Wednesday, August 31, 2005

Danny O. Snow's View

Participants in the 2005 Book Summit: Industry Leaders Discussing the Future of Publishing in a Flat World are being asked for their views. Book Summit checked in with Danny O. Snow, owner of Unlimited Publishing. UP's goal is to achieve the best of both worlds: the speed and economy of print on demand, and the kind of quality and public exposure of books more typical of larger, mainstream publishers.

1. What are the implications to the industry with more books being sold beyond the bookstore ?
Look at the music industry: independent distribution (legal and otherwise) via Web sites like Napster and iTunes stunned the major record labels. And it's not just online: Bands like Pearl Jam now record a new CD at every concert, and sell it at the door the same night. More independent marketing methods arise almost daily. The established leaders (both music labels and retailers) must now play catch-up, and adjust their methods to keep pace, in order to remain competitive.

In 1997, I met with a VP of Warner-Electra-Atlantic Records and cautioned her to pay close attention to the (at the time) "new" phenomenon of music downloading. My concerns were dismissed, and by 2003 the company had lost nearly a third of its sales. I would raise the same concerns today to movie studios and major book publishing concerns. We will soon see a pattern in the film industry that is similar to music, as broadband matures and it becomes routine to download large files. If Hollywood has been paying attention to the music industry, they'll anticipate the trend toward alternative marketing and distribution vehicles. Companies like Netflix are already forcing traditional "video" stores like Blockbuster to update their business models, and more will follow when high-speed Internet connections are the norm.

Book publishers, wholesalers and retailers are fortunate to have music and movies as precedents to help them avoid getting left behind. In a 1996 study, the Book Industry Study Group estimated that there are nearly TEN TIMES more outlets for books than bookstores per se. I believe that a very large number of sales are already being made through these channels by independents, but they are largely unreported.

My colleague Dan Poynter points out that the growth in nontraditional marketing and distribution includes a trend toward "disintermediation," read: bypassing middlemen. I believe that many sales of POD books go directly from the author to local retailers, to audiences at live events, to readers from the author's Web site, etc.

More recently, there has been even more disintermediation; my company, Unlimited Publishing, now routinely has books shipped directly from one of our POD printers to a nontraditional buyer, even in small quantities. Soon, we expect to see SINGLE copies shipping directly from a printer to an individual consumer... Lightning Source already handles many Amazon orders this way, but of course there are big discounts and pay is slow. Soon, we expect to see singles moving directly from printer to reader without the kind of discounts typical of trade sales, and without returns. UP still wants trade distribution... in spite of the big discounts, returns and slow pay... but I think that major publishers, wholesaler distributors and retailers (especially chain stores) would be wise to look closely at the music and film industries to remain competitive in the years ahead. They will soon face the challenges that music labels and record stores started seeing five years ago, and I hope they fare better.

2. What do you see as the most pressing issues facing distribution (returnability) of digitally printed books?
Many feel that returnability is anathema to POD, but POD books CAN be returnable, when there is proven demand. UP has more than 50 titles that are available on a fully returnable basis through one of our POD printers/distributors.

Having said this, the higher per-unit cost of POD printing makes returns especially punishing, so DO THE MATH before you agree to buy back unsold books: can you afford to sell at 50 percent below cover price, deduct high print costs AND absorb returns of 20 percent or more?

Aside from chain stores, my impression is that retailers are usually more interested in discounts than returnability. Chains may accept orders for single copies, but rarely if ever stock nonreturnable titles. If your book isn't fully returnable, you probably won't find it on the shelves at chain stores.

3. What would it take to get digitally printed books into the mainstream distribution channels?
Better content: too many POD books are released without editing or professional quality layout and design. Some form of vetting process is needed -- yet writing and book design are largely subjective. One objective "litmus test" might be whether a publisher is willing to accept returns,
demonstrating confidence in the product... but again, many feel that returnability is contrary to the spirit of POD, an artifact of the past that should be consigned to the dustbin of history.

Sadly, the term "POD" has become nearly synonymous with vanity publishing, though I can personally document scores of POD books that are competitive with those of major traditional publishers, or in fact FROM leading publishers! Nevertheless, the stigma lingers, and some form of quality control would help dispel it.

4. What do you see as the future direction for print-on-demand publishing companies?
Ignoring the challenges (and they are serious challenges) of improving content and presentation, I see a growing trend toward disintermediation, (bypassing middlemen) with more and more books moving directly from author to printer to reader. I predict that the concept of the "out-of-print"
book will soon fade away... to the true benefit of readers, writers and publishers. In time, I see a world where every single copy of a book can be unique, customized for the specific needs of any individual reader. There will be hurdles to clear along the way, but my conviction is that we WILL clear them, and realize the full promise of on-demand publishing in our time.


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