As E-Book Sales Slip, Publishers Invest in Print Over Mobile

Kindle users can switch between reading and listening to a book without leaving the app

Yesterday’s New York Times features a story that indicates publishers are no longer “seized by collective panic over the uncertain future of print.” In “The Plot Twist: E-Book Sales Slip, and Print is Far From Dead“, writer Alexandra Alter reports that publishers are, in fact, investing more in print:

Publishers, seeking to capitalize on the shift, are pouring money into their print infrastructures and distribution. Hachette added 218,000 square feet to its Indiana warehouse late last year, and Simon & Schuster is expanding its New Jersey distribution facility by 200,000 square feet.

Penguin Random House has invested nearly $100 million in expanding and updating its warehouses and speeding up distribution of its books. It added 365,000 square feet last year to its warehouse in Crawfordsville, Ind., more than doubling the size of the warehouse.

This outsize investment in shoring up print seems to ignore another finding in Alter’s piece—that “a growing number of people are reading e-books on their cellphones.” Shouldn’t publishers be investing in mobile; particularly in ways readers can seamlessly transition from print to mobile without losing their place in a book—same way they can with an e-reader and certain audio reading apps?

Anything could change as far as our collective dependence on our mobile phones. Yet another study could come out that details how the diodes of light our cellphone screens emit are searing our optic nerves, followed by a campaign to #lookaway or #shutdown and #spendtimenotselfies. But right now, telecommunications companies are investing heavily in content that can be pushed from mobile devices. It’s no coincidence Nigerian internet and phone data company Etisalat sponsors an eponymous literature prize. This in mind, shouldn’t publishers be paying closer attention to these trends and figuring out how to get in on or ahead of them?

Simon and Schuster President and CEO Carolyn Reidy is quoted as asking: “Will the next generation want to read books on their smartphones, and will we see another burst come?” I hope publishers are actively seeking and leading the charge in arriving at the answer.

Now You Can Sell Your eBook on Twitter

Self-published Authors, Twitter could turn into an immediately measurable revenue stream for you. Gumroad.com enables artists to upload their work and sell directly from their Twitter accounts via a Buy button. Traditionally-published scribes may be able to take advantage of this depending on their publisher. Hachette is experimenting with Twitter sales, piloting their partnership with Gumroad using a few authors with huge twitter followings. There’s no news yet about Hachette’s twitter sales performance (they announced the partnership December 10, 2014), but we’ll be monitoring this. Nice move forward for Hachette, by the way, after a bruising 2014 locked in battle with Amazon over ebook pricing.

Apple to Pay E-Book Readers $400 Million in Antitrust Settlement

Unless an appeals court overturns a July 2013 ruling that Apple conspired with publishers with the aim of compelling Amazon to price their books at an advantage to publishers, Apple will have to pay  “$400 million to consumers in cash and e-book credits, and $50 million to lawyers” according to the New York Times.

The NYT piece explains:

The government’s lawsuit focused on 2010, when Apple entered the digital book industry with the introduction of the iPad and the iBookstore. At that time, publishers’ agreements to sell e-books were made under the so-called wholesale model of print books; publishers charged retailers about half the cover price for a book, and the retailers then set their own prices.

But with the iPad and iBookstore, Apple offered publishers a new business model. The government said Apple’s co-founder and then chief, Steve Jobs, persuaded publishers to agree to the so-called agency model for selling books, which let publishers set their own prices for e-books.

Pursuant to the verdict, Amazon notified Kindle readers they could expect a credit for some past e-book purchases. The appeals court date is scheduled for December 15, 2014.

Sony Is Officially Out of the E-Reader Business

“Sony has confirmed today that they will not be making another ebook reader – not even for their sole remaining market in Japan.” – the-digital-reader.com

Sony’s decision not to produce another e-reader follows their February 2014 announcement that they were shuttering their e-bookshop. With the lion’s share of readers using Amazon Kindles and Barnes and Noble Nooks, and the iPad ranking highest among tablet users according to a PCMag.com survey, writers and publishers need to figure out how we can leverage the devices readers prefer in fresh ways. How can we deliver digital stories that go beyond the standard, expected page-to-digi transfer?

In 2011, bestselling author Victoria Christopher Murray introduced the A Chapter A Month Club which enabled readers to receive a new chapter of original writing by authors on a monthly basis. In 2013, Margaret Atwood released a serial novel via Byliner.com. Now that Amazon has launched its Kindle Unlimited ebook subscription service even as similar services like Oyster and Scribd gain market share, a serial system of some sort could really engage readers. Interesting how this 3.0 platform is bringing back the storytelling delivery popular in the days of old school radio.

Some Industry Insiders Say It's Too Easy to Vilify Amazon

“Is Amazon Really the Devil?” A number publishing industry pros told Publishers Weekly they think the satanic characterization has been oversimplified, especially with respect to the etailer’s current stalemate with Hachette. The Amazon-Hachette dispute is allegedly over failure to agree on ebook pricing.

Citing the Authors Guild position that publishers are offering unfair ebook royalty rates to authors, and  the less impassioned industry response to Barnes and Noble’s reduction of Simon and Schuster orders last year, Guild President Roxana Robinson told PW it’s  “a question of who’s being the biggest bully at the moment.”

An independent publisher who was quoted anonymously asserted that Barnes and Noble is the bigger antagonist.

“[I]t’s B&N that’s really evil,” the publisher said. “although now they’re supposed to be so great. They make us change covers, editorial, all kinds of crap, and the returns. B&N used to be just under a quarter of our sales but with massive returns.” By contrast, the publisher said, Amazon generates about the same percentage of sales with far less returns.

Porter Anderson, director of the AuthorHub at this year’s BEA, placed the onus on publishers.

“[P]ublishers need to start selling directly and reach out to readers,” Anderson prescribed, using BEA’s consumer event and BookCon as examples. “Find the readers rather than bitch about Amazon.”

I place the onus on writers. As the industry shifts, writers must seize the opportunity to take more ownership of the retail and distribution of our work.

Hachette Announces Layoffs

Today, Publishers Weekly reported Hachette Book Group is eliminating 3% of its U.S. personnel, or 28 employees. A company statement quoted on PW called the cuts “essential to our company’s continued growth, and our ability to carry out our primary goal: to publish our authors’ work with passion, originality, and impact.”

The layoffs come amidst news of the publisher’s tense negotiations with Amazon. Hachette, the subsidiary of French multimedia company Lagardère, is allegedly at loggerheads with the etailer over e-book profit margins. In a statement released last week, Amazon expressed that, until the dispute is resolved, it is “buying less (print) inventory and ‘safety stock’ on titles from the publisher, Hachette, than we ordinarily do, and are no longer taking pre-orders on titles whose publication dates are in the future.”

Comedian Stephen Colbert, whose new book America Again is published by Hachette, is among a number of authors including J.K. Rowling and Malcolm Gladwell caught between their publisher and the retail giant that commands more than 30% of book sales. Colbert is asking his fans to temporarily boycott Amazon until they cease delaying orders of Hachette, while Gladwell told the New York Times “if [the standoff] keeps going, the authors are going to have to get together.”

R.I.P. Sony Reader

The Sony PRS-T3S (via Goodereader)

Sony Electronics has decided to close its Reader Store next month, leaving the North American e-Reading public to choose between the Kindle, iPad, and the Kobo. In a press release explaining the move, Sony announced that it will transfer “Sony’s Reader Store customers and their current eBook libraries… to the Kobo ecosystem starting in late March.”

The release adds of the Toronto-based company whose name is an anagram of “book”:

Kobo serves 18 million readers around the world and works with 1.3 million authors to deliver one of the world’s best catalogues of more than 4million eBooks, magazines, and newspapers. From bestselling authors like Dan Brown, Margaret Atwood, Jodi Picoult, Khaled Hosseini, John Grisham, Nora Roberts, and Gillian Flynn, to popular magazines like Vanity Fair, People, Macleans, Food & Wine, and Today’s Parent, Kobo has something for everyone.

NPR says of Sony’s shuttering e-bookshop, “Although initially competitive, Sony’s ebook store and apps have lagged [behind] competitors such as Amazon and Apple for years.” Barnes and Noble’s electronic reader the Nook has also been struggling to compete.

In other e-reading news, Publishers Weekly reports:

In a deal that brings together one of the oldest independent e-book publishers with one of the largest, Open Road Integrated Media has signed an agreement to acquire E-Reads, the digital publisher founded by Richard Curtis in 1999. The purchase, which is set to close April 1, will add more than 1,200 e-books to Open Road’s list and includes authors such as Dan Simmons, Harlan Ellison, Greg Bear, John Norman (in science fiction and fantasy), Aaron Elkins, Barbara Parker (mystery), Laura Kinsale (romance), and Ray Garton (horror). Following completion of the deal, Open Road will publish and distribute the titles through its own platform and the E-Reads site will be taken down.

If You're a Kindle Reader, Publishers May Owe You

As Amazon’s protracted battle with publishers and Apple — which pitted the online bookseller against the latter with regards to e-book pricing — slowly winds down, readers may benefit. On August 30th, a Forum Moderator on Amazon’s message board announced that “eligible Kindle customers… may be entitled to a credit for some of their past Kindle book purchases as a result of legal settlements between several major book publishers and the Attorneys General of most U.S. states and territories.” The credit could be anywhere from $0.73 to 3.82. Read the full announcement here.

PBS is Getting into the E-Book Business

PBS has released two new ebooks via their digital media initiative MediaShift, PaidContent.org reports, with a plan to release 10 to 20 more over the course of the year. “This is a test for us and PBS,” said Mark Glaser, MediaShift’s Executive Editor, of the first two titles How to Self-Publish Your Book and Your Guide to Cutting the Cord to Cable TV. “[W]e will learn as we go and adjust prices, length, subject matter and more.”

Free Excerpts of New Works by Elizabeth Gilbert, Wally Lamb Now Available

Elizabeth Gilbert

Digital industry newsletter Publishers Lunch has released a free ebook called Buzz Books 2013 featuring excerpts of new works from some of the most successful writers in the business. Joy Luck Club author Amy Tan, She’s Come Undone scribe Wally Lamb, and Elizabeth Gilbert of Eat, Pray, Love fame are among the starry names. Actor and writer James Franco is also debuting new fiction in the ebook. BostonHerald.com reports Buzz Books 2013 is now available for download on Kindle, Nook, and other digital devices. Two weeks ago, a site called Obooko.com launched announcing it would offer new and emerging writers’ work for free download.