Economics of Publishing
 

Here's an article on E-books, a good one: http://news.cnet.com/8301-1023_3-574...carouselMain.0

Because I am a financial planner and a poet, I've seen a lot of publishers' closely guarded financial statements. It costs not much more to publish a cook book or a dog training book which can sell tens of thousands of copies than to publish a poet who will sell 500 copies. The difference is just paper and shipping. I think one of the bravest guys in the world is Alex, who has founded Able Muse Press to bring us really good poetry. I don't see Alex' financial statements, but I know what he's up against.

The most shocking thing to me in this article is that Borders owed Penguin $41 million when they filed for bankruptcy. That's a pretty big trade credit! The Sullivan/Murphy Beowulf is published by Penguin's parent, Longman/Pearson, whose president for literature is a hunting buddy of mine. If Barnes and Noble goes down the loss will be graver by far. Today I am going to go spend some money on books.

This has long been clear to anyone who buys a lot of books. Not the necessarily the wherefore part, but certainly the why part.

In the past few years it has been possible to get a classic (Dickens, Balzac, etc. the kind of books usually offered by so-called thrift publisher niche, Dover books et al) for zero dollars in a Kindle version.

I have in recent memory, a painfully similar marketing trick here in Sweden, one applauded by dummies when it appeared but which energetically and painfully screwed the general public in the long run, (no, make that "within a short planning horizon).

Background. As long as I have lived here, which is half a century, we have traditionally had excellent and dependable public transporation (both rail travel and bus) at affordable prices. Some years ago a bus operator from another country muscled in. They printed vouchers in newspapers that anyone could cut out and present to the bus driver and travel anywhere, anytime for free. No need to book in advance, just be there. If the bus was full, another would be called to take up the slack.

After a while you had to pay to ride, but still it was a ridiculous price compared to what a ticket cost on the established transportation modes, esp. rail, which as we know, leaves a much smaller environmental footprint than busses do.

After another while, the national rail transport--then a state responsibility--was losing lots of money and was privatized. In other words, a company built up by tax dollars was sold out. Local bus companies which were undercut went belly-up.

The situation now is that most of our transportation is owned and operated by foreign companies. A rail ticket is set according to supply and demand. So if you want to travel on a weekend or holiday at a popular time, expect to pay up to ten times what it costs to travel on the late, late train. This method means that young children, old people, the handicapped can't travel at a reasonable cost at a reasonable time. Do trains arrive on time? Guess.

Needless to say, there are fewer bus alternatives throughout the country. Also, not surprisingly, it is no longer possible to "show up and board". The ticket must be booked in advance, via the internet, and when a bus is full, it is full. Sorry, bye-bye. Bus travel prices have gone up to fill in the gap left by bankrupt competitors.

I expect this to happen in the book branch when publishing is consolidated to the major actors in the field who see a book as a commodity just like any other and to hell with cultural or educational value-added. And don't expect to find a kindle version of books that almost no one buys. Even if old books are sold as physical objects on the second-hand market, handling and postal costs will make it prohibitive.

Since e-books have no postal charges and a minumum of handling cost a.k.a. fewer employees, when the book market settles back into its present price level, the difference will go to the distributor, not the author or the buyer. I am as skeptical about authors being contracted to a major player-supplier such as Amazon, as I would be if they were being bound to an organization controlled by a totalitarian state.

The answer is not, alas, to buy more books, but to get a government that is not influenced by lobbyists and controlled by greedy big business. I'll stop there.

signed

a Luddite and proud of it.

another interesting development:
is it only a matter of time before more follow suit?
http://finance.yahoo.com/news/daring...140209029.html

All this makes me very sad. Those poor little publishing houses, led like lambs to the slaughter at the altar of Apple and Amazon. What ever will they do? Why, just the other day I heard them talking about how the sky was falling, and they can't possibly stand up to those twin corporate giants.

Take poor little Macmillan. They've published everybody: W.B. Yeats, Rabindranath Tagore, Sean O'Casey, John Maynard Keynes, Charles Morgan, Hugh Walpole, Margaret Mitchell, C. P. Snow. How could they possibly keep resisting the evil empire? Except, of course, they are a wholly own subsidiary of Verlagsgruppe Georg von Holtzbrinck. And have been for a couple decades.

Harper Collins, of course, is wholly owned by News Corp, and is part of the Rupert Murdoch group, better known here for it's Fox News subsidiary.

Penguin isn't Penguin, it's a subsidiary of Pearson PLC.

Simon & Schuster is wholly owned by CBS. That one gets even better. Here's a brief summary of the last few decades:

In 1975, Gulf+Western acquired the company, and nine years later, Prentice Hall was brought into the company fold. G+W would change its name to Paramount Communications in 1989.

In 1994, Paramount was sold to the original Viacom.

In 1998, Viacom sold Simon & Schuster's educational operations, including Prentice Hall and Macmillan, to Pearson PLC, becoming part of Pearson Education.

Viacom would split into 2 companies at the end of 2005: one called CBS Corporation (which inherited S&S), and the other retaining the Viacom name. Despite the split, National Amusements retains majority control of both firms.

And who, you may well ask, is National Amusements? Well, it's 80% privately owned by Sumner Redstone. His daughter owns the other 20%.

So, these poor little publishing houses, innocent victims of those big bad wolves like Amazon and Apple? Makes me want to weep in my beer. What's the world coming to? ;)

Thanks,

Bill

Thanks for the link Seree. I'm familiar with EDC and didn't know they'd cut both Amazon and Baker & Taylor off. It's hard to feel too much sympathy for the big publishers but Amazon has now moved to squeezing small and mid-size publishers until they die. And they have the federal government on their side.

The point is that it is the reading public and the authors who are being screwed. Monopoly is not just a board game.

I was surprised to discover recently that Abe Books, which I had considered an alternative place to purchase, is, in fact, owned by Amazon. The modus operandi in media and publishing is the same as in the pharmeceutical industry, ad infinitum. Smaller companies are taken over and eliminated or assimilated, and competition which is supposedly the heart of free enterprise is ceasing to exist.

I am flabbergasted by anyone not concerned about the consolidation of the media and information industries into the hands of a few. Look around you to see what can happen to a nation when one person or a few actors monopolize the media. Look at the the danger wrought by Murdoch and Berlusconi for heaven's sakes and the methods these players employ once monopoly is a fact.

An article in this month's Atlantic analyzes the transition from having a market society to being market society. i don't know if it is online but this is a clue to the content http://www.huffingtonpost.com/2012/0...n_1424733.html

There are many things that I feel should not be entrusted to market forces but which are the province of citizenry via good government, among them the control of books and information media.

Others, formerly responsibility of government, now the province of business are: education, prisons, public transportation, affordable housing.

I suggest a close reading of the Atlantic article by Michael J. Sandel titled "What Isn't for Sale?"

One should not disregard that the one percent is wiping out the middle class which is the main factor for stability in any society. Look at the countries without a middle class and you will see what happens when the vast majority are poor and controlled by a small elite.

Poverty and joblessness not only lead to a greater crime rate it is anti-productive in every sense of the word.

Anyone fortunate enough to have a beer should indeed be weeping in it.

Oh, my. That's a "Luke, I'm your father" moment.

Ed

In the UK poetry publishers do exist, such as my last one Peterloo, now alas defunct, my next one, Enitharmon, and Ann and Bill's, Cinnamon, which would not do so were it not for The Arts Council, a Government body which gives them money - and still does, though less, in these straitened times.

Another reason to buy our books.

PS I don't know about the economics of Jayne's publisher. Publishing hese days is much cheaper than it was, as I think Tim pointed out. I've sometimes thought of going in for it myself, but not for long, it's a blody life's work. Vive Able Muse!

In The real story: publishing, four and a half years on Sharon Blackie, of Two Ravens Press (Scotland), writes about sales, marketing, blogs, reviews, money and motivation - "Even though our sales through Amazon, for example, go out at the highest discounts we ever give, we love them. Because they represent firm sales, and they never come back again." ... "We’ve had e-books for a couple of years now, sold through our website and also fully distributed through a major wholesaler, and our bestselling e-book has sold about ten copies."

How are readers being screwed by Amazon?

There's a bit of circular logic to it.

People are naturally drawn to the place that sells a product for a cheaper price than another place. Amazon is typically the cheapest place to buy books (and many other things besides). As a result, independent presses and small businesses that actually require a profit margin on each individual item they sell -- as opposed to observing an overall profit on hundreds of thousands of items collectively -- don't get the business that they would in the absence of a corporate behemoth.

This assumes, of course, that people would always be willing to pay $20+ for a book. I don't think that's the case, personally. But the other alarming trend is that when all the smaller presses start to close down because they can't compete with a large scale entity like Amazon, then the only arbiters of literature become the entities that can mass produce and mass distribute.

But the real problem is that people, for the most part, aren't wealthy. They'll only spend twice as much as what they have to if they truly believe in the deeper value of their money and think about where it goes. For the most part, the immediacy and cheapness of going on to Amazon is more valuable than trying to keep a small scale publishing house afloat. There's a real disconnect between dollars and sense.

Originally Posted by G. M. Palmer
The answer to that is "Do you still beat your wife?"

I suggest you look more closely at the meaning of "oligarchy" and review the acquisition patterns and corporate structure of the media industries (for instance http://en.wikipedia.org/wiki/Concent...edia_ownership and http://www.telegraph.co.uk/finance/n...All3Media.html) .

It is the same pattern as in the pharmaceutical industry
http://www.ehow.com/about_5558983_st...-industry.html

The steel industry, the oil industry, etcetera.

You might also find this of interest

PDF]



Media Ownership – Does It Matter?

Fewer owners have control over more newspapers and their circulation, and most of the media have been absorbed by large conglomerates, ‘families’ or chains.

In addition to ownership concentration of the mass media industry, content provision, packaging and distribution have also ‘become a standardised production and marketing process in which the messages communicated are constrained and directed in both quantity and quality to meet the economic imperatives of that process’ (Melody 1978: 219). What are the implications of this? The result is that what most people hear and see in the mass media is remarkably uniform in content and world-view (Neuman 1991: 130). Giddens goes even further when he calls for ‘the democratising of the democracy’. He criticises the untamed power of media owners:

The media have a double relation to democracy. (my boldfacing) On the one hand ...

the emergence of a global information society is a powerful democratising force. Yet, television, and the other media, tend to destroy the very public space of dialogue they open up, through relentless trivializing, and personalizing of political issues. Moreover, the growth of giant multinational media corporations means that unelected business tycoons can hold enormous power (Giddens 1999: np).

You might also wish to look more closely at Pierre Bourdieu http://en.wikipedia.org/wiki/Pierre_Bourdieu

Janice,

I've always been fond of Bourdieu. His argument that judgments of taste are acts of social positioning is something we see demonstrated all the time, both here and elsewhere. And I agree with him that sometimes those expressions constitute a form of symbolic violence. He's arguing against the "I am I, and you should believe as I do" argument, and he has my sympathies.

That said, he looks much different in the hexagon than he does here: http://fr.wikipedia.org/wiki/Pierre_... _symboliques . I'm afraid I'm missing the connection you wished to draw, and it makes me feel I'm not reading your words in good faith.

Back on the actual subject, I think you and I view web marketing differently. I'm a big believer in the long tail. It used to be that you'd go into a bookstore in Memphis or Minneapolis, and find the same few poetry books there. The big houses controlled the selection of authors, and the limited distribution chains made it easy for bookstores to just stock what was being offered. It was good for poets with connections to the big houses, but bad for everyone else.

Things are different now, small presses are blossoming all over, mainly because of the long tail. It's become economical to list thousands of titles, rather than just a few dozen. Do I miss bookstores? Of course. But I also remember a sincere young man, who had no money for books, who was limited to those very few things he could find in the local library. That young man today, armed with a cheap kindle, could get just about every classic book in the history of world literature for free, and books of contemporary poetry for not much more. There's something to be said for that, even if we wish a few of the details were treated differently.

So I think we're mostly in agreement. We both see small presses as a good thing. Some note the explosive growth of small presses over the last decade, others say they could grow even more if they were better treated. Who could argue with either point? ;)

Best,

Bill

I don't wish to quarrel with you, Bill, or attempt to persuade you to my way of thinking. I have no objection to electronic distribution per se, nor do I object to electronic reading devices per se. My objection (which I don't seem to be able to make clear), is that it is detrimental to diversity of thought and to democracy if one powerful organization controls authors and content, publishing, and distribution channels to the exclusion of independent bookstores and a multiplicity of publishers.

That is why antitrust laws originally came to be.

When information can be so easily erased or manipulated, I trust those who control it no more than I trust the tabloids or Fox News.

I've finished with this debate now.

Amazingly (or not!), I could have written Janice's last post word for word. Also large portions of her earlier posts on this thread. It may be that any differences we have had in the past were simply superficial misundertandings based on what I think are misleading (to me, at least) labels.

Thank you, Allen.

Yes indeed. We are going full circle back to the Victorian era, when the man who could get the most work out of the paupers for the least amount of food got the contract to run the workhouse.

I think you're suggesting how Amazon could screw customers.

Not how they are screwing them. Being freed from travel in $4/gal gas land and having a vastly wider selection of goods appears to be the opposite of screwing.

Clearly the ability of Amazon to gather in so much power is concerning--but their goal is to make money on sales, not anything else--Bezos wants to be the point of sale for the world.

You don't get that by screwing your customer.

Perhaps you imagine a world in which Amazon gains a total domination of the market and then cuts us off Soviet-Bread-Line-Style.

Hardly. The very existence of the internet (as it stands) makes such behavior impossible due to the ease of creating competition.

Just read this related article and thought I'd share.

Best,
Michael

"Bloated infrastructure"? Didn't we have enough downsizing in the 1990s? Jesus Christ! Sure, one could, I suppose, run an even leaner ship than the already understaffed publishers do already, but really, it's no way to live, and the disappearance of such jobs has been a contributing factor to this city starting to suck. It's a Tea Bag argument, really.

Precisely, Gail!

And actually, while I'm on it, Michael, the whole "anyone could compete" with Amazon really does fall flat when one realizes that the economy of scale still matters. The internet changes things to an extent, but late-capitalist political economy is largely what it was twenty years ago--except that the plutocrats have an even greater share of the wealth!

I know I said I was through with this debate but Post 18 is such an excellent example of the downdumbing of reasoning abilities that it should be addressed.

Firstly Mr. Palmer, in a previous post, challenges me to explain a statement which I have not made. Then he returns and tries to answer it for me. And in his argument he supports the very notions that I introduced in the thread i.e. the danger of consolidation of goods and/or services into the hands of monopolies (a situation in which one company controls an industry or is the only provider of a product or service) and oligarchies (a small group of people who together govern a nation or control an organization, often for their own purposes).

a) he suggests that such consolidation as Amazon represents frees him from the excessive fuel expense that driving to an independent bookstore entails.

ExxonMobil[ is one of the largest publicly traded companies by market capitalization in the world, having been ranked either No. 1 or No. 2 for the past 5 years, and is the second largest company in the world by market revenue. http://en.wikipedia.org/wiki/ExxonMobil

b) Quote: … Amazon ['s ] goal is to make money on sales, not anything else--Bezos wants to be the point of sale for the world, :)

c) Quote: Perhaps you imagine a world in which Amazon gains a total domination of the market and then cuts us off Soviet-Bread-Line-Style.

http://upload.wikimedia.org/wikipedi...ntMother02.jpg
http://en.wikipedia.org/wiki/File:Lange-MigrantMother02.jpg

The following post refers to TechniDirt. I'd like to also refer to it; today's post (April 18) http://www.techdirt.com/user/mmasnick which indicates the intention and ideal use of the Internet which most certainly speaks against the idea of one or some few actors controlling it.

In providing a system for manipulating this sort of information, the hope would be to allow a pool of information to develop which could grow and evolve with the organisation and the projects it describes. For this to be possible, the method of storage must not place its own restraints on the information. This is why a "web" of notes with links (like references) between them is far more useful than a fixed hierarchical system. When describing a complex system, many people resort to diagrams with circles and arrows. Circles and arrows leave one free to describe the interrelationships between things in a way that tables, for example, do not. The system we need is like a diagram of circles and arrows, where circles and arrows can stand for anything.

I'd like also to suggest some further reading picked after a quick search through my bookshelves (possibly available on Kindle): The Culture Industry by Theodor Adorno, Democracy and the Marketplace of Ideas by Erik Åsard and W. Lance Bennett, The Marketing of the President by Bruce I. Newman, Om Televisionen (English title On Television) by Pierre Bourdieu. None of these are new, but all are worth reading still.

I daresay this topic—control of the media and information industries—will become even more topical as the American presidential campaigns move out of first gear.

Anyone who doesn't have bubble wrap inside their skull ought certainly to see the reason to strive to control information content and availability.

Finally a quote about Adorno's book mentioned above:

…He argued that the culture industry commodified and standardized all art. In turn this suffocated individuality and destroyed critical thinking. At the time, Adorno was accused by his many detractors of everything from overreaction to deranged hysteria. In today's world, where even the least cynical of consumers is aware of the influence of the media, Adorno's work takes on a more immediate significance. The Culture Industry is an unrivalled indictment of the banality of mass culture.

Add to that the fearsome thought of having access only to trivial and/or brainwashing information, and worse, believing there to be nothing else.
I'll bet you a dollar to a stale doughnut that if you took a poll of the general public (or of the Tea Partygoers) and asked them the origins of the national motto "In God We Trust," most would vaguely believe it came with the constitution.

I happened to think of another book that might be of interest. Democracy and Its Critics by Robert A. Dahl. A polyarchy, which is a nation-state that has certain procedures that are necessary for following the democratic principle) http://en.wikipedia.org/wiki/Polyarchy ; among these conditions is that citizens have access to alternative sources of information that are not monopolized by the government or any other single group (p. 233 in chapter 17).

Ponder the idea of media control by a group such as the inane Tea Party or some anti-democratic religious sect.

Quincy--I said the article was interesting, not necessarily canon.

The interesting thing about Amazon is that it actually allows for more independent booksellers as it functions also as a printing press. There is a great resistance among the indie, small, and micro-presses (at least the ones with booths at AWP) to engage in ebook publishing (notably, however, Red Hen just came out with an ebook of Ernie's 60 Sonnets). This is to their peril.

I certainly believe Amazon could abuse their power to limit the availability of texts (see what Smashwords did recently regarding certain forms of erotica). This is on the same scale with what Google could do with the information they have on hand.

The problem, though, is that it's not in their corporate interest to abuse that power--not to the extent you imagine, Ms Soderling (if we're being formal). Certainly it is in their interest to reduce competition (that's what people do) but if they went from product distributors/information providers on the general populace end (and ad agency on the business end of Google) to product/information restrictors, their business would dry up overnight.

Perhaps it is possible for Amazon & Google to get too big for their britches and want to take over the world.

I doubt it, though.

Corporations aren't governments, even if they do their best to try to run governments.

Their interest CERTAINLY is in manipulating our behavior but to turn a profit, not to oppress us, advance an ideology (unless it's to make money), etc.

This seems to me to be relevant to this thread.

http://www.utne.com/mind-body/gay-mo...m_medium=email

In a situation where the presidental candidates are funded by big business and religious organizations, it is hard to believe that the funding doesn't come with an agenda.

If one of these groups is prone to censor the covers of magazines, what else would they desire to censor? What kind of legislation would they desire to overturn and replace?

Just asking.

Read this and watch this terrific video. Do it.

http://www.utne.com/The-Sweet-Pursui...eet-Books.aspx

Romney knows that he can't play up his Mormonism if he wants to be president. Too many conservatives think all Mormons are evil devil worshippers.

Honestly, reading the article is just sad. People are so ignorant. They remind me of the folks calling for George Zimmerman's blood--only these folks have gotten a chance to act on their idiotic beliefs. Violence is simply not the answer.

It hardly addresses the Amazon problem, though. Amazon isn't run by Mormons. Amazon's "ideals" are to make money, not participate in a theocracy.

Erm... Zimmerman shot a man (well, a teenager) armed with Skittles. If violence is indeed not the answer, tell that to the family of Trayvon Martin, who have insisted, not unreasonably, on the rule of law.

Where I found your recent posts... lacking, though, had to do with a lack of sense of how political economy works--perhaps in turn rooted in a generally benign notion of capitalism. Yes, Amazon deigns to allow independent booksellers to use its site, but one pays through the nose to do so. It's not terribly surprising in that regard, but the fact remains. Where the company itself is concerned, working conditions are often like this:

http://www.huffingtonpost.com/2011/0..._n_971851.html

And as for Amazon's "interest" in not screwing customers, did you ever drive a GM-produced vehicle from the 1970s? Sure, the Japanese and Germans made inroads in the American market due to the manifest $#ittiness of American cars specifically designed to become obselescent after a few years, as it wasn't as if independent auto producers stepped into the gap. No, to work the analogy, if Amazon slips, it'll be Barnes and Noble stepping in. Or something of that ilk.

The thing is, we approach the economy not just (or even primarily) as atomized consumers hunting for bargains, but also as (in general) employees. Sure, I don't like shelling out $20 for softcover books any more than the next guy--and in some cases (e.g. textbooks) the prices are artificially inflated by companies who know that students will pay because they, well, have to--but praising Amazon feels a bit like praising Walmart. I'm not entirely dewy-eyed about what they're replacing, but I do recognize the human cost of capital's tendency to accumulate.

The big assumption frequently made in these discussions is that the system somehow "works," that if the intrepid businessman can suss out what the consumer wants, all will be well... as if the manufacturing of demands weren't a major part of the process, not to mention that as the past several years have made painfully obvious, the interests of the shareholders and those of the consumers are frequently out of alignment. Beyond which, the rise of freelancing in white-collar work, even as industrial-sector unions continue their nosedive, has made work for literally millions of people a matter of constant hustling. Go into a cafe in Fort Greene or Clinton Hill or Park Slope or Williamsburg and look at the glowing screens of the laptops. It won't be Facebook beaming back at you, but, more often than not, this, that, or the other project. Yes, more things are being traded, the world has been "flattened" in that dolt Thomas Friedman's maladroit metaphor... and my generation--and yours, Michael... we're roughly the same age--works longer hours with less job security than our parents. It doesn't work, not for most of us.

If you remember the sixties, you know that back in the day, futurologists were extremely concerned about what we would do in coming decades with our vast accumulation of leisure time.

And look what happened...people working on laptops in cafes, as described by Quincy, and the 2-week vacation has been largely replaced by the "weekend getaway" (where you can bring your laptop).

At least if you're American. If you're French, you still get the whole month of August off every year.

God forbid we should become like the French.