17 January 2013

Business As Usual: An Insider's Look at Publishing


I think publishing has changed in ways that we haven’t begun to come to grips with. The changing landscape of the media-intensive culture we live in necessitates that we become content providers in ways we didn’t need to worry about even five years ago. While that’s exciting, on the one hand, on the other I find it, frankly, daunting.

So here is Aunt Noony’s down-and-dirty look at publishing, from my perspective. The biggest change I’ve seen is the eclipse of New York traditional publishing by the digital-first providers, which then turned so-called “traditional” publishers into digital-first by necessity. But what does all that bla-bla mean?

I’m going to pretend for a moment that my reader is a reader, and not an author, just so we can all get on the same page. To writers of my acquaintance, and at writing conferences, the term “New York,” “traditional publishing,” and even, sometimes, “real publishing” is used to mean the big houses, or “the Big Five”: Hachette Book Group, HarperCollins, Penguin, Random House, and Simon & Schuster. Technically, as of November, 2012, it’s the big four, since Penguin and Random House merged.

Digital-first is a term used to refer to houses that publish books in digital form first, and was coined as a way to step away from the idea that publishers that started out as e-publishers were simply “small presses.” Small press is a publishing house that releases a limited number of titles in a year, usually to specific market segments. Before the advent of digital publishing, authors really only had two possible markets: try to get into one of the big houses, or choose a small press and potentially smaller sales. (It’s worth noting that not all small presses mean smaller sales and not all “big five” contracts translate to big money.)

In 2010, Amazon announced that ebooks sold more than hardcovers, which shocked many people in the industry and observing it. (WSJ and NYT stories.)  Would that spell the end of traditional (i.e. paper) publishing? Speculation ran high as to when paper would end, how it would end, and how large a piece of the pie ebooks would consume. Fast forward to January 2013 and ebooks are an established part of the marketplace and a large portion of the reading public doesn’t know what they did before their e-reader. That’s not to say books in paper form are gone, but the trend is clear: ebook sales are growing, paper sales are flat or declining across all sectors, and New York houses have paid attention. The Big Five have started putting real money behind their ebook initiatives and digital-first publishing has hit the mainstream.

I could speculate as to what I think will happen in the next two years, but I don’t think that adds to the discussion. What will be, will be. My job, as an author and content provider, is to write the content, not worry about the channel. I need to understand the channel, but I don’t need to worry about it. The changes in the channel don’t change the fundamental nature of what I do as a writer: I still craft stories. How they get from my mind to the reader’s mind is not as important as that they get written first.

At the risk of sounding like I’m contracting myself, I do think it’s incumbent on us as authors to pay attention to the changes in the marketplace and to understand the channel. As interested readers, we can follow it as well, if for nothing else than to be witness to the greatest shift in media consumption since the printing press. So here’s what I’m going to do instead of make predictions. I’m going to show you a window into the predictions of the “big boys.”

While any publicly-traded company that trades on an exchange in the United States is required to disclose a ton of information on a regular basis, I found that none of the Big Five are publicly traded (though a couple parent companies of the publishers are). If the company is private it’s a little harder to get information on their official opinions, but you can always start by visiting their website and digging around.

Yahoo Finance and Morningstar have a wealth of information available, as does Bloomberg Online. Using the Big Five as an illustration:

  1. Hachette Book Group is now a private company. more>>
  2. HarperCollins is now part of Rupert Murdoch’s NewsCorp. more>>
  3. Penguin and Random House merged in November, 2012, creating the largest publisher of consumer books. The merger still has to be approved because of ongoing litigation against Penguin for price-fixing of ebooks. more>>
  4. Simon & Schuster is a part of CBS. more>>
Barnes and Noble and Amazon are publicly traded, however, and their quarterly reports to Wall Street and investors are archived on Morningstar. I recommend you check them out.

  1. Amazon.com; Ticker Symbol AMZN; Q3 2012 Earnings Call Transcript
    (Q4 comes out the end of January, 2013; keep your eyes peeled for the transcript)
  2. Barnes & Noble, Inc.; Ticker Symbol BKS; Q2 2013 Earnings Call Transcript

I suppose, in closing, I will leave you with the thought that as authors, we must understand that we are, also, in the publishing business. The better we can understand that business, the better – more effective – we can participate.

What questions do you have about the publishing industry in general or any of the specifics I’ve included above? Don’t be shy. It’s a complex subject, but we can figure it out together.

Write on!

--
“It takes courage to grow up and become who you really are.”
- E.E. Cummings

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Check out BURNING BRIGHT, available from Samhain Publishing.
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