Some thoughts on books

Some of you might have wondered when a guy having studied literature embarks on a journalistic journey about books on ecomPunk. The answer is: now. So sit back and relax while I try to come to terms with the recent discussions about this industry.

Brick-and-mortar bookstores

What immediately comes to mind when talking about buying books in the real world, ie. in brick-and-mortar stores, is the case of the Borders bankruptcy last year. The Borders bookstore, which was founded in 1971 grew into one of the world’s most prominent sellers of books and media, with more than 500 so-called superstores, 19,000 employees during its peak times (Find more about the details about the company’s decline in the Wikipedia article about the Borders Group.) Ousting and buying traditional mom-and-pop bookstores, they managed to completely changing the character of physical book retail. Instead of small to medium sized businesses, they established gigantic retail stores, one the biggest being one in Kuala Lumpur, Malaysia featuring a  sales area of 700,000 square metres.

For much too long, though, the world of those gigantic stores had been at the core of Borders’ long-term strategy. It was not until 2008 that Borders set up their own online store – before that, it had a cooperation with Amazon and was thus laying its online fate into the hands of the company that like no other represents the challenges the publishing industry is facing today. I let Zappos handle the online business for my local shoe store. Yeah right.

In Germany, we have been witnessing something similar recently. Thalia, a bookstore chain with almost 300 stores in Germany and Austria and a turnover of about  EUR 9o0 million in 2009/2010, which belongs to the Douglas Holding, has gotten intro troubles recently. Rather than EUR 25 million earnings, that have been estimated for 2011, the result was only EUR 5 million, raising questions about whether their business model of large and expensive sales floors is prepared for the future.

Digital world

Apart from the physical world, the book business has seen the shift to the digital medium in a double sense. First of all, Amazon.com went online in 1995 and started to sell books via the web – something that nobody at the time had thought possible. People surfed the web, bought their books there and had them delivered to their doorsteps.

The business decisions of the very same company also had a lasting effect on the form of the (e)book itself: In 2007 they started distributing their first Kindle devices and are now selling more Kindle eBooks than paper editions. Digital books sold via a digital medium – no wonder that paper evangelists aren’t particularly happy about this. Talking of which: literature printed onto wood pulp still has quite a strong lobby. You can tell from the discussions about the subject that the Gutenberg moveable type paradigm is still very much engrained in how authors and publishers think – more than 500 years later.

And if this all wasn’t enough: Instead of having publishers perform the tasks of the actual book production, as well as the marketing and logistics, there are authors who – Alas! The impudence! – do it all on their own, using specialised self-publishing and on-demand services.

Regarding the key players’ reactions to these kinds of developments, Cora Stephan comments in Bücher? Aus Papier? Nur nicht sentimental werden! (Books? On Paper? No need to get sentimental!):

The digital world is more wide and open and meets curious readers. There are no voodoo charms and no brave denials which could work against this. However, this is what authors, conservative as they are, are specialists in. And this is the reason why publishers can fob them off with a 20% margin for the ebook editions of their works. Self publishing? For heaven’s sake! No “decent” author will dirty his hands with this. Stupid. Sure, even with a self-published ebook no author will automatically get rich, famous and happy. However, it improves their bargaining position. (our translation)

Increasingly, people will want to be able to buy a nicely edited hardcover book from a local retailer and downloading it onto his electronic reading device – in a single transaction, for the same price. Why should one shell out a second time for a book which one already owns – albeit in a different form? The act and the experience of reading will become more and more important and, as examples as Goodreads shows, sharing and commenting are already important drivers for buying decisions.

The more the “established” members of the industry fail to come up with ideas that address those developments, the more likely it will be for third parties to enter those markets. As the example of Apple shows, it needed a PC hardware producer to come up with a distribution model for digital music that works both for them as well as the partipating record labels – who wasted time and money to address online piracy rather than coming up with clever alternatives themselves. It needed a computer science guy such as Jeff Bezos to set up a global business attacking the mechanics of traditional book retail – something that should and could have been done by “insiders” before that.

(Image by nSeika)

2 Responses to Some thoughts on books

  1. Axel m says:

    What do you think about Tim ferris new book edited only by amazon ? Looks like, in a few years, publishing houses will be in the situation where the music labels are right now

    • Roman says:

      Hi Axel, I think Tim Ferris is a special case. He’s a master of self promotion and self-publishing for him is even reinforcing this image. Other authors who aren’t as well-known yet will need the support of a strong publisher. But I agree, the situation of publishers will change, nevertheless, I don’t think the industry could do without the editing/filtering of publishers altogether.

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