Slothful Publishers?

[DiapDealer]

Suffice to say that, if accurate, I don't see Hachette's reported numbers as being indicative of trends in tradpub as a whole. If things are "fine and dandy," why the mergers, the downsizing, the outsourcing of editing, the quicker axing of bubble midlisters? That's a changing industry. Yet they still insist on placing the vast majority of their money-making eggs in yesteryear's business-model basket. I don't see it lasting. *shrug*

[HarryT]

There seems to be a popular misconception that the traditional publishing industry is in big trouble. Their financial results tell a rather different story, and are public information. "Reports of their death have been greatly exaggerated", to misquote someone.

[fjtorres]

Originally Posted by HarryT

Picking an example at random of one of the "Big 5", these are Hachette's revenue figures for the last 5 years:

2011: 2038 (millions of Euro)
2012: 2077
2013: 2066
2014: 2004
2015: 2206

(Source)

Those don't look like the figures of a business that needs to change. Revenue is stable and, indeed, increased by 10% in the last year. Large companies tend to be risk-averse. Their current business model is clearly working well for them at the moment.

I should add, by the way, that I'm in no way disagreeing with you. Just saying that it's understandable why they should see no need to change a way of doing business that's working well for them.

Careful with those last numbers: the euro decline vs the dollar over the last two years has turned US sales net dollar drops into net euro gains.

Plus a lot of those year to year "gains" are the result of mergers where the post merger result is lower than sum of the pieces pre-merger. (But it reduces costs by putting people out of work--sending them to freelance for Indie, inc.)
Plus the BPHs are putting out less Mass Market paperbacks and doing more trade paperback releases at higher prices; they sell less books but beef up their sales reports a lot and their profits just a bit.

A lot of those "gains" are really trading long term market share (and author income) for short term reportable "boosts".

Accounting games aren't limited to Hollywood.

The BPHs' business has been stagnant-to-declining all century long *despite* the mergers, staff reductions, declining advances, price hikes, windowing, author squeezes, vanity publishing plays, and format changes.

http://the-digital-reader.com/wp-con.../06/5Wide1.gif

http://the-digital-reader.com/2014/0...ustry-numbers/

And the funny part is they *aren't* actually trying to beef up a real cash cow (that's why you had the term in quotes, right?) since pbook net margins are about half the net of even "too cheap" $9.99 ebooks. The Agency price hikes in 2010 actually reduced their profits.

Watching sausage get made is rarely pretty but in this case it is amusing to see the obfuscation games they come up with. They are anything but slothful.

Reminds me of the Wizard of Oz (movie).

[DiapDealer]

Originally Posted by HarryT

There seems to be a popular misconception that the traditional publishing industry is in big trouble. Their financial results tell a rather different story, and are public information. "Reports of their death have been greatly exaggerated", to misquote someone.

I don't believe they're dying either. I'm just not drinking the "everything is hunky dory--we don't have to change" kool aid.

I think they're unwisely banking on "toughing out" what they see as a temporarily rocky trail, when investing in some good hiking boots would actually benefit them more in the long run.

[fjtorres]

Originally Posted by DiapDealer

I don't believe they're dying either. I'm just not drinking the "everything is hunky dory--we don't have to change" kool aid.

I think they're unwisely banking on "toughing out" what they see as a temporarily rocky trail, when investing in some good hiking boots would actually benefit them more in the long run.

Exactly.
They are acting as if their livelihood depended solely on dead treepulp instead of the IP they control. And in the process they are reducing their access to both new IP and the consumers of that IP.

As I said: self-defeating.

[pwalker8]

Originally Posted by fjtorres

Careful with those last numbers: the euro decline vs the dollar over the last two years has turned US sales net dollar drops into net euro gains.

Plus a lot of those year to year "gains" are the result of mergers where the post merger result is lower than sum of the pieces pre-merger. (But it reduces costs by putting people out of work--sending them to freelance for Indie, inc.)
Plus the BPHs are putting out less Mass Market paperbacks and doing more trade paperback releases at higher prices; they sell less books but beef up their sales reports a lot and their profits just a bit.

A lot of those "gains" are really trading long term market share (and author income) for short term reportable "boosts".

Accounting games aren't limited to Hollywood.

The BPHs' business has been stagnant-to-declining all century long *despite* the mergers, staff reductions, declining advances, price hikes, windowing, author squeezes, vanity publishing plays, and format changes.

http://the-digital-reader.com/wp-con.../06/5Wide1.gif

http://the-digital-reader.com/2014/0...ustry-numbers/

And the funny part is they *aren't* actually trying to beef up a real cash cow (that's why you had the term in quotes, right?) since pbook net margins are about half the net of even "too cheap" $9.99 ebooks. The Agency price hikes in 2010 actually reduced their profits.

Watching sausage get made is rarely pretty but in this case it is amusing to see the obfuscation games they come up with. They are anything but slothful.

Reminds me of the Wizard of Oz (movie).

Let's just say that I'm more willing to believe numbers where someone will wind up in jail if they are intentionally misleading over numbers that are based on someone's best guess estimate and wishful thinking.

There are a lot of different things going on in the publishing world. Rather obviously they are not reducing people's access to ebooks. The ebooks are out there, the question is how fast backlist books come out (not nearly fast enough for me) and how much the ebooks cost. Over time, prices are set by the market.

[meeera]

Originally Posted by HarryT

What's the incentive to change a successful business model, though? The profits of the Big-5 (or however many it is now) publishers are good. Why take the risk of changing what works?

Because you don't want to be seem as a discriminatory business? Because you don't want a lawsuit? Because it's good business to sell to customers what the customers want to pay for?

[meeera]

Originally Posted by HarryT

Picking an example at random of one of the "Big 5", these are Hachette's revenue figures for the last 5 years:

2011: 2038 (millions of Euro)
2012: 2077
2013: 2066
2014: 2004
2015: 2206

(Source)

Those don't look like the figures of a business that needs to change. Revenue is stable and, indeed, increased by 10% in the last year. Large companies tend to be risk-averse. Their current business model is clearly working well for them at the moment.

I should add, by the way, that I'm in no way disagreeing with you. Just saying that it's understandable why they should see no need to change a way of doing business that's working well for them.

Do you have the stats on how many of Hachette's hback/ebook releases are windowed?

[HarryT]

Originally Posted by meeera

Do you have the stats on how many of Hachette's hback/ebook releases are windowed?

I'm afraid not.

[HarryT]

Originally Posted by meeera

Because you don't want to be seem as a discriminatory business? Because you don't want a lawsuit? Because it's good business to sell to customers what the customers want to pay for?

It's really stretching it to claim that selling hardbacks is "discriminatory" because they're heavier than paperbacks. By that argument, you could sue a publisher who published a long book, because it's heavier than a shorter book. I have some monstrously heavy "coffee-table" type art books that I wouldn't want to hold. I prop them up on my lap, or on a table.

[Nate the great]

Originally Posted by HarryT

Picking an example at random of one of the "Big 5", these are Hachette's revenue figures for the last 5 years:

2011: 2038 (millions of Euro)
2012: 2077
2013: 2066
2014: 2004
2015: 2206

(Source)

Those don't look like the figures of a business that needs to change. Revenue is stable and, indeed, increased by 10% in the last year. Large companies tend to be risk-averse. Their current business model is clearly working well for them at the moment.

I should add, by the way, that I'm in no way disagreeing with you. Just saying that it's understandable why they should see no need to change a way of doing business that's working well for them.

Revenue is only stable because they have been buying other publishers.

Their market share is shrinking, and they're not signing as ,amy new midlist publishers as they used to.

[meeera]

Originally Posted by HarryT

It's really stretching it to claim that selling hardbacks is "discriminatory" because they're heavier than paperbacks. By that argument, you could sue a publisher who published a long book, because it's heavier than a shorter book. I have some monstrously heavy "coffee-table" type art books that I wouldn't want to hold. I prop them up on my lap, or on a table.

I wasn't talking about hardback/paperback windowing, I was talking about hardback/ebook windowing.

[HarryT]

Originally Posted by meeera

I wasn't talking about hardback/paperback windowing, I was talking about hardback/ebook windowing.

Do you think that's common these days? Pretty much all the books I take note of seem to have simultaneous hardback and ebook releases.

[meeera]

Originally Posted by HarryT

Do you think that's common these days? Pretty much all the books I take note of seem to have simultaneous hardback and ebook releases.

It happens, but not very often (in the books I read at least), which is why I wondered why you were putting effort into defending it as the traditional and profitable option. " Hardbacks are the "cash cow" of the publishing world. It makes sense to release hardback only for a while in order to maximise income for the book. ".

[HarryT]

Originally Posted by meeera

It happens, but not very often (in the books I read at least), which is why I wondered why you were putting effort into defending it as the traditional and profitable option. " Hardbacks are the "cash cow" of the publishing world. It makes sense to release hardback only for a while in order to maximise income for the book. ".

I was referring to the windowing of hardback and paperback releases, not to hardback and ebook releases.