booklab

Preparing for Frankfurt? Find a detailed analysis of the Global Ranking of the Publishing Industry in a close up analysis

In German here

In English with focus on trade publishing here > go to October 2009 newsletter

In English with a focus on professional / science / education and on globalizatioon here :

A survey portraying the top 50 publishing groups worldwide, with a revenue based ranking, trends and developments for the past 3 years - and lots of insights to be drawn from those data.

Having the pleasure and the privilege to travel with this group of US non fiction editors to see a number of German publishers in Munich and Frankfurt

Editors from the US on the S. Fischer Frankfurt roof top

- C.H. Beck, C. Hanser, Campus, Suhrkamp, S. Fischer, Random House  - the most interesting insight was at how many levels these markets have drifted apart:

• Selling a good monograph to 12.000 readers (a normal target for German scholarly publishers) is just a dream on the US side;
• Having philosophy or sociology titles finding readers outside of universities (and a shelf in a normal book store) again is unseen in the US;
• Using print-on-demand is a very normal routine to produce books in the US, while their German homologues just start to discover this perspective;
• EBooks accounting for 100.000 $ of sales in 2008 is better than average in the US; however such sales not even started in Europe;
• Trying to jump start a book digitisation and eBook platform run by an association is hardly conceivable in the US, but a fact in Germany.

I will tell a few more details after a good night of sleep (or two). And, perhaps even more importantly, will introduce a few of those checking those new ways out.

More pix here

Within only a few weeks, I came across all sorts of news refering to big publishing conglomerates and small indiependent houses who launch or announced  new approaches to putting books onto the internet. And at the same time, a new debate about eventual business models has started - anywhere between giving away all the stuff for free to charging for the download of a page or a chapter. This was not only triggered by the launch of new digital readers like Amazon’s Kindle and the Sony Reader. It shows that there are a lot of people and companies out there thinking at and planning for perspectives of the book in a digital and connected world.

I certainly will comment on this in future posts, but in a first step, I thought that mapping those debates and announcements may be more useful and valuable. I have written a first overview, in German, in my column “Virtualienmarkt” at the Berlin based Perlentaucher. But here you can look at the ‘tool box’ with quotes and links to the main findings I covered, with only a minimum of comments

US Trade Wholesale Electronic Book Sales

Statistics: Here is a table with ebook sales in trade in the US. 

Examples of new ebook and digital book announcements and reports from recent weeks with quotes and links:   HarperCollins to put books online free (11.02.08 The Bookseller) “HarperCollins Publishers US is to offer free electronic editions of some of its books on its website, including a novel by Paulo Coelho and a cookbook by the Food Network star Robert Irvine, reports the New York Times. (Coelho blog) The idea is to give readers the opportunity to sample the books online in the same way that prospective buyers can flip through books in a bookstore.“It’s like taking the shrink wrap off a book,” said Jane Friedman, chief executive of HarperCollins Publishers Worldwide. “The best way to sell books is to have the consumer be able to read some of that content.”  Top authors to go digital with ebooks (The Sunday Times) “Random House and Hachette, which together control just over 30% of the British book market, are to offer downloadable versions of titles by authors ranging from Delia Smith to Ian McEwan and Michael Parkinson. Every other major publisher is drawing up plans to follow suit, pitching the books at just below the price of a hardback. The publishers have made the move to ebooks to follow the launch of two rival devices due to come on sale in Britain over the next few months – Sony’s Reader and Amazon’s Kindle. (…) In America, the Sony Reader and Amazon Kindle have been on sale since last autumn and about 90,000 titles are now available on them. (…) Borders in Ann Arbor, Michigan, unveiled a digital “concept store”.Publishers  Lunch“Perhaps the most interesting launch is the one without a press release at all so far: Tor Books is accepting e-mail sign-ups for a program that promises “free digital books from bestselling and award-winning SF and fantasy authors…. Once you register, you’ll receive our newsletter and a link to download a digital book. And you’ll receive a link to another new book every week.” The first week’s free book is Mistborn, by rising fantasy star Brandon Sanderson. Next week’s will be Old Man’s War by John Scalzi, 2006’s winner of the John W. Campbell Award for Best New Writer. Over the next several weeks, other books still.” Random to sell chapters online11.02.08 The Bookseller “Random House US is to begin selling the individual chapters of a popular book to gauge reader demand for bite-size portions of digital texts, reports the Wall Street Journal.The publishing group’s experiment appears to be the first time a major consumer publisher has offered a title on a chapter-by-chapter basis. It will sell the six chapters and epilogue of Made to Stick: Why Some Ideas Survive and Others Die for $2.99 each.The move comes, says the WJS, at a time when retailers and publishers are looking for clues into how readers want to access digital content.”Publishers Weekly“In the Random test, Chip Heath and Dan Heath’s Made to Stick: Why Some Ideas Survive and Others Die, published in hardcover in January 2007, is being made available in six chapters and an epilogue—the content bunches are priced individually at $2.99 each—at www.randomhouse.com/madetostick. Consumers who buy a chapter will receive an e-mail with a link for downloading the purchased file, which cannot be shared electronically. Avideh Bashirrad, deputy director of marketing for RHPG, said the company chose Stick because each chapter contains standalone lessons. Matt Shatz, Random’s v-p, digital, said the experiment is intended “to gauge the demand for short form electronic content.” Several publishers, mostly in the travel and computer fields, have offered chapters for sale, with mixed results.” Publishers Weekly, 2/11/2008 Random House drops audio DRM 25.02.08 The Bookseller“Random House Audio — a division of Bertelsmann, one of the largest publishing conglomerates in the world — has announced that it will now allow its audiobooks to be sold without DRM by all of its online retailers. According to blog site BoingBoing Random House noted that they’ve been running a DRM-free audiobook program with eMusic for months, and that none of the pirate editions of their audiobooks online came from those DRM-free editions; rather, they’ve come from DRM’ed editions that were cracked, and from ripped CDs.”   Brockhaus stops printed edition and moves online instead“The German encyclopedia publisher Brockhaus said it would place its reference works on the Internet to offset falling revenues. Unlike popular reference work Wikipedia, it will be ad-sponsored and professionally edited.”Deutsche Welle   Brockhaus ceases publication of its paper edition“This news represents a watershed,” was Manfred Schneider’s comment on the announcement by the traditional Brockhaus publishing house that it would be making its encyclopaedia available on-line from 15 April on a free, advertising-financed website rather than publishing a new paper edition of the thirty-one volume work. “A review of the history of Brockhaus forces contemporary book-lovers to draw the wistful conclusion that this move marks not only a change in publishing strategy but also the end of an era. “Frankfurter Rundschau quoted in Courier International  In France, the popular encyclopedia “Quid” stops printed edition“The 2008 edition of Quid, France’s favourite encyclopaedia, has been cancelled by its publisher for lack of interest. The annual sales of the 2,000-page tome, which reached more than 400,000 in the mid-1990s, collapsed to just over 100,000 last year. The book’s publisher, Robert Laffont, says the whole concept of the print encyclopedia can no longer compete with the free information available on the internet.”The Independent 19 Feb 2008 The new debate on how to prepare and serve a free lunchKevin Kelly: Better Than Free “When copies are super abundant, they become worthless. When copies are super abundant, stuff which can’t be copied becomes scarce and valuable. When copies are free, you need to sell things which can not be copied. Well, what can’t be copied?”“The elusive, intangible connection that flows between appreciative fans and the artist is worth something. In Radiohead’s case it was about $5 per download.“ In: EdgeChris Andersen: Free! Why $0.00 Is the Future of Business “It’s now clear that practically everything Web technology touches starts down the path to gratis, at least as far as we consumers are concerned. Storage now joins bandwidth (YouTube: free) and processing power (Google: free) in the race to the bottom. Basic economics tells us that in a competitive market, price falls to the marginal cost. There’s never been a more competitive market than the Internet, and every day the marginal cost of digital information comes closer to nothing.”In: Wired Chris Andersen on his Blog The Long Tail“I plan to make as many versions as possible of FREE, well,  free, starting with the MP3 audiobook and possibly including a sponsored physical book. Is this going to backfire, given that I’m already on the well-known side of the equation?Well, if all I wanted to do was sell books, it might (although I doubt it, given the usability benefits of the physical form of a serious book. After all, giving away a pdf version of his book on net policy and economics helped Yochai Benkler sell more hardcover books than he would have otherwise. 500+ pages is a lot to print out, to say nothing of reading on-screen).”In Andersen’s blog The Long TailOprah e-freebie now Amazon’s 3rd best p-seller “Can you boost p-book sales by giving away e-copies of the same titles for free? Oprah Winfrey’s book club last week allowed free downloads of the book in Kindle and PDF formats and perhaps others, for 33 hours. It drew more than a million downloads“David Rothman in his blog in Publishers Weekly  February 19, 2008  “Free is more complicated than you think” by Scott Adams, Creator of Dilbert “I spend about a third of my workday blogging. Thanks to the miracle of online advertising, that increases my income by 1%. I balance that by hoping no one asks me why I do it.  A few years ago I tried an experiment where I put the entire text of my book, God’s Debris, on the Internet for free, after sales of the hard copy and its sequel, The Religion War slowed. My hope was that the people who liked the free e-book would buy the sequel. According to my fan mail, people loved the free book. I know they loved it because they emailed to ask when the sequel would also be available for free. For readers of my non-Dilbert books, I inadvertently set the market value for my work at zero. Oops.”Scott Adams in a column in The Wall Street Journal 1 Nov 2007   Tim O’Reilly picked up on Adams’ discovery of the ambivalence of freebies and did the math more in detail, with figures from his own book publishing business. He realized what fabulous numbers of page views and ad clicks would be required to come up with the revenues he had by selling printed books in traditional ways. As quoted by one listener to his presentation: “Assume (hypothetical but probably close to his real business) that he sells 200K books/month @ $20 = $4M/month = $48M/year. Average book is 446 pages, which is equivalent to 90M page views per month. At a $1 CPM (=Cost per thousand impressions), that’s $90K/month. At a $20 CPM, it’s $1.8M — roughly half the size of the book business.”Tim O’Reilly’s conclusion was that at first he had considered advertising to provide a solution for creating revenues out of online publishing („advertising works and we’re just not good at it”), before he flatly understood: “We need to stop thinking of advertising as a model.”  Tim O’Reilly: “Free is more complicated than you think” New publishing models: Case studies and presentation from this year’s O’Reilly Tools of Change for Publishing onferenceProcedings  of the conference in 2008Ben Vershow, Institute of the Future of the Book: “Books as Conversation”If the book is digital, however, and resides on a network, new possibilities begin to open up. The page margin can become a public space. Authors and readers can interact in close to real time. An entire classroom can operate inside a single text. Books can become conversations.   And let me remind you of sci/fi writer Cory Doctorow who was probably the first writer who understood how to use free online publishing of his writing  (and the usage of ‘creative commons’ licences) to establish his publishing success through a web community of fans.

Here you can find Paulo Coelho’s new megaseller “The Witch of Portobello” - for free. Oh, and yes, it is entirely legal. Courtesy of Harper Collins, Coelho’s US publisher.

Why they give away Coelho’s new book digitally? In order to sell it on paper, of course. And Harper decided, as of today, to start putting books up online for free more or less systematically. With Coelho, this will be one book per month, in a read only, no printing, no saving locally version, yet of course with a direct ‘buy this book’ link attached.

Harper Collins is, after all, a division of Rupert Murdoch’s media empire of News Corp, and he has a reputation of both not doing anything without thinking of the money he can make, and of having a pretty good nose for when is the moment to jump on a band wagon of innovation. Remind you that he had acquired MySpace, and thereby heavily boosted all of web 2.0

In an interview with the New York Times,  Harper’s top lady Jane Friedman called this kick off of serious experimenting (I guess this is what it is, after all): “It’s like taking the shrink wrap off a book“.

This is an interesting concept, I think: Using digital to **open books**.  (I will discuss all the many implications of this in a special post here soon).

But as for today, take note of a number of co-inciding recent announcements, related or not: Simon & Schuster created the office of a Chief Digital Officer “for the full scope of the company’s activities in the digital realm.” Random House meanwhile will start to sell “chapters” of books online, starting with “six chapters and epilogue of Made to Stick: Why Some Ideas Survive and Others Die for $2.99 each”, according to the Wall Street Journal, and quoted by The Bookseller.

While I’m not sure if the price tag of $2.99 for a chapter is a sticky idea - I remember an earlier announcement by RH (or was it Amazon) of a bit more than a year ago of a penny a page - and sorry, I did not check now what was the correct quote.

But the strong news is this: Publishers - and for sure, rather sooner than later, online booksellers even more so - start to take the web seriously (and, oh, right, Amazon just acquired Audible, to sell bookish content truely online, and not from their brick ‘ mortar warehouses).

Add to all of this the sheer number of books that are somehow available digitally online - in all of those restricted forms, as ’snippets’ with Google, in digitalisation projects - with many users craving to access them at once.

My point is: This is how the eBook market will take off for real, not through heavily rights managed closed boxes in the style of Amazon’s Kindle. Cost is not the main hurdle. It is that (a) why should I want to digitally buy a clumsy and bastard variant of a book reading device, and more importantly, (b) why would I allow anyone selling me that digital book to intrude into my ways of using that book, so that I can’t give it to my buddy, or do with my copy whatever else I want.

So, when publishers stop sitting on their digital books and start to experiment, put up stuff for free, cooperate with their writers, and their writers’s communities, when booksellers get serious about downloads of audio (and therefore need to consider if they will use RDM, or learn from the music industry and prefer high usability), and start to consider of all of this in integrated strategies (with some Chief Digital Someone), they may liberate forces that are really relevant.

More on this soon.

The Global Ranking of the Publishing Industry as presented at this year’s Frankfurt Book Fair was echoed widely in professional conversations and small talk throughout the fair.

The presentation, held at the Press Centre on Wednesday 10 October 2007, brought together the editors in chief of several of the leading book trade magazines.

It was, in a nutshell, a state of the global publishing industry report, and will be updated from now on every year.

Publishing today, at least in a global perspective, is not just about books and authors. It is about information, knowledge, and education. It is as much about digital publishing as about ink on paper. It is a mirror of the global balance of (economic and technological) power, yet with surprises: It is far less about US, or even Anglo-Saxon cultural predominance than one may expect, but yes, it is an American-European domain, with Asian countries only starting to become visible in the big picture. And sure, expectedly, any glimpse at global publishing will portray an industry that is currently subject to extraordinary change and even turmoil. The top 45 publishing companies worldwide combine revenues of ca. 53.5 bn Euros (or ca. 73 bn $). This is certainly not a big industry, if compared to computers, or cars.

Within our ranking, the top 10 companies account for ca. 2/3 of the combined top 45 revenues. The overall 73 bn $ from the top 45 companies, or all publishers with revenues of more than 200 m Euros (or 250 m $) in 2006, compare to a global publishing market of ca. 80 bn $ according to a statement of the International Publishers Association (IPA) in October 2006 at the Frankfurt Book Fair. Even if the IPA definition is probably a bit more restricted than ours, it clearly shows that the publishing industry has pretty much consolidated over the past 10 years.

For more, come to our press conference at the Frankfurt Book Fair on Wednesday, 10 October 2007, at 3 pm in the Press Centre (hall 6.2) or check out the basic facts and further links here

Over the past several years, English language books have been given increased shelf space in traditionally non-English reading countries. As this trend continues, publishers are searching for more ways to infiltrate these new markets.

We could organize a first set of expert panels to map thsi 3 bn $ market at BookExpo America in New York in June 2007. Participants include Pascal Zimmer, Libri Germany, Francoise Dubrouille ,International Booksellers Federation, Esther Allen, Columbia University, und Peter Clifton, Ingram International.

You can listen to the panel debate at the Podcast

I was really puzzled when I realized the amount of interest (and feedback) I had the other day with a piece written for Publishers Weekly about how autobiographies are classified in different ways in the AngloSaxon world, and in the rest of Europe:

While Americans and Brits expect writers of autobiographies to say the truth, somehow, in France, Spain or Germany, those same books are routinely classified as fiction.

Think of German Nobel laureate Gunter Grass’s autobiography “Peeling the Onion”, which was released last week and promoted with a talk between Grass and Norman Mailer in New York, a book reveiling the fact of Grass, the moralist, having been a member of Nazi Waffen SS as a youth, which of course was listed as fiction in Germany last year. Or even more stunning, John Grisham’s The Invisible Man, an essay against the death penalty - again read as a book of fiction in Europe due to the author being a writer of novels primarily. 

One of my interview partners for the piece, Bernhard Fetz, a Vienna-based researcher with the Austrian National Library, and a specialist in the genre, pointed to a pretty  complex set of traditions beneath the odd differences in classification, as he told me:

“The differences of perception go back to antagonistic traditions in philosophy and cultural history: While Germany, or France, have a mostly idealist tradition in culture, Britain, and hence the U.S., have always had a more pragmatic approach. Essays by Jean-Jacques Rousseau, or Goethe, always combined factual accounts with personal intuitions and selfreflections of the author, giving autobiographies also a political angle by defining a life story as exemplary for a nation. The Anglo-Saxon tradition was instead much more and much earlier influenced by science, and therefore supposed to rely on facts, and less on intentions, Fetz says.

Amazing, I think, and you understand why reading the same book in different cultural surroundings may provide a very different read (and understanding) indeed!

We proudly announce the birth of our new baby - the Livres Hebdo Global Ranking of the Publishing Industry, or the first reliable list of all publishing groups from around the globe with revenues of over 200 million Euros or 250 million dollars.

For almost 10 months, we were researched, tracked down data and people helping us, kept checking and cross checking numbers and sources, in order to produce a list of the top 45 groups, plus many of their major sub-divisions and sometimes even regional break down figures, plus an ample documentation on who is doing what exactly.

 And guess what, we did not find only books.  Almost the contrary is true, as the top 5 include only 1 and a half traditional ‘trade publishers’, with Pearson’s Penguin division (Pearson being #2), and with Bertelsmann (#5).

 The world’s biggest houses are Reed Elsevier, Pearson, Thomson, Bertelsmann and Wolters Kluwer.

Take also note that the top 45 groups account for a turnover of ca. 52 billion Euros - with almost half of it from non-Anglo-Saxon corporations. This compares to the number of 80 billion dollars (or 60 billion Euros) for all of global publishing, according to last year’s estimate by the International Publishers Association IPA. Or, our 45 ranked publishers account for a really hefty chunk of our industry.

The definition of ‘publishing’ as used on the ranking includes book publishing (trade, STM, education, etc.), book clubs, other closely related activities (e.g. retail or distribution), relevant database publishing (e.g. professional information) and journals. It excludes however newspaper and consumer magazine publishing.

I suppose these numbers, and what’s in them at a closer look, will trigger some debate, even more so as over the next weeks, the ranking will be co-piublished, aside from the French Livres Hebdo, by Publishers Weekly (US), Buchreport (Germany), Svensk Bokhandel (Sweden) and Publishing Today (PR China).

At BookExpo America, I could set up and launch a debate on the “Internationalisation of English reading“, or a funny 3 bn $ market niche that so far got little attention by book folks aside from the few online and wholsalers who are actively increasing their revenues from it.

Anyone exploring a major book store in Europe can see how the ‘foreign language’ section (as they used to call it when ‘foreign’ was still considered to draw a clear line of separation between ‘us’ and some ‘other’) has expanded over the past few years. Yet hardly anyone has so far tried to make sense out of it, in terms of business, culture, or personal convenience for readers like you and me.

Many funny things occur in that niche:

1. It doesn’t exist in the first place, at least if you look at the general trade statistics. Yet, as Pascal Zimmer of Libri could show at our debate,  if you consider the sales of any major wholesaler, and dig up data from within their warehouses, you see how tremendously the niche is growing. You can, of course, also just look at many readers (I am a good example myself) to realize that reading the ‘original’ has become pretty popular in no time.

2. For some reading markets, like Scandinavia or the Netherlands, this even turned into a substantial problem, at least as far as translations are concerned, e.g. from English into Swedish or Dutch, as Lasse Winkler from the Swedish book trade magazine Svensk Bokhandel told us, as the imports aggressively compete with those translations.

3. In major corporations, this competition between several language versions unavoidably became part of a sales strategy, as explained by Richard Kitson of Hachette / Hodder Headline UK, as his company routinely adds to the domestic sales of UK fiction bestsellers over 100.000 (!) more exported copies across Europe alone, and guess what, of course these export markets are the same into which translation rights for the same title have been sold.

I put some material at my website, with more on this exciting and likely also controversial subject to come.