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Richard Curtis on
Publishing in the 21st Century
by Richard Curtis
AT THE END OF THE MILLENNIUM
(first published in Backspace
Like a world held between the gravitational pulls of two
stars, the publishing industry is suspended between two great
paradigms. One is the familiar industrial model built around
tangible objects: bound volumes of paper manufactured on printing
presses, warehoused in depots, transported in vehicles and
sold in stores; the other, newly born, can be described as
virtual. The sun of traditional publishing and bookselling
has illuminated and warmed us for a millennium, but it is
unquestionably fading, while the other, fueled by the prospect
of direct communication between authors and readers independent
of physical means of manufacture and distribution, scintillates
with possibilities. In the balance lies the fate of one of
civilization’s most precious artifacts, the book.
How is the transition from one system to the other affecting
authorship today? What challenges can writers expect in the
next few years? Is it possible to plot a course using coordinates
that are not yet precisely fixed? In this series of articles
I would like to describe the old and new models and speculate
on how the roles of authors, editors, literary agents, booksellers,
and even readers are changing – or must change –
to adapt to evolving conditions.
A Dying World
The best way to understand the differences between the two
paradigms is to analyze the ways that traditional texts are
distributed versus electronic versions. Looking unsentimentally
at the publishing process, it is essentially one in which
the writer’s text is delivered to the reader by means
of a distribution medium. The process adds value to the work,
converting a collection of words into a product for which
money can be charged.
Printed books today are published and distributed through
an industrial complex consisting of brick and mortar editorial
offices, printing plants, warehouses, and retail stores. After
being edited, the author’s text is printed and bound.
The physical object called the book is then transported from
station to station in fossil fuel-powered vehicles. These
peregrinations add cost to the original text and they are
supposed to add value.
Whether they add value any longer has become debatable.
The distribution model of the book industry is a consignment
one. Books are returnable to publishers for full credit, meaning
transportation of books back through the chain of brick and
mortar stations from whence they came. This practice was originally
created as an admirable incentive for booksellers to take
chances on new writers. Most other manufacturing processes
place the burden of disposing of unsold goods on the retailer,
such as in-store sales at increasingly high discounts. Not
so for publishers.
For most of the twentieth century a modest and stable rate
of return stimulated the book industry’s growth. In
the 1980s and ‘90s, however, the return rate for trade
books (fiction and nonfiction of general interest) began to
soar to unprecedented levels of fifty percent and even higher.
One does not need an advanced degree in business to perceive
that it is almost impossible to make a profit selling one
unit of a product for every two manufactured, especially when
the manufacturer is compelled to fully refund the purchase
price to the customer. Indeed, it is hard to imagine a less
efficient delivery system.
As cash grew shorter and shorter, publishers developed strategies
to raise more of it. One was to pursue branded authors who
could guarantee profits. This strategy seemed sensible in
theory but failed in practice as shrewd agents demanded and
got huge prices for their household-name clients, guaranteeing
only that that many authors would get rich while their publishers
lost money or at best broke even.
Other publishers sought mergers with larger houses or rich
conglomerates in the hope of becoming major players in the
bidding for those household-name authors. Like many a chemical
reaction, this approach generated much light and heat, but
as time went by the new entity found itself hobbled by the
same cash flow problems that had triggered the merger, only
on a larger scale. This insatiable hunger for capital led
to a new round of acquisitions, and this time not of marginal
presses but of giants like Simon & Schuster, Doubleday,
Macmillan, Putnam, Warner, Harper, and St. Martins.
In the process, the unique personality and culture of each
company that succumbed were destroyed. Those executives fortunate
enough to survive the acquisition found themselves in a surreal
corporate culture that seemed to have little to do with the
values that got them there. Editors became disenfranchised
as they lost touch with the wonderful and mysterious process
by which art and literature are created. Many left the industry,
to be replaced by editors whose mandate was to acquire books
and authors that would guarantee high sales. This emerging
culture can be characterized by what was aptly described as
a blockbuster mentality. It has become the prevailing one
in today’s book business.
Authors, too, became disenfranchised as they confronted
a world that rewarded bestsellers prodigiously while giving
short shrift to newcomers and modest performers. Publishers
could no longer afford to carry promising new writers until
they justified the investment with a breakout book. Authors
were now expected to hit the ground running with perfectly
crafted, highly commercial hits. An agent I know, asked by
a brilliant but penniless author how he was supposed to support
himself until he completed his breakout opus, advised him,
“Drive a goddam taxi.”
Had the plethora of mergers and acquisitions that shrank
the number of publishers to a handful of behemoths achieved
a literary renaissance, perhaps we could rationalize that
it was worth all the turmoil. But it did not. After each consolidation
the patient continued to hemorrhage. It became obvious that
gigantic publishers hemorrhage the same way that tiny ones
do; it’s just that gigantic publishers have more blood
to lose and the losses can be disguised in the financial reports
of their parent companies.
Like many a dying patient, publishers have lived in denial
about the underlying cause of their chronic losses. Yet, the
reason has been in plain sight all along: the returnability
of books is killing the business.
A New Form of Currency
Fear of provoking Federal antitrust prosecution inhibited
publishers from combining to combat the practice of returnability,
even though it was draining the vitality of the industry.
What was worse, the vested interests of the retail bookstore
business insured that the system would never change. Powerful
chain store entrepreneurs shrewdly recognized that returns
are a form of currency and found a way to systematically
manipulate them. Instead of paying cash for new titles, the
chains simply returned slow-moving stock and applied the credit
toward the purchase. No money changed hands – just paper.
Deprived of capital, publishers developed their own way of
manipulating the currency of returns. They achieved this by
withholding royalties from authors. They figured out that
they could defray their overhead by holding author money for
long periods of time in order to offset possible returns.
The higher the percentage of royalties “reserved”
against returns and the longer those reserves were held, the
more interest publishers could earn.
The returnability of books was originally created as a good
will gesture. Since then, the currency of returns has been
debased, pitting booksellers against publishers and publishers
against authors in an atmosphere of distrust and anger. In
short, the old system has become corrupt and dishonest.
The New World
Towards the end of the twentieth century, advances in computer
technology and telecommunication offered thrilling vistas
of a new way to produce and deliver texts to reading audiences.
The maturation of digital word processing, email correspondence,
Internet commerce, cell phone communication, and miniaturization
of computers provided a climate in which development of e-books
could go forward vigorously. A generation comfortable with
computers and Internet navigation had evolved for which the
idea of electronic books seemed like a natural step. The meteoric
ascent of amazon.com provided an attractive business model
for online bookstores.
Although development of a viable handheld e-book reader proved
more challenging than visionaries had projected, the eventual
perfection of such a device and its adoption by the mass market
was taken for granted by most futurists. Their optimism was
bolstered by growing investment in research and development
fueled by the economic boom of the 1990s. Towards the end
of that decade these streams converged, and if any year could
be celebrated as the official start of the digital book era,
it is 1998.
In that year, breakthroughs in two initiatives were announced.
The first introduced to the public a prototype of the portable
electronic reader, the Rocket Book. Though crude (it would
eventually be succeeded by far better devices and delivery
systems) the mere thrill of downloading a text from a remote
server and “navigating” it on an “e-book”
had a galvanizing effect on authors and publishers alike.
When, not long afterwards, bestselling author Stephen King
self-published a novella and offered it for sale on the Internet,
any publisher still in denial about the potential of e-books
as an alternative publishing model woke up with a start.
Though initial giddiness about an e-book revolution was to
prove premature as technological problems and business realities
plagued progress, the impression nevertheless was indelibly
imprinted on the consciousness of anyone connected to writing
and publishing: a day would come when books would be read
on a palm-sized reader.
Until that day, the reading device of choice was still the
traditional book, and with all its faults there was still
money to be made in publication of the good old bound and
printed version -- if only a more efficient way could be developed
to distribute it. Enter the second technological marvel, the
process called print on demand.
Print on Demand
Until the introduction of “POD” in 1998, the
basic process for printing books had not varied from the model
that prevailed for many centuries. Speculating on customer
demand for a book, publishers printed a certain number of
copies, distributed them through booksellers, and warehoused
the unsold stock until the time came to replenish bookseller
supply through another printing. As the book trade developed
in the twentieth century, profits on sales were augmented
by revenues generated by the licensing of subsidiary rights
such as book clubs, reprint editions, and translations.
Though book marketing has never been particularly efficient,
post-World War II publishing seemed to flourish and promised
to continue flourishing as long as returns were held to modest
levels. But returns grew like a cancer. The cure? Print on
How does POD work? Computer-readable files of a book’s
text, cover, and illustrations if any, are stored on the printing
company’s server in such formats as Quark or PDF. Unlike
traditional books requiring print runs of thousands of copies
and storage in warehouses, POD is capable of printing a few
copies or even a single one for specific customers.
In a POD transaction, a customer orders a copy from an online
retailer like amazon.com, charging the purchase to a credit
card. The book is then printed and drop-shipped to the customer.
The sale is final; unless the book is damaged it is not returnable.
Though the cost of printing one copy is higher (as of this
writing as much as four times higher) than that of a single
unit of a conventional print run, there is no waste whatsoever;
the “sellthrough” percentage -- the ratio of books
actually sold to books shipped -- is 100%.
But it was not just the efficiency that inspired almost hysterical
hyperbole among publishers who had seen POD in action at the
publishing industry’s annual book expo in 1998. It was
the realization that the process enabled them, entitled
them, to keep books in print in perpetuity. No longer would
publishers have to return to authors the rights to their books
on the grounds that it was too costly to issue and warehouse
Author? What’s an Author?
The technological breakthroughs of e-books and print on demand
stunned the publishing community. It was as if the magnetic
poles had shifted leaving everyone connected with books utterly
disoriented as a new millennium dawned. Suddenly we were confronted
by perplexing questions and paradoxes: In the coming age of
disintermediation – of direct delivery of texts from
author to reader – exactly what function will publishers
serve? Will editors have anything to edit? Will bookstores
and libraries be necessary? How will readers know what to
read? Will agents be relevant? Most disturbing of all, as
technology empowers authors to perform all the roles traditionally
undertaken by publishers – printing, distribution, and
publicity – will they still be able to define themselves
Many of these questions will be resolved as we progress towards
a virtual future. But because we are still controlled by the
gravitational pull of traditional publishing, there are far
more urgent issues at hand. Can authors succeed in an environment
that punishes modest sales performance? How do editors balance
their need to nurture literary endeavor against the intense
pressure to acquire blockbusters? What strategies are agents
employing to introduce new talent into a contracting marketplace?
In the next installment of this series we’ll explore
the current ecology of publishing in the twenty-first century.
All the best,