Can There Be Book Deals Without Meals?

From Publishers Weekly:

It was week four of coronavirus shelter-in-place. Going on 2 p.m.; I’m at my desk at home, answering emails, filtering submissions, contemplating a forthcoming edit. But wait, what’s that sound? Oh, right, it’s my stomach growling. I’m hungry. Must be time for a can of that chicken noodle soup I’ve been hoarding.

What a difference a couple of weeks makes. Before the lockdown orders came down in New York City, no self-respecting publishing person could forget about lunch. We all knew the drill. At 12:30 or 1 p.m.—occasionally as early as 12:15 or as late as 1:15—the office exodus would begin. We’d gather our coats and bags and wits and head out to meet with agents and authors at restaurants where reservations had been scheduled two, three, six, or eight weeks in advance. The mission: start or continue relationships that might lead to new submissions from said agents and authors, which in turn would lead to new acquisitions to be announced at future in-house editorial meetings.

While we might have shared sushi at Nobu, everybody knew lunch wasn’t really about food. No, it was about gossip, shop talk, and bringing brand new projects to fruition. Lunch, in other words, literally meant business.

So it should come as no surprise that among the questions, and there were many, that a lot of us asked when this whole work-from-home thing started was what would happen to the publishing lunch. 

. . . .

We have now had 10 weeks of sheltering in place, and I am happy to report that while I haven’t met anyone in a restaurant for what feels like forever, I, and most of my colleagues, are still making and publishing books and signing up titles for forthcoming seasons. I’m on the phone constantly, checking in with agents and authors about how they’re doing with kids at home and a bunch of new worries—but also about the projects they’re shepherding. I’ve been in a couple of major auctions and have won and lost several books, both fiction and non.

Will those books “work”? Who knows? Determining what the future reading world will embrace… well, that’s been a problem endemic to our industry forever; we’ve asked the question before (most recently during the 2008 recession, and before that after 9/11) and we’ve always survived. Sorry to paraphrase the over-paraphrased Mark Twain, but despite bookstore consolidation, the rise of e-books and audiobooks, and the explosion of interest in streaming TV, publishing’s death has been greatly exaggerated—many times. So what if now we’re talking books over Zoom, or WhatsApp, or maybe just in a plain old-fashioned phone call instead of across a two-top? We’re still publishing.

Link to the rest at Publishers Weekly

While PG believes and ardently hopes there will always be an England, he can’t say the same thing about the traditional publishing business.

There will always be books, albeit in evolving forms, and books require authors (AI is lurking, but PG needs a bit more convincing that AI is capable of creating good fiction.) but printers used to do much of what publishers do today.

Publishers are an example of a classic middleman (or middleperson if you prefer, agents are as well) receiving products created by somebody else and funneling them to the organization or person who will actually sell those books to readers.

PG concedes that editors (whether they are called agents or not) can and do add value to the end product. However, this function can be outsourced to nice people working from their home office in Kansas where (for the benefit of those New Yorkers who have never visited), the costs of a comfortable life are much, much lower than on that skinny island hanging off the eastern part of the United States. The restaurants may be of a different type than Manhattan’s were before the plague, but with all the newly rich indie Kansas authors, Nobu may find greener pastures in Wichita.

If authors and booksellers (online or off) can work without the middlepersons, they both will probably make more money from their respective businesses.

From whatever New York restaurants survive the current disruption, the decline and fall of traditional publishing may cause an occasional tear to be shed, but there will be more-prosperous authors and booksellers who may make up the difference.

28 thoughts on “Can There Be Book Deals Without Meals?”

  1. It’s a long way from “sushi at Nobu” to a can of chicken soup scrounged from the back of the pantry.

    Who bore the costs of all those “working” lunches?

    • And our literary culture barely survived the loss of the tax deductible status for these meals.

    • When (a) you’re not the one paying for sushi at Nobu, (b) your employer isn’t paying you much of anything, and (c) you can’t cook because learning how might have dislodged the silver spoon from your mouth and disqualified you from rubbing elbows with the right sort of people at your Ivy League school – well, it actually isn’t such a long way from one to the other at all.

      It’s a bit like the story of that poor, downtrodden English nobleman who couldn’t make his toothbrush fizz properly because he had to travel without his butler, and his butler was the one who knew that you had to apply toothpaste to the brush. It sounds like a wild fantasy, but some of the children of privilege really are that incapable of fending for themselves.

  2. Publishers are an example of a classic middleman (or middleperson if you prefer, agents are as well) receiving products created by somebody else and funneling them to the organization or person who will actually sell those books to readers.

    I think that neglects the financing and production of the book. The story is indeed created by someone else. But the product sold to the public is financed, produced, and distributed by the publishers. This is what fills bookshelves all over the world. Someone else doesn’t produce millions of tons of these units.

    What you describe fits the agent much better than the publisher.

    • You make some good points, E., but that model adds no real value to ebooks, yet the publishers take a majority of ebook revenues in return for uploading a bunch of free electrons to a handful of large computer systems.

      Speaking as a very, very, very long-ago advertising account executive with a very large ad agency, the quality of most publishers’ advertising would get the junior account executive and copywriter on the Alpo Dog Food account fired in about 15 minutes.

  3. You make some good points, E., but that model adds no real value to ebooks, yet the publishers take a majority of ebook revenues in return for uploading a bunch of free electrons to a handful of large computer systems.

    It’s certainly possible for an author to pass a publisher an eBook perfectly formatted for subsequent passage to Amazon. And in that case, I would agree little value is added.

    But, for eBooks, the economic role the publisher played simply shifts from the publisher to the eBook retailer/distributor. Amazon now plays the role the publisher used to play in transforming the author’s electrons into something a zillion consumers all over the word can read. It’s the same value added function the publisher provided with paper.

    There is always a value-added function between the author and consumer. The people we label publishers can all disappear, but the economic function remains. It just has a different label.

    Author and intermediary are both necessary to sustain today’s level of eBook commerce. But neither alone is sufficient. Together, they are.

    And publisher’s advertising? I have always wondered where it is. I never see it. Who is getting paid, and what are they doing? I have seen more advertising for the pillow guy’s recent autobiography than for any other book. And it looks like he’s running his own publishing, advertising, sales, and distribution.

    • But, for eBooks, the economic role the publisher played simply shifts from the publisher to the eBook retailer/distributor. Amazon now plays the role the publisher used to play in transforming the author’s electrons into something a zillion consumers all over the word can read. It’s the same value added function the publisher provided with paper.

      The difference is that Amazon does not fob the author off with 10 percent of the retail price (and then calculate that percentage dishonestly). Nothing that publishers do is worth giving up 90 percent of the sale. And nothing that any business does is enough to justify the false accounting that old-line publishers routinely engage in.

      • Of course there is a difference, but it’s the same basic economic function. There is also a difference between paper and electrons. But the intermediary is still just as necessary as the author in maintaining today’s level of commerce.

        If authors don’t like getting 30% of the publisher’s revenue from the book, that’s easy to fix. Have 90% of them drop out of the market so the publishers no longer have a supply of marketable manuscripts that exceeds their needs.

        And is there some reason authors feel entitled to any of the retailer’s revenue?

        The economic value of a good varies with supply and demand. When authors are chasing publishers competing with each other for publishing slots, they will get less than if publishers were chasing authors competing for marketable manuscripts. Supply. Demand.

        • Of course there is a difference, but it’s the same basic economic function.

          Yes, that’s why publishers are losing business rapidly: they are charging three times the going rate for that function. It’s bloody simple, yet you can’t see it.

          If authors don’t like getting 30% of the publisher’s revenue from the book, that’s easy to fix.

          They aren’t getting 30%. In a great many cases they aren’t getting 20%. And very often, they aren’t getting the percentage that the publisher promised, via a legally binding contract, to give them. Why do you keep making excuses for the criminal behaviour of publishers?

          Have 90% of them drop out of the market so the publishers no longer have a supply of marketable manuscripts that exceeds their needs.

          Why on earth do you think this hasn’t happened? The people who are still sticking with traditional publishing at this point either (a) value prestige over money, (b) have no aptitude for business and don’t want to learn, or, most often, (c) have existing contracts that they can’t afford to get out of.

          I know people in the business, and I know that (behind closed doors) a lot of them have been crying about the supply of publishable books drying up. They are not getting either the same quality or quantity of manuscripts that they used to.

          And is there some reason authors feel entitled to any of the retailer’s revenue?

          Well, 100% of the price of the book is the retailer’s revenue. Some percentage of that needs to be passed on to the author, or else what is the point of writing books for publication? You seem to think that publishing are a business but authors are charities.

          • Some percentage of that needs to be passed on to the author, or else what is the point of writing books for publication?

            The retailer owes nothing to the author who uses a publisher. The author’s business relationship is with the publisher, not the retailer.

            Nor does the retailer owe anything to the widget maker who sells to a wholesaler. He has no business relationship with the retailer.

            And the “criminal behavior of publishers?” There is none. Authors competing with other authors is what limits their pay. Just like widgets. Books aren’t special.

            • And the “criminal behavior of publishers?” There is none.

              Fraud is criminal behaviour, and it is rampant in the publishing industry. Learn some basic facts before you shoot off your yap.

            • The retailer owes nothing to the author who uses a publisher. The author’s business relationship is with the publisher, not the retailer.

              That is irrelevant to my point. All of the money received by the publisher comes from the retailer. If the author is to receive any money at all, it has to come from the retail price of the book. You obviously believe that authors should not be paid at all, since you claim they have no claim on any portion of the retail price. You are a complete idiot.

              Oh, and this?

              Just like widgets. Books aren’t special.

              Widget makers don’t supply their products for free. Obviously you think books are so special that the people who supply them should never be paid anything for their product. Twerp.

              • If the author is to receive any money at all, it has to come from the retail price of the book.

                An advance can be paid without a single retail sale.

                I agree widget-makers don’t provide their goods for free. However, they still have no business relationship with the retailer when they sell through a wholesaler. Nor do they have a claimon the retailer’s revenue.

        • But the product sold to the public is financed, produced, and distributed by the publishers.

          … and until recently the publishers are having sushi at Nobu and the authors were the ones scrounging the can of chicken noodle soup. Thus, the tiny violin played along with this article.

          This situation is not just because of supply and demand. It is because publishers have a choke-hold on access to the market for paper books sold in brick and mortar bookstores’, and paper books that are ‘featured’ when reviewed or mentioned in what still passes for the press.

          Restricting supply to publishers wouldn’t change that. As we can see, it just changes the quality of what those publishers can acquire with the contractual terms that support this (probably deductible) “working lunch” lifestyle.

          As long as bookstores only order from large publishers and book media only discusses large publishers, this exploitative situation will continue. It is not, really, the Big 5’s fault for pursing a logical business model. It is the fault, if there is one, of the other two actors in this 3-way relationship for enabling the Big 5.

          This is why book media and others related to them spread the word that Amazon is ‘bad’. Amazon offers another route to the market, one that does an end route around the triumvirate that would prefer to keep control of the market that feeds them.

          • “As long as bookstores only order from large publishers and book media only discusses large publishers, this exploitative situation will continue.”
            —-
            There is a fair chance that the “payday loan” business model of the predatory Trapubs in Manhattan will fall before the B&M bookstores.

            Two reasons: used books and lifestyle merchandise.
            (Plus, there are lots of smaller honorable publishers out there, enough to keep some B&M bookstores afloat.)

            The danger for the big publishers is their business model is based on blockbuster volume. They throw stuff on the wall (and the bought and paid for front tables) looking to puff something, anything, into a big seller. It used to be they could count on a few big bandwagon sellers each year, usually from their stable of big name writers. They’re still running out a few successes each year but the number of big successes is declining as well as the line that marks what is a big success. With the steady increase of available titles in every genre it now takes the big names longer to hit their traditional volume and the next tier of authors, old and new, are often peaking well below tbe line.

            This is no secret nor is it a secret tbat most of the big publishers are pumping out less new titles both because they are receiving less submissions likely to hit their targets and because the ones they do put out are more likely to miss. Their model allows them to make some profit on “failures” that don’t earn out the payday loan but those profits can’t support their overhead, much less the deal-making lunches.

            They are increasingly dependent on the big names and those legacy authors aren’t going to be working forever. With each one that retires goes a big chunk of their profits. At some point they’ll still be shipping a lot of books and making a nominal (pre-inflation adjustment) profit but not enough in real terms to justify staying in the new book business.

            This tipping point will come at different times for different BPHs but the signs are already out there. In the number of small publishers selling out, the publishers dropping out of genres, in even bigger publishers getting out of the business (TORSTAR ditching Harlequin, CBS/Viacom trying to sell S&S).

            The multinationals aren’t going to stick with a fading business forever.
            The smarter ones (with other revenue streams) will look to gracefully exit stage left, leaving somebody else holding the bag long before the final tipping point comes.

            For now the canary is S&S: whether anybody steps up to buy it, how much they pay, and what they do with it afterwards. It might go the way of MGM or RKO radio. (There is still an MGM but the great library associated with the name is actually owned by Warner Media. Apple needs a video library and talked to MGM…and walked away.) Amusingly, the rumor is Netflix is looking to buy tbe full conglomerate and either sell or spinoff S&S. What they want is STAR TREK, PARAMOUNT, and CBS, not zombie publisher.

            It won’t be settled overnight but I doubt there will still be five big publishers in Manhattan by the end of the decade. I peg the over/under at three: S&S and and un-merged Hachette are the easy suspects but if the Murdocks look to get out (like they did in video) before 2025 all bets are off. And the current crisis isn’t helping their prospects one bit.

            Just don’t expect the press to report it until it’s time to play TAPS.

          • If publishers don’t have enough marketable manuscripts to fill their desired publishing shots, is there a reason to think they will not compete for marketable manuscripts?

            How come Stephen King gets far bigger advances from the publisher than the average author? Why doesn’t the Three Way Relationship just decide to pay him $3,000? The publishers have choke hold on the market.

            • How come Stephen King gets far bigger advances from the publisher than the average author? Why doesn’t the Three Way Relationship just decide to pay him $3,000?

              Stephen King makes far more money from film and TV rights than he does from selling books. Because he deals first with book publishers, they get a cut of those rights, per contract. If they stop paying him what he wants, he can sell the film rights directly and tell the book publishers to go and screw themselves. The publishers do not have a chokehold on every market, but if you are not Stephen King or another highly famous name, you don’t have access to the majority of those other markets.

              If you were not aware of these facts, you are even more gobsmackingly stupid than I thought.

              • Sounds like the publisher is competing with other content buyers.

                God bless the free market, for the choke hold is broken.

        • Of course there is a difference, but it’s the same basic economic function. There is also a difference between paper and electrons. But the intermediary is still just as necessary as the author in maintaining today’s level of commerce. …

          But you’re missing a key difference: ACCESS & CONTROL. As an Indie self-pubber, I make all the decisions. And I have 100% access to the market (of my choice). No one gatekeeps me.

          If authors don’t like getting 30% of the publisher’s revenue from the book, that’s easy to fix. …

          30%? Say what? It’s been a while but in trad pub days, I was earning 12% of “Publisher’s Net”. I can’t imagine it’s gone up a lot since then. And that yielded me about 5% of a suggested retail of $39.99 per book, or $2.00. Compare that to the significantly more I make now on a $3.99 ebook that I self-publish.

          Bottomline: I’m the Author, I’m the Agent, and I’m the Publisher. And I have instant access to the world’s largest Retailer. Checkmate.

  4. [my other reply seems to gone into the abyss… trying again here after changing a couple of words; let’s see if it works… Sorry, PG!]

    Of course there is a difference, but it’s the same basic economic function. There is also a difference between paper and electrons. But the intermediary is still just as necessary as the author in maintaining today’s level of commerce. …

    Yeah, but you’re missing a key difference: ACCESS & CONTROL. As an Indie self-pubber, I make all the decisions. And I have 100% access to the market (of my choice). No one gatekeeps me.

    If authors don’t like getting 30% of the publisher’s revenue from the book, that’s easy to fix. …

    uh, 30%? Say what? It’s been a while but in trad pub days I was earning 12% of “Publisher’s Net”. I can’t imagine it’s gone up a lot since then. And that yielded me about 5% of a suggested retail of $39.99 per book, or $2.00. Compare that to the more I make now on a $3.99 ebook that I self-publish.

    The bottomline: I’m the Author, I’m the Agent, and I’m the Publisher. And I have instant access to the world’s largest Retailer. Checkmate.

    • I agree you have access to the market of your choice, and I agree you can make your own decisions. However the intermediary is still necessary to maintain current levels of commerce. Both author and intermediary are necessary for maintaining current levels of commerce, but neither is sufficient. Together they are. There are lots of terms under which that can operate.

      How was publisher’s net defined, and what kind of book sold for $39?

      I also agree you have access to the world’s greatest retailer, but without that intermediary, the author cannot maintain the levels of commerce we see today.

      • Whatever they chose.
        That’s what control means.

        (12% was pretty good for the times. 8-9% was more common. $0.25 (5%) or lower per unit not unheard of in the self-dealing scams and deep discount deals.)

  5. Second try.
    (WP ate my homework.)

    DaveMich said:
    “As long as bookstores only order from large publishers and book media only discusses large publishers, this exploitative situation will continue. It is not, really, the Big 5’s fault for pursing a logical business model. It is the fault, if there is one, of the other two actors in this 3-way relationship for enabling the Big 5. ”
    —–
    The enabling and justifying isn’t actually helping BigPub. It’s like somebody sinking in quicksand while their friends take selfies and assure them the pool is drying up and they’ll be out of trouble in no time.
    Pretending there is nothing wrong with a dated model helps nobody, least of all the BPHs.
    Want them gone? Encourage them to keep on going as if nothing had changed.

    There is a good chance B&M bookstores will be still be around after the BPHs predatory payday loan business model collapses.
    Two reasons: used books and lifestyle merchandise.

    The Big Publishers’ business model is predicated on volume: it depends on enough titles making it big to provide big returns above breakeven. Mostly from high profile bandwagon event books and the output of their big name legacy authors. No amount of handwaving is going to hide the fact that the bandwagons aren’t rolling. Which was the last event book that got buzz outside the enabler press or twitterverse? 50 SHADES? TWILIGHT?

    The big names are still around and still producing but the dilution of the marketplace is hitting them too. They still sell big but they don’t sell as *fast* as they used to. And in a business built on slots and sales velocity this is deadly because sucks the oxygen out of the sales of lower tier books. This is being reflected in the enabler press: lower bars to declare “bestsellers”, shorter strays for all others. And those legacy authors aren’t being joined by enough, equally effective newcomers so when the big names stop working a good chunk of the corporate profits go with them, with no replacement in sight.

    The blockbuster model is fading and what remains is churn. Yes, they turn a minimal paper profit off books that don’t earn out but it is minimal and only before factoring in inflation. Witgout the high volume blockbusters the churn isn’t enough to pay for the fancy deal lunches or satisfy their overlords.

    The signs are all over: established midlisters walking away or being dropped, less new titles, more publishers dropping or minimizing genres, imprints being shuttered or consolidated, and the continuing consolidation which is seeing even big publishers being sold off. Smarter conglomerates are getting out while the getting is good, leaving others holding the bag and trying to milk their steadily declining market. Torstar ditching Harlequin, CBSViacom trying to sell off S&S…

    The latter may be tbe canary in the coal mine. How the sale plays out: if any buyers show up, the price, and what the buyers do with S&S afterwards will inform the prospects of the remaing Manhattan corporate publishers. Will it go tbe way of MGM in the 80’s? Bought, stripped of IP, and flipped to a dreamer? It won’t play out overnight so the “all is well” eyes wide shut enablers can keep on pretending the tipping point isn’t steadily approaching. Slow lingering deaths are still deaths, though.

    The over/under for the Manhattan corporate publishers by 2030 is three. S&S is already on the chopping block. Hachette is an easy victim to point out as the smallest, weakest, and least effective outside Amazon. But if the Murdocks get out before 2025, as they did in video, all bets are off. The Germans will probably stay but it is worth noting that the combined market share of the merged randy Penguin is already smaller than pre-merger Random House. Their is a real question of how long tbey will tolerate a churn-driven business. Again, look at S&S’s latest financials. Lots of releases, big aggregate gross but itty bitty pre-inflation net. Margins matter.

    And if financial services is what BigPub has to offer, there are better and safer usesfor tbeir cash than piecemeal payday loans on manuscripts. Don’t assume the Germans will hang around forever.

    The enablers’ pretense that all is well hides the fact that trade publishing no longer revolves around Manhattan and that twenty years of stagnation have stripped away their market power, to say nothing of their relevance.

    They can keep on merrily doing what they’ve always did but they’ll keep on getting what they’ve been getting. It’s not wise to mistake unproductive activity for healthy progress. It is just the early death throes of a fading business model as supppliers and customers go to smaller, more focused, non-predatory tradpubs and Indie, Inc.

  6. It won’t play out overnight so the “all is well” eyes wide shut enablers can keep on pretending the tipping point isn’t steadily approaching.

    The tipping point is behind us. Ahead is the downhill slope.

    • The pandemic might indeed be the last straw.

      But we still won’t know for a while. Big monsters take their time dying.
      There is still an MGM out there even though it bears no resemblance to the studio of its heydey.
      RCA, POLAROID, the names endure long past the death of the company, when all that remains is the IP hoard. If that.

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