Hachette UK to target diversity in senior management

15 November 2016

From The Bookseller:

Hachette UK is to target diversity in its senior management team with its Diverse Leaders Future Mentoring Scheme, designed to give up-and-coming stars from non-traditional publishing backgrounds the skills and confidence to rise up in the business.

The measure is one of four being launched in Hachette’s Changing the Story programme, which aims to make it “the publisher and employer of choice for all people”, regardless of age, disability, race, gender, sexuality or socio-economic background.

Places on the scheme will be limited and the selection process will be “rigorous”, concentrating on diversity and potential. Each successful candidate will be paired with a Hachette UK Board member who will have received professional mentoring training to ensure that this “intense” programme of one-to-one mentoring is “fruitful and rewarding” for mentors and mentees alike.

. . . .

Sharan Matharu, editorial assistant at Hodder & Stoughton, said: “Our aim is to get young adults excited about different aspects of publishing and to raise awareness of the industry in those to whom publishing might not seem an obvious career path.”

Link to the rest at The Bookseller

PG wonders if this initiative will help eliminate Big Publishing’s common practice of pushing out older and higher-paid editors in favor of younger and cheaper versions.

Harry Potter helps Hachette UK to 30% third quarter sales rise

10 November 2016

From The Bookseller:

The release of the Harry Potter and the Cursed Child playscript, published by Little, Brown, has helped Hachette UK to grow its sales by 30.1% in the third quarter, according to results issued by its parent company Lagardere. The release of the “eighth story” on 31st July to coincide with the showing of the play also helped Hachette UK achieve a sales rise of 8.3% for the nine months up to 30th September 2016.

The UK growth was attributed “partly” to the success of the playscript – which to date has sold 1,319,355 copies for £14.37m according to nielsen BookScan- and “partly” to the “solid performance” of its Education unit, especially at the secondary school level.

Tim Hely Hutchinson, c.e.o of Hachette UK, said: “Hachette UK had an exceptionally strong third quarter, driven largely by J K Rowling’s Harry Potter and the Cursed Child published on 31st July, with record-breaking sales through the quarter, resulting in our significant year-to-date growth and corresponding rise in market share.

Link to the rest at The Bookseller

Hachette to bring in new royalty statement system in 2018

18 October 2016

From The Bookseller:

Hachette will be bringing in more regular, clearer and more detailed royalty statements for authors by the end of 2018, the company has said in a letter to its authors.

Writing his annual end of year letter to Hachette authors sent out yesterday evening (13th October), c.e.o Tim Hely Hutchinson said: “After consulting widely with agents, we have commissioned a new royalties system to produce much better, clearer and more detailed royalty statements.”

. . . .

The news follows Hely Hutchinson’s interview with The Bookseller in April last year, in which he intimated that payments to authors would be made more frequently. “Actually, a fairly low proportion of contracts get royalty payments as the advances are often unearned, but I do think that more frequent (probably monthly) payments will come and we will invest in new royalty systems over the years to make that easier,” he said at the time. He also envisaged different types of contracts: one would be low advance, higher royalty, paying more often; another would be traditional high advance, lower royalty, paying  less often. “I’d like to be able to offer those packages and within three years or so we will be able to—if there is demand” he added at the time.

Hely Hutchinson’s letter also warned authors that times were “tough” for the book trade, despite recent publicity about an increase in print sales. He also expressed concern that controls on immigration shoud be given priority over free trade in the government’s Brexit negotiations.

He warned authors that the “well-publicised” resurgence of print was “not the whole story,” explaining that the sales had been skewed by the craze for adult colouring. The trade print market and publisher values had still fallen by 11.5% between 2011 and 2015, and by 27% for fiction, he said.

He further warned that the e-book market will have fallen by about 22% for Hachette by the end of this year from its peak in 2014. This he attributed to “the imposition of UK VAT at the full rate on e-books, changes in e-book trade terms and, to a smaller extent, self-publishing”. This drop was also reflected in the company’s results for the first half of 2016.

“For part of this time, growth in revenues from e-books made up for some of the shortfall, but that is no longer the case. So times are quite tough for trade publishers, even if they are sometimes mitigated by particular lovely successes,” he wrote. “This is probably a long-term trend, as more of consumers’ time and money is spent on the many new or recent digital platforms for information and entertainment.”

Link to the rest at The Bookseller and thanks to Diana for the tip.

PG says that the royalty statements he has seen from most publishers could hardly be more primitive.

Hachette Sues Seth Grahame-Smith

29 August 2016

From Locus:

Seth Grahame-Smith, author of Pride and Prejudice and Zombies and Unholy Night (among other titles), is being sued by Hachette Book Group for breach of contract. The publisher is suing to recover the $500,000 (plus interest) they paid for a book they allege the author never delivered.

Hachette and Grahame-Smith made a $4 million deal for two new books following 2010’s Abraham Lincoln: Vampire Hunter, with $1 million paid on signing: $500,000 for each book. They published Grahame-Smith’sThe Last American Vampire in 2015, but despite offering extensions on the second book’s deadline, it never arrived.

Link to the rest at Locus and thanks to Kris for the tip.

Following is a copy of the Complaint with a copy of the publishing agreement as Exhibit A.

PG was not involved in the negotiation of the publishing agreement, but will observe it contains some provisions detrimental to the author that PG typically recommends be removed or modified.

 


Hachette buys mobile game company Neon Play

24 June 2016

From The Bookseller:

Hachette has bought mobile games development studios Neon Play in a “substantial” acquisition. Hachette c.e.o. Tim Hely Hutchinson has said the acquisition “could be one of several” for the company in the app space.

Neon Play was founded by co-owners Oli Christie and Mark Allen in Cirencester in 2010 and to date has created over 30 games, including Paper Glider, Flick Football and Panic Traffic London, attracting over 60m downloads.

The studio, which has won 20 business awards including the Queen’s Award for Innovation, will be tasked with “creating, developing and marketing new mobile games” as a standalone business under the Hachette UK umbrella.

Although terms of the acquisition were not disclosed, Hely Hutchinson said it was a “substantial acquisition designed to lead to substantial revenues”, and was also a “serious first step” for Hachette in a bid to make its business “more digital”.

Referring to the mobile gaming industry as “complementary” to the book industry, Hely Hutchinson anticipates that trade and educational publishers will become “more like 50% digital” within the next five to 10 years. He told The Bookseller mobile gaming is “part of the future of the book industry”, with games the biggest and fastest growing part of the app market, while e-books, currently in decline, are “so similar to print books … they barely count as digital objects”.

. . . .

He added: “It’s something where we are very much on the front foot. E-book sales are not declining because people don’t like digital things. They are declining because there is less discounting in the market. So that is the main reason why e-book sales are lower this year. In fact e-books are so similar to print books that they barely count as digital objects. What people are really looking for with the digital world is more interactivity. So communicating with each other on social networks and playing games, you’re not just looking at something, you’re directly involved. And that’s where we want to be.”

. . . .

Hely Hutchinson (left) said that conversations with Christie and Allen had shown him their efforts with apps to date were “somewhat amateurish”.

“They know infinitely more than we do about the app market and how to make an app work, and I think the skills and knowledge they have at Neon Play will help us, for example with a cookery book app or an educational app that actually has nothing to do with games, so I see the acquisition as taking us several steps forward in various parallel relevant directions,” he said.

Hachette has already seen success in the games market with New Star Soccer in May, a game and a book all in one, that was produced in partnership with game developers New Star Games and Insight Studios, and contributed to by award-winning children’s authors The2Steves (Steve Barlow and Steve Skidmore). It hit 35,000 paid downloads in its first week and charted in Apple’s top 10 apps.

. . . .

Hely Hutchinson said the mobile game market “is not for all books,” because “they have to be big enough – have a big enough market – to justify the potential investment, which is quite large.”

Discussions with authors and agents whose books are candidates for gamification would start “from scratch,” Hely Hutchinson said. “Even if we happen to have a very broadly worded contract we would never go to authors and agents ‘we’ve got these rights, we’re going to exploit them’. We would always want to go to the author and agent and discuss the whole thing with them whether the games dimension is the sort of thing they want to do and we would start the terms discussion from scratch.

. . . .

“We see ourselves as having a role of taking, sensitively, creative people’s work to market and turning it into money – income – for creative people. It doesn’t mean we at Hachette can do everything, we are not of the scale to be producing Hollywood-style movies, but there are some things we can do where the investment level is affordable, which will widen our offer to our traditional author base and also give us potential new products where we can gain a very good understanding and do the job properly.”

Link to the rest at The Bookseller and thanks to SFR for the tip.

PG is not familiar with the mobile gaming world, but he tried to imagine what Hachette could bring to a company that makes games. He couldn’t come up with anything but money.

Hachette UK first quarter sales down 5.2%

17 May 2016

From The Bookseller:

Hachette UK sales were down by 5.2% in the first quarter, due to lower e-book sales.

Digital sales have been hurt by the “negative comparison effects” following the introduction of the new agency agreement in July 2015.

Tim Hely Hutchinson, c.e.o of Hachette UK, said digital sales would “probably give rise to negative year-on-year comparisons for at least another quarter”.

He added: “Digital sales were on budget but, in line with the rest of the industry, are below sales for the same time last year.”

Hachette UK parent company Lagardère reported its first quarter sales for the publishing division were down 2.1% like-for-like and totalled €415m (£328.19m), but cautioned that the first quarter traditionally makes a lower contribution to the year as a whole.

Sales in its French division were down 2.2%, while US sales were down 10.3%. The Spanish/Latin America unit was up 31.2% by comparison, thanks to a “one-off export operation to Latin America”.

Link to the rest at The Bookseller

Hachette Reaches New Deal With Perseus Books

1 April 2016

From The New York Times:

The Hachette Book Group has reached an agreement to buy the Perseus Books Group’s publishing business, 18 months after its previous attempt to acquire the company fell through.

The new agreement, which was announced on Tuesday, comes six months after Perseus, a large independent publisher, began looking for a buyer again after the first deal with Hachette collapsed.

. . . .

The acquisition will strengthen Hachette’s position in a publishing landscape where the biggest companies often dominate. It is the latest in a wave of consolidations that has swept the industry in recent years, including the 2013 merger of Penguin and Random House, which created a publishing behemoth with about 250 imprints, and the News Corporation’s acquisition of the romance publisher Harlequin for $415 million in 2014.

By buying Perseus’s publishing program, Hachette will fulfill the long-term goal of its parent company, Hachette Livre, which is owned by the French media conglomerate Lagardère, to expand its publishing footprint in the United States. In recent years, Hachette has acquired Black Dog & Leventhal Publishers and Hyperion’s adult books list. The Perseus deal is Hachette’s largest acquisition to date.

. . . .

 “They all want more volume, and Perseus is one of the largest trophies out there,” said Mike Shatzkin, the founder and chief executive of the Idea Logical Company, which analyzes the book industry. “If you take the long view, I’d be so bold as to say we’ll have two big trade publishers 10 years from now, and no more.”

Link to the rest at The New York Times and thanks to Deb for the tip.

PG says this will almost certainly mean layoffs at Perseus. Some Perseus authors will likely lose their editors and find their books effectively become orphaned in the process.

Hachette UK sales drop 6.7% in fourth quarter

11 February 2016

From The Bookseller:

Hachette UK saw overall sales fall by 6.7% in the fourth quarter of the year due to lower e-book sales, with its parent company Lagardere Publishing saying that “market trends have reversed in the US and the UK”.

. . . .

A note in the Lagadere release said: “In 2015 market trends have been reversed in the US and the UK, with a rebound in volumes of printed books to the detriment of e-books, due to new contracts terms with Amazon. For the time being this digital transition remains essentially confined to the English-speaking markets and only in the general literature segment, which represents about 40% of total sales of the division. In the UK, Lagardere Publishing digital sales represent 26% of Adult Trade compared to 31% in 2014.”

. . . .

Tim Hely Hutchinson, c.e.o. for Hachette, acknowledged e-book sales had “slowed”, “after six years of stratospheric growth”. However, he emphasised: “We estimate that we remain the number one publisher in e-books and that, in the year, Hachette UK’s estimated market share rose by 1% to 22% of the e-book market. Digital sales now represent over 20% of HUK’s total sales.”

Despite the sales dip, Hely Hutchinson hailed 2015 “another standout year for the Hachette UK group”.

Link to the rest at The Bookseller

Hachette CEO Michael Pietsch on the Future of Publishing

2 December 2015

From Hachette CEO Michael Peitsch via The Wall Street Journal:

I’ve been hearing about the demise of book publishing since the first day I stepped through the doors of a publisher back in 1978. But here we are still, publishers like Little, Brown, with histories going back 100 and 200 years. What other American industry has companies still in existence after two centuries, evolving and modernizing but still doing much the same work? The most recent variant of the death watch: A digital revolution would cause e-books to replace printed ones, authors would overwhelmingly choose self-publishing, and publishers would follow carriage makers into oblivion.

After several years of rapid e-book growth, their sales topped out at about one-quarter of publishers’ revenues and have declined for a year. Print books have proved durable because, as a format, they’re simply hard to improve on. Music, movies and TV were all fundamentally altered because digitization allowed readers to experience those entertainments anywhere. Books were portable the day they were invented. Other forms have only just caught up.

And self-publishing? It’s grown hugely as an option for writers who want to reach readers directly. But writers like to be paid, in advance, for their work. Publishers are investors and risk takers. And a publishing company with longstanding media and marketing relationships is far more capable of getting attention for a new book than a writer working alone.

. . . .

Publishers’ essential work will remain the same—identifying, investing in, nurturing, and marketing great writers. The abundance of titles readers have come to expect will continue to gush forth. Pictorial storytelling will increase in popularity, and comic versions of novels and nonfiction will become commonplace. More titles will be published for children and young-adult readers, including books blended and layered with games. Beloved best-selling writers, living and dead, will publish books more frequently, often with help from co-writers. (Especially the dead ones.) Self-publishing will continue to grow, and appetites unnoticed by mainstream publishers, like the erotica explosion that began in online fan fiction, will find, well, satisfaction. New forms will emerge for mobile devices, as millions abandon e-readers with phones already in their pockets.

Ever-larger retailers and wholesalers bring significant margin pressure, which will lead to continued conglomeration. Social media will continue to expand the writer’s ability to connect with readers; publishers will deepen their relationships with writers, but they’ll also create content of their own. As runaway books sell ever-larger numbers, publishers will earn more on their biggest sellers—which will keep driving up the advances they pay for potential hits. At the same time, publishers will need to innovate and challenge assumptions about every aspect of the business.

Link to the rest at The Wall Street Journal (Link may expire) and thanks to Anthea for the tip.

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Ebook Sales down at Hachette

31 July 2015

From a Lagardère press release discussing 2015 first half results:

In the United States, the decline in activity, which had been expected (-7.8%), can be explained by the high level of activity in the first half of 2014 (including The Silkworm by Robert Galbraith and The Goldfinch by Donna Tartt) as well as a decline in e-book sales.

. . . .

Digital: in the 1st half of 2015, the weighting of e-books in Lagardère Publishing total sales declined to 10.7%, compared to 11.3% at the end of June 2014. This transition remains limited to English-speaking countries and to the General Literature segment:
– in the United States, in a declining digital market (slowdown seen since the beginning of 2014), sales of e-books have dropped (24% of sales for Trade vs. 29% at the end of June 2014), given a less successful slate of new releases and the implementation of the agreement with Amazon;
– in the United Kingdom, the market is stabilising and has been impacted by the January 1, 2015 VAT increase. E-books represented 33% of sales in Adult Trade(8) vs. 36% at the end of June 2014.

Link to the rest at Lagardère press release

“Implementation of the agreement with Amazon”

PG suspects this means Hachette’s agency pricing agreement with Amazon which allowed Hachette to increase its ebook prices. Is it possible that Amazon knows more about the optimal pricing of ebooks than Hachette?

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