Will E-Books Topple Publishers as We Know Them?

Are the major publishing houses we love and revile about to come tumbling down, undermined by a million e-bookers? Yes, says Smashwords' founder Mark Coker, "there's a revolution afoot." No, says Berrett-Koehler's David Marshall, the new publishing houses will just be different and better. The odd man out, publishing consultant Peter Beren, thinks the traditional publishers will not only survive, they will probably just absorb the current e-book craze and crazies.

Some 85 overflow attendees at the ASJA-sponsored free gathering on Sunday, May 15 [2011], in the Berkeley Public Library heard both sides (and a skeptic's doubt) about what may be two sea change revolutions roiling in the publishing world.

The topic was E-Books, Apps, and Clouds: How Writers Are Creating the Future of Publishing. Mark Coker, founder of Smashwords, predicted the end of mainstream publishers as we know them. Berrett-Koehler's David Marshall countered by telling of the changes that traditional publishers will make to survive and thrive in the future. And publishing consultant Peter Beren, after the Coker-Marshall exchange, offered a third view, that ultimately the "big houses" may just absorb and dominate the e-book format.

It's time to let the public decide what they want to read

Mark Coker began by saying "It's time that writers and publishers stood up for free speech!" And that it was paradoxical that only a few blocks away his mother (and he in utero) took part in the Free Speech movement at its peak in the 1960s. And now, finally, with e-books ranked as the #1 format among all trade categories, there is a renaissance in book publishing as firms like Smashwords, offering a free publishing and distribution platform, help give ordinary people the power about what should be said and printed.

"The 'Big 6' have judged the worth of writers by the commercial merit of the books they sent for publication. They controlled the printing presses and the venues of mass distribution, but their myth as the arbiters of value is giving way to a new reality as brick and mortar bookstores close, they pass the post-publication PR burden to the writers, their book advances tumble while they still reject almost every submission, they take 18 months to put those few books accepted in print-and if the new book doesn't sell in the first weeks that it's in the bookstores, it is withdrawn to be remaindered or pulped."

"Writers have been exploited. It's the public who should decide what they want to read. We offer an online, open platform so writers can release their potential. That creates many more choices."

Coker said that answers to two questions will lead to the downfall of the big publishers (though they will never totally disappear, nor should they):

The first question is, "What can publishers do that I can't do myself?"

The second, "Will using a traditional (or mainstream) publisher harm my book's success?"

In response to the first question, Mark said that any author can use the Smashwords format to create an e-book in nine software languages. Those books are then openly marketed by distributors worldwide, democratically serving all. There is no cost to the author/publisher. And a royalty of 60-85% is paid for every book sold (compared to 5-17% in royalties for the major houses). The books are released as e-books almost the moment they are processed.

The second question, how would a traditional publisher harm a book's success? By making it unaffordable (in part to pay for their overhead), said Coker, often selling it at prices double or triple the e-book rates. And by limiting its distribution, geographically or for restricted periods of time. ("E-books know no boundaries since they become immediately accessible internationally once they are seen in an online catalog. Readers can also sample a part of the book before buying. And since there is unlimited space in the e-book bookstore, the books will remain available everywhere forever.")

"By self-publishing and having the means affordably at hand, the authors/publishers can take control of their own publishing destiny," Mark added. "If they write a good book that resonates with writers, buyers will honor the writer with word-of-mouth promotion."

But another key question remains unanswered: will the "open press" or "ancillary publishing" process bring authors enough income for their efforts? "Right now we have less than 50 authors earning $50,000 a year," Mark replied, smiling. But in just three years his firm has helped 20,000 writers publish 50,000 e-books, and in the process Smashwords has become one of the largest e-book distributors.

Smashwords is one of eight "open press" firms now printing and distributing both bound and electronic books. Others include CreateSpace, Kindle, PubIt!, Lulu, Blurb, Scribd, Google, and LightningSource.

Is a second publishing revolution afoot?

The established publishers held their ground. It was posed that not only will they remain (though probably changed), they would create a new kind of book and production that is simply too complex and layered for the new firms like Smashwords to match.

D. Patrick Miller, the President of the NorCal chapter of ASJA (American Society for Journalists and Authors) presented David Marshall, VP of Editorial and Digital at Berrett-Koehler Publishers in San Francisco, a nonfiction independent house in the educational field.

David felt that the future of traditional publishers depended upon software, layering, video, animation, interactivity with the reader, and responding to the "age of reading TV and watching books" by smarter and tighter cutting-edge firms. In this new world, authors were asked not to think of themselves as book writers but symbols of creative change.

Marshall also focused on a revolution in publishing, emphasizing more the digital explosion in tablets and e-readers, ranking the top four as Amazon, Apple, Barnes and Noble, and Google, and citing the four top formats as PDF (creating the exact replica of the print book), e-pub (with flowing text where type font and size can be changed but graphs and tables must be omitted), Mobi (in the Kindle), and the scanned process used by Google Book Search.

Most of the transformation from print to digital, he said, has been in fiction; nonfiction has increased from 7 to 12% of the total. Marshall then painted the vision of how nonfiction will look in the near future, as "enhanced" books including audio, video, self-assessments, and community portals where readers can talk with the writer and other readers. There might be games in the book or animation in the preface with the author's voice-over.

Most of the book won't live in the tablet either. It will "live in the clouds," in a grand file beamed down from a database available any time from anywhere. The user can buy any section or chapter they want, paying through a meter. And the data can be dynamically changed, updated, or added to (as can articles) as facts emerge or change.

This will transform the authors' role. They will publish digitally first, then think print later. The barriers and excuses will be gone. "If it makes sense, print it," Marshall said.

The "power of free" then becomes possible with the digital book. The writer can capture market share by giving away the first book (or the first chapters), then charge as the fan base develops. An e-list becomes the authors' selling center.

Since e-books in the future will be multimedia, the writer will be responsible for the text and the embedded media components. Writers will find partners from film, audio, and art to create the best format.

David encouraged the participants to read his "Tools of Change Conference Call Report" from February, 2011, available at scribd.com.

From that report, the changes on the publishing horizon are almost overwhelming. Particularly interesting in the report are Wired Magazine's Kevin Kelley's six trends that book publishers need to address in order to stay competitive and eight ways to make it easy to pay but hard to copy. Brian O'Leary (Magellan Media) compares the old paradigm to the new and Margaret Atwood (The Handmaid's Tale) gives a chilling author's perspective. In fact, all 12 pages paint a brave New Publishing World in which today's major houses, and Coker's self-publishers, hardly fit.

Perhaps David Marshall's summary of that report best expresses the sense he shared with clarity, conviction, and excitement at the ASJA gathering:

"All 'heck' is breaking out in the digital publishing space. E-books are just the first wave of many waves of digital innovation. Early pronouncements from some pundits that enhanced e‐books are more interesting to publishers than consumers misses the point. As the market for pure text products, even in digital form, moves to free, publishers must innovate to provide new layers of consumer value, or perish. Products such as The Elements (185,000 sold) show the portent of the industry. Unfortunately, most publishers will not be able to profitably transform themselves into companies such as Touch Press, Open Road Media, or Callaway, and some of the stiffest competition to traditional publishers will likely come from VC-funded 'born digital' start-ups. I sat at a conference lunch table (recently) under the banner, 'What's the difference between book and software publishing?' That is an apt reflection of how these two industries are quickly merging. (Berrett-Koehler's) collaborative partnership business model is more important now than ever before. We (too) must re-invent ourselves to stay relevant."

The big houses are more likely just to absorb the e-books

In a conversation after the ASJA gathering, Peter Beren commented "I remember more than 30 years ago when we used the same rhetoric and vigor that Mark Coker used today, but then we proclaimed that you didn't have to publish in New York, that West Coast publishing was the new frontier of creativity!"

Coker had just called for writers to re-embrace freedom of speech, and prophesized the end of mainstream publishers as we know them.

Peter is a literary agent; a columnist for the San Francisco Publishing Examiner; a publishing consultant to authors, self-publishers, and independent publishers, and a literary agent with 30 years experience in book publishing. Among his six published books are The Writers Legal Companion (with Brad Bunnin) and California the Beautiful.

"I just can't believe that e-books are the self-publishing keys to the kingdom. Mark's rhetoric is as extreme as ours was. Particularly if it gives the idea that a writer can self-publish and by-pass the traditional publishers and achieve the same result in terms of readers and earnings. If the person does that, and only distributes to electronic platforms/channels, it is very difficult for a reader to know a work exists and how to get it. E-books are a great secondary sales channel and they can add to the authors' earnings in a considerable way but right now the entire channel accounts for only about 13% of total sales.

"Nor do I see bookstores disappearing any time soon. True, Borders folded, but Barnes and Noble is predicted to bring in $300 million more in business in its absence. Independent bookstores, while only 5% of the market, are doing well, and the Expresso Book machine now produce books on the spot worldwide. In fact, it's far more likely that traditional publishers will absorb the e-book channel just as they have absorbed trade paperbacks, books on tape, and boxed sets. Random House and other major publishers are going back to their authors and releasing their works in e-book form. They are even experimenting with enhanced e-books, which the new, smaller open press firms simply can't do.

"And what about the craft itself? Think of coffee table books-that can't be duplicated electronically.

"Also, how much of the e-book fire is being fed by the dozen or more firms earning $100 million selling self-publishing services?"

Peter added that he doesn't disapprove of self-publishing or e-books, just the hype. He said that e-books are keeping many of the smaller publishers in the black right now, and there are many micro publishers that will flourish in the new environment.

In fact, Beren saw the difficulties a year ago in a his San Francisco Examiner Publishing column, on March 4, 2010, when he shared that "(w)hen self-publishing grew by leaps and bounds, it grew because technology made book printing simple. Combined with print-on-demand (POD)-where you get the orders first and then print to fit-self-publishing became an irresistible lure. Suddenly, there was disintermediation, eliminating the middle-man. Anybody could get their book on Amazon where it would democratically rise or fall without the mediation of the prejudices of a store's book buyer. Since they were dealing with POD, there was no need to hold inventory or carry the capitol risk of inventory. Anybody could be an author, anybody could publish a book.

"What self-publishers discovered with the e-commerce channel was that somebody or something needed to capture the attention of the individual reader and motivate them to look the book up on Amazon or some other venue. Marketing and distribution became, and still are, self-publishing's great challenge."

A revolution at the presses? Or two? Or is it more-of-the-same but with new players and new tools? Keep reading..."

Gordon Burgett

Gordon Burgett has been a book publisher since 1981 specializing in both non-fiction and niche marketed products. He has also had 39 books and 1,700 articles published. He began offering almost-ready-for-print manuscript reviewing in 1995 to help fellow professional speakers make certain their "book" was in fact ready for release and fully directed for maximum sales or use. He now helps all non-fiction authors select the best publishing route, save money, and create top-quality books and products. If interested, please see http://www.gordonburgett.com or read his blog at http://blog.gordonburgett.com.

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