From veteran publishing consultant Mike Shatzkin:
The overarching theme of our upcoming Publishers Launch Conference at BookExpo America on May 29 is “scale”.
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We’re covering “scale” from many angles on May 29.
The program will kick off with a presentation from Pete McCarthy, formerly a digital marketing strategist at Random House, about moving beyond our standard understanding of “industry data” — what we learn about the industry in the aggregate from BookStats and Bowker and others — to mining and analyzing the massive amounts of public data about readers: who they are and where they are. The data we care about, and that can really help us, isn’t labeled “book publishing data” but is far more useful and actionable than much of what we try to decipher meaning from that is tagged that way.
The requirements of scale threaten to really change the business of literary agents. Since the rise of agents as intermediaries between publishers and authors in the 1950s and 1960s, it has always been possible for agents to operate as very tiny operations. Single-agent offices have never been terribly unusual, and agents could run a successful business with a handful of prosperous clients, or even just one!
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But those times are changing. The opportunities for self-publishing and the requirements for authors to be self-promoters have placed new demands on literary agency offices. It is often no longer sufficient to have knowledge of acquiring editors and what they want and a network of foreign co-agents who can help place projects in other languages and territories. Agencies large and small are adding self-publishing services, which can include capabilities as mundane as getting cover art designed and as sophisticated as distribution to a global network of ebook retailers. This adds the potential for “conflict” for the agents. In some cases, agencies have chosen a course that might present a choice for an author between a publisher’s deal and their agent’s deal.
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The ebook bestseller lists have been the evidence of strong challenges to the publishers who operate with scale on their side, as an increasing number of self-published authors have seen their work rise to the very top of the charts.
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Frankly, our view is that very few of the outside disruptors, often tech- and private equity-centric start-ups providing “solutions” to the problems as they perceive them, have gained much traction or added much value. We’ll get more perspective on that from our “business development” panel, who are the ones in their companies charged with interacting with the aspirants, but we stick to the belief that there is more to be gained by watching what the established publishing players and the biggest companies in technology are doing than in tracking the theories spawned by industry outsiders who think their insights will change our world.
But we recognize a weakness to our approach. There are some things the established players just can’t discuss. We can’t expect Random House and Penguin — or their biggest competitors — to talk about what the merger of the two biggest publishers will mean to the marketplace. We can’t expect publishers who must trade with Amazon and Barnes & Noble to discuss the impact of their unique marketplace power — one in online sales and one in brick-and-mortar — on publishers’ margins. We can’t expect agents and publishers to talk candidly about when and whether established authors might be willing to eschew their bookstore sales in favor of higher margins on their online sales through a direct tie to Amazon.
Link to the rest at The Shatzkin Files
“[W]e stick to the belief that there is more to be gained by watching what the established publishing players and the biggest companies in technology are doing than in tracking the theories spawned by industry outsiders who think their insights will change our world.”
PG says this is an interesting contrast to the tech world where smart established companies and tech investors are constantly watching what small startups are doing. You’ll recall that Facebook bought Instagram when Instagram had only a handful of employees and no revenues. Then Facebook scaled Instagram immensely.
Instagram was launched in October, 2010
Acquired by Facebook in September, 2012
When Facebook acquired Instagram, it had 30 million total users. That has grown to over 100 million active (post at least once per month) Instagram subscribers who have posted more than 4 billion photos. 40 million new photos are posted each day.
59 of the world’s top 100 brands are now on Instagram. (PG says expect them to start paying Instagram for this visibility.)
In February, 2013, Instagram’s mobile app had 3.5 million more daily users than Twitter’s official app on iPhone and Android, according to ComScore.
As of April, 2013, after being acquired by Facebook, Instagram was handling this growth with about 25 staff members.
That’s how you scale.