Wednesday, April 30, 2008

A Tempest Or The Whole Pot of Tea?

The, a UK website, had an interesting article on Friday.

They say that HarperCollins US and Simon & Schuster US are refusing to sell e-book rights to UK publishers.

UK publishers confirmed that acquiring e-book rights was key to their publishing plans. Little, Brown c.e.o. Ursula Mackenzie said: "Virtually all UK publishers, as far as I'm aware, feel it is essential that e-book rights are included with volume rights--otherwise we could find ourselves in the position in a few years' time of spending money promoting a book in the UK, but anyone seeing our advertising but wanting to download it would download a US edition with a different cover, and we wouldn't get any commercial benefit despite having paid for the promotion that caused the sale. It just wouldn't make sense."

The article implies that all major U.S. publishers had started with the same attitude, but that the others have since moderated their stance. Only HarperCollins US and Simon & Schuster US are continuing to demand the e-book rights.

I shook my head at one sentence. Another major publisher's spokesperson said: ". . . it makes absolute sense that the e-book can be bought at the same time and place and, in Penguin's case, at the same price."

I don't think she was saying that the two should be bundled together and sold for one price. I think she was saying that the e-book should cost the same as the physical book.

Most of the major publishers have been scrambling over the past two years to get their digital warehouses up and running. I am sure the expense involved was enormous. However, to think that they could pass their start-up costs along to the reader is an insane notion.

E-books SHOULD NOT cost the same as physical books. The expense involved in digitizing and uploading an e-book is much less than that of printing, distributing, warehousing and handling returns on physical books.

I'm very glad the major publishers are recognizing the importance of e-books. Now if they'd just realize that they cannot cling to their old pricing models, we'd be on the path to real progress.

Michael Cader of Publishers Marketplace is one of my publishing industry gods. I read his daily newsletter like a fundamentalist reads the Bible--with the fervor of a true believer and a belief in its inerrancy.

I disagreed with part of his Friday comment on this story, however. He considered this a tizzy in which "otherwise sensible executives continue to find new ways to go to war over miniscule and/or non-existent revenue streams."

Any lawyer knows that "precedent" is a powerful concept. I have no doubt that publishers are looking ahead to a day when e-books are more prevalent. They are trying to lock in their control over that segment of the industry now.

I take a contrarian view. When books can be published digitally online, the major publishers' control of the industry will become obsolete. As I have said numerous times in the past, when they no longer own the means to production, the major publishers will need to bring something else to the table beside an arrogant attitude. Otherwise, their readers will migrate to e-publishers who set more reasonable prices. AND, more importantly, their authors will seek out e-publishers who are more willing to share the profits.

Cader did redeem himself when he said:

This dispute joins the already-in-progress line of nonsense reasoning in the UK where publishers are explaining to authors and their agents that they've invested way too much money on electronic initiatives with no clear ROI [return on investment] in sight and therefore are compelled to chisel authors on their soon-to-be tiny ebook royalties (even though the actual cost of converting a print file to ebook format and placing it with ebook retailers is negligible.

Read the entire article here.

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