Publishers need to learn lessons of the record industry
IN my less cynical moments I feel sorry for the record labels. While I think they are almost entirely to blame for destroying huge swathes of their own industry, they did so unwittingly. Their abject failure to respond to the digital music revolution that occurred in the early part of this century means the recorded music business will be permanently smaller. But the record labels were in unchartered territory. Publishers have no such excuse. The music industry offers a textbook case of how not handle a technological reformation – yet publishers are making exactly the same mistakes.
Take, for instance, the much-hated digital rights management software that punished legitimate buyers of MP3 files. If you bought your tracks on a legal site such as iTunes, it was virtually impossible to transfer them between different devices. If you bought them off a pirate file-sharing website, then it was incredibly easy. The record companies actually pushed people on to illegal platforms by offering such a terrible service. The publishing industry is doing the same by insisting on DRM for e-books. Similarly, the price of e-books, although falling, is still too high, especially when you consider that the cost of distributing and retailing a digital book is fractional compared to a physical one.
There are already early signs that e-books are threatening publishers’ business models. At the end of March, JK Rowling started selling e-book versions of her hugely successful Harry Potter series through her own website, Pottermore. In doing so she bypassed publishers and vendors completely, keeping the vast majority of revenues for herself. Pottermore sold £3m worth of e-books in its first month. If Rowling had distributed the titles through a publisher she would have been lucky to have seen £450,000 of that. Rowling has learned the lessons of the music industry – the e-books cost far less than the printed versions and are free of restrictive DRM protection.
Of course this only works for the big hitters like Rowling. Fledgling authors would struggle to find exposure or readers without publishers standing behind them. The book industry works on the assumption that if an author makes it big, the proceeds of their success are used to offset the cost of backing new authors, many of whom will be commercial failures.
As Morrissey puts it so scathingly of record labels, “they want to help you to grow, and then siphon all your dough.” But why shouldn’t they? It would be terribly sad if books were to become a winner takes all market.