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What the “Book People” Won’t Tell You: Print is Dead

18 September 2017

From The Digital Reader:

I have been writing about industry trends in bits and pieces in each news story, but it has been a long while since I last pulled everything together, took a step back, and told you what I see.

I can sum it up in a single sentence: The major publishers are dead because they bet against digital, which is the future.

The thing about the major publishers is that they thought they could make the market go where they wanted.

They didn’t want ebooks to cannibalize print sales, so they conspired with Apple in early 2010 to bring about the Agency model. Then they doubled down on their bet with Agency 2.0, and hedged that bet by sabotaging subscription ebook services like Scribd and Oyster by saddling them with nonviable business models.

It is now 2017, and book publishing is in the later stages of a transition to digital.

. . . .

The major publishers bet against digital, and they continue to do so, and it is going to kill them in the long run. In fact, we can see them die bit by bit. First they dropped mid-list authors, then they started dropping best-selling authors.

Link to the rest at The Digital Reader

PG thinks the illegal collusion between the big publishers to force Amazon to set higher prices for ebooks was an important milestone on their path to suicide. They got together in various New York restaurants to engage in face-to-face groupthink.

Here’s a summary from Wikipedia:

The Publisher Defendants sold over 48% of all e-books in the U.S. in the first quarter of 2010. The Publisher Defendants along with Random House Publishing are the six largest publishers in the United States (collectively the Publishers) and are often referred to as the “Big Six” in the publishing industry. In 2009 Amazon.com Inc. had nearly 90% of the e-books industry. Amazon charged $9.99 for certain new releases and bestselling e-books which helped make it the market leader in the sale of e-books and e-readers with its Kindle.

Amazon’s price point caused discontent among the Publishers. The Publishers believed that the low price point was a problem for their sales of more profitable hardcover books. Approximately every three months, the CEOs of the Big Six would meet in private dining rooms in New York restaurants “without counsel or assistant present, in order to discuss the common challenges they faced, including most prominently Amazon’s pricing policies.” The Publishers used several different strategies to fight against Amazon’s pricing point, including selling e-books for the same price as their printed version through a continued wholesale model and “windowing” new releases. Windowing is a tactic that would delay the release of books to their e-book form for a certain window of time.

. . . .

Amazon sent a letter to the Federal Trade Commission complaining about the simultaneous nature of the demands for agency model agreements from the Publishers who had signed with Apple. By March, Amazon had completed agency agreements with four of the five publishers. During the negotiations over the agreements, the publishers would talk with each other and share information about what Amazon would concede with each. Apple was closely following all of this progress and Cue was in contact with the publishers. Following Amazon’s move to agency amounted to “an average per unit e-book retail price increase of 14.2% for their new releases, 42.7% for their NYT Bestsellers, and 18.6% across all of the Publisher Defendants’ e-books.”[2] The Publishers also raised the price of some of their New Release hardcover books so as to move the e-book versions into a correspondingly higher price tier. Amazon saw Random House (who for the moment had not joined Apple) e-book sales having an increase of 41%. Two studies showed that the Publishers who moved to agency model sold over 10% fewer units at major retailers. In contrast, other publishers’ sales increased 5.4% in the same period. In January 2011 Random House also moved to the agency model and raised the prices of its e-books, and then experienced a decline in its e-book sales. This allowed Random House to join the iBookstore.

. . . .

Beginning on December 8, 2009, Apple’s senior VP of Internet Software and Services, Eddy Cue, contacted the Publishers to set up meetings for the following week. During the meetings Cue suggested that Apple would sell the majority of e-books between $9.99 and $14.99, with new releases being $12.99 to $14.99. Apple also adopted the agency model which it used in its App Store for distribution of e-books. This let Publishers control the price of the e-books with Apple receiving a 30% commission. Apple also set up price tiers for different books. Apple also included a MFN clause in their contract with the Publishers which allowed for Apple to sell e-book at its competitors’ lowest price.

. . . .

On the day of the launch, Jobs was asked by a reporter why people would pay $14.99 for a book in the iBookstore when they could purchase it for $9.99 from Amazon. In response Jobs stated that “The price will be the same… Publishers are actually withholding their books from Amazon because they are not happy.”[2] By stating this, Jobs acknowledged his understanding that the Publishers would raise e-book prices and that Apple would not have to face any competition from Amazon on price.

This collusion between the top executives of five out of the (then) six major US publishers to destroy Amazon’s pricing model for ebooks helped accelerate the development of anti-Amazon/anti-ebooks groupthink throughout Big Publishing.

Later, when the Justice Department charged these publishers with illegal anti-competitive behavior and publicly humiliated their management by requiring an admission of guilt and forcing monetary settlements, the anti-Amazon/anti-ebook sentiment blossomed into something of an industry-wide psychosis.

Publishing couldn’t live without Amazon and hated the company even more for their dependence upon it.

When Borders, the second largest bookstore chain in the US, went bankrupt in 2011, that shocking event should have set alarm bells ringing in CEO offices of every publisher.

The second-largest bricks-and-mortar customer for every major US publisher had just imploded. Perhaps it was time for some new thinking? Would the future be a lot different than the past? What a silly thought.

Borders would have been happy to sell its assets to virtually any willing purchaser, but smart money was not interested. Neither was dumb money and about 650 retail bookstores in the US just disappeared.

At the time of the Borders bankruptcy, reporters and business writers (often relying on traditional publishing sources) concluded that Borders had made a big mistake by working with Amazon to sell ebooks. On the other hand, Barnes & Noble was brilliant because it had spent lots of money to build up its Nook business as a viable competitor to Amazon’s Kindle.

Amazon Derangement Syndrome was running rampant through the publishing business and that, combined with widespread ignorance of technology among management, blinded them to a simple fact that was evident to anyone with an ounce of internet savvy: Amazon was much, much better at selling books (and a lot of other things) online than Barnes & Noble and the gap between the two organizations was growing at a rapid pace.

The traditional book industry and its convoy of pet pundits have not gotten any part of selling online right for well over ten years and show no indication that anything is going to change in the next ten years (to be clear, PG is not predicting that Big Publishing has ten more years ahead of it).

Barnes & Noble is running on fumes. Whether it continues to sink into the sunset or suddenly implodes won’t impact the overall trajectory of the retail book business. It’s dying. At this point, even if Barnes & Noble were able to hire talented management, PG thinks it’s too late for that to make a difference.

When Barnes & Noble is gone, what’s left for legacy publishing? A bunch of mom and pop bookstores. There may be some fancier moms and pops in Manhattan and Washington DC, but they’re all small businesses with tiny profit margins.

PG ran out of time before he could bloviate about traditionally-published authors heading for the exits and hedge funds taking over management of the gazillion legacy publishing contracts which represent the only value of Big Publishing.

Amazon, Big Publishing, Disruptive Innovation

77 Comments to “What the “Book People” Won’t Tell You: Print is Dead”

  1. I wish I had mentioned Borders; you’re right in that it died because its creditors (the major publishers) would not let it be saved.

    • I’ve seen something telling in a number of stories about bookstores closing down. It’s typical that they are unable to sell their businesses, but lately I see quotes along the line of “banks won’t loan to any prospective purchaser.”

      • The Amazon effect.
        Dreamer: “I want a loan to buy a failing bookstore.”
        Loan officer: “How do you intend to compete with Amazon?”
        Dreamer: “Amazon can’t offer the ambience and camaraderie and literary conversation that will be our stock in trade.”
        Loan Officer: “Next!”

        • Perhaps, but when was the last time you went to Amazon for a book signing?

          • I don’t know about Mr. Torres, but speaking as a reader, I have never gone anywhere for a book signing.

          • I’ve only ever been to book signings at conventions.
            I’ve never attended one at a bookstore.

            • I’ve only ever been to two book signings – the first was for Robin Hobb when she visited Melbourne many years ago. The second was for Hugh Howey and Tad Williams when they both visited a convention, again in Melbourne.
              I’m sure there are people who do go to book signings in bookshops, but I’m not one of them. 🙁

          • If you guys like fantasy and Brandon Sanderson is in town, you should go to one of his signings. Lots of fun.

            I went to probably a dozen book signings while I was in college. The best ones were always at the BYU Bookstore. Lots of other good ones at conventions.

            Bookstores also have the advantage of setting up local book clubs. My mom goes to one of those at her local indie bookseller and really enjoys it.

            They can also set up special speaking events for local authors, which can be really fun. Pioneer Book in Provo does a bunch of those. Went to one a couple years back for a friend of mine from the slushpile of a student literary magazine. Great way to catch up.

            Pioneer Book also does a deal with the kolache shop down the street, where on Saturday mornings a receipt from the kolache place counts as a BOGO free deal. I can’t tell you how many girls I took out there for a first date. One of those blossomed into a six month relationship.

            Point is, there’s lots of stuff you can do at a bookstore that just doesn’t translate into an online space. Big box v. online retail v. indie bookseller is very much like rock paper scissors.

            • Joe. There is stuff you can do at some bookstores that you can’t online. The problem is that I don’t place a high value on any of these things, and I suspect that most readers don’t. And for those who do the local library still offers these things without trying to sell you overpriced paper books.

              Hopefully there will be enough people prepared to pay for the privilege of having local bookstores which continue to offer this social element.

          • How much money do typical signings generate?
            I suspect there is more money for authors in doing it like Kevin Anderson and DWS, among others: online.

            • The main reason people go to book signings isn’t to get signed books. It’s to meet their favorite authors in person and hear them talk. Some of them can be quite entertaining, and it’s always a good chance to ask a question or two that you’ve been dying to know about the books/story/characters.

              Book signings are a thing that some people enjoy. Do they make money? Not usually, no. But that’s not why authors do them. They’re good publicity and good for building and solidifying a fan base. Just because you personally don’t see any appeal in them doesn’t mean other people don’t or that they’re not something worth doing. (Though, IMO, they’re only worth doing as a way to please existing readers and make them more excited fans, not so much as a way to try to get new readers, because sitting alone at a table hoping someone will come talk to you is a depressing waste of time, I’m sure.)

              And while libraries do have events, it is good to have it somewhere where people can buy your books if they want to (but they’re not forced to). Libraries don’t have books available for purchase. But I’d think it’s probably a good idea for the author to have copies of their own book to sell regardless of venue, just in case.

              • The question isn’t whether book signings make money for authors or not, but whether they make money for bookstores. Signings are an activity only brick and mortar stores can hold (well, hold easily, anyway). But if they don’t enhance the store’s revenue, it’s not a tangible advantage for them.

              • Before the internet age, I was interested in meeting a few authors I admired at conferences/book fairs/etc. But now, we can ask questions of authors online, see them speak on Youtube, hear them interact on podcasts. I don’t have to go see them live, since many authors interact with fans on message boards–I remember Nora Roberts regularly dropping in on AOL fan boards in the 90s–and on their own blogs. What wasn’t easily possible in my early reading years is a snap now.

                Authors don’t need to hit the bookstores and sign to connect with readers. In fact, I don’t want my fave authors doing anything that eats up their time and affects their writing time. I’d prefer they skip the traveling for signings and get me the next story…like fast. 😀

                They can always do a live event on Youtube (I enjoy those, actually, with the Game of Thrones fandom and astronomy enthusiasts, so why not with authors?)

              • I loved meeting Terry Pratchett at Borders and hearing him talk.

                But a library or a park and so on wouldn’t preclude buying the author’s books because now there’s Square, which has the added advantage of letting you buy their e-books. If Amazon still has a card reader then that would offer painless downloading as an option, too. And now selfies are a thing.

                That said, I like the compromise of authors doing YouTube or other online events. Less time away from the books I want them to keep writing…

          • For me, book signings don’t have the cachet they once had. In the past, I would go to them (usually at Borders, but more recently at Poisoned Pen). Since I read mostly ebooks, the only thing a signed copy does for me is make it more difficult to resell or give away.

            In recent years, the only book signings I go to are at the Tucson Festival of Books. While several bookstores handle sales for the big name authors, indie authors sell theirs themselves.

        • Great post Felix. However, I would have thought that such out of touch dreamers wouldn’t make it far past the front door. I have visions of security throwing them bodily into the street immediately after they reach the enquiry counter and mention the words book shop!

    • Your thoughts were very insightful without Borders, Nate.

  2. Tradpub isn’t in the book business. They’re in the *paper* business. And to top that, none of them are actually involved with the end product; they ship files to printers, who handle that sort of thing.

    Tradpub sees its customers as the warehousers and distributors. They’re blind to the individuals buying their products.

    When you don’t know what your product is, and you don’t know who your customers are… you’re just coasting on inertia before the deputy nails the auction notice to your door.

  3. Those of you who haven’t read KKR’s latest column (maybe the one previous), she wrote about TradPub dropping a slew of authors who were still selling well, but not enough for them. She didn’t name names unfortunately.

    • I reference that column in my piece.

    • Not authors. But she named the randy Penguin as one of the publishers dropping authors.

    • That happened bigly back in the mid-1990s.

      I went through my collection a few years ago and noted there were more than a dozen authors I had really liked, who had been fairly prolific, whom I hadn’t seen anything from in a long time. I made a list and went to the Web. Many of them had web sites or blogs, almost always with the same story – they’d been solid midlist authors with steady and predictable sales. And then their publishers either dropped them, or made ridiculously low offers for current works.

      One or two had jumped genres, most had simply given up writing.

      The industry’s reasoning appeared to be threefold –

      a) if you weren’t a best-seller, you weren’t worth dealing with

      b) they were going to (somehow) print only best-sellers and cut away all the deadwood

      c) if that didn’t work, there were plenty of people who’d “generate product” for a hundred bucks and a box of author copies

    • could someone post a link to the KKR column in question? I was looking on her site yesterday, and couldn’t find it.

  4. Everything in the OP is more or less true but alas, it’s not the whole story.
    There is more to print than the biggest traditional publishers and there will be a (reduced) market for print books for a long time to come.

    What the ongoing disruption is undercutting is the economics of the large-batch, velocity-driven model supporting the Manhattan Mafia. That does not mean, however, that smaller, more agile and focused publishers can’t survive selling both print and digital.

    There’s quite a few roads to survival even for the BPHs but none of them involve throwing out ten thousand titles a year, hoping that one of them might hit paydirt and make their year. And none of them tolerate the kind of predatory contracts the BPHs are deploying.

    As is, there are no signs that the pundits and “book peopke” yet understand the scope of the ongoing change. And the real threat headed their way:

    Borders took 25% of their true stock in trade: B&M shelf space access. B&N and the department stores have downsized another 10% or so. When and if B&N goes, that’ll take another 15%. 50% gone in less than a decade.

    But that is total shelf space.
    And,as I’ve said before, not all shelf space is the same. When a 60,000 book B&N closes, it might be replaced by three 30,000 book Independent stores, but those stores will be stocking mostly the same 30,000 books. The other 30,000 that used to be shelved at B&N will only be available via special order. Or Amazon. Or digital.

    In terms of B&M presence, B&N going away will be taking away well over 50% of the exposure and visibility (such as is) that makes authors go tradpub. This on top of the lost shelf space. In other words, there will only be room at B&M for a quarter of the titles there used to be, which was already a small fraction of the millions of books currently in print.
    (Figure a generous 50,000 average bookstore catalog. That is maybe one-sixth of the books published in the US in a given year. Now factor in the sctive backlist. Rather tight shelves, aren’t they?)

    That is why tbe BPHs are dropping good selling authors today. They are preparing for the day, coming soon, when they can’t find shelf space for anything but their top sellers, the kinds of books sold at airport newstands for months on end.

    Anybody else will have to either go small press or go Indie.
    And there aren’t enough small presses to accomodate all the proven sellers being cut loose.

    I think we can all do the math from that point on. 🙂

    • When a 60,000 book B&N closes, it might be replaced by three 30,000 book Independent stores,

      Nah. New bookstores are opening themselves around a core cafe, which reduces their stock count significantly.

      • I’m trying to give them the benefit of the doubt.
        Will some be cofee shop/newstand operations?
        Sure.
        And the more there are of those, the worse it’ll be for tradpub authors. But some may be able to sustain a larger new book catalog.
        Don’t want to be too pessimist.

        • … or perhaps nothing will replace it. The B&N in a very good location in Santa Monica (you’ve all heard of that place, right? It’s part of a big metropolitan area in California – you would recognize the name if I mentioned it) – is closing. Not relocating. Closing.

          http://www.santamonicanext.org/2017/08/after-more-than-20-years-barnes-noble-on-third-street-promenade-to-close/

          Santa Monica itself is a desirable part of the area to live in. It’s not a depressed neighborhood, and it’s not out in the sticks, and the people who live there have money. The former Borders store here is now an Apple store, and those don’t occupy low-rent retail.

          We’ll see if a 30K title bookstore opens up nearby. I wouldn’t hold your breath.

          • Sounds like the kind of upscale site AmazonBooks targets.

            • I make a similar point in my later post. Many of us are predicting the end of B&N in the near future. The signs have been obvious enough for some time even to us mere mortals. So is it unlikely that a certain large online retailer saw the same signs, but probably much earlier than the rest of us? They say nature abhors a vacuum! Let’s say one does develop in this industry in the near future? Do you know of any huge cashed-up online retailer who has been opening retail stores, prompting much speculation from all sorts of quarters as to why? Perhaps we have our answer. The only reason I can think of for them not to do it is possible concern over anti-trust law.

          • If B&N can’t make its business work in Santa Monica, I can’t think of where it would work.

          • When the Third Street Promenade opened back in the Sixties, it was just a typical Main Street USA that got rid of the cars and made a 3-block pedestrian experience. There was Newbury’s, hardware stores, barber shops, shoe repair places, yada.

            Alas, no more. The Promenade has been Melrose Avenued, yuppified, upscaled, genrified — whatever process you want to call it.

            The old stores are gone. Now it’s nothing but la-de-da boutiques, trendy weird-food restaurants loaded with “atmosphere”, expensive specialty stores, etc. There are street performers (with their tip boxes) everywhere. Parking, never easy in downtown Santa Monica, is, anymore, an order-of-magnitude more horrible experience trying to find an empty space… and a a reasonable price.

            I seldom go to Santa Monica anymore. Crowded, crawl-speed traffic, and (not just on the Promenade) expensive establishments that draw the kind of “Hollywood-style” beautiful people, shallow social climbers, and fatuous wannabes that I have nothing in common with. And merchandise I have no interest in buying at ultra-inflated prices.

            YUCK!!!

      • We had a B&N once. It closed years ago.

        It as the size of a small Wal-Mart, but “books” were definitely not what it was about. It appeared to be primarily a video store with a sideline in tchochkis. Probably 1/3 to 1/4 of the offerings involved books or magazines.

        I don’t know if there were “60,000 books”, but I do remember entire shelves of the same title. I’m afraid I conflate a hundred copies of this month’s (hopeful) best-seller as the same book, for purposes of “book-like offerings someone might purchase.”

    • Don’t forget all the shelf space that Borders and B&N destroyed. Was it Borders that bought up Waldenbooks and basically dismantled them?

      • Yup.
        And B&N bought up B. Dalton and closed it up.
        The two chains with a viable model for these times killed in favor of the no-longer viable warehouse model.

        They zigged, the world zagged…

  5. Currently Amazon sells 60%+ of the Big Five print sales, most of these with heavy discounting. If the Big Five thinks this will go on forever they are mistaken.
    Fast forward 5 years: POD book prices and sizes are reduced — $10 self published mass market paperbacks anyone?

  6. Suppose there had been no collusion among publishers.

    In that case, or in any plausible case, what economic value would publishers contribute in a digital world? What would their competitive advantage be? What would they do better than anyone else?

    Publishers’ competitive advantage was manufacturing, distributing, and promoting paper products with words printed on them. They did that very well, better than anyone else.

    When there is no paper, and no physical distribution, what do they do that cannot be done just as well or better by a zillion other players?

    The notion that publishers made a mistake rests on the implicit assumption that there is something they could have done to preserve their position. What? (It’s not avoiding meetings in backrooms.)

    • Don’t forget that it was the collusion price hikes that drove many (most?) readers to sample indie wares.

      Absent collusion one near-certain outcome would be a lower Indie, inc market share. How much lower? Hard to guess. But lower Indie sales would have offered less inducement for new writers to go straight to market.

      Another certain outcome is they would’ve saved several hundred millions in fines and all the bad press and reader ill will they earned.

      Finally, absent collusion, ebooks would’ve remained a wholesale product so the smaller ebook retailers that relied on price competition, micropayments, and loyalty programs wouldn’t have died in 2010-2011, taking interoperable epub with them. Apple might not have entered the ebook market but Sony would still be a player, Google might be stronger, and the various Christian- and/or LGBT-focused ebookstores that relied on generic Adept epub would not necessarily have folded.

      Absent Agency, B&N might have thought twice about moving Nook hardware to near-cost pricing. Purely speculative, that. But if they hadn’t, the current ereader market would be more diverse with entries from the larger Asian consumer electronics companies. This would also have strengthened interoperable epub and presented Amazon with better competition.

      Pretty much the only thing that is absolutely clear is the BPHs wouldn’t be as weak as they are now. They might still be in trouble but they would not be as bad off as they are now.

      • OK. But the fundamental economic question for any business is what does it offer that fills a market need? The second question is, what competitive advantage does it have over a zillion other folks?

        When the fundamentals are against you, there are lots of paths events can take, but they end up in the same place.

        • All events end up in the same place: the sun goes nova.

          The path matters, though.
          Some paths take forever to reach the end, others go quicker.

          Maybe the BPH’s were destined to lose their power and influence anyway. That doesn’t mean they were destined to break the law, screw their customers and authors, pay big fines, and hand the market on a silver platter to the very company they wanted to destroy.

          We don’t know much about the road not taken but we know a lot about the road they did take. And it is littered with decisions that cost them money, goodwill, and market share.

          I don’t see why hypothetical assumptions excuse any of it. All I see is what they did.

          • I don’t see why hypothetical assumptions excuse any of it. All I see is what they did.

            Neither do I. The very real observation is that publishers offer no economic benefit today that can’t be provided by many others. That situation doesn’t depend on their behavior. It’s an externality they can’t control.

            Concentrating on collusion masks the much more important economic forces at work. It implies a control that dos not exist.

            Publishers didn’t hand the market to anyone. They didn’t have that kind of control. The market moved away from them as consumers made individual choices to adopt new opportunities enabled by the new technology. Publishers are unnecessary.

            The publishers may have been wonderful people, or they may have been awful. That doesn’t matter to the market externalities. The good, the bad, and the ugly – it hits them all.

            • You don’t see any economic benefit?
              There’s quite a few authors who realize true economic benefit from many small and medium publishers and Apub, among others.

              The BPHs and the rest of the “Industry standard” predatory contract publishers aren’t the only publishers out there, for all their posturing and pretense.

              Let’s not overgeneralize. There are still publishers out there who actively promote authors and their books, both new and backlist, who embrace ebooks and rational pricing, who provide honest (editing, formatting, graphics, and marketing) services and act like true partners. Even the BPHs could be useful to an economics-savvy author if they ditched the shovelware/fresh produce model in favor of an honest service bureau model. They would have to cut back new releases by an order of magnitude, which their overlords would never allow, but paths to relevance do exist even in a reduced shelf space model.

              Much like bookstores, the future of publishing lies in smaller, more agile and responsive business models.

              • You don’t see any economic benefit?

                “The very real observation is that publishers offer no economic benefit today that can’t be provided by many others.”

                “But the fundamental economic question for any business is what does it offer that fills a market need? The second question is, what competitive advantage does it have over a zillion other folks?”

                • You don’t need to offer a unique setvice to do well in business. Plenty of businesses thrive offering generic goods and services at competitive prices. Supermarkets come to mind. Hairdressers. Auto repair chains.

                  There is a middle ground between “Godfathers of publishing” and “road kill”.

                • You don’t need to offer a unique setvice to do well in business.

                  Correct. Stable demand for services enables multiple players to do well.

                  As demand decreases, or new and cheaper substitutes enter the market, the stable demand curve moves downward. The industry or segment then loses the stable demand and shrinks back. That’s what we have been watching for the last ten
                  years. It’s not finished.

                  Note the players talking about how they will succeed by offering personal services, talking to customers, nurturing partners, etc. That is a response to the recognition that the core service they offer is losing demand.

                • One reason for the reduction in demand for BPH services is the reduction in the supply and quality of the services offered. Tbat is not a market issue, it is a management issue. This reduction in supply clearly came first, when the big publishers offloaded marketting on authors and retailers, setting the stage for their own disintermediation.
                  Again, not a market change.

    • Look at Baen. They’re one of the few legacy publishers that seems to be doing well—though to my knowledge, they aren’t affiliated with any of the big 5.

      • Bite your tongue.
        T’would be a dark day if BAEN were forced to sell out to the predators.

        So far they seem to be managing their business well enough to provide value to their authors and reader base. May they stay on that path.

    • One thing the publishers also did was provide some level of quality control–yeah, sure, they threw out a lot of good stuff, but you were at least assured that it would be readable (relatively speaking)–your book cover might be downright weird but it would at least look professional, etc.
      And, let’s face it, there are people who, for various reasons, just like having paper books rather than ebooks.
      The problem was that the Big Five decided that those services were worth more than the market was willing to bear.

      • Well, that, and the “quality control” part (which they like to call “curation”) basically disintegrated a decade or two ago.

        I’ve come across entirely too many novels by Real Name Writers, published by Major Publishers, that apparently went through a quick spell-check and off to the printer. Major continuity errors, wtf-level sentence structures, and other things that I, in my innocence of How Things Are Done, expect the editors would deal with. If they actually did any reading and editing. From what sometimes gets printed, I’m not sure that’s a job requirement any more.

        • I’ve been reading the ebooks of old favorites by a single author. In five of the six books (I’m counting the omnibus trilogy as one book), nearly all of the books have misspelled words, words that should be italicized but aren’t, and words that shouldn’t be italicized but are. I distinctly recall at least one scene break that happened without the usual line break or marker of some sort (such as an asterisk).

          The funny thing is, I don’t recall any of these mistakes in the print versions (and each of those I’ve replaced at least a few times over the years), though in the trilogy omnibus, they did somehow manage to find the one repeated sentence that appeared at the bottom of one print page and the top of the opposite side and correct it. In fact, of all the old favorite ebooks I’ve read by this author, that trilogy onmibus was the best-edited.

          Then again, that trilogy omnibus’s individual books have been available in print since they were first issued in the late Eighties through early Nineties, which leads me to suspect that the publisher decided that the omhnibus ebook of that trilogy deserved at least one more editing run as it was prepared for epublishing, probably due only to the fact it was a combination of all three books. The rest, not in omnibus editions (two other trilogies), seemed to have just been haphazardly slapped together.

      • Don’t forget certain publishers ensuring that only politically-correct books would get published. There has to be some value in knowing you’ll never be triggered and have to run to your safe space while reading one of their books.

  7. Incidentally, if you want a read a really great, thorough explanation of exactly what Apple and the publishers did, and how the judge reached a verdict, Andrew Albanese of Publishers Weekly wrote this really great ebook, The Battle of $9.99. $1.99 at Amazon, and well worth it.

  8. Felix, You’re a lawyer, aintcha? Who else writes ‘Absent collusion . . .’?

    • Nope.
      Engineer by nature, inclination, and training.
      But I have been involved in contracting at one time or another so I’m fluent in both english and legalese.

  9. And on a related note, I was struck by some odd similarities in the situation of Toys R Us, which may be on the cusp of filing for bankruptcy.

    • Interesting. Didn’t know they were in trouble. But I do note that other than video games, the only toys I typically buy are amiibos (which are video game adjacent), and those are usually all $13 at all retailers — except for Toys R Us, where they’re $14. Could never figure that out, but it makes a little more sense now. (Consequently, the only amiibos I tend to buy at Toys R Us are the rare exclusives, or when they have them on sale.)

    • It’s hard to compare B&N to tRus because toysRus is loaded down with so much buyout debt that they can barely move.

  10. Print book retail might be dying, but it’s not dead. Amazon has picked up the slack. There are whole genres such as kids, YA and middle grade that prefer print to eBooks and they buy that print at least 1/2 the time from Amazon.

  11. There are things that the large traditional publishers could have done which would have allowed them to remain major players in the industry in the longer term. However, faced with the so-called innovator’s dilemma, the odds were stacked against them. Few if any management teams have been far-sighted enough to avert disaster in these circumstances.

    The large publishers faced the same innovator’s dilemna as the music industry, just a little later. Had they not been so insulated, bloated and complacent from decades without real competition it could have been some of them coming out with the Kindle. Had they had more foresight and fortitude they could have adopted pricing designed to maximise their revenue rather than preserve their legacy business model. They held all the cards, in that they were the only game in town for content. This possibility essentially died with Amazon’s release of the Kindle. Who would have thought that an ereader would finally take off? Or realised that Amazon, unlike Sony, would not be content to simply accept their continued dependence on traditional publishers and allow them to dictate terms. KDP was a red flag which, with the benefit of hindsight, should never have been ignored. At that stage the large industry players could have either sought to negotiate a favourable long term arrangement with Amazon, or to try to drive them into the ground. It was quite open to publishers to themselves establish self-publishing arms matching or bettering Amazon’s terms. Indeed, they would have had a competitive advantage in offering self-published and Indie authors who succeeded a pathway to print and promotion of their works. Instead they clung to their existing business model and their predatory treatment of authors became even worse. When subscription models came along, they could have supported the companies offering them rather than effectively killing them. At that time Amazon would have had a very difficult time competing with a similar model to KU including their best selling authors, even if their subscription offer had been a little more costly.

    The result of all of this is that much of the retail market was ceded to Amazon without any real attempt to compete. At the same time, Amazon was able to establish a lower priced market for Indie and Self Published books which it essentially controlled, drastically reducing their dependence on the large traditional publishers for their supply of books, as well as taking a large amount of market share.

    These were all opportunities missed. The result is that Amazon now dominates the market for books in much the same way as ITunes dominates the market for music, but Amazon’s domination is even stronger. I am now tending towards the opinion that it is quite simply too late for the large traditional publishers. Their main strength, as an earlier post pointed out, is their back catalogue. Some may survive in a much smaller form, but their domination and exploitation of both authors and readers is doomed. In the US, judgement day will come on the likely imminent collapse of Barnes and Noble. It is no accident that Amazon is opening brick and mortar retail stores, and I expect that it will act to fill some of the gap created. And guess which books it will largely be pushing in these stores.

    In other English speaking countries, Armageddon may not be quite so soon, but it is coming. Europe will likely be the last bastion of the tradpub model, because its often luddite governments have shown themselves prepared to legislate to preserve the status quo and ignore the rights of consumers. The old model may well survive a lot longer in Europe, but in the longer term is likely doomed there as well.

    • @ Darryl

      Doesn’t really matter what Big Pub could have done. The past is past. Where’s they’re at now, and how they will be going into the future is what’s important in the real world.

      And the import for their survival doesn’t look good, IMHO. The big publishing dinosaurs are extictifying. But small, agile, fast mammalian indie bookstores will survive, mutate, adapt, and fill the niches that they will be successful in.

  12. If B&N went under, then I’m sure one of the immediate consequences would be the increased importance of print-on-demand books, because without so much shelf space major publishers would no longer be able to justify the current print runs for midlist authors. Indies and small presses would then be better able to compete with major publishers for print sales via online retailers. I’m sure that’s been suggested on TPV before. But is anyone else with me in thinking that the reason Amazon introduced their Amazon KDP Print program recently, when they already had Createspace, was because they are preparing for a significant increase in the sales of POD books? If B&N were in rude health, I don’t think Amazon Print would exist.

    • I wouldn’t doubt it.
      Even Shatzkin admitted that the likelihood of a B&N bankruptcy is being planned for.

      The sad thing is that even today, B&N could be saved if their management were willing to file chapter 11 ASAP. The biggest driver to a full implosion is their management’s unwillingness to give up on the warehouse model as exemplified by tbeir recent buzzword-driven spiel about “selling more”.

      https://the-digital-reader.com/2017/09/08/bns-new-plan-save-wait-sell-stuff/

    • Between this and Amazon physical stores it is hard to escape the notion that Amazon has planned for a B&N collapse, and has positioned itself to take a good chunk of their market share if it happens.

      • Bezos wouldn’t be Bezos if he didn’t have a plan and a team on call, ready to pounce.

        “Sickly gazelle…”

        • I think Bezos probably benefits from having the sickly gazelle. Less (mistaken) screams of “monopoly.” If he’d wanted to give B&N two in the hat, he would have started selling epub files as well.

          Though, come to think of it, that would have been a mercy killing. Allowing them to keep the Nook going is like leaving a .174 batter in the line up.

    • Are there any POD machines that can meet retail demand at the consumer level? How long does it take to produce a 300 page book? How reliable are they? More or less reliable than the copy machines that keep flashing the “Call Operator” light?

      Can they go non-stop, twelve hours per day? If we count the number of books and pages bought at a B&N on Saturday, and apply queuing theory, how many machines do we need? How long would a consumer have to wait?

      I know Amazon can blast out POD, but what does that take?

      And on a side note, my local Whole Foods have recently become Amazon delivery pickup points.

      • Yes and no.
        Some of the larger POD facilities are very fast and could output a book in a few minutes, while you wait. They are very big, though. Not something that would fit in the backroom of a bookstore.

        There are POD systems that do fit in a small consumer facility but are slower and only output a few books per hour.

        Amazon uses a mix of facilities to do POD, ranging from traditional offset presses to outsourcing and using Ingram’s facilities. I haven’t found pictures or videos ofAmazon facilities but this is what an Ingram POD setup looks lije:

        http://www.bookservices.org/wp-content/uploads/2015/10/lightning-source41.jpg

        Today’s consumer POD is better suited to same day or next day delivery than print-while-you-wait.

  13. On those rare occasions I find myself at the checkout in B&N, they always try to sign me up for their rewards card. My refusal response is always the same, why would I pay money to save money? If they close I will only be sad that the mall will have a hard time filling the space.

  14. maybe amazon will buy the leases and stock of b and n

    maybe big pub should go to the communist model

    all paperbacks with cheap say, 26 pound covers, paper so thin that you could easily use for toilet paper, foldover spines with huge rusting staples in the gutters.

    when in bucharest helping booksellers to set up after the soviet union fell, that’s what the old commie books looked like, most with throw-up green covers, gray covers, brown covers, prob because dye costs money in the higher chromas

  15. It is having to pay the interest on debt that forces companies into bankruptcy. Barnes and Noble actually has little debt, although they probably have a lot of lease obligations. So I’m don’t think filing for bankruptcy would help B&N’s problems, unlike Toys R Us, which piled on debt when it went private some years ago.

    However, B&N sales continue to decline and I agree that management is inept.

    It seems most likely that B&N will gradually, or not so gradually, become a zombie company, but it will remain an outlet, albeit shrinking outlet, for publishers.

    • Chapter 11 would help B&N get out of their leases and the Samsung tablet deal and restructure around a newer business model. If they wait until borrowing money to pay dividends brings them to court they’ll end up in chapter 7 like Borders.

      Plenty of companies go through chapter 11 rinses to get out from under crippling deals and contracts. B&N should follow their example.

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