Summertime Reading

Check out NPR's summer reading list here.

If--by some chance--you don't find something on that list, try Stephen King's picks for summer here.

I'll be back later today.

Borders Has a Tough First Quarter

The Borders Group has reported first quarter results.

Bad news: Sales fell 12.1% to $641.5 million, creating a net loss of $86 million.

Good news: The operating loss for the quarter was only $15.9 million, an improvement over the analysts' estimates of more than $29 million.

Shelf Awareness reports: "because the loss was lower than expected, Borders shares rose 12.8% to $2.90 a share in after-hours trading, according to Reuters."

The number of Borders stores remains flat at 515--they neither opened nor closed any stores during the quarter. Sales at their superstores fell 13.5% while sales at the regular stores fell 10.7%.

Things were very different over at Waldenbooks. Borders closed 11 Waldenbooks locations during the first quarter, 100 over the past year. That leaves 376 stores still open. Total Waldenbook sales fell 19.9% while comparable store sales (those still open in the first quarter) fell 5.5%.

Ron Marshall, Borders CEO, said:

Make no mistake about it, we have much more work to do and will continue to maintain our financial discipline. At the same time, we know that we cannot save our way to prosperity. Our long-term success will come from doing a much better job of driving sales and that's where our focus is right now.

A Day To Give Thanks and Praise

As you barbeque or play baseball or visit with family and friends today, spare a few minutes to give thanks to all the military members who gave their lives so we can live in freedom.

And then give thanks to all those who stand in harm's way today around the world so that we could eat barbeque, play baseball and visit with family and friends in peace. Say a prayer that they will remain safe and eventually return home to their own family and friends.

I certainly will.

Star Trek

I'll admit to having had some ambivalence about the new Star Trek movie. While I've never attended a Star Trek convention or laid claim to the title of "Trekkie," I've harbored a surprising reverence for the original television series.

Watching the original series (TOS) again and again has been something of a family tradition. My three brothers and I rarely agree, but all of us loved TOS. Years after we were all grown, a favorite triva game was to do a round-robin, naming all the episodes. As each of us failed to name one, we lost our turn and dropped out of the game.

I never watched any of the numerous television spinoffs of TOS. I did go to see Movies 1, 2, and 4, but then swore off the films, too. It was just too painful to watch my favorite characters growing old, bald and fat.

The fourth film debuted in 1986, so it's been twenty-three years since I've developed any new Star Trek memories. But I was happy to have the reruns. Just for fun, as I wrote this, I cruised the regular network channels and discovered The Devil in the Dark was playing on Channel 52 in Dallas. That episode from the first season was one of my favorites: with the mother Horta fighting to protect her eggs from miners.

Today we went to see the new Star Trek movie. To my complete surprise, I loved it! The film is bold and imaginative while still great fun and respectful of the original canon. The young cast is superb, especially Zachary Quinto as Spock and Simon Pegg as Scotty.

My favorite parts were those paying homage to the original series and to the early movies (one of the best parts was the telling of how cadet Kirk beat the Kobayashi Maru test devised for Starfleet recruits and first described in the second movie The Wrath of Khan.

Among the other fun moments:

• How McCoy got the nickname "Bones."
• A nod to Sulu's love of fencing (mentioned in the first season episode of TOS called Shore Leave)
• The trilling of a tribble in the background when we meet Scotty on a Starfleet base.

Run to your nearest theatre to see Star Trek. I promise you won't regret it.

Good News About Good Friends

Stephen Parrish was one of the first people to ever find this blog. He and I have been on-line friends for nearly four years now. He is funny, kind and incredibly empathic. All terrific qualities in a writer.

It will probably appear in tomorrow night's weekly summary of deals over at Publishers Lunch, but agent Janet Reid noticed the early posting. Read this and smile:

FICTION: MYSTERY/CRIME

Stephen Parrish's ADAMANT STONE, a fast-paced story involving a cartographer and jewel thief who join forces to recover legendary, lost jewels and solve an ancient mystery, to Brian Farrey at Midnight Ink, in a nice deal (World).

It couldn't happen to a nicer guy . . . or a better writer.

Visit Stephen's wonderful blog here.

Congratulations, my friend!

Prom Time

Prom time. The brunette on the right is my niece, my middle brother's only chick. L is as sweet as she is lovely. The blonde on the left is one of her best friends.

Kindle's New Deluxe Model

Following the announcement two weeks ago of the new big screen Kindle--the Kindle DX with a screen two and a half times as large as the previous models and a $489 price tag--Amazon indicated its plans to move into the textbook market in a big way.

The New York Times reported:

Amazon said it had reached agreements with three major textbook publishers to make their books available in the Kindle store: Pearson Education, Cengage Learning and Wiley Higher Education. It said six colleges and universities — Pace, Arizona State, Case Western Reserve, Princeton, Reed College and the University of Virginia — would begin testing the device with students later this year.

Amazon is also launching a pilot project with the New York Times, the Boston Globe and the Washington Post to offer the newspapers at a reduced price for a long-term subscription--but only where the actual physical newspaper is not available to subscribers.

Amazon's current deal with 37 newspapers has created some ill will. The revenue-sharing split is 70/30 with Amazon keeping the 70%.

The announcement of the Kindle DX drew a large amount of attention . . . and some parodies, too. My favorite is here.

To read the New York Times article on the Kindle DX, go here.

The Number of On Demand Books Soar

R.R. Bowker, the official U.S. ISBN agency, has released preliminary statistics on the number of books in print in the United States in 2008. More than 75,000 publishers provided data.

According to Publishers Weekly, title output by traditional methods in 2008 fell 3% to 275,232. However, "the number of on-demand and short run titles soared 132%, to 285,394. The on-demand and short run segment is the method typically used by self-publishers as well as online publishers. With the decline in the number of traditional books released last year and the jump in on-demand, the number of on-demand titles topped those of traditional books for the first time. Taken together, total output rose 38%, to 560,626 titles."

Shelf Awareness reported:

Phenomenal growth in the on-demand books sector was reflected in Bowker's projections that 285,394 on-demand books were produced last year, a 132% increase over 2007's 123,276 titles and 462% above 2006 levels.

Bowker reported that the top five categories for U.S. book production in 2008 were fiction (47,541 new titles), juvenile (29,438), sociology/economics (24,423), religion (16,847) and science (13,555).

Scribd Launches New Venture

Two months ago, I did my first post on Scribd here, which I described as:

a document-sharing website with more than 50 million monthly users. Anyone can post a document to the site and, according to Wikipedia, Scribd is "the world's largest library of user-generated documents."

In that post I explained that several major publishers had agreed to offer both teaser excerpts and some full-length novels on Scribd free of charge.

A few weeks later, I did another post here when Scribd came under attack. J.K. Rowling and other published authors had accused Scribd of posting their copyrighted material without permission. Scribd said it immediately took down such material when posted without permission upon receipt of a notice. While this approach keeps it in compliance with the DMCA (Digital Millennium Copyright Act, I said the onus should be on Scribd to prove they are good citizens of the publishing world by taking an active role in avoiding copyright infringement rather than standing by passively and allowing well-known books to be posted to their site.

Sunday's Publishers Weekly had an article describing the launch of the new Scribd Store in which publishers or individual authors could post their works for sale.

The Scribd Store offers a generous revenue sharing agreement with sellers getting 80% of revenue. Publishers and authors also have complete control over price and packaging—they set the price, or set no price at all, and can dictate what to sell, whether entire documents, chapters, even pages. They can also dictate reading options—for example, allowing for works to be viewed on Scribd only, or enabling PDF downloads, PDF downloads with DRM, or ePub downloads. Sellers can also offer downloads to mobile phones and devices.

Go here to check out the new Scribd Store.

Famous Lines That Were Never Said

On Monday, we'll get back to the business of publishing. However for today, the UK's Guardian had a great article on the famous movie (and television) lines that were never actually said the way they are repeated in our culture.

Here are the top ten lines the way they are remembered. I'm not going to give the film or show. You should all be able to name those. But can you give the line as it was actually said?

1) "Luke, I am your father"

2) "Mirror, mirror on the wall, who is the fairest of them all?"

3) "Do you feel lucky, punk?"

4) "Play it again, Sam."

5) "Hello, Clarice."

6) "Beam me up, Scotty."

7) "Frankly, Scarlett, I don't give a damn."

8) "If you build it, they will come."

9) "I don't think we're in Kansas anymore, Toto."

10) "Mrs. Robinson, are you trying to seduce me?"

For the answers, go to Access Hollywood here.

With a Little Help From My Friends.

Sorry for being AWOL. I'll try to catch up with the missing posts.

Here's one that delighted me from the Animal All Star site. It's the story of a baby squirrel trying to climb a wall that was jussst too high for him. Go here to watch the video.

Booksales for March

The Census Bureau's numbers on booksales for March are out. According to Shelf Awareness, bookstore sales are "much healthier than general retail sales this year." These numbers don't include used books, ebooks or mail orders.

During March, bookstore sales fell 1.3%. Year to date, bookstore sales dropped 4.1%. By comparison, for the month of March, total retail sales dropped 12%. YTD, total retail sales are down 11.6%.

Publishers Weekly reported:

The Census Bureau revised bookstore estimates for January and February, with new figures showing a 1.7% drop in January sales and a 11.3% plunge in February, making February the worst month for bookstore sales since the downturn began last fall.

Now States Are Getting Into the Act

On April 30, I reported that the Justice Department is reviewing the Google settlement.

Then on Friday, Reuters reported:

State attorneys general are looking into a proposed settlement Google Inc reached with author and publisher groups allowing the Internet company to digitize millions of books . . .

And, of course, the court still has to ratify the deal.

Read the Reuters' story here.

Online Piracy of Books Growing as a Problem

Yesterday's New York Times had an article about book piracy on the web.

John Wiley & Sons, a textbook publisher that also issues the “Dummies” series, employs three full-time staff members to trawl for unauthorized copies. Gary M. Rinck, general counsel, said that in the last month, the company had sent notices on more than 5,000 titles — five times more than a year ago — asking various sites to take down digital versions of Wiley’s books.

Fabulous quote from Cory Doctorow, who gives away e-books of some of his books: “. . . my problem isn’t piracy . . . It’s obscurity.”

Go here to read the article.

Pros and Cons of the Google Settlement

I did a presentation for the DFW Writers Conference at 2:30 PM on May 3 on trends in publishing. Among the handouts I provided was one on the Google settlement, giving the pros and cons. I'm reproducing it here:

Pros

• Google will act as a giant card catalog, putting information at the fingertips of people all over the world. This is no small issue when you consider that it will improve undeveloped nations’ access to books.
• Readers doing a search will be able to read sample pages of a book online and have a link immediately available for an online purchase of the book in question.
• Authors whose books are still under copyright, but out-of-print will now have a way to earn royalties, which they previously did not. The Internet offers both unlimited shelf space and unlimited time for the book to stay alive. Books out of copyright and almost forgotten will have an opportunity to be read again by new generations of readers.
• Public libraries and school libraries will be able to purchase an institutional license to permit them to offer full access to the books scanned. Authors will receive royalties from these license sales.
• A Books Rights Registry will be created with settlement funds to track down copyright holders.

Cons

• Google required all libraries that joined the Google Book Search project to sign an agreement promising not to make their books available for copying to other search engines. This creates a search engine monopoly that could have serious consequences if Google forgets its motto “to do no evil.”
• This settlement puts an even larger financial barrier in front of any new search engine coming along to challenge Google. I believe the plaintiffs in this lawsuit did not think this through carefully enough.
• What’s to stop Google from unfairly pricing its search engine or the institutional licenses?
• Google ends up with complete control over the “orphan” books for which no rightsholder has been located.
• Not only does this impact other search engines; it also impacts other booksellers and distributors.
• Prior to this agreement, Google only offered snippets of works. The agreement permits readers to access up to 20% of any work.

Tomorrow we'll talk more about the settlement. Both the Justice Department and state attorneys general are now looking into it.

Two of the Big Six Report Results

Both HarperCollins and Simon & Schuster reported ugly financial results this week.

On Wednesday, Publishers Weekly reported on HarperCollins:

A $30 million charge tied to corporate restructuring drove HarperCollins into the red in the third-quarter and nine-month periods ended March 31. With the charge, HC had an operating loss of $38 million in the third quarter compared to income of $29 million in the third quarter of fiscal 2008.

Talking about HarperCollins, Publishers Lunch reported:

Sales at HarperCollins dropped by nearly 20 percent in their fiscal third quarter through the end of March, falling by $59 million to $243 million for the period . . . The drop in sales is only modestly better than the 25 percent drop-off last quarter.

Publishers Weekly had this to say about Simon & Schuster:

Late Thursday afternoon Simon & Schuster parent company CBS announced that the publishing house had an operating loss of $2.1 million compared to operating income of $14.6 million in last year’s first period. Sales declined 19.8%, to $161.7 million . . . S&S CEO Carolyn Reidy said results were “somewhat worse than our original expectations.”

Publishers Lunch reported on Simon & Schuster, too:

CEO Carolyn Reidy says that the quarter started poorly and then improved. "In our first quarter we usually have strong carryover sales from the fall." But "consumers stopped buying" and "our strong fall titles collapsed at the end of the year . . . It really wasn't until the middle of March that we started seeing some liveliness in our sales."

Though improving, Reidy says "the market hasn't completely recovered," . . . and the "backlist is still soft." But "our children's list is stronger" and the "teen portion in particular has shown remarkable strength in this market."

News Roundup

Lots of news out there today.

From Publishers Weekly:

The New York Law School is launching a Web site dedicated to the Google Book Search settlement that will include discussion forums, a comprehensive archive of settlement documents and related commentary, and a tool for users to insert their own analyses and commentary on individual paragraphs of the proposed settlement. The project, dubbed “the Public Index,” is part of the Public Interest Book Search Initiative overseen by NYLS professor James Grimmelmann, an expert who has written extensively about the deal. The effort will be staffed by NYLS students and is being underwritten with a grant from Google competitor Microsoft.

The Quill & Quire reports:

. . . Kunati Books – an Ontario-based company that won acclaim in 2007 as ForeWord Magazine’s Publisher of the Year – has not been paying its authors. Furthermore, publisher Derek Armstrong . . . has been unresponsive to authors’ phone calls and e-mails, and has failed to provide the financial statements due them. According to several Kunati authors . . . no one in the Kunati stable – which includes more than 20 authors – has been paid in the last nine months.

Publishers Lunch directed me toward an article in the UK's Daily Mail on Stephen King:

. . . as is revealed in a fascinating new biography, he [King] spent most of the Eighties on an extended drug and alcohol binge which so fogged his mind that even today he cannot remember working on many of the books he wrote during that period.

The book is Haunted Heart: The Biography of Stephen King by Lisa Rogak. Read the Mail Online article here.

Harlequin's First Quarter Results

Torstar, parent of Harlequin, released its first quarter results for the period ending 3/31/09 today.

Publishers Lunch said:

While Torstar's newspaper business suffers heavily from the advertising slump, sales at the company's Torstar unit have remained strong, boosted further by the weak Canadian dollar.

The press release said:

"Harlequin delivered an excellent quarter of growth while our newspaper businesses confronted lower advertising revenues as a result of the recession," said Robert Prichard, President and CEO of Torstar Corporation. "Harlequin has made a strong start and is on course for another solid year. Despite the global recession, Harlequin's overall performance remains strong with digital revenue growth offsetting some print declines in Japan and the U.K."

Harlequin's revenue from book publishing was $124.5 million [CAN] in the first quarter, which was up $14.8 million from the same period in 2008.

In looking more closely at that revenue increase, only $3.3 was an actual increase in sales while $11.5 million came from foreign exchange rates (the Canadian dollar is weaker than it was). The revenue from the three divisions of the company broke down this way:

• North America Retail -- up $2.2 million
• North America Direct-To-Consumer -- down $1.4 million
• Overseas -- up $2.5 million

When it came to profits, Harlequin was up $2.2 million for the first quarter, excluding the foreign exchange rate impact.

• North America Retail -- down $0.3 million
• North America Direct-To-Consumer -- flat
• Overseas -- up $2.5 million.
  

Harlequin continues to move away from its staid past as it repositions itself in the digital world. About thirteen months ago, the company announced it would distribute digital manga on Japanese cell phone and Internet sites through the SoftBank Group, a provider of cell phone service in Japan. While Harlequin continues to publish p-book copies of manga in Japan, this move was intended to capture the large audience of Japanese who read on their cell phones during commutes.

At the beginning of this year, the Anime News Network reported that Harlequin was launching "Monthly Harlequin, a new Japanese magazine of one-shot manga stories 'in the style of overseas romance novels'." The first edition had four standalone stories.

When I went to the "Interim Management Discussion and Analysis," Torstar had this to say about Harlequin:

Overseas revenues and operating profit were both up $2.5 million in the first quarter of 2009. The agreement in Japan with SoftBank Creative Corp . . . to distribute digital manga (comic) content on cell phones and Internet distribution sites . . . was the primary contributor of improved results in the quarter. An offset to the success of digital publishing in Japan was a decrease in sales of printed books, primarily series titles.

While several countries reported modest year over year gains, the U.K. operation experienced a continuing decline in their direct mail business and lower retail series sales. At the end of the quarter, the U.K. operation announced the closure of their direct-to-consumer warehouse and the intent to outsource the fulfillment for that business.

Publishers Weekly summed up the company's prospects:

Looking at the rest of 2009, Torstar said it expects Harlequin to have growth for the full year, but not at the rate posted in the first quarter. The publisher has largely avoided any negative impact from the worldwide recession, and results for the year should also gain from a weaker Canadian dollar.

Amazon to Hold Press Conference Wednesday

The big news today is that Amazon is scheduled to introduce a new Kindle on Wednesday--one that will have a larger screen to appeal to readers of textbooks and newspapers. This event follows the introduction of the newest version of Kindle just three months ago.

The Wall Street Journal reports that Amazon already has a deal with several textbook publishers to load their textbooks onto the new device. In addition, the WSJ reports:

Beginning this fall, some students at Case Western Reserve University in Cleveland will be given large-screen Kindles with textbooks for chemistry, computer science and a freshman seminar already installed, said Lev Gonick, the school's chief information officer. The university plans to compare the experiences of students who get the Kindles and those who use traditional textbooks, he said.

Five more universities have been lined up to participate in the experiment: Arizona State, Darden School at the University of Virginia, New York's Pace University, Princeton, and Reed in Oregon.

The press conference will be held Wednesday at Pace.

Read the WSJ article here.

The Biggest Threats to Publishing

Thanks to TeleRead here for drawing my attention to a series of blogs on e-book retailers.

It all started with sci-fi writer Orson Scott Card kvetching about Amazon here (after a long intro on storing brown sugar in airtight containers):

. . . with the Kindle and other electronic book systems, nobody has to pay for unsold copies because none are ever printed. Nor does Amazon have to pay for rent or utilities for bookstores all over the country. They have exactly one bookstore, which is online . . . And Amazon is keeping 65 percent of the cover price for themselves. The publisher and author have to figure out how to divide the remaining 35 percent between them – but lots of publishers are giving their authors only their standard royalties.

Mike Shatzkin picked up on the subject here. He makes a point that I made during one of my two talks yesterday at the DFW Writers' Conference: that Google is a search engine, interested in remaining the preeminent force in search. It's doubtful that Google has any interest in becoming a publisher.

Mike went on to say:

I think if I were a big publisher, I would make it clear that the era of 40, 50, 55, 60% off retail for digital downloads is one that must come to an end. I’d lean to a phased reduction and, in the short run, all kinds of support (including additional margin) to help “retailers” . . . and every store served by Ingram and Content Reserve) build their offering and their capability. The big publishers will have extraordinary leverage to recreate the paradigm.

Agent Richard Curtis jumped in here, agreeing with Mike that the risks a physical book retailer assumes are far greater than the risks an e-retailer takes on.

Mike suggests that the print publishers take a stance against e-retailers like Amazon.

I agree with Mike. Amazon has already made it plain that they are willing to use their considerable clout to demand EVEN MORE advantageous terms than they are already getting. Last June, I reported in my blog here that, during annual contract negotiations with Hachette Livre (one of the Big Six of publishing), Amazon had taken the audacious step of removing the "sale" buttons for HL titles on Amazon.uk.com in order to increase pressure on the publisher.

Even before then, in March of 2008 here in the U.S., Amazon had used the same tactics of taking down the "sale" buttons for publishers using POD technology in an effort to force them to use Amazon's proprietary press BookSurge if they wanted their books sold directly by Amazon. You can read about that here.

My admiration for the founders of both Amazon and Google knows no bounds. At the same time, I have enormous concern for their aggressive efforts and the potential for damage they represent to the publishing industry.

Google was happy with the proposed settlement created by that idiotic lawsuit brought against them. If that settlement goes unchallenged, they will have destroyed almost any chance a competitor may have of challenging their hegemony in the world of search engines. I was delighted that the Justice Department decided to review the Google settlement.

I would be equally happy if the Justice Department decided to take a good look at the potential threat from Amazon's vertical integration and its willingness to use one part of its empire to advantage another part.

Hope For Us All

My friend Karen Adams directed me to an op/ed in the New York Times that really made my day.

Titled "Genius: The Modern View," the article is written by David Brooks, a commentator on The Newshour with Jim Lehrer. Here is the encouraging message:

The key factor separating geniuses from the merely accomplished is not a divine spark. It’s not I.Q., a generally bad predictor of success, even in realms like chess. Instead, it’s deliberate practice. Top performers spend more hours (many more hours) rigorously practicing their craft.

Go here to read the entire article.