Tag Archives: Harper-Collins

Friday Morning Links

I’m up to my elbows today in reviewing edits and such, so today’s post is going to be short.  Hopefully, I’ll be able to get back this afternoon and do a longer post.  Until then, here are a couple of links that caught my eye this morning:

Harper, Donnelley in Wide Ranging Supply Chain Deal — what this means in the long term for authors has yet to be explained.  However, I can’t help but wonder if this isn’t another way to prevent a title from going out-of-print.  If so, authors, you need to make sure your agents are taking that into account in your contracts.

Borders is once again in the news — twice.  The first is this call from the CEO Mike Edwards once more telling publishers to “trust me” and start sending stock under reasonable terms.  In other words, we’ll pay when we’re good and ready.  And he doesn’t understand why they aren’t willing to run the risk.

The second is this article from PW where it is speculated that there has been an offer for Borders.  Note, however, that in the link in the previous paragraph, Edwards does his best to downplay that possibility.

Finally, there has been an e-mail sent by Edwards to the Borders Reward customers.  In the same metaphorical breath as he tells everyone he is confident Borders will emerge from bankruptcy as a “best-in-class” bookseller, he also says they are expanding children’s games as well as their stationary and gift offerings.  Hmm…bookseller….riiiiight.  And in what I’m sure is a great cost-cutting measure — yes, I’m being sarcastic here — they are offering, for a limited time, free priority shipping to the customer’s home any title not in stock.  All you have to do is come into your friendly neighborhood Borders to take advantage of the deal.  Well, I checked.  My friendly neighborhood Borders is at least half an hour away, without running into traffic delays.  I’d pass at least two Barnes & Noble stores.  Hmm….why am I going to Borders?

Okay, more later.


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Monday morning thoughts — Borders, HC and more

Yes, more on Borders.  You knew it would happen.  But I’ll get to it in a minute.  There are a couple of other items first.

Kate Sheehan has a wonderful post explaining why so many librarians are calling for a boycott of Harper Collins after the publisher announced it would limit the number of times an e-book could be checked out of a library.  In this thoughtful and insightful post,  Ms. Sheehan reminds us how the library serves its patrons and is not in the profit-making business.  Yet, even as the library serves its patrons, it is actively working to protect the rights of the publishers and authors.  But, in this day and age of financial constraints and shrinking budgets, to put an arbitrary — and unreasonable, in my opinion — limit on how many times an e-book can be checked out before it is “destroyed” is foolishness.  I applaud Ms. Sheehan for her stance and for explaining it so well.

Then there’s this post about changes going on at Waterstone’s.  Dominic Myers, the head of Waterstone’s, is taking the bookseller on a trip back to the past.  And all in order to survive.    From The IndependentWhen he took the helm, Myers rightly cited “stifling homogeneity” as a source of his company’s ills. Its financial woes are forcing Waterstone’s, however tentatively, to return to what made it so popular in the first place: knowledgeable staff, hospitable stores, and a love of literary fiction with popular potential.

All I can say is:  YES!  It has long been my complaint about the big box stores here in the States that the knowledgeable and friendly staff the local independent bookstores employed became a thing of the past as the big chains took over the market.  Over the last five to ten years, something else was lost — neighborhood or even regional specific titles because stocking decisions were suddenly being made on a national level and not local.  So the store in Dallas was the same as the store in Denver that was the same as the store in Boston.  I applaud Myers for his willingness to look back at what made Waterstone’s and other stores great and to try to adapt those methods to today’s market.

And now for Borders.  We’ve finally heard from Borders president Mike Edwards.  As I read this article, I can only shake my head and wonder why the decisions he is so sure will save his company weren’t made months or years ago.  Then I read further on and find my sense of disbelief and, yes, resignation growing.  Here are some specifics from his interview:

Saying he hopes to come out of bankruptcy in August or September, Edwards notes, “You’ve got a window, and you have to act decisively.”  True.  But why did Borders wait so long to take actions that were obviously needed?  If decisive actions were necessary — and I think we can all agree they were — why did it take filing for bankruptcy to bring them about?

He also says Borders may close up to another 75 stores, although the number may be as low as 20 – 25, depending on how lease re-negotiations go.  Again, why wait so long?

In papers filed last Thursday by the unsecured creditors, it is alleged that Borders won’t have the funds to place orders in the late summer/early fall for the the holiday season.  If true, this would be disastrous for the bookseller.

The same filing alleges that the loan Borders secured from G. E. Financial was more than necessary and resulted in $16 million in unnecessary fees.  It is also possible that, under the current terms of the loan, Borders won’t be able to secure the full loan amount of $550 million.  Again, not good.

Borders is now receiving stock from publishers, mostly on a cash basis.  Needless to say, Edwards wants to go back to how it was before.  All I can say is if the publishers agree to this before Borders proves there is a viable plan in place and that they can stick with it, then they deserve anything that happens.

But what really surprised me in the article was how, after noting that their online presence isn’t working, Edwards said he sees the biggest challenge as being the reconfiguring of their super stores.  Specifically, he said they “no longer need to hold huge inventories of slow moving books when they are available online.”  What?  Let’s remember, he just said their online presence isn’t working.  Second, I’ve never known Borders to keep books on the shelves for long.  Not unless they happened to be a NYT best seller or part of a paid end-cap or stand-alone display.

It sounds to me like there is still too much of the same ideology the got Borders in trouble to begin with.  If I’m right, I don’t see the company coming out of bankruptcy any time time.

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Some links, some comments and a giveaway

Crawling out from under the rock, the weary editor looks around and then smacks her forehead, realizing she missed the beginning of Read an E-Books Week.  More on that later.

First, however, I want to point you to a good article from Time about why Barnes & Noble has, so far, managed to avoid the pitfalls that seem destined to materially alter — if not doom — Borders.  The author points out the prominent display of the Nook and its accessories in his local B&N, showing how the company recognizes the need to embrace the new technology and demands of the buying public.  But more importantly, at least in my opinion, is the fact that the B&N management team has managed to maintain their financial health — having $900 million more in assets than they do in debt.  Remember, at the time of the Borders’ bankruptcy filing, Borders owed approximately $40 million more than it had in assets.

Does this mean B&N is out of the woods?  No.  But it means they are working hard to stay a vibrant company.  Here’s hoping they manage to do so.  We need bookstores and the loss of even one is not something I want to see.

Then there’s this article from USA Today about how librarians are responding to Harper Collins limiting the number of times an e-book can be checked out to 26.  (For some background, read here.)  Some librarians are calling for a boycott of HC and using various social media sites to rally support for their cause.

This quote says so much:  “It’s never pretty when a publisher decides they have to destroy books in order to save their business model,” Kelly Clever, a librarian at Seton Hill University in Greensburg, Pa., wrote on Twitter.  It also points out something many of us have been saying for so long — that the traditional publishing houses simply aren’t willing to adapt their business models to the changing times.  Instead, they try strangling the new technology in an attempt to either force it into the existing model or to make it so unattractive for their customers that it dies a premature death.  “It would almost seem as if (publishers) are trying to force us back to print only,” Sarah Houghton-Jan, deputy director of the San Rafael (Calif.) Public Library, wrote on her blog (librarianinblack.net). “Oh what a sad day for publishers. You are killing your own business.”

Librarians aren’t the only ones up in arms by HC’s decision.  Cory Doctorow has a very good post about it.  One of the points he makes is what I mentioned in my earlier post — that, despite HC’s assertion, most library books are not pulled from the shelves as unusable after 26 check-outs.  Go take a look at what he has to say.

Now for the giveaway.  Leave a comment.  At least one person will be chosen tomorrow to receive any one of our titles they want for free.  Check back tomorrow for the winner or winners and to find out what e-book or short story we will be offering for free tomorrow.



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More on the agency model and H-C blowing up library e-books

As you’re probably aware, the last of the major publishers to hold out against the agency model of pricing for e-books has finally given in.  Or maybe I should say sold out.  Random House announced earlier that it would join the other publisher not so affectionately nicknamed the Big Five in adopting the agency model for e-books.  What this means is that the publisher and not the retailer will set the price for e-books.  So, no more shopping for competitive prices.  E-titles will cost the same across the board, no matter which online retailer you use.

Now, it’s been interesting to watch some of the reactions across the web over the last few days to the news.  On the kindle boards, readers were gnashing their teeth at the sudden increase in price for a number of books.  And, folks, we aren’t talking small price jumps.  No, we’re talking increases of multiple dollars.  And we are talking about some very restless and angry customers.   Customers who may decrease the number of their purchases simply because they can’t afford — or won’t pay — as much for an e-book as they will for a mmpb.  More than that, when they see the price of an e-book for a title that has just hit the market and the projected for price for the mmpb that will be out in just a few months AND the mmpb is less than the digital title, well, the natives start doing the war dance.

But what is really telling have been the justifications for the change to the agency model. Random House talks about how this will make more money for them and for their retailers and will even the playing field for the independent booksellers who now sell e-book titles through google books, etc.  But no where have I seen anything about the authors — the creators of the e-book — getting more money.   While I appreciate anything that helps save the indie booksellers, let’s face it — this is simply one last grab at trying to maintain the status quo and not adapt to the changes pounding the industry right now.

There’s one other point I want to address about the above link.  One of the reasons the author of the article cites as being “good” about RH’s adoption of the agency model is “blockbusters everywhere!”  Gee, this wasn’t a problem before Apple opened the iBookstore.  Remember, everyone, we didn’t have the agency model until Apple and Steve Jobs got into the mix.  As for blockbusters everywhere, the only ones left out were those who purchased solely from Apple and, gee, they didn’t have to.  Kindle, Nook and the other major e-readers all have applications for the iPad, iPod touch, etc.  So Apple users weren’t tied to iBookstore.  Also, has anyone noticed how Apple hasn’t offered apps for non-Apple platforms, thereby losing sales?

’nuff said.

As for Harper-Collins and its decision that e-books sold to libraries will basically self-destruct after 26 check-outs, they’re really started a firestorm of protest.  Librarians are up in arms, calling for boycotts of H-C and, in some cases, even the jail-breaking of DRM on H-C e-books.  Why?  Because this decision will wind up costing libraries across the nation who offer e-books to the patrons in one way or another.

The most obvious way is that the libraries will have to contract with OverDrive for more “copies” of each e-book.  Let’s face it, that presents a problem in this day and age when libraries are facing huge budget problems.  Libraries across the nation are being forced to reduce hours, reduce their acquisitions, reduce staff numbers and are having to reduce hours — when they aren’t closing altogether.  Having to find more money in their budgets to buy additional copies of e-books because H-C has applied some magical formula and come up with the number 26 because, supposedly, that’s how many times a print book is checked out before it’s taken out of circulation.  C’mon, guys.  Apples and oranges here.

I don’t know about your libraries, but mine checks out books a lot more than 26 times before it is taken out of circulation.  The exceptions are when the binding breaks down — then it is temporarily removed and the binding is repaired — water damage, etc.  But normal wear and tear doesn’t kill a book that quickly.

But let’s look at it from another side.  Libraries are facing an increasing demand for e-books.  If, suddenly, they can no longer offer books — or if someone has been on a waiting list for months and months for an e-book only to suddenly be told they won’t be getting it because it reached that magical number of 26 checkouts, can you imagine the bad feelings?  Patrons make or break a library.  Angry patrons complaining to city councils can definitely break it.  And all over something libraries have no control over.

But what does H-C have to say about the uproar?  Here is an open letter to libraries about their decision.  H-C recognizes the importance of libraries but — and this is a big but — “Our goal is to continue to sell e-books to libraries, while balancing the challenges and opportunities that the growth of e-books presents to all who are actively engaged in buying, selling, lending, promoting, writing and publishing books.”  In other words, they are more worried about making sure libraries are as humstrung by DRM as is the purchasing public.

But let’s see what else they have to say.  “. . .our goal to make sure that all of our sales channels, in both print and digital formats, remain viable. . . ”  More of the same.  Limit digital in anyway possible to keep the print end alive.  But don’t ask us to change our business model because we won’t.  At least not one moment before we absolutely have to.

“We have serious concerns that our previous e-book policy, selling e-books to libraries in perpetuity, if left unchanged, would undermine the emerging e-book eco-system, hurt the growing e-book channel, place additional pressure on physical bookstores, and in the end lead to a decrease in book sales and royalties paid to authors.”  So, are they going to start putting limits on the number of times a print book can be checked out?  Or, conversely, start paying authors royalties based on the number of times an e-book is checked out?

“Twenty-six circulations can provide a year of availability for titles with the highest demand, and much longer for other titles and core backlist. If a library decides to repurchase an e-book later in the book’s life, the price will be significantly lower as it will be pegged to a paperback price point.” Wow, a whole year.  Possibly only 26 readers and then the title goes POOF.  As for tying the price of repurchasing the title to the paperback price point, well, I sure hope that’s written into the contract now because I seem to remember the publishers that adopted the agency model saying e-book prices would come down when the mmpb came out.  How closely have they stayed to that promise?  Well, let’s just say, I stopped holding my breath a long time ago because the price drops aren’t occurring as quickly or as deeply as represented.

I’ll admit now that I am a big supporter of libraries and I think this is a lousy decision by H-C.  A decision that hurts libraries and their patrons.  More, it hurts the author and even H-C because the decrease in the number of e-titles the libraries offer will lead to a decrease in sales.  People often use the library now to check out authors they haven’t read before.  Or to check the latest book from an author they used to like a great deal but who had disappointed in a book or two.  If they like what they read, they will then go buy books by that author.  The same goes with e-books.  This is a no-win decision for all involved and very short-sighted, imo, on H-C’s part.

For more information on this, check out this article from the Des Moines Register.


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Some Random Thoughts and Links

Well, it’s Sunday morning and I’m find myself in a quandary.  I didn’t write the blog early yesterday because, well, I was hoping to find something that wasn’t related to Borders or publishers-doing-stupid-things.  So, here I am on Sunday morning trying to get enough coffee into me to function and figure out what to blog about at the same time.

Let’s start with the obligatory Borders report.  Mark Evans has an interesting list of six reasons why Borders went bankrupt.  While I don’t necessarily agree with what he has to say, he makes some interesting points.  Author Melanie Benjamin talks about where she was and how it affected her when she first learned about the Borders filing.  The bankruptcy trustee has named the unsecured creditors committee.  Included on the committee are publishers and landlords.  This article points out that one of the issues Borders will have to deal with is making sure it is closing the right number of stores AND the right stores under the circumstances.  Also, this committee will have something to say about it.  Add that to this article that seems to confirm my suspicions that there will be more closures in the very near future.

In other news around the publishing world, Random House announced it is offering early retirement to employees over 50 who have been with the company at least 5 years.  This offer expires April 15th.  Of course, they are also quick to say that this is NOT an indication that RH is going to downsize.  I really wished I believed them.  But, in my experience, when companies start offering this sort of a deal, particularly with employees who have not been there for long, it is a sure sign of downsizing in the future.

Barnes & Noble released its third quarter figures for 2010.  It doesn’t surprise me to see that their sales were pushed by digital downloads and tech.  Barnes & Noble has done a lot of things wrong, in my opinion — most importantly having played a large role in driving out the independent booksellers.  But they did two things very right, things Borders should have done.  They embraced the internet and have had a strong online presence for years and they have a branded e-reader that is associated with their name.

On the ongoing front of will we ever get an industry standard in e-book formats,  Japan has made a step in that direction.  It was announced last week that their publishers and electronics companies had adopted EPUB 3.0 as their standard.  Unless I am completely wrong — very possible, of course — it isn’t going to be long before we see two main formats:  EPUB and MOBI.  The other formats will drop by the wayside.  Whether we will see EPUB become the industry standard or if it remains split between the two will be something to be seen over the next 5 years or so.

In other EPUB news, and this does fall under the heading of publishers-doing-stupid-things, comes this.  Harper Collins once again proves, at least to me, that it doesn’t support e-books nor does it support public libraries.  To start, there aren’t that many e-titles available for download from libraries.  Now there will be even fewer.  Why, because of this idiotic decision by HC.  A decision that flies in the face of mainstream publishers’ very frequent cry that e-books aren’t real books.  It is this argument that publishers use to justify DRM, saying that when we pay for an e-book we are only buying a license for it.  But, with the decision to limit the number of times an e-book can be checked out, they are saying it should be treated as if it has the same lifespan as a “real” book.  Can you say, have your cake and eat it too?

Finally there’s this article about the increase in piracy of e-books, specific to this article Kindle e-books.  I think what frustrates me the most about articles like this is the fact that it completely ignores the fact that piracy happens to ALL books, not just those released in digital format.  How quickly they forget about how the last Harry Potter book hit the internet in PDF before it was released in stores.  When’s the last time they brought up the brouhaha that surrounded Stephenie Myer when one of her manuscripts was leaked on the internet AND SHE THREW IT AWAY.  But what really bothers me is how so many of the publishers who rant about e-piracy use the argument about how it is stealing from their authors and yet these same publishers do not give accurate accountings of e-book sales, nor do they give authors a reasonable royalty on e-book sales.

Finally, on a personal note, I want to thank everyone who has supported Naked Reader Press and our authors.  It dawned on me today that we put our first books up for sale just about 6 months ago.  It’s been 6 months of hard work but it has been worth it.  So thanks to everyone who made it possible.

(Cross-posted to Mad Genius Club)

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The Good, the Bad, & the-oh-so-ugly

The Good — the New York Times reports e-book sales in the Young Adult market are increasing.  Specifically, e-books made up 25% of all YA sales in January for Harper-Collins.  this is up 6% over this time a year ago.  The article also notes that YA e-books made up approximately 6% of total digital sales for St. Martin’s Press in 2010.  So far this year, they account for 20%.  Mind you, the year is young so there’s no guarantee this trend will continue.  However, I expect it will.  Perhaps not with such a huge increase, but with an increase nonetheless.  Our teens and young adults are more tech savvy than most of their parents.  They have smart phones and iPods and tablets.  It is only natural that they read via the same hardware they use for their music and games.  Besides, anything that encourages them to read is good in my book.

The Bad (maybe, kind of, sort of) — A Literary Glass Ceiling? That’s the question posed by The New Republic.  It’s an interesting article with its roots in the kerfluffle started this past summer when Jodi Picoult and others accused the NYTBR of being sexist when it came to who and what it reviewed.  The numbers presented are staggering, until you look — as the author did — at the underlying numbers for books likely to be reviewed that were written by men v. those written by women.  It won’t silence the accusations, but it does shed light on the reality of the situation.  Now, what would be interesting would be to see the numbers of submissions to the publishers the author spoke to v. the acceptances and then to see how that breaks down by sex.  Not only by the sex of the author but by the sex of the editor purchasing the book.   Of course, I don’t think we’ll ever see those numbers.

The also bad — The Washington Post has an article that puts forth the premise that it costs basically the same thing to create a best selling e-book as it does the hard cover version.  There’s a nice break down of costs near the end of the article.  The problem I have with it is the generality of the entries.  Overhead cost.  What are they including in this catch-all section?  More to the point, are any of these costs also costs applied to hard covers — at the same time?  In other words, how much double-dipping is being done, and at the author’s expense.  Look, I’m not exactly saying these numbers are wrong.  In fact, under the current business plan of most traditional publishers, they are possibly correct.  However, it’s my opinion that the traditional business plan — and the expenses inherent with it — is completely wrong for the e-book business and, as I’ve said before, it is time for these traditional publishers to be dragged into the 21st century.

And the oh-so-ugly — Well, what else but Borders.  Again.  First, Borders has been notified by the NYSE that it has six months to pull its daily stock price average to above a dollar or its listing will be dropped.  When this news hit the streets, stock prices fell 2% to 39 cents a share.  In the last year, stock prices have fallen 67%.  What is interesting, and more than a little disconcerting, is the statement from a spokeswoman for Borders saying the company has not yet implemented plans to return to compliance with the NYSE regulations.  This is a company that has — or at least should have — seen the writing on the wall more than a year ago.  A company that only now seems to realize just how dire the situation is.  I simply have to ask how long before it either voluntarily files for bankruptcy or is forced to in order to try to stay afloat.

To put the Borders picture into perspective, at the end of January, corporate value was estimated at $29 million.  That’s down from $663 million two years ago.  The number of employees at its headquarters in Ann Arbor has been cut from 1,200 to less than half that number over the same two year period.

Add to that the fact that some industry insiders are predicting Borders will have to close 150 stores — or more — to meet just one of the requirements of GE Capital for the loan needed to stay afloat a bit longer.  According to the above article, all of Borders’ stores are currently locked into leases.  The average length of time left on these leases is 8.1 years.

“A full 369 stores are in leases that won’t expire until 2017 or later.  And the dollar obligation of the leases for the company is staggering: $562 million last year, or 19 times the $28 million value of its stock as of last week.”

So, if Borders files for bankruptcy or, worse, goes under, not only are its own employees and shareholders left out in the cold, so are the landlords, lenders and others associated with the leased properties.  Where was the oversight, the checks and balances needed years ago when the trouble should have been spotted.

I’m keeping my fingers crossed Borders manages to pull out of this debacle without taking any part of the publishing industry or anyone else down with it.  I’m just not very hopeful at this point.


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More Links of Interest

The NY Times has revealed “its new e-book bestsellers that will appear in print in its February 13 edition.”  It’s going to be interesting to watch this over the next few weeks and months, especially since they have the list broken down into bestsellers as e-books, as print books and then as a combined list.  The list is also broken down into fiction and non-fiction bestsellers.

There’s additional news on the “is Amazon a publisher or a bookseller?” front.   I think it’s pretty clear Amazon is a publisher, at least on a small scale when it comes to print books (CreateSpace not counting in my opinon since is it POD).  However, the fact they are willing and eager to go after authors who have been dropped by their publishers is yet another indication that the industry is changing.  It also proves what I’ve always thought — the publishers are foolish for cutting their mid-list authors loose.  These authors might not sell mega-numbers, but the publishers know there is an established fan base that can be counted on to sell X-number of books.  That’s money in the bank.  Unfortunately, the publishers don’t seem to understand this.

In an attempt to help members (independent booksellers) expand their online presence, the American Booksellers Association has partnered with Monsoon Commerce Solutions.  This will allow members to list their used inventory on more than a dozen online marketplaces for free.

Here’s more on the Apple decision to reject the Sony e-book app and its possible implications.

Finally, even more evidence that e-books are a market that publishers have to embrace.  Second quarter sales at Harper Collins were down.  Part of the reason for this, according to HC, were fewer titles being offered.  However, even as sales overall fell, e-book sales rose 400%.  Think what they would have done without the agency model.

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