British publishing is in trouble
Katharine Kerr June 14th, 2006
Last night I had an interesting dinner with my agent, Elizabeth. Among other things, we dicussed the difficulties I’ve been having with my British publisher, the “Voyager” line of HarperCollins UK. They are squeezing their authors with smaller advances and lower royalty rates, and they’re cutting production costs every which way they can.  The problems however go way beyond them. Some of these problems are often discussed: more forms of entertainment available, lower standards of literacy, and the like. Here are two more:
 One of these problems is unrealistic expectations on the part of the Corporate MoneyPeople who now own/dominate most publishers. To them, a risky investment like publishing should earn an 18% profit in return for the risks.   In a very good year, most publishers operate at a profit margin of around 7%. 5% is realistic. The “remedies” the corporate types propose are cutting into what sales there are, but can they see this? Of course not. They have MBA’s. They’re always right. This problem’s worse for Voyager than for some other lines. After all, HC is owned by Rupert Murdoch, the man who reduced the London TIMES to a tabloid. Literally.
The corporate practice of deep discounts to chains, which was introduced late in the UK, is also having a bad effect on the profit and loss sheets. We could have told them. They wouldn’t have listened.
 The second: import laws under the European Union are destroying the old distinction between first American and first UK exclusive rights. Any EU country can import books from America, then ship them to Britain without restriction. Even with the shipping costs, American books cost less in the UK than British ones. Last year, or so Elizabeth told me, 50 million pounds’ worth of US books were sold in the UK — most of which should never have been sold there. That’s money pounds, not weight, btw.
One proposed solution is, of course, for authors to sell world rights to a single publisher, leaving us with less bargaining power (as if we had much to begin with) and a reduced income. Doubtless this sounds like a great solution to the Murdochian minions and their ilk.
Can British publishing be saved? Not on the large scale, is my take on this. Small houses will muddle through, as they’re doing here in the States. Look for big corporations to either expand their publishing lines to the US, as Hachette is doing, or to divest themselves of their publishing interests.
The obvious solution is to sell to the New York market first. Granted, the streets ain’t paved with gold, but the advances _are_ better and plenty of British authors do very well here.
Publishing is, and always has been, something done for love more than money. It’s easy to go down to the bank and open a money market or CD and get better than 5% return on your investment. Most business shut their doors for anything less than 7%. It is true that multi-national corporations require increased profits year after year, and the only way to achieve them is to cut cut cut. With the slip in readers both in the U.S. and the U.K., these uber companies have a tough time bringing in profits that their shareholders consider acceptable, and as you note, the publishing world is suffering.
New York pays better? Not to me! Both my British publishers have been more generous than the NY one!
I hate to rehash all the ebook hype from the early 90s. I didn’t buy into the hype back then but I do know. We’re already seeing a growing number of readers connect directly to their audiences online. That relationship is only going to get more and more involved over time.
I can’t wait until I’m buying my fiction electronicaly. I’m just waiting for an electronic paper product that isn’t crippled by drm. And I’m only buying non-drmed files that are reasonably priced (25$USD for a crippled text file- who are they kidding) but I don’t doubt that I’ll have lots of excellent choices.
I have to agree with Jose.
I am a reader from germany, reading mostly german translations (to Katherine & Kate: loved your books as far as I could grab them in german…) but the price for a crippled DRM-file at 16 Euros, while the hardcover comes at 19 Euros is just… laughable. I doubt ebooks will really start over, not until someone comes with reasonable usability and pricing.
Oh, and not to forget some decent hardware!! An ebook-reader worth calling it a “reader”.
btw: From what I heard the situation regarding fantasy isn’t any better over here. Maybe even worse. Don’t let me start ranting what the companies put into HC (if they ever do) and what they release as paperbacks or TPBs only. (And I hate the later!)
I love the idea of ebooks but honestly I want ones that mimic the experience of the book, such as the epaper I read about some years ago which is reprogrammable.
However, I think many people are adjusting to reading on a single screen, so the dinosaurs, like myself, may just become obsolete in terms of our reading technology preferences. I don’t know. One thing I continue to like about paper books is that, beyond sunlight, I need no other power source to read it.
TeichDragon - thanks!
Actually I doubt ebooks will ever replace “real books”. Well, at least not for me. I am dinosaur!
You just cannot the feeling when you have a real book in your hand. If (and I am saying IF) I ever buy ebooks, those will be texts I already own as “real” books. (Or maybe some stuff I am really sure I would never buy as a book, but want to take a look at the text anyway….)
@Kate: There are actually some prototypes on the way, which look really promising. And the charm of having 50 “books” with you, while flying to spain for vacation, and NOT having to carry 3 bags or so, is something I would really like. If I can find the links to those hardware-readers, I’ll post them later. Oh, and “De Nada :)”
Hello, Kit! It has been many years since we last connected; I hope you and Howard are doing well. Sorry to hear about your problems with the British publisher — I remember when they treated you like the Queen you are! Publishing does seem to be undergoing a complete transformation; I don’t know what the outcome will be — personally my own experience with e-publishing was lukewarm, but it may improve. I believe the future of publishing lies in Print-on-Demand; right now there is a lot of resistance to it, because of companies like X-Libris where there is literally no editing or filtering of poor writing. But refinements are happening, and I believe it is with POD printing that publishing will finally go global. I’ve done it both ways, and that’s my take…for the future, at least!
I think Print on Demand will work when people can buy a home paperback binder for the same cost they’d buy a bread machine, with the same size and so forth, and have the happy little thing spit out paperbacks that you can take to the beach or forget on the bus and not worry about.
I enjoy my iPod, but I’m not going to take it anywhere where I have to worry about it getting lost, stolen, or eaten by someone else’s dog or toddler. It’s too valuable for that level of convenience.
Other Print on Demand options will be things like bookbinderies replacing bookstores, allowing people to get uniform sets of their favorite books in the type styles they like and the bindings they choose. Long ago, people would have their personal libraries bound to match their decor. I’d see a return of that, and I think that’s actually a good thing, especially given the general crappiness of paperbacks. The bookstore might not have the book the second you want it, but more people would be happy to pick it up later the same way they pick up their drycleaning. And like photo shops, there would be a premium service where people could do “one hour bindery” and would, if they were in a rush, call ahead so the book is ready when they get there.
As for the distribution troubles with books, I think simultaneous publication is the way to go. After that it’s simply a question of price and consumer preference for various binding styles. When my cousin came over from Germany with the British edition of the new Harry Potter, I traded her my American edition, even though it was prettier, because I wanted the British text. The British cover is also better, though the American binding and typography is superior.
With the cost of paper, I would tend to guess that POD - or a handy bread machine that spits out paperbacks (a nifty idea) - is less likely to replace the current system than these epaper books.
I am traveling now, and overloaded, as always, with books. If I could take one epaper book with 25 bookchips, or however the technology ends up working, my luggage situation would be much better.
In the same way, I can now fly with an iPod instead of CDs and a CD player - much less bulky.
Otoh, who knows how long the kind of plan travel we currently take for granted will be around given the future of oil . . .
The trouble with e-books is price, as several people have commented above. The readers cost a lot of money up front, from $250-300 for the ones I’ve seen. Then you have to pay for the books, too! And batteries, or the charger, and the electricity . . .
Buy a paper book, and you can read it for free in the sunlight, if you can’t afford a lamp.
Only the most techy of techies are going to read e-books until the readers are given away free with X many book purchases. The convenience does not outweigh being ripped off, for most people anyway.
My British advances are larger than my American ones, too, btw. Still. The Americans are getting just as stingy, is the problem.
The other thing you have to remember is that ebooks, especially searchable ones, are considered a necessity of the current generation for certain purposes. Notably gaming.
All of the new Dungeons & Dragons books, as quick as they come out, are shortly thereafter rendered into PDFs by some fan, sometimes even in fancy indexed searchable versions, popped up onto a search engines, and downloaded by gamers everywhere. What’s not wrong with this scenario is that the vast majority of the gamers who download these already have the books in question. They use the PDFs on their laptops for quick search functions or for portability. Rather than lug some obscure minor book to game on the off chance you use it, have it on your laptop and pull it up if it’s needed.
What publishers need to do is sell print books with e-copies already attached, without ugly and inconvenient DRM to make the publisher’s copy less useful than a pirate version.
There’d be an easy way to do this too–bookmarks. The content of a book could easily be saved on something equivalent to a credit-card strip or chip. The bookmark is the tangible sellable ebook. Include one free with each paper copy, or sell them by themselves at a cheaper price for those who aren’t buying the bound copy. Have deluxe ones that also include the audio tracks.
Once you have your spiffy ebook reader that actually works better than the old Rocketbook I’ve got sitting next to my desk here, all you’d need to do is slip the bookmark into a slot on the back to go ahead and read that book.
We can scream all day about “But people aren’t supposed to do that!” but it doesn’t change the fact that they do that because it’s more convenient than whatever silliness the publishers are currently doing. Make it more convenient for the consumer to use the legitimate channels and no one will go to the trouble of finding workarounds.
Deborah, hello! Good to see your phosphors here!
The trend that worries me most is MacMillans ‘we rely on you not finding other contracts, so we offer you a bum deal and hope you’ll jump on it’ 20% royalties, no advance model.
And yes, it’s hard to break in, without having to worry about what you’ll do when you get to it.
But re: the Times, there’s only one paper left - the Daily Telegraph - that hasn’t changed to a smaller format. The Independent and Times have gone tabloid (*so* much easier to read) while the Guardian has gone ‘Berliner’ (a smaller broadsheet size). In recent years, the quality of the times editorials has picked up again, and the Indy is going from strength to strength.
I haven’t heard about Macmillan’s new contract. Ugh.
I really prefer the smaller sized newspapers.
Maybe the future of publishing will end up like the way http://www.lulu.com is setup.
For a small time writer, write a few sample chapters in various forums, but also have some third party publishing company that prints the whole book, but lets you keep the rights and 80% of the profits.
Maybe the authors could comment on what they think about it - because it may be the next generation’s future as an author.
Admits to reading The Times much more often now that its tabloid sized….but even I am now starting to think “PLEASE BE MORE OBJECTIVE in your reporting - and that comes from an ex daily mail reader ;).
Back to the topic in hand, I can see how the smaller publishing houses may need more to make more returns, but with risks being smaller for the large publishers, that seems like a fair bit.
By the way, for those that may not know, there is a survere flaw in basing decisions upon the Return on the Investment percentage.
If all their other businesses, make a 25% return on Investment, and they invest in one that makes only 10%…then that lowers their overall return on investment percentage, and that looks bad for their department. Whereas when you look at money coming in, the investment may be totally sound.
Just out of curiosity, are book sales pretty static year in year out? Or have they been gradually decreasing over the years? From what I can see, the whole arts industry is trying hard to keep its head above the water. Thing is though, the other mass media productions have different strategies to explore.
Music companies can and do sell a lesser quality CD for a much lower price. if you put a super cheap mass market legitimate CD on one of the best music systems in the country there is a marked difference between the cheap CD(£5-7) and the one that costs more (£10-15). On most systems though, that difference is not noticeable. (Which is probably why Super Audio CD’s although much more superior to normal CD’s never took off).
Movie companies rehash movies again and again - say 10 year anniversaries to make money. Or when the format changes, transfer the movie to that new format.
eg VHS—>DVD—->Blue Ray/the other one whatever its called !
Book publishers though have no “strategy” to prolong the sales life…..and the Hardback copies are too expensive to keep in production, even though I think those make the most money. Except maybe if they hook into the leather bound specially made copies - which generate huge profits I imagine….but very difficult and costly to produce (and not certain of sales either).
I work in a small UK based self-publishing company and in a single years experience of the industry from this side I would say POD hasn’t got a hope of being there for anyone that wants to sell a lot of books. The unit cost of each book is very high meaning the retail price to allow for a third party seller discount is again far too pricey.
Fag packet maths ahoy: The binding cost for a 200 page perfect bound on lulu books is about $8.54 (about £4.50). The average retail price for UK book of that size is 4.99-5.99. So you either make next to nothing on each sale or you put the retail price up (bare in mind postage on top of this already discourages sales, amazon gets a discount of 35-60% that enables cheaper postage). You’ve also got to make back the money for editing/typesetting and cover design unless you did it yourself and even then that is your time that is worth money.
In my opinion POD is fine for a labour of love like a family history but is not viable for an author wanting to go full time. Even then the cost of digitally producing 100 copies isn’t as expensive per unit and the finish is less distinguishable from other books on the shop shelves. A 1000 copy litho run is cheaper and better again. I think most people if they work hard can break even with a decently edited book, sel-published book they just might not recuperate the time they put into selling those copies.
Untill the high street is actually dead (and even then amazon requires a discount to make selling worth their while) or we have our own desktop printing and binding machines POD will not be a viable means to the market.
Self-published authors can and do make it but you have to have the ready funds, the guts, the time and the determination to do it. Most of what we publish often aren’t meant to make the author the next Dan Brown or Rowling. They just want to see their book in print and know that people can buy it should they wish.
On the other hand some of our authors spend every weekend doing signings, talks, marketing pushes and have sold lots of books. A few have gotten mainstream deals out of it, a few have turned down those offers just because they enjoy the level of control and involvement they have in their book.