Lifelong learning looms large
What to expect in 2015 (and beyond)

Anticipating change in the myopic publishing industry

Have you ever heard the quote, “everything that can be invented has been invented”? It was once believed that a U.S. Patent Office commissioner uttered those words but that claim has since been refuted. Regardless of whoever said (or didn’t say) it, I’m convinced it’s a view many in the publishing industry strongly believe in. 

Let me provide a few examples…

In 2006 the ebook marketplace mostly consisted of PDF files. There were a few other formats but none showed any signs of broad consumer adoption. The industry seemed to be growing weary of anticipating the ebook explosion that was always “just around the corner”.

I remember working at a large book publisher in those days. One of my former colleagues was very outspoken, noting that books aren’t like music (which had already made the shift from physical to digital), there’s no device that makes a digital version more interesting than a print version, consumers like holding and reading a print book, etc.

Then, in late 2007, Amazon launched the Kindle and everything changed.

Let’s fast-forward a few years for the second example… In 2011 I was co-chair of the Tools of Change publishing industry conference. One of the messages we communicated to attendees was the need for them to diversify their channel strategy and focus on the one channel they totally control: direct-to-consumer. Our pleas were met with rolling eyes, yawns, and responses like this one from a very high-level executive at one of the Big Six: “We don’t need to create a direct channel…that’s why we have retail partners like Amazon, for example.”

My how times have changed. Today we even see the big guys focusing more on direct-to-consumer strategies, particularly as Amazon becomes more dominant and pushes for an ever-bigger piece of the pie.

For my third and final example, let’s look back to 2013, when some were suggesting a “Netflix for books” model would emerge. Most scoffed at the idea, suggesting books aren’t like movies and an all-you-can-read option would never take hold.

Earlier this year we saw the launch of Oyster Books, featuring that all-you-can-read model. Some publishers opted to experiment while consumers (like me) flocked to the service. Even Amazon has copied the model with their Kindle Unlimited program. 

(Btw, as I’ve said before, the current all-you-can-read ebook models are unsustainable. How long can these providers keep paying publishers more than they’re earning from most subscribers in top-line revenue? Amazon is the only player with enough resources to pull that off, and based on their stock’s performance in 2014 it looks like Wall Street is becoming impatient with Amazon’s loss-leader philosophy.)

I mention these three examples because I believe we’re in the midst of yet another shortsighted moment. Ebook revenues have plateaued for many book publishers. Some believe the market has reached equilibrium and that a roughly 75/25 split between print and digital is the future.

These publishers are quite comfortable living in the “print under glass” world, where they drive incremental revenue from digital editions that are identical to the print editions. They don’t like it that consumers expect to pay less for the digital edition (vs. the print edition price), but they’re growing comfortable with the model. Many of them briefly experimented with native apps and enriched ebooks; for the most part, their expenses exceeded revenue on these failed projects.

This is largely why these publishers have an allergic reaction when someone mentions the phrases “enriched ebook” or “enhanced ebook”.

In the early days of television most shows were simply radio programs in front of a camera. There were probably quite a few executives back then who figured that was the future and radio-plus-camera was as good as it would get.

I firmly believe that quick-and-dirty digital editions of print books are not the endgame. Some consumers are and will be perfectly content to read digital replicas of print products, but many will crave something that’s much richer though, especially once they experience it.

We won’t be stuck eternally in today’s “print under glass” world. In the not-too-distant future I’m convinced at least one model will emerge to take us out of this rut. Publishers would be wise to continue experimenting with content enrichment and enhancement (yes, we need better a better term for this!) so they’re not caught flat-footed when the movement takes hold.

Comments

Madabhushi Raghavan

Thanks for thought provoking post Joe.

Publishing is indeed at crossroads and most astonishing fact is they always bump to crossroads and that too, every alternate year. With onslaught of innovations from technologies, publishing industry as a whole is suffering.

Global delivery of content over various channels is confusing them more.

Unless they leave dogma of print replicas they can't innovate and generate new models and user experience.

That's hard to change as print is still making money in most parts of rest of world (may not be in West).

I had chance to be associated with cyberread around 2006-07, innovative concept then tried to link authors, publishers, distributors and readers. Got bogged down between all stakeholders.

In Pressmart we created Tablet based education system called MOCA, where ebook based ereader for textbooks is prime feature of system. We got takers in ASEAN countries than anywhere in the world. Right from Schools, Publishers, Students and Parents (consumers) adopted it. Middle East, SAARC and Africa now are looking promising.

I have come across children comic book store, bulbulapps which is doing well in specific targeted segment of publishing interactive comic books. They offer comic content to children and in their store they have started creating puzzles and fun games which is increasing adoption rates.

While technology can travel fast from west to east content creation and consumption are still societal factor. If publishers can choose or create or co-create ebook delivery platforms that can focus on targeted genre or region, they can be much more successful.

As such focus can help them to create optimized content and associated value added offerings to customers which will drive revenue models.

Dan Dube

Joe,

I couldn't agree with you more! Consumers will push for this to happen, sooner rather than later. It may start in certain niche publishing markets (educational publishing makes lots of sense, where academic books can become more interactive with video/audio/animation and interactive testing of concept mastery). But, it's only a matter of time before this trend explodes into the mainstream.

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