Mike has impressed me more than once with his innovative management style. Among the posts in which I mentioned him was one describing the reorganization of the Thomas Nelson Company three and a half years ago here. In April, 2008 here, I reported that Thomas Nelson would not be participating in Book Expo America (BEA) and the International Christian Retail Show (ICRS) because Mike no longer believed the two trade shows offered enough value for the cost.
Even when I've disagreed with Mike, as I did when I asked "Is this really how you want to make money?" here, I've respected his business acumen.
I say all this as a lead-up to Mike's blog post on Tuesday here in which he made six predictions for e-book trends to watch in 2011.
To be fair, Mike never claims to be the first making these predictions; he just says that these trends will "happen in earnest" this year.
Even so, from my perspective, some of the "predictions" were gimmes--because they've been talked about for so long. In January, 2008, Mike Shatzkin made fifteen forecasts for Publishers Weekly (PW), including this one:
Although overall sales will remain paltry, increased activity by publishers selling direct to consumers from their Web sites, particularly digital downloads, will lead to “read and listen” bundles of e-books and digital audio and other pricing experiments (it is worth noting that the Sony Reader and the Kindle can deliver both text and sound). Other combinations, including book-and-audio and book-and-digital file (the latter tried by Amazon), and even combos of multiple titles, will be offered.Even though the "Bundled Books" prediction has been around a while, I give full credit to Mike Hyatt for being one of the early adopters. His company was at the forefront of bundling when they announced the initiative they called Nelson Free two years ago. I wrote about it here, quoting Publishers Weekly:
Thomas Nelson announced today the launch of NelsonFree, a program that allows readers to receive content in multiple formats—physical book, audiobook and e-book—without making multiple purchases. With NelsonFree, the price of the hardcover book includes both the audio download and the e-book ...A month after Shatzkin's predictions in PW, Advertising Age did an interview with Chris Anderson (he of The Long Tail) in which he talked about "the three kinds of free." I wrote about the article, saying:
Which, of course, is what prediction #5 ("Free e-Readers") is all about.The first kind of free he describes is the Gillette razor-and-blade model. At the turn of the twentieth century, King Gillette invented the safety razor. While trying to convince people to try his innovation, he gave away thousands of razors. Of course, the razors were useless without the blades, which people then purchased for their new "free" razor. Anderson calls this model the cross-subsidy one, where the manufacturer subsidizes one product in order to build a market for another.
I feel similarly about the "e-First Publishing" and "Social Reading" predictions. The Institute for the Future of the Book has been experimenting with social reading for years. Here's an excerpt of a post from September, 2009:
I was most interested in two of Mike's six predictions: "Monetization Experiments" and "e-Book Clubs."Today reading is primarily a solitary experience, even for those people in book clubs who join together after the fact to discuss a book they've read. I think Robert Stein is on the right track in describing the book's future. Stein is a senior fellow at the London School of Economics and director of the Institute for the Future of the Book. He believes that in the future reading will become more of a social experience.
In the very near future, people will be able to read a digital book in a social networking environment. They'll be able to comment on the material being read in real time. And the author and fans will be able to converse digitally as the readers progress through the book.
In "Monetization Experiments," Mike says, "This will include in-book advertising (or commercial-free for a premium), sponsored links, subscription delivery, and even all-you-can-read options for one price."
Chris Anderson had suggested in-book advertising or commercial-free for a premium, but I was interested in the all-you-can-read options for one price. That would be a very intriguing possibility.
Under "e-Book Clubs," Mike says "Just like the book clubs of yesteryear, etailers will give them an e-book bundle in exchange for a commitment to purchase a specific number of titles at a special membership discount."
This was the only one of Mike's six trends that I actively disagreed with. Historically, book clubs have appealed to people who were unable to access bookstores. Years ago, when book clubs were in their heyday, they were popular with people who lived in geographically isolated areas or with people who didn't have ready access to a vehicle.
Bertelsmann (parent of Random House) and Harlequin--two huge book club vendors--both saw their profits begin to tank with the advent of the Internet. In July, 2008, I wrote here:
With the easy immediacy of e-book downloads and the ready availability of online bookstores like Amazon, why should anyone sign up for a book club that has an expectation of a minimum number of books or where the selection is left to the publisher?The one case in which I might expect to see a resurgence in book clubs would again be in geographically isolated areas without ready access to either the Internet or bookstores.
In May, 2007, BusinessWeek had an article that I referenced in my previously mentioned 2008 post in which they reported:
Ukraine is the most spectacular example of Bertelsmann's success with book clubs in the former Soviet bloc. And it's proving that with the right mix of marketing and merchandise, there's money to be made even with low-cost goods. The region has well-educated populations hungry for a good read but relatively few bookstores where they can indulge their passion. As a result, Bertelsmann has also become the biggest book publisher in the Czech Republic and has scored big successes in Poland, Russia, and elsewhere.I'll admit to huge curiosity about Mike's book club prediction. I am not following his reasoning on that one. Perhaps he is talking about providing religious books to under-developed countries. In that case, I could understand and agree with him. Otherwise, I don't see that one trend taking off.
At any rate, I was pleased to see Mike's blog post on the subject.
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