I attended O'Reilly's Tools of Change in Publishing conference last year. Since the 2010 event is right around the corner (Feb 22-24), I thought I'd dust off and update this post from my own blog, written after the 2009 conference.
I wrote it after coming home in shock. What I heard at the 2009 event was almost exactly what I heard at music business conferences circa 1999. I was looking around like, hey you people!! Doesn't anyone else notice this?? We all know how this story ends!! Tools of Change, indeed. I guess it depends on how you define "tools." Tools! You're about to go down the same road as the pony-tailed ones you look down your noses at.
Hello book publishers. You're starting to scare me.
I am a writer, but was a record label executive from 1989-2000 and am fascinated by parallels between the two industries. When it comes to the digitization of product and attempts to master/mangle the phenomenon of social media and file-sharing, the publishing business is where the music business was about 10 years ago. And although publishing probably sets its collective IQ (not to mention good manners) as superior to the music business, I can't find evidence that their reactions to industry sea change are substantially different.
While attending this week's O'Reilly's Tools of Change in Publishing conference, I heard a lot of this:
There is still time to change course and we've got to do something now--but we don't know what.
In the meantime, let's co-opt whatever new trends we see out there by assigning some low-level marketing person to troll Twitter or hiring a social media consultant.
Please, please don't let us end up like the record business.
If there's anything to be learned from the recent past, it's that none of these thoughts are worth pursuing. The "somebody do something that works so we can copy it" mentality duplicates the kind of hoping-for-the-best attitude espoused by long-time executives in music who simply could not or would not question the viability of the professional cocoons they'd built for themselves. And who can blame them -- corporate mega structures are schooled in consolidation as the primary means of growth, not fleet-footed, shape-shifting responsiveness to change. But now we're in a world where getting bigger is not the answer, getting smaller is.
The question I hoped would be addressed at the conference was: How will publishing avoid being trapped by its own environment? But it never was. Instead, I noticed a lot of talk of waiting and seeing how things are going to work out before making any earth-shaking, world-class responses to a world that has already changed.
At the conference, I was excited for a keynote aimed at comparing the music and publishing industries. Although entertaining, it lacked vision. The speaker talked about how only wimps fear the freedoms of the digital marketplace and make attempts to control intellectual property rights and that at least we're not going to start arresting people like those thugs over at the RIAA. I was disappointed not to hear a more sophisticated dissection, beginning with debunking the idea that digital downloads killed the music business, or could kill publishing.
Downloads did not kill the music business. (For my ideas about what did, see this post.) Shortsightedness and turf-protection on the part of music business executives did. Piracy and changing distribution schema will not kill the publishing industry. Shortsighted infrastructure-protection on the part of publishing houses will.
What offed the music business -- and what the publishing industry is facing -- is a corporate structure built to churn out hits to subsidize an entire product line. Rather than developing artists, exploiting regional marketplaces, and building financial models that can easily support a mid-range list, both industries focus on entertainment at the expense of art and expression. (Difference between selling entertainment vs art? Entertainment starts with the customer and works back to the product. Art begins with the product and works forward to find/create an audience.) Although publishing is a lot more successful at marketing mid-range titles, both need hits to keep the doors open. The vast majority of releases do not earn out. They want to sell many copies of a few items, not a few copies of many items: the kind of product that can be shot out of a cannon, dominate the retail market, and then basically disappear--because anything else is simply too complicated for a similarly bulked up corporate retail environment to track. The appearance of downloads and file sharing could almost be seen as a desperate measure on the part of consumers to listen and read in an un-mandated manner.
Commodification of bookselling is the eight-hundred pound gorilla in the room, not e-books or DRM (Digital Rights Management) or Kindle pricing or what have you.
Without making friends with this beast, my guess is that in 2-5 years we'll see a publishing industry that looks like the music business does today: Super-downsized major companies selling a product line aimed at an older demographic or chopped into whatever the ring-tone equivalent will be in publishing, and a jillion new companies creating the next generation of publishers, retailers, and readers. Just like in the music business, some in publishing will be mourning the death of the business while others will be wildly excited because all they see is opportunity.
At Tools of Change, Sara Lloyd of Pan-MacMillan nailed it when she said, "Publishers understand markets, but not customers." As anyone in the music business could have told you years ago, the customer is now a human being, and publishers--who still see retail as their customers--don't know how to build products for individuals who might want to discuss, interact with, congregate around, or add their own $0.02 to the content. The customer has stepped out of the bookstore and into the foyer of the publishing houses, they are knocking on the doors of authors, and asking to be addressed as individuals. They will consent to purchase, not when coerced by a front-of-the-store display or fabulous media coverage, but when their friends start talking about how awesome/helpful/inspiring/powerful the actual book itself is. And this--the book itself--is what publishing is dangerously close to losing sight of in the attempt to build market share. To shift this kind of corporate culture will require super-human "change management" to flip a mega-entity staffed by people who are petrified of losing their jobs into a business that can be one step ahead (instead of five steps behind) consumption trends.
Ultimately, the music business sacrificed music to save the business. Hopefully, publishers will realize that if books are similarly sacrificed, what will be left is an industry that doesn't care about its product, focuses on creating grandiose supply chains instead of amplifying demand, has no idea what end-users (aka readers) want, sees value only in commodification, and has to keep spinning out hit after hit after hit to survive. The result? A beast that consumes itself.
I truly wish I had heard some mention of this at the conference. Maybe next year.