Home » Big Publishing, Ebooks » The Big Five Publishers and the Nutri-Matic Drink Dispenser

The Big Five Publishers and the Nutri-Matic Drink Dispenser

23 February 2018

From TeleRead:

The recent interview that Hachette CEO Arnaud Nourry gave to Indian news site Scroll.in has been a sort of nine-day wonder of the ebook world lately. In this interview, Nourry called the ebook a “stupid product” because it’s “exactly the same as print, except it’s electronic. There is no creativity, no enhancement, no real digital experience.”

. . . .

Reading over this particular article actually reminds me a lot of an anecdote from the late Douglas Adams’s best-known work, The Hitchhiker’s Guide to the Galaxy.

. . . .

Episode 9 of the radio drama touches on the Nutri-Matic Drink Dispenser, an automated and sentient machine that runs complicated taste analyses on its customer, but then invariably dispenses an unpalatable beverage that is “almost, but not quite, entirely unlike tea.” In this episode, Arthur Dent and friends on the starship Heart of Gold are on the run from a fleet of enemy starships intent on their destruction, when Arthur gets into an argument with the shipboard machine.

While ranting at the machine, Dent asks, “And you know why I want a cup of tea?” The Nutri-Matic machine immediately starts trying to compute the answer to that, tying up all the computing power on board the ship so it can’t activate its Infinite Improbability Drive and escape—a dilemma that eventually ends up requiring supernatural intervention to sort out.

This machine seems to be the perfect metaphor for the Big Five traditional publishers, of which Hachette is one. Both the Nutri-Matic and the publishers are supposed to determine exactly what their customers want, and then profit by supplying it to them—but they also both seem to have the hardest time actually figuring it out. For the Nutri-Matic, Douglas Adams just wanted to get some laughter from the audience and make a few more jokes at poor Arthur Dent’s expense. What’s the publishers’ excuse?

. . . .

Einstein supposedly said that the definition of insanity is doing the same thing over and over again and expecting different results. How many times have the major publishers, hopeful start-ups, inventors, and others repeatedly tackled this problem of the “enhanced” ebook? And yet after all this, the only lesson that Nourry—the head of one of the biggest publishing companies on the planet—can take from it is that publishers just don’t have the skill set to do it right.

. . . .

The lesson publishers should be learning is that the format of the plain-vanilla prose book—by which I mean both paper books and ebooks—is just so close to being perfect that it can’t easily be improved upon.

The only differences between prose ebooks and paper books are a matter of format; the content of both is a series of words that are meant to be read sequentially from beginning to end. When people reach for a book, that’s what they want—whether it’s on print media that doesn’t require batteries and can be easily riffled through, or on digital media that can have text resized and reflowed and searched. They just want to read words sequentially. They don’t want some “enhanced” multimedia experience, any more than Arthur Dent wanted a Nutri-Matic “unlike tea” beverage.

. . . .

And just how “stupid” can ebooks be if they make up 20% of the traditional market, and would make up more of it if publishers would drop the prices further?

. . . .

And then there’s the “price that keeps the ecosystem alive” which, if you read between the lines, actually means the “price that keeps them from cannibalizing print book sales any further.” And it’s funny how even Nourry admits that “there is still a readership for ebooks” just a couple of paragraphs before he goes on to call them a “stupid” format. Is Nourry so delusional that he actually believes all this stuff?

Link to the rest at TeleRead

As PG has mentioned before, over twenty years ago, when he was working for a large legal publishing and technology organization (LexisNexis, owned by Reed-Elsevier (now, with typical marketing acumen, called the RELX Group)), the subsidiary with the single highest profit margin of any part of LexisNexis sold a huge directory of American lawyers called Martindale Hubbell. The subsidiary offered a few other books, but Martindale was the crown jewel.

The printed version of Martindale was a huge and heavy series of books printed in tiny type. Virtually every law firm had a set somewhere in its library. If one of the firm’s best clients was cited for drunk driving in a small town in Idaho, Martindale’s list of lawyers (with brief bios) who practiced in that town might provide a starting point for locating competent local counsel.

Each year, Martindale published a small paperback supplement (called a “pocket part”) which updated the huge books. The supplement was available via an expensive subscription. Every few years, Martindale would send subscribers a new edition of its monster books and the firm would try to sell the old books, usually without success.

PG was a lonely internet cheerleader at LexisNexis and he had a meeting with the head of Martindale to urge the quick creation of an electronic version of Martindale. He pointed out a lot of obvious benefits to doing so.

“We can’t do that. It would cannibalize our sales from Martindale books!” was the response.

PG suggested that, if the print version of Martindale could be cannibalized by an online legal directory, if Martindale wasn’t the cannibal, someone else would be.

About two years later, Martindale’s sales crashed and its operations were rolled into the mother ship.


Big Publishing, Ebooks

12 Comments to “The Big Five Publishers and the Nutri-Matic Drink Dispenser”

  1. “RELX” sounds like a laxitive. Just say’n.

  2. The exact same scenario happened with encyclopedias when Bill Gates (early 90’s) wanted to license (Britannica/World Book/etc) for a CDROM product to goose the market for CDROM-based PCs. He offered to pay all costs, do all marketing, and make essentially zero net. The objective was to move PC adoption forward and make the money off Windows.The

    All said the same thing: they made their money via door to door sales and couldn’t afford to annoy the salesmen.

    Gates had no option but to outright buy rights to the (not highly regarded) FUNK & WAGNALLS encyclopedia, hire a bunch of laid off editors from the other encyclopedia companies, and create ENCARTA. Sales were decent and it served its purpose but things really exploded when a temporary promotion at EGGHEAD (eventually bought out by, ahem, Amazon) revealed an enormous untapped market at under $99.
    (They sold out their entire holiday season allocation in barely a week.)

    Microsoft permanently dropped the price, started getting requests to bundle Encarta with new PCs, and that was that for home sales of encyclopedias as a business.

    Either you obsolete your product or somebody else will do it for you.

    (And when MS saw the handwriting on tbe wiki wall, they spun Encarta off to a non-profit because they new soon tbere would be no profit in it.)

    You need to be aware of and responsive to changing customer needs. Or else.

    • Fascinating…

      This was written in the gap before Wikipedia


      Excerpts and bullet points from the article, the whole thing is a quick worthwhile read.

      the history, the myths, the shared values, and the unreflective presuppositions that define a strong corporate culture can blind business leaders to events that do not fit into their collective mental framework.

      “Months passed. Sales continued to plummet. In response, the company put together a text-only CD-ROM version of Britannica, only to encounter another crisis: a revolt by the sales force. Even if priced at a significant premium over Encarta, a CD-ROM version of Britannica could not possibly generate the $500 to $600 sales commission of the printed product, from which it would so obviously take sales.”

      even if the executives of established businesses fully grasp the impact of new technologies, and even if they can reason their way beyond their corporate myths and assumptions, they still face a massive competitive disadvantage arising precisely because they are incumbents. Incumbents are saddled with legacy assets — not just clunky mainframe systems, but sales and distribution systems, bricks and mortar, brands and core competencies. Competing in the face of the new economics of information requires cannibalizing those assets, perhaps even destroying them. Incumbents hesitate to do that, especially as long as the business has positive margins.

      (italic emphasis is mine).

      • …and by the time their positive margins are ebdangered it is too late. The market is lost.

        It takes courage to abandon a business model in time to save the company. One ongoing example of what *not* to do is B&N.

        (Good find, btw.)

        The other thing I remember is that Britannica’s second CDROM effort was essentially an archived website using netscape as a GUI. But netscape refused to oet them hide the browser, charged them full freight ($40 a copy) and insisted they ship a separate Netscape installation CD. So consumers had to do two separate installs, even if tbey already had a newer Netscape installed.

        The third Brittanica CDROMn off Internet Explorer.

  3. The ebook *is* a stupid product if you price it at 14.99.

    Oddly the people who are not dependent on a paper book distribution system seem to be able to price belo paperback price and do well….

    • As noted in the original article, “stupid” was actually referring to how digitally enhanced the product is, not whether it’s a bad idea.

      • I’ve heard the article spun that way, but I’ve re-read it three or four times and I think you have to be VERY charitable to Mr. Nourry if you’re taking it that way. It MIGHT have been referring to that, but I’m not convinced.

  4. He pointed out a lot of obvious benefits to doing so.”

    Which of course is never listened to …

  5. The publisher of Machinery’s Handbook with CD knows their market.
    They also know how to charge too.
    If you need this book and you will know if you need it, the price is well worth the investment.
    And it is a investment.

Sorry, the comment form is closed at this time.