes a textbook binding to wear out. With this new legislation set to change our notions of the textbook forever, we’re no longer bound (no pun intended) by those limitations.

Phil West is principal of Luminaria Media & Public Relations, a communications firm based in Austin, and has served as an adjunct English professor at universities and colleges in Austin and San Antonio. West ran a campaign for Hochberg this fall on the digital instructional material legislation in Texas.

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By Ryan Chapman, Internet Marketing Manager, Macmillan

A lot of the discussion about eBooks tends to frame the format in absolutist and misleading terms.

“It will destroy print.”

“It will devalue the book.”

We shouldn’t make the mistake of assuming a growing new format will upend the entire industry (remember the fear concerning audiobooks?). The format will dictate the content and this makes for one of the most exciting shifts in the industry since the rise of mass-market paperbacks.

I bring up mass-markets as an analogy and a precedent. Could you imagine pitching the concept to publishers? “It’s a smaller trim size, printed on cheap paper, and we’ll charge a third of the hardcover price. Yes, hardcovers are beautiful objects, but we think there’s a big opportunity here in treating our books as disposable commodities.”

I wouldn’t be surprised if industry pessimists back then expressed the same fears of cannibalized sales and devalued content that they do now regarding eBooks.

Mass-markets defined their own readership (at airports and supermarkets) and genres (commercial and genre fiction); you don’t see biographies or political nonfiction in this format. Of the current top 20 bestsellers on the New York TimesPaperback Mass-Market Fiction list, 8 have never been published in hardcover (disregarding the large-print hardcovers for Snow Angels and Hot on Her Heels).

The eBook format is no different. After the digital transition, we’ll find that certain books fit an eBook audience, while others are meant for print. Personally, this year I purchased hardcovers that I would never buy as an eBook (Thomas Pynchon’s Inherent Vice), and vice versa (Steve Knopper’s Appetite for Self-Destruction).

Of course there will be overlap. Of course there will be outliers. It’s foolish to think this will be cut and dry on either side.

Thankfully, the publishing industry will be able to weather this transition with greater ease than at previous inflection points. Returning to our analogy, a mass-market pilot program for a major publisher would have required a significant amount of capital for market research and R&D. Not anymore. A lot of traditional market research tools have become affordable (if not free) in their digital forms. Creating consumer surveys, testing book covers, sampling book fairs (for the YA market), etc. Publishers leveraging their direct-to-consumer channels will gain unprecedented reader data at much less cost than in the past.

In the digital transition, we’ll stumble and fall more than once. Harlequin felt this recently with the warm reception for their Carina Press announcement, and the cold shoulder Harlequin Horizons received a week later. But now we can “fail fast forward,” informed with real-time reader response to determine what readers want and in which formats.

The data will most certainly run counter to our guesswork and opinions.

Bowker’s Kelly Gallagher has noted eBook consumption favors fiction over nonfiction at a rate disproportionate to print. (We’ll learn more during his Digital Book World presentation, “Today’s eBook Consumer: A Look at First-Round Data from BISG’s On-Going Survey of Consumer Attitudes Toward eBook Reading.”) Is this significant of eBook habits overall, or merely the behavior of the early adopter community? How much of this is determined by the device?

Reading on a dedicated ereader is different than reading on the iPhone or PC; this too will determine purchasing behavior in the coming year. e.g.: I can embed links to YouTube videos and relevant URLs in my ePub, which, for the right title, makes it a more attractive media property on the iPhone than the Kindle.

Just as 40% of New York Times mass-market bestsellers have never seen the traditional hardcover format, I predict that by this time next year we’ll see a trade title flourish as an eBook, with little or no print support. I’m not talking about Stephenie Meyer selling 10K copies of the Twilight iPhone app, but a word-of-mouth hit operating solely within this new market. Maybe it’ll be a thriller encouraging readers to seek out YouTube content; or an extremely topical work of satire pushed to market at twice the speed a printed book can be crashed.

We know all change is disruptive, and in an industry with thin profit margins that can be scary as hell. It may get worse before it gets better.

Whatever happens, though, I find it’s a thrilling time to be in publishing.

Ryan Chapman works for Macmillan as an internet marketing manager. In January he’ll transition to working exclusively with Farrar, Straus and Giroux. You can follow him on Twitter at @chapmanchapman or on his blog.

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A free webinar, presented by Digital Book World.

“In the social realm, there’s nothing better than true engagement between customers and brands (through the employees that represent them).”

Shiv Singh, VP and Global Social Media Lead for Razorfish

No conversation about publishing’s future and the importance of engaging readers directly is complete if it doesn’t include the perspective of the independent bookseller — our partners, curators and, most importantly, community organizers.

Indie Booksellers and the Digital Transition: Opportunity Knocks?“, a free webinar from Digital Book World, will address the challenges and opportunities ahead for independent booksellers, and what a digital future means for them.

  • Is it possible to compete with Barnes & Noble, Amazon, and Wal-Mart?
  • What effect will publishers selling direct to consumers have?
  • Where do POD and ebooks fit in the picture?
  • How can social media be used to build a community, online and in-store?

Debbie Stier, SVP/Assoc. Publisher for HarperStudio and Dir. of Digital Marketing for HarperCollins will moderate a lively conversation with out panel of independent booksellers: Stephanie Anderson, WORD (Brooklyn), Patrick Brown, Vromans (Pasadena, CA), and Bridget Warren, Vertigo Books (College Park, MD)

Indie Booksellers and the Digital Transition: Opportunity Knocks?” will be held on Wednesday, December 9th @ 1 pm EST // 10am PST.

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