The book war the authors already lost...

[fjtorres]

A short, snarky history of Manhattan corporate publishing...
http://www.theweeklings.com/jefishma...-already-lost/

In 1986 that now-famous German publishing conglomerate Bertelsmann—of whom, I guarantee, not a soul in America had ever heard before 1986—purchased venerable old publisher Doubleday for nearly half a billion dollars. With that kind of loot kicking around the Nelson Doubleday household, our cultural defenders forgot to contemplate whether this acquisition was good for American letters. Maybe it helped knowing that Bertelsmann had begun life as that most unthreatening of all entities: a Bible publisher.

Anyway, once again, no one asked authors—you know, those originators of the content that makes the book business the book business—what they thought. The only option authors had was to go on writing books and hope it all worked out.

If someone had bothered to ask, maybe an author or two would have scratched his or her head and wondered whether Bertelsmann really needed to make the dramatic changes to the Doubleday business model that it soon implemented.

Before its acquisition Doubleday was a vertically integrated company. They owned printing plants and bookstores and even their own book clubs.

It’s funny to hear industry experts today suggest that the way to defeat Amazon—presuming Amazon needs defeating at all—is for publishers to sell direct to consumers, rather than rely on so-called trade channels of distribution (the now shrinking bookstores) and other brick-and-mortar retail outlets. The reason it’s funny is that when the Germans started shuffling paper at Doubleday, they wanted badly to turn a fresh page. In short, they decided that vertical integration was a dumb idea.

Lots more snark at the source.

[BearMountainBooks]

Interesting. I never knew that Doubleday had printers and sold direct. History may start repeating itself...

[fjtorres]

Originally Posted by BearMountainBooks

Interesting. I never knew that Doubleday had printers and sold direct. History may start repeating itself...

Doubleday book clubs ruled!
Their SF book club provided a solid education into the genre through their monthly newsletters (I collected them for decades, until... something... changed).
Some of their book club editions are legendary (Their ERB Barsoom series, their two volume Treasury of Great SF...).

Mystery book club, Literary Guild...
Once upon a time, a NYC publisher actually *knew* what readers wanted to read and provided it. They had a brand readers trusted.
The trust evaporated fairly quick, though...

Beancounters can poison any relationship.

And since the beancounters are still in charge and will be in charge for the foreseeable future, that is one bit of history that won't be repeating any time soon.

[jersysman]

Ahhhh...

The memories of being a member of the Mystery Book Club.

Those three-in-one books were my source of books back in the day.

[fjtorres]

Originally Posted by jersysman

Ahhhh...

The memories of being a member of the Mystery Book Club.

Those three-in-one books were my source of books back in the day.

We were a bunch of bookworms at our college apt. Well, three of the four.
I had the SFBC, another had the Mystery club, and the third the literary guild. We loved the omnibus editions; paperback prices for hardcovers. And of, course, there were the much desired signup bounties: 2-3 books for getting a friend to join.

We actually played by the letter and spirit of the terms but a lot of our acquaintances merely honored the letter: sign up, get intro bundle, buy 4 cheap titles, cancel. Rinse and repeat every quarter with a different name.

Worked beautifully until Bertelsmann turned them into a dumping ground for leftovers and switched to retail hardcover pricing. Pretty much the same way Mercedes ran Chrysler into the ground.

[calvin-c]

Originally Posted by fjtorres

Beancounters can poison any relationship.

And since the beancounters are still in charge and will be in charge for the foreseeable future, that is one bit of history that won't be repeating any time soon.

A lack of 'beancounters' has closed more businesses than giving too much power to beancounters ever has. I'm not sure that's true if you weigh them according to the size of the business but it's definitely true of small businesses. Business is profit-driven. Even businesses that run charities are profit-driven. (The charities might not be but the businesses behind them definitely are-that's why so little of 'charitable' contributions ever makes it to the recipients of the charity.)

Beancounters do make mistakes, of course. One is deciding that demand is inelastic so reducing quality won't reduce sales. Sometimes that's true, more often it opens an opportunity for others. In the case of book publishing there's plenty of opportunity but few people taking advantage of it. Mostly that's because without beancounters balancing their costs vs revenue they end up going broke. Beancounters are expensive-but a lack of beancounters is deadly.

[rollei]

It’s funny to hear industry experts today suggest that the way to defeat Amazon—presuming Amazon needs defeating at all—is for publishers to sell direct to consumers, rather than rely on so-called trade channels of distribution (the now shrinking bookstores) and other brick-and-mortar retail outlets.

Books can be purchased online directly from Simon & Schuster, Random House etc

[fjtorres]

US book publishing in the 60's and 70's was a forrest of small and medium firms focused mostly on, duh, books. Some were profitable, some muddled along, some folded...pretty much as normal in any varied competitive market. BERTELSMANN didn't drop a half billion in 80's money Doubleday because Doubleday was sinking. It was a prosperous company with a valuable brand and customer base. So were Bantam, ACE, Pyramid and most of the other pre-invasion publishers. And there were thousands of bookstores doing fine even after the emergence of the mall chains.
In pursuit of "synergies" and "efficiency" the corporate beancounters consolidated that healthy competitive environment into a fossilized oligopoly utterly dependent on a handful of channels to shovel out product. They outsourced all the core functions that used to distinguish their precursors. First level content evaluation? Outsourced to agents. Printing? Outsourced to China? Distribution? Outsourced to Ingram, Baker&Taylor, Barnes&Noble, Amazon...
Editing? Downized and contracted out.

All they have left inhouse is dealmaking and financial services.
They have more in common with the Wall Street moneychangers than the book people that founded and built up the imprints they've devalued to nothing. Except the Wall Street gang wouldn't be caught dead on the same side of the street. They at least know how to run a scam without telling the feds it's coming.

Here's a video to check out:

http://www.youtube.com/watch?v=LGds6GdM7C8

The introduction of the new, unified Randy Penguin Logo.
Notice all the independent publishers they ate up and compare the sea of lost quirky logos, representative of each brand's personality, all now replaced by... utter blandness...

The war was lost long ago. We're just now entering the body count phase...

Oh, here we go, another case of previously undiscovered synergy:
http://www.thebookseller.com/news/ha...les-teams.html

Hachette UK is to create a new sales structure, merging the teams of Little, Brown and Orion, and Hodder & Stoughton, Headline, Hachette Children’s Books and Quercus.
The restructure means Dallas Manderson, sales director at Orion, will leave the company to “pursue other interests”, while Jane Harris, executive director sales and marketing at Quercus, will also leave. Hachette said a “small number of roles in sales are now at risk of redundancy”, as a result of the sales team mergers.

What the heck, books is books. You don't need five teams for five imprints...

More consolidations to come, they're too far gone to stop now...

[ballfresno]

Originally Posted by fjtorres

Doubleday book clubs ruled!
Their SF book club provided a solid education into the genre through their monthly newsletters (I collected them for decades, until... something... changed).
Some of their book club editions are legendary (Their ERB Barsoom series, their two volume Treasury of Great SF...).

Indeed! I still have most of my SFBC books and I don't think there was a month that I didn't buy at least two or three books.

[Fbone]

Some book clubs developed a bad reputation when they "lost" the announcement postcard and then sent you the monthly book you didn't want.

[fjtorres]

Originally Posted by Fbone

Some book clubs developed a bad reputation when they "lost" the announcement postcard and then sent you the monthly book you didn't want.

Yeah. I heard a lot of that in the 90's.
The science-focused Book club, which switched "partners" twice while I was signed up, did it to me three times. I sent the books right back unopened and quit after the third time. By then they had also picked up the nasty habit of making expensive (and mostly useless) textbooks their monthly selection and all three times it was textbooks they shipped out.

By contrast, I never had either problem with SFBC.

[RHWright]

Originally Posted by calvin-c

A lack of 'beancounters' has closed more businesses than giving too much power to beancounters ever has. I'm not sure that's true if you weigh them according to the size of the business but it's definitely true of small businesses. Business is profit-driven. Even businesses that run charities are profit-driven. (The charities might not be but the businesses behind them definitely are-that's why so little of 'charitable' contributions ever makes it to the recipients of the charity.)

This may just be semantics, but I think there is a difference between "bean-counters" and "knowledgeable staff who keep a business financially sound."

Bean-counters are the ones that say, for example, "We could be more profitable if we outsource editing." Without regard to the quality of the product. Not that editing can't be done in-house and still make a profit*, but more profit is better right? Quality be damned!

*Full disclosure: I have no knowledge of the economics of in-house vs. outsourced editing, I'm just using it as a hypothetical example of quality being a largely dismissed factor in the bean-counter mentality.

To a certain extent, some bean-counterism is needed in large organizations due to scaling issues. A mom 'n' pop burger stand that cuts back from 2 to 1 pickle (costing .01*) on a burger, selling 10000 burgers a year, would shave $100 off their costs. McDonald's,selling 23,652,000,000 hamburgers per year, would save $236,520,000. Even with profits of ~$5B, that's still 4% on just one little thing.

*Another theoretical for example. I have no idea about actual food costs, and I am sure they are different for single-unit and multi-unit organizations.

Big businesses need to look for ways to save on little things, because the impact scales up to considerable costs.

Small businesses have more wiggle room, it seems, as long as their overall financials are good. They need someone good to keep an eye on costs to keep them profitable, but you see a lot less bean-counting and more passion about quality.

Every big business I've ever seen will accept lower quality (if it does not significantly impact sales) if it means increased profits. Not the difference between being profitable or not, just the pursuit of maximum profits.

But I'm one of those wackos who sees an important distinction between achieving a reasonable profit as part of overall business goals and pursuing maximum profits as the primary focus.

[John A. A. Logan]

Originally Posted by RHWright

This may just be semantics, but I think there is a difference between "bean-counters" and "knowledgeable staff who keep a business financially sound."

Bean-counters are the ones that say, for example, "We could be more profitable if we outsource editing." Without regard to the quality of the product. Not that editing can't be done in-house and still make a profit*, but more profit is better right? Quality be damned!

*Full disclosure: I have no knowledge of the economics of in-house vs. outsourced editing, I'm just using it as a hypothetical example of quality being a largely dismissed factor in the bean-counter mentality.

To a certain extent, some bean-counterism is needed in large organizations due to scaling issues. A mom 'n' pop burger stand that cuts back from 2 to 1 pickle (costing .01*) on a burger, selling 10000 burgers a year, would shave $100 off their costs. McDonald's,selling 23,652,000,000 hamburgers per year, would save $236,520,000. Even with profits of ~$5B, that's still 4% on just one little thing.

*Another theoretical for example. I have no idea about actual food costs, and I am sure they are different for single-unit and multi-unit organizations.

Big businesses need to look for ways to save on little things, because the impact scales up to considerable costs.

Small businesses have more wiggle room, it seems, as long as their overall financials are good. They need someone good to keep an eye on costs to keep them profitable, but you see a lot less bean-counting and more passion about quality.

Every big business I've ever seen will accept lower quality (if it does not significantly impact sales) if it means increased profits. Not the difference between being profitable or not, just the pursuit of maximum profits.

But I'm one of those wackos who sees an important distinction between achieving a reasonable profit as part of overall business goals and pursuing maximum profits as the primary focus.

Yes, to paraphrase Robert Pirsig, it's that focus on Quality that makes the difference.

Maybe "beancounter" isn't quite the term for those who are seeking to wring a business dry, maximise short-term profit, and then disappear into the horizon with full personal pockets when the short-termism finally busts the business as a whole...

So, perhaps the intentions of the "beancounter" are crucial - whether a genuine intent to look after the business long-term, sustainably...(which would entail looking after authors/readers in the publishing business)....or just an attempt to mine a decade or two of unsustainable profit from a business that will then predictably flounder.

A bit like modern politicians, who are too afraid to think long-term, and plan policy correspendingly...because their eye is on the short-term profits that come through re-election...

And then, as with banking when Quality was thrown out the window...there is the problem of Quantum Beans...(derivatives etc)...Beans which are spoken of as Real, but which do not exist as such...

Magic Beans, like those Jack sold his cow for, and grew a Beanstalk from...are probably more "real" than these Quantum Beans...

I think politics/banking/publishing...and all in the same sort of 30 year time frame...could be shown (by anyone interested in taking up the project!)...to have floundered on the same Rocks of short-term thinking/aborting of Quality to chase quick unsustainable profit - and worship of some invisible Quantum Bean only the "initiated" can see.

[fjtorres]

Originally Posted by RHWright

Every big business I've ever seen will accept lower quality (if it does not significantly impact sales) if it means increased profits. Not the difference between being profitable or not, just the pursuit of maximum profits.

In many cases they'll keep right on cutting costs until the product becomes unusable or unsafe. Plenty of examples from the auto world at Ford, Toyota, GM...

What happens is that as companies get bigger and bigger and people's jobs get more specialized within the organization, their information horizon gets tighter and tighter. Eventually it gets to the point all they see or care about is what happens in their cubicle. They find a way to save a half of a percent on the cost of their piece of the business and flip it over the wall with nary a thought on how it impacts the rest of the business or the customers.

There is an old story from the late 80's when Microsoft was co-developing OS/2 1.0 with IBM about how they kept getting code modification orders from IBM to keep taking things out or putting odd things in. As IBM was the senior partner in the project, that meant rigorously analyzing each request and doing a full official response on things like: "product improvement - remove downloadable font engine. Justification: cost savings. Feature unnecessary for line printer use."

The Microsofties got enough of those they ended up renegotiating with IBM to develop OS/2 1.0 and 2.0 more or less in parallel, with 1.0 built to IBM spec and 2.0 to MS spec. Of course, 1.0 was totally useless in a PC world that had just seen the Mac and was rushing into desktop publishing but at least 2.0 was in the pipeline. (And Windows 3--MS couldn't afford to bet tge farm on OS/2.)

It wasn't that the IBMers were incompetent, but rather they were competent in the wrong area. From their point of view--the world of mainframes--GUIs and multiple printer fonts were a waste of time and money and ripe for cutting out. From the PC point of view, those features were enablers for an entirely new market to sell PCs into.

As the original article says, the multinational media companies saw no value in vertical integration either in printing--book club exclusive editions be damned--or in retailing, no matter that decades of investment in the Doubleday brand was tossed in the dumpster. From where they were coming from, those things were a waste of time and money when they could get other people to do them for them. It did wonders for the next quarterly report back to Germany. Bonuses all around.

From the point of view of readers, it severed any direct connection to Doubleday the publisher and made them indistinguishable from any other publisher. Worse, what readers saw was a big price hike. Those people were simply competent at the wrong thing at the wrong time. Once their bright idea played out the company had lost much of its value to consumers.

It has happened before and it will happen again; megacorps never learn.

[calvin-c]

Originally Posted by fjtorres

What happens is that as companies get bigger and bigger and people's jobs get more specialized within the organization, their information horizon gets tighter and tighter. Eventually it gets to the point all they see or care about is what happens in their cubicle. They find a way to save a half of a percent on the cost of their piece of the business and flip it over the wall with nary a thought on how it impacts the rest of the business or the customers.
[...]
It has happened before and it will happen again; megacorps never learn.

First, beancounters are, IMO, managers in charge of budgets. Either they prepare budgets or they audit people to ensure they stick to them. Most are accountants but many are MBA's. Some are both.

FJTorres is right about most employees in major organizations-but one of the advantages a 'beancounter' has is a broader view. Not that they can't get narrowly focused & the worst is lack of focus on customers. But most beancounters, because they're dealing with budgets, deal with broader aspects of the organization. (This is particularly true of those who prepare the budgets. An auditor may audit only R&D, for example, but the person preparing the R&D budget needs to see how that budget fits into the total budget for the organization.)

If the beancounter doesn't understand how the work of those he's auditing (or whose budget he's preparing) affects the organization, that's when he fails. (Or she. Intending to generalize, not be sexist.) And when the beancounters fail that's when the organization usually fails.