By now most people have heard that ebooks are currently outselling paperbacks and hardcovers on Amazon.com (and Amazon.uk), the world’s largest book retailer. What you may not have contemplated, however, is how this change is affecting the very infrastructure on which books have been published for hundreds of years.
Allow me to elaborate. According to this Cyber College Internet Campus review of the publishing industry:
Before the 1960s, the book publishing industry was composed mostly of independent companies whose only business was books. But, growing profits made the business attractive to large corporations looking for new investments.
At about the same time that large corporations started buying publishing houses they also started buying out independent bookstores. A nine-year period, which also continues into 2011, is shown below.
The combined effect of fewer independent book publishers and bookstores has resulted in some major changes in book publishing.
While corporate profits have increased (which is good news for the shareholders) the type and scope of books have decreased. Instead of risking the publication of new titles by unknown authors, these corporations tend to stick with known authors and past success formulas. This, of course, makes it difficult for new authors with new ideas to enter the marketplace.
Today, only a very small percentage of the works of new authors are considered for publication. At the same time, the industry is rift with stories about manuscripts that have been turned down by 20 or 30 publishers, only to later become bestsellers.
A couple of things stand out from this selection.
1) The market used to be almost entirely comprised of independent publishers and booksellers, but this gave way to the large publishing conglomerates. The impact of this is clear. The independent publishers were less concerned with profit margins than they were with putting out books about which they were passionate. They created strong relationships with independent booksellers who shared a similar interest in providing a wide spectrum of literary options to their reading customers.
2) Today, traditional publishers are depending more and more on the ability of a few superstar authors to continue churning out global hits. They use these higher sales to cover the costs of their infrastructure and losses accumulated by publishing hundreds of books a year that never sell enough copies to break even. This puts a ton of pressure on large publishers to deliver growth year over year and makes them quite risk averse when it comes to the titles they publish, print, and distribute.
Still, the large publishers do keep their eyes out for talent. They do this via the services of professionals known as literary agents. The primary function of a literary agent is to filter through thousands of requests from authors and hundreds of manuscripts to find the very few they think can be sold to an editor at a major publishing house. Once they’ve convinced an editor to take a chance on a book, then they become author representatives and work to get the best deal for the author they can negotiate. The issue for literary agents in the current market of e-books is that there are more people writing more books than ever before – far too many books for even the best literary agent to identify the gems they may have sitting on their slush piles.
This led to the rise of the Indie Publisher. In the late 90′s and early 2000′s, the first revolution to transform publishing was the advent of Print-On-Demand technology . This enabled smaller publishers to establish a system where they only printed a book when they had a sale, eliminating the need for warehouse space for books, and creating a new wave of author/entrepreneurs tired of being rejected by literary agents and publishing houses, and deciding to do it themselves. There was only one problem – a clear quality gap existed between these “self-published” titles and the glossy bound perfection being printed by the Big Boys. Retailers wouldn’t carry these lower quality books so many of these authors turned to alternative methods to getting the word out about their books. These early authorpreneurs dealt with high print costs, rejection from retailers, and even snobbery from readers who wouldn’t sully their hands or minds with what they felt were inferior products from writers unable to secure a traditional publishing contract.
But Amazon and the Kindle have changed all that. Today’s intrepid author’s, still dealing with rejection after rejection from the traditional publishers, have started going straight to the readers and allowing book buyers to determine their worth. When I read that 50 Shades of Grey is now the bestselling title of ALL TIME, this does not surprise me, because readers decided it was a hit long before literary agents or traditional publishers even knew E.L. James existed. Because e-books authors can afford to be more aggressive with their pricing, readers, enticed by low prices have started taking chances on these unknowns and guess what? It’s not all crap. If there was more willingness to take risks, the traditional publishing establishment would have found out the same thing. It’s too late for them to get in on this game, however. Their business model prevents them from exploiting these new found opportunities.
So what happens when readers figure out that traditional publishers aren’t the only one’s who can put out quality books? What happens when mid list authors, tired of being ignored by their publishers, decide to take their destinies in their own hands and reach out to their readership on their own? What happens when more big-time authors like J.K. Rawling negotiate to get the rights to their e-books back and vertically integrate from authors to publishers?
Collapse is what happens.
I already predicted this in a blog last year entitled It’s The End of Publishing As We Know It…and We Feel Fine. But to see it actually happening is another thing altogether. Like how TPC Books author Qwantu Amaru wrote about Hurricane Isaac ravaging the coast of Louisiana in his award-winning, bestselling novel One Blood, and 10 months later, folks in New Orleans are feeling the wind.
Publishers and literary agents are feeling the winds of change, but it may be too late for them to find shelter.