Archive for the ‘Publishing Business’ Category

Amazon’s Appeal To Authors

Wednesday, July 9th, 2014
Sticker from The Colbert Report web site

Sticker from The Colbert Report web site

Amazon must be feeling the heat.

After Stephen Colbert and Sherman Alexie called the company out for strong-arming publisher Hachette in negotiations over terms, Amazon was uncharacteristically quiet.

Over the weekend, Amazon made its own appeal to authors, saying it was “thinking of proposing” that, for the duration of the negotiations, authors published by Hachette get to keep all of the revenue from their digital-book sales (see Amazon’s letter to authors and agents here), with both Amazon and Hachette giving up their percentages.

As word got out, Hachette issued a statement, rejecting the idea, saying it would be “suicidal.”

Amazon responded, “We call baloney. Hachette is part of a $10 billion global conglomerate. It wouldn’t be ‘suicide.’ They can afford it. What they’re really making clear is that they absolutely want their authors caught in the middle of this negotiation because they believe it increases their leverage. All the while, they are stalling and refusing to negotiate, despite the pain caused to their authors. Our offer is sincere. They should take us up on it.”

The story is being covered widely. Shelf Awareness, the daily newsletter for booksellers, characterized Amazon’s move as being ” a bit like a mugger wanting praise for donating stolen goods to a charity.

New York Times – Amazon Angles to Attract Hachette’s Authors to Its Side

Washington Post – Amazon makes an offer to Hachette authors – this article takes an interesting look at the stats, which indicate that Hachette would have much more to lose by giving up revenue from their author’s ebooks than Amazon — “According to Hachette’s Web site, the publisher makes approximately 33 percent of its sales from e-books; the New York Times reported that around 60 percent of that business comes through Amazon. A New Yorker report in February estimated that 7 percent of Amazon’s revenues come from books.”

Wall Street Journal – Amazon Dangles E-Book Offer Amid Hachette Dispute

New York PostAmazon bows to author pressure in e-dispute

PEOPLE Reviews Disappearing?

Friday, June 6th, 2014
Books now subsumed into "People Picks"

Books now subsumed into “People Picks”

When opening the new issue of People magazine, you may wonder where the Books section is.

Unfortunately, along with the other reviews sections, it is gone. Books, movies, TV and music will now be combined in an upfront section, “People Picks,” where they will also have new competition from apps, games, viral video and other entertainment.

In the inaugural “Picks” section, books appear towards the end (ahead of the DVD of the HBO series, True Detective and the streaming musical, Side Effects), with just three new hardcovers, all of them by well-known authors – Stephen King’s Mr. Mercedes, Diana Gabaldon’s Written in My Own Heart’s Blood, and Lisa See’s China Dolls – as well as three paperback reprints, also from big names.

The last issue with a Book section

The last issue with a Book section

This is the first major change to the magazine under the new Editorial Director, Jess Cagle who took over in January. It seems his predecessor, Larry Hackett, had considered making changes to the sections, but kept them to support upfront fractional advertising pages.

The book business has had to suffer the diminishing, or closing, of many book review sections. Given People magazine’s extensive reach, this may be the worst blow of them all.

Colbert Gives Amazon the Finger

Thursday, June 5th, 2014

When Amazon began their fight with publisher Hachette, they may not have taken into account the fact that Stephen Colbert is published by Hachette.

Colbert explains the situation below and shows Bezos what he thinks of it.

Colbert brings on “fellow Amazon victim,” Sherman Alexie, who is also published by Hachette.

Since debut authors are most at risk from Amazon’s tactics, Alexie helps one of them by recommending viewers pre-order California, by Edan Lapucki, (Hachette/Little, Brown, July 8; audio from Dreamscape) via Powells.

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The book has appeared earlier on summer reading lists, including the Pittsburgh Post Gazette‘s, with the following recommendation,

When the American economy collapses and anarchy reigns in the land, a couple from Los Angeles head for the hills where they have to forage for food and improvise shelter. They are quickly confronted by stark choices and must figure out whether reconnecting with other survivors would be worth the aggravation that comes with being a part of civilization.

The New PRH Logo

Tuesday, June 3rd, 2014

Just debuted, the new Penguin Random House corporate logo, clearly crated to work easily with the combined company’s many other logos. The press release notes that the individual imprint logos do not have to be paired with the new corporate logo (a good thing for book spines). Neither corporate parent is included (Bertelsmann controls 53% of the company and Pearson 47%).

The following video demonstrates its usage.

Amazon vs. Hachette

Monday, May 12th, 2014

Amazon logohachette-320x134

Hachette and Amazon are involved in a fight over sales terms, to the detriment of writers, says the NYT’s tech reporter David Streitfeld in not just one, but two articles published at the end of last week (Streitfeld doesn’t appear to have a personal interest in this; he is one of the few NYT reporters that hasn’t published a book).

Streitfeld says Amazon is in a “secret campaign to discourage customers from buying books by Hachette,” by cutting discounts on some of the publisher’s titles, increasing delivery times, as well as “suggesting that readers might enjoy instead a book from another author” (we’re not sure what that means; Amazon routinely lists titles that “customers who bought this also bought”). This is presumably in retaliation for Hachette balking at new demands as part of their contract renewal (neither side admits to that), which is nothing new. As Publishers Weekly says, this seems to have become “a rite of spring.”

Unfortunately, as Forbes Magazine points out squeezing suppliers is business as usual in all areas of retailing  (WalMart has turned it into a fine art). In fact, Forbes views Amazon’s moves as “small-ball tactics” that are actually a show of weakness, because “both Hachette and Amazon know that Amazon can’t afford to pull Hachette from its shelves.”

As of today, although the NYT has published two stories on the dispute, The Washington Post, owned by Amazon CEO Jeff Bezos, however, has not  (although they did one on Amazon expanding Sunday deliveries to 15 more cities). UPDATE:  The Washington Post covers the story on Wednesday, May 14, noting that Hachette may be forced to “relent on the price at which it sells books to Amazon, squeezing its slim profit margins even further” and that, as Amazon’s market share increases, “if there’s no real choice of where to buy things, maybe there should be some other way to retain pricing power for those who produce goods in the first place.”

Librarians Are Fading Out?

Tuesday, February 11th, 2014

The New YorkerIf you want to add to your February blues, read George Packer’s story in the new issue of the New Yorker, “Cheap Words: Amazon is good for customers. But is it good for books?” (happily, subscription is not required to read this one online).

Among the conclusions? For publishing, the “long-term outlook is discouraging. This is partly because Americans don’t read as many books as they used to — they are too busy doing other things with their devices — but also because of the relentless downward pressure on prices that Amazon enforces.”

Packer quotes Russ Grandinetti, the vice-president of Kindle content who asserts that, because of GoodReads, gatekeepers are no longer necessary,  “ ‘Suddenly, we’re not locked into hearing the opinions of a small number of reviewers in newspapers’ ” and adds an unattributed aside, which is presumably Packer’s own, “Professional reviewers are fading out anyway, along with librarians and bookshop owners.”

As an author, Packer has some interest in the fate of gatekeepers. His book, The Unwinding: An Inner History of the New America (Macmillan/FSG), was on many 2013 best books lists (including the Amazon editors’ Top 20) and won the National Book Award.

Random House Penguin Merger Completed

Monday, July 1st, 2013

prh_interim_logo_1c_cmyk

In press releases issued early this morning, the parent companies of Random House and Penguin announced that they have finalized contracts for a merger of the two, creating the largest trade publishing house in the world, named Penguin Random House (interim logo at the left).

The Random House parent company, Bertelsmann, owns 53 percent of the new company and Penguin parent, Pearson, 47 percent. Random House chief executive Markus Dohle becomes CEO of the  new group and Penguin’s CEO John Makinson, the chairman of its board of directors. The CEO of Penguin USA, David Shanks, has stepped down to serve as Senior Executive Advisor to Dohle and the U.S. executive team. Madeline McIntosh, formerly Chief Operating Officer, Random House U.S., becomes the President and Chief Operating Officer of the new U.S. company.

While it is too early to speculate on the composition of the new company’s library marketing teams, it would make sense on the adult side if they combined each group’s expertise in academic and library marketing into two new larger departments. In terms of eBooks libraries will be waiting to hear if the new company follows the Random House or Penguin models.

Press Releases:

Bertelsmann Press Release

Pearson_Press Release

PRH Press Release

John Green Accepts ABA’s Indie Prize

Thursday, June 6th, 2013

Below, John Green, accepting the Indie Prize given by the American Booksellers Association to writers who best represent commitment to independent book stores, calls “bullshit” to the concept that authors like him, who speak directly to their readers via social media, don’t “need the value-sucking middlemen of bookstores and publishers and in the future … no one will stand between author and reader except possibly an e-commerce site that takes just a tiny little percentage of each transaction.”

He hates being held up as an example of an author who doesn’t need support from publishers, editors, librarians and booksellers and ends by saying,”We built … the book business, the idea-sharing, consciousness-expanding business together … and we’re going to keep building this together.”

His comment about Ayn Rand is worth an award in itself.

Amazon Gains New Data Source

Friday, March 29th, 2013

Now that Amazon has announced they are buying Goodreads, speculation is growing about what this means. Below are a few signal reactions:

Interview with Goodreads CEO Otis Chandler and Amazon’s VP of Kindle content, Russ Grandinetti, on paidContent raises many of the questions that people are asking, although answers are mostly variations of “we don’t know yet” and assurances that things will remain the same (the headline “First Do No Harm” comes from Grandinetti’s response to the question of whether Amazon reader reviews will migrate to Goodreads, “Our mentality here is to first do no harm, and make sure that if we’re going to do integrations, users genuinely find it to be a big benefit.”)

Tim Spalding, creator of Goodreads competitor, LibraryThing writes on his blog that he’s been “wanting for this forever” and expects publishers and readers will defect from Goodreads to LibraryThing

ShelfAwareness rounds up industry reactions

So far, we haven’t heard whether Goodreads members are concerned that Amazon may soon own their content.

New Approach to Online Book Recommendations

Tuesday, February 5th, 2013

After the publisher-supported site Bookish.com delayed its summer, 2011 launch date  and changed management several times, many in the book business wondered if it would ever arrive. Just as rumors had begun to die down, the site launched last night.

Aimed at consumers, it’s a Johnny-come-lately to online book merchandising. As Ron Charles of the Washington Post notes with tongue-in-cheek, “If you’re one of the countless people wondering, ‘Why isn’t there anywhere to buy books online?’ we’ve got good news: Bookish went live last night.” The press release offers details on what is billed as a “one-stop, comprehensive online destination designed to connect readers with books and authors.

The site is sponsored by publishers Simon & Schuster, Hachette Book Group and Penguin Group, with participation from 16 other publishers.

Users can buy books directly from Bookish, with B&T handling fulfillment. There are also links to online retailers, including ABA’s IndieBound.

The site will include author interviews (a conversation between Michael Koryta and Michael Connelly is currently featured), book excerpts and reviews.

It also aims to provide a “state- of-the-art recommendation tool…from a proprietary algorithm that factors in editorial themes, professional and consumer reviews, publishing house editor insights, awards and more.”

At this point, it’s not working that well. Entering The Power Trip by Jackie Collins brings up the following results. Hemingway might be pleased with the comparison.

Power Trip Recs

Headed for the Big Four?

Wednesday, November 21st, 2012

The Wall Street Journal reports, based on anonymous sources, that Rupert Murdoch’s News Corp., which owns HarperCollins, has expressed interest in buying Simon and Schuster.

This follows closely the announcement of a merger between Random House and Penguin, to be completed sometime next year. News Corp tried to make a bid, but was rebuffed.

As a graph in the WSJ story shows, the 2011 estimated market share for each publisher is:

Random House — 19%

Penguin — 9%

Combined RH/Penguin– 28%

HarperCollins — 12%

S&S — 9%

Combined Harper/Simon — 21%

Hachette (which includes Little, Brown and Grand Central), has an estimated 11% share. The market share for Macmillan, the other company in the so-called “Big Six,” is lumped in with the 41% “Others” category.

The new landscape may not be the Big Four, but the Big Two, Plus Four (Hachette, Macmillan, Wiley’s trade division and Harlequin).

Random House/Penguin Deal Expected To Close Next Year

Monday, October 29th, 2012

Following up on last week’s acknowledgement by Pearson that the company is in talks with Bertelsmann to merge their two consumer book publishing divisions, Penguin and Random House, the companies issued a statement today that the deal is “expected to complete in the second half of 2013,” assuming it clears regulatory approvals.

Random House will own a controlling 53% share of the company that will be known as Penguin Random House. The CEO of the new group will be Markus Dohle, currently CEO of Random House. John Makinson, Chairman and CEO of the Penguin Group will be the chairman of Penguin Random House. The new venture is expected to be based in New York, where Dohle now resides and Makinson is expected to spend more time.

This makes for a very nervous time for the staffs of both companies as they worry about which jobs will become redundant. Makinson told The Guardian that “the strategy behind the deal was not to take an axe to the editorial side of the business, but that there could be savings to be had in the back office.”

Over the weekend, news broke that NewsCorp, owner of HarperCollins, had made a counterbid for Penguin. Some reports indicated that this could undermine the proposed merger. Responding in The Guardian, Mackinson dismissed that idea, saying, “There isn’t any sort of break clause [with Bertelsmann]. It is a signed transaction.”

A Penguin Wanders Into a Random House

Friday, October 26th, 2012

   

The above two titles may eventually have more in common than their genre and cover designs.

In a tersely-worded “Statement on media coverage regarding Penguin” yesterday, Pearson set off a round of speculation and gossip in the publishing world:

Pearson notes recent media coverage regarding Penguin, its consumer publishing division, and Random House (part of Bertelsmann). Pearson confirms that it is discussing with Bertelsmann a possible combination of Penguin and Random House. The two companies have not reached agreement and there is no certainty that the discussions will lead to a transaction. A further announcement will be made if and when appropriate.

Reports in European news sources, beginning with a story in Germany’s Manager Magazin on Monday, forced Pearson’s response.  When Bertelsmann, which owns Random House, was asked to comment, they simply pointed to the Penguin statement.

Speculation is now rife as to the reasons for proposed merger, with some saying it’s necessary because ebooks have changed the business and others that publishers need to gain enough clout to stand up to Amazon. Those are side issues, however; the major reason is that Pearson is focusing on their education business, and Bertelsmann’s new CEO Thomas Rabe has promised major acquisitions and strategic partnerships.

The New York Times story quotes literary agents saying that the deal will not be good for authors. Says agent David Kuhn, “a shrinking book industry could be compared to the situation in Hollywood, where studios under financial pressure now focus on churning out a handful of blockbusters a year, rather than taking risks on smaller films.”

If the merger were in effect today, seven of the fifteen NYT Fiction best sellers would be published by the new company.

Whatever the speculation, this is far from a done deal. There are still hurdles to jump, like gaining approval from U.S. and U.K. regulatory agencies (although, as many news stories point out, those agencies have allowed the music business to shrink to three major companies). The most meaningful part of Pearson’s statement may be the “if” in the final line.

Publishers May Expand eBook Programs to Libraries

Wednesday, August 29th, 2012

It’s estimated that 75% of the public libraries in the US lend ebooks, a fact many people are surprised to hear.

NPR’s Diane Rehm Show gave exposure to the practice yesterday with a full program devoted to the subject. Responding to a question about why some publishers don’t make ebooks available to libraries, Jeremy Greenfield, editorial director of Digital Book World, said they are worried that lending will result in reduced sales. Carrie Russell, from ALA’s Office of Information Technology, countered that libraries are “confused by that argument since the evidence shows that library borrowers are the same people who buy,” referring to Library Journal‘s “Patron Profiles” and a Pew study.

Later in the show Greenfield said, based on his meetings with publishers, there is good news for libraries; publishers who make their ebooks available to libraries believe it helps, rather than hurts, their business and are planning to continue as well as expand their programs. In the coming year or two, he expects to see other publishers make their ebooks available to libraries.

However, he said, some publishers look at the studies skeptically, believing that library borrowers buy ebooks only when they are unavailable through the library and that a change in policy would result in fewer sales.

Also featured on the show were Vailey Oehlke, Director Multnomah County Library and Allan Adler of the AAP.

Penguin Making EBooks Available to Some Libraries

Thursday, June 21st, 2012

Cautiously returning

Penguin announced yesterday that they are working with 3M on a pilot program to again make their e-books available to the New York and  Brooklyn Public Library systems.

The catch? Titles will not be released until six months after they go on sale through retailers and they will expire after a year, with an option to renew. The prices will be “in the same range as prices that retail consumers pay.” (the Wall Street Journal).

Chris Platt of NYPL tells the Wall Street Journal that he hopes Penguin will eventually “agree to make some titles available immediately, while retaining the six-month delay for hot-selling titles. Exposure of first-time authors in libraries, for example, could boost sales.”

The deal was announced just three months after Tony Marx, NYPL President and CEO told publishers that he would be willing to  consider introducing more “friction” into the lending of ebooks to address their fears that library lending would affect the nascent consumer market for ebooks.

It’s a sign of the times that the story of this cautious change was broken by the Wall Sreet Journal (Libraries Cut E-Book Deal With Penguin). The NYT also ran a story in their Media Decoder blog.