On 14 September 2011 Lionel Barber, editor of Financial Times (FT), gave this year’s Fulbright lecture, entitled ‘The Future of News and Newspapers in the Digital Revolution’. The full text of Barber’s lecture may be downloaded from the Guardian website.
The purpose of the current post is to engage, not with the entire lecture, which is wide-ranging, but with a central passage in which Barber sketches the challenge presented to the FT by digitalisation and summarises the newspaper’s response. The question I wish to explore is, what parallels might there be with the book industry?
The advent of the internet, says Barber, revealed that the ‘old business model for newspapers was broken’. Power has shifted from publishers to consumers. A far wider range of people now gather, filter, and distribute news. As a result, ‘the mainstream media will face competition not only from social media, but also aggregators’.
Few would argue with Barber here, save to suggest that ‘now face’ would be more accurate than ‘will face’.
The FT, according to Barber, has responded in some general ways – through ‘commitment to quality’ and seeking ‘actively to differentiate itself’ – and with the following specific moves:
1. doubling the price of the newspaper;
2. developing the subscription business (for the website and the newspaper);
3. charging for content ‘using a meter model based on frequency of readership’;
4. abandoning or revising arrangements which allowed other parties to sell the FT‘s content in return for a fee;
5. developing convergent practices (in which journalists work for both print and digital channels).
Whilst implementing these changes, the FT has sought to learn from the Swedish newspaper Svenska Dagbladet‘s distinction between ‘fast’ news and ‘slow’: ‘The Swedish paper now reserves a dedicated amount of space for deep and original reporting on matters of public interest. Reporting the news of the day is limited’.
What parallels are there, or should there be, with book publishing – especially scholarly or professional publishing? First, Barber’s thinking on price will no doubt be viewed by many in the book industry as contrarian, even perverse. I suggest it deserves serious consideration.
Here a parable: two or three years ago, I came across a book called The Mining Valuation Handbook: Australian Mining and Energy Valuation. Unsurprisingly, I could find no competing volumes. What did the publishers (Wiley) price this unique product at? £37.95.
Perhaps this was a very intelligent price. Perhaps they’d asked a focus group of owners and prospective owners of Australian gold mines, ‘What would you be prepared to pay for a resource explaining how to value mines’ and they’d sucked their teeth and said, ‘Thirty-eight quid – and not a penny more!’. May be. Or maybe they just priced it according to some general notion of what you should charge for a book, without giving it much thought.
For, if you do give it some thought, you realise that the book is competing, not against other books, but against other sources of information, analysis, and advice – conferences, consultancy, journals, and so on. I hear that £38 doesn’t buy a lot of consultancy in the Australian mining industry.
And I do like that ‘.95’ – as if whole-pound pricing might scare away potential readers (‘I need that 5p to increase my bid for that platinum mine I have my eye on!’). I see that the new (2009) edition of this book is priced at £62.50. Perhaps the publishers consider that they’ve been terribly bullish (a 65% price increase!). Sorry, what in this field does £62.50 buy?
The FT‘s repricing has accomplished two things at the same time. It has reduced risk, by reducing the number of copies they need to sell for any given level of profitability (in terms of economic theory, one might say that they have chosen to move to a different place on the demand curve). But it has also, in Barber’s words, sent a ‘powerful signal … that the FT is a premium product’ (in economic terms, they have sought to shift the demand curve by bringing into play the symbolic value of price).
What signal, in contrast, does £37.95 – or £62.50 – send? That The Mining Valuation Handbook is a poor product (even though, in fact, it isn’t).
To draw the full significance of Barber’s comments, we need to do more to join them up. The above distinction between ‘fast’ and ‘slow’ news has an application to book publishing. Though books may not be trading in ‘news’, there is a parallel distinction to be made between information (= fast) and analysis and argument (= slow).
Here we need in turn to distinguish between ‘information’ as facts-or-data and ‘information’ in the technical sense of digital content (of whatever type). Books, like newspapers, are commonly seen as vulnerable to online competition, precisely because the latter provides a wealth of information free of charge. But the type of ‘information’ that books provide is not restricted to information in the sense of facts-or-data. Books often provide other types of content – analysis and argument (‘information’ in the technical sense alone) – that are not so freely available.
The premium that books (monographs, in particular) can – and need to – provide is sustained rigour: that is, precisely the kind of quality that the famous Lex column provides to readers of the FT. This places a responsibility on commissioning editors to ensure that their authors write trenchantly.
With monograph authors (particularly academics), that is easier said than done. One encounters two obstacles – a scholarly preference for nuance and a reluctance to step on the toes of anyone who might in future offer the author a job. Robust quality management is required.
Let me here bring in one further comment from Barber:
the decline of the newspaper does not necessarily translate into the death of the newspaper. This is not nostalgia or some irrational fondness for dead trees – print newspapers can still be profitable products; many of our readers and advertisers still want them … Moreover, new, more efficient forms of springing up which are far less expensive than the industrial style plant with gigantic (and costly) presses.
Barber’s account has identified a triangle of forces:
1. production costs
Book publishers have tended to perform strongly on cost, taking advantage in particular of the globalisation and digitalisation of the print industry. As I suggested above, they have been far more timid in terms of price.
Consider here the latte ratio: for a given book, estimate the number of hours required to read it; estimate the number of lattes a reader in Starbucks would consume during the time spent reading; what is the ratio between the cost of the book and the cost of the coffee? Often one finds that even specialised works are sold below parity. This is – as I argued in ‘Pricing the backlist‘ (18 Set 2010) – all the more true of backlist pricing.
Book publishers have also been complacent over the third point of the Barber’s triangle, i.e. quality. I do not mean here that publishers have not cared whether their books are any good. I refer rather to changes in processes over time: book publishers have over the long term tended to do far more to reduce cost than improve the quality of content.
In scholarly and professional publishing, production methods have seen vast innovation over the last decade or two: editorial work has been outsourced, often to foreign countries; printing has shifted to central Europe and Asia; short-run printing has been introduced; binding and cover design has been streamlined; and the interface with authors (involving, for example, formatting, proofing, and indexing) has been digitalised.
Where has been the equivalent transformation in editorial methods of quality management? Previously, commissioning editors relied on book-proposal-plus-peer-review: now they rely on – well, book-proposal-plus-peer-review.
There are many more parallels to be drawn from Barber’s lecture. The themes of subscriptions and the meter model (for example, with regard to book-streaming) and convergence are fruitful to explore in book publishing too. But Barber does not develop these themes in detail, so I will not explore them here.
Rather, I would like briefly to consider one point of divergence in view. For the most part, Barber presents a binary structure: on the one hand, there are newspapers (by which he means the print product) and, on the other, there are online products (including the websites, such as ft.com) associated with newspapers. On a superficial level, I have done the same – contrasting ‘books’ and online material.
There is, however, a difference here, for my use of the term ‘book’ has so far been ambiguous. That is, I have used it sometimes to mean the printed product (‘p-books’) and sometimes to mean something like a unit of text – where the text may exist in print, in digital form (as an e-book) or both. (In journalism the closest analogue for e-book is surely the fully purposed digital newspaper, such as The Daily: in the lecture, Barber rather leaves this third term out of the picture.)
Many of the arguments outlined above apply both to p- and e-books. Most notably, the application of the distinction between ‘fast’ and ‘slow’ helps to define book-ness, regardless of medium. Similarly the drive to reduce costs applies – with the exception, obviously, of printing – both to p- and e-.
In one respect, however, we need here to distinguish between the two types of books. There has been much discussion of the concept of enhanced e-books (where ‘enhancement’ may refer to the addition of textual content not available in the p-book edition or to the addition of other forms of content – audio or video). But there is also an opportunity – outlined in my earlier post, ‘Enhanced p-books?‘ (20 Apr 2011) – to create enhanced p-books by accentuating the attractiveness of the material qualities of the hard copy.
Newspaper publishers have very limited options here. They can seek to improve their text design and typography. And, as Barber notes, the FT has helped to distinguish itself through the ‘salmon pink tinge’ of its pages. Book publishers, however, have more to play with – notably cover design, binding, and paper.
Perhaps the most pregnant sentence for book publishers in ‘The Future of News and Newspapers in the Digital Revolution’ is one I quoted earlier: ‘the decline of the newspaper does not necessarily translate into the death of the newspaper’. Some forms of p-book are undoubtedly under pressure – yet that does not justify the ever-breathless obituaries for the p-book, though I guess that ‘decline’ has always made less good copy than ‘fall’.