The future of the book/publishing: A social network based on a book ?

INTRODUCTION

This post covers two topics:

a) For the budding author who wants to write a book in the business or technology areas – this post provides an understanding of the publishing industry – both where it is currently at and (more importantly) where it is going to

and

b) A vision of my own business (futuretext) which is a niche publishing company. Specifically our vision is based on the idea of creating a creating a social network based on a book as I explain below

So, you want to write a business/technology book – Where do you start? Should you start at all?

In writing about the publishing industry, I have a unique perspective – being a published author (through Mobile Streams ) and then going on to set up a publishing company futuretext . We have published books from authors like Tomi Ahonen, Alan Moore, Rakesh Radhakrishanan (Sun Microsystems), Mark Curtis and many more to come.

Some of our authors have appeared in leading publications – for instance Tomi Ahonen on CNN , Mark Curtis(in the Financial Times) etc.

Unlike the more traditional publishers who don’t understand new media like blogs (Some actually prohibit their authors from blogging ‘too much’ since it may hit sales!) – we were born in the era of the blog and we actively encourage our authors to blog. When we started futuretext, I toyed with the idea of starting a magazine to promote our books. However, after reading the seminal article in Business week about how blogging will change your business in May 2005, I realised blogging was the way to go. I went on to create one of the most successful blogs in the mobile space(OpenGardens blog ) (The OpenGardens blog was also started on 31 May 2005 inspired by this article ). For a note on why blogging works for our business (publishing) see SEO: How to use blogs for Search engine optimization and to improve your Google ranking/Alexa rating

So, I hope – my views and insights cover both new and old media and add value to you. In turn, your feedback will help me to formulate the future direction of my company

The questions which I get asked most often are – ‘I want to write a business/Technical book. Should I do it? How long does a typical book take to write? How much money will I make? Do you think my book will be covered by the mainstream press? Etc

There are lots of articles, books etc about ‘How to write a book’ – but mostly they are from the perspective of the existing publishing industry, they ignore new media like blogs and they often cover fiction writing. So, this article focuses only on business and technology books especially taking into account the emergence of new media like blogging.

THE STRUCTURE OF THE PUBLISHING INDUSTRY

Here is a simplified structure of the book publishing industry as applicable to our discussion i.e. writing technical/business books.

We can classify books into the following categories

a) Mass market fiction – think Harry Potter!

b) Business books – Many entrants – Very few winners. Historically the industry promotes the same books over and over again – even though there are many newer books on similar topics. If you doubt this, next time you are at an airport lounge – see how many ‘old’ books dominate the business sector. Two classics I see are Barbarians at the Gate and Built to Last. Both are excellent. But ‘Barbarians’ I read when I was in school(not typical reading for your average school kids – but my dad always had many books at home and this was one of them!). It is the story of the hostile takeover of RJR Nabisco by K Kohlberg Kravis in the 1980s. Point is – its chief protagonist Henry Kravis has since gone on to do many more things – yet this story of greed in the 1980s dominates the bookstores in 2000s – for reasons to do more with risk aversion from the publishing industry. Traditional publishers like Harper Collins who published Jack Welch

and also academic/business publishers like Harvard business school press who publish Hamel and Prahalad are best known in this space

c) Traditional technology books – Large business and technology publishers are in this space – Wiley, Blackwells etc.

d) Academic books – Written by academia (often for academia). Expensive and with a relatively small print base

e) Programming books – ‘How to’ books for programmers. Companies like O Reilly, Apress and others dominate this space

f) Niche publishers – a relatively new phenomenon – publishers focussed narrowly on a specific vertical – for example futuretext in mobility and convergence

g) Publish on demand – Self publishing – strictly not a publisher for reasons outlined below

THE IMPACT OF DIGITIZATION ON THE PUBLISHING INDUSTRY

Before we begin ..

Let me tell you a little secret – I believe that the book publishing industry as it stands today, will be unviable in the near future – if it is not so already. It will be a victim of the relentless digitization we are witnessing around us and which has already affected movies, music, newspapers, magazines and other non digital forms of media.

Books are no different – and there is no reason why books will be an exception.

The most important effects of digitization on the publishing industry are

1) A reduced barrier to entry for publishing through digital printing (print on demand ). Print on demand is a process. It conjures up an image of literally printing one book at a time. However, there is another way to look at print on demand. It enables us to print a smaller batch size. The option to digital printing is litho/offset printing – with a minimum batch size of 1000 copies and often a lot more. Thus, digital printing enables many smaller publishers to get started(and this was the route we took to get started as well).

2) The emergence of niche publishers specialising in specific topics for the reasons listed above (Digital printing)

3) The ability to bypass the print media altogether through blogs

4) The rise of Amazon – which is a ‘level playing field’ when it came to publishers (i.e. it treated all books equally irrespective of whether they came from a small publisher or a big publisher). Note that recently Amazon has started to distinguish between its own printing company booksurge vs. the rest. But that’s a different story i.e. Amazon still treats all publishers as the same)

5) Print on demand – the ability to print one book at a time leading to self publishing

6) A voice for the Long tail – the emergence of long tail books i.e. books which would normally not be printed but are now possible since barriers to entry have been reduced

7) Many more avenues to gain exposure – for instance the blogosphere. Contrast with the few large newspapers, magazines prior to the rise of blogosphere.

PROBLEMS WITH THE STATUS QUO FOR AUTHORS, PUBLISHERS AND THE CUSTOMERS

There are many problems with the existing market structure for authors, publishers, distributors and customers. Here is how I see them

a) Publishers have become risk averse – focussing on the same few authors and titles which they think are ‘safe’. I mentioned Barbarians before. In an ironic twist , the book The Long Tail has also become a permanent fixture of many an airport lounge(I took this picture at Heathrow a couple of months ago)

long%20tail.jpg

b) The rate of change of information is far greater than the print media can manage i.e. books take too long to produce and by that time the topic has moved on

c) The most knowledgeable people have no time to actually write a book

d) It is difficult to get exposure in media – and I say this inspite of having authors on CNN and the FT. If I am honest, there was an element of luck and timing with it. In addition, big media is itself declining – for example the decline in newspaper readership.

e) Books are too expensive in emerging markets like India, China and Brazil. The biggest growth however will come from these markets.

f) Book distributors continue to take as high as 55 percentage of the price of the book. This means many of the more interesting and latest books will never make it to bookstores. I don’t see bookstores changing their business models. Instead I see many large bookstores and distributors dying out in the near future and the industry will face considerable consolidation.

g) There is little revenue for the author in terms of royalties. This fact coupled with long timeframes to write the book and little exposure – make the whole process unviable for authors

WHAT IS THE SOLUTION?

So, what are the solutions

a) What about self publishing? This seems most obvious – but has a critical flaw – since no one has invested in / validated your book – it immediately has less value in the minds of the reader. In contrast for instance, even with a niche publisher like futuretext, the fact that you are in the company of other authors like Tomi, Rakesh and Mark – is an intellectual validation of your work. By the way, while we are on this topic, don’t ever sign up to someone who expects the author to pay the publisher! That’s vanity publishing!. The publisher must always take the commercial risk for the book.

b) Why not create your own blog? This is a possibility – and if you can do it – I encourage you to do so. It is however not easy to get exposure for blogs and most bloggers will admit that it’s really hard work.

c) The industry is evolving and the best developments are from the digital / new media – than from traditional publishing. Google with Google book search , O Reilly with Safari books and various developments from Amazon are the most promising

VISION

So, what do I think will work?

Obviously, the book publishing industry still works (except in my view the self publishing option for the reasons listed above). Hence, if you get a publishing contract with a reputable publisher and you can write that book within a timeframe – it is well worth considering

However, I believe increasingly the following trends are driving book publishing to change the nature of the book itself:

a) It will be increasingly not be possible to make money on books for authors

b) There is a trend towards the ‘reference’ book i.e. if the book is simple enough – most of the content can be obtained online. People will pay to buy a book which is complex and one they need to refer back repeatedly

c) Ironically, at the same time, there is an opposite trend –towards smaller, cheaper books. The wired article on Snack content provides a rationale towards consumption of content (including books) in bite sized chunks

d) Emerging markets are the key drivers but they will warrant a much lower cost of the book(they already do)

e) Increasingly, fewer books will be covered by mainstream media for the reasons listed above

f) I find that authors will increasingly struggle to write books especially in the light of the fact that they get little exposure in the first place and little royalties.

So, I believe the creation of an online social network based on a book may be an option

Here are some more thoughts on this

a) There is an increasing tendency to pay online. Consider Wall street journal, Financial times and the Guardian all have paid models

b) We need differential online prices for emerging economies

c) We need the interactivity i.e. people pay for the community.

d) The book becomes a living document –there by making it easier to write since writing becomes an ongoing process

e) I believe that translations will play an important part in this process

f) I see a price point of $9.99 / year for emerging markets like Brazil, India, China etc and $19.99/year for UK/USA etc.

I seek your feedback on this especially the price points and the benefits.

You should also read the work from The future of the book project

Many thanks to Justin Oberman for pointing out the link to me.