Thursday, January 5, 2012
Musical Clues To Publishing
The music industry was the first in entertainment to suffer as a result of the digitization of its product. Then newspapers and magazines. Then television… and now book publishing. Well, the numbers are in and they ain’t pretty. From 2000 to 2010, revenue from music sales dropped 52 percent, according to the Recording Industry Association of America. But the good news is that the music industry showed a 3 percent uptick last year in revenue, the first time in seven years that sales increased. In 2011, for the first year ever, digital music purchases surpassed those of physical albums like CDs, as 50.3% of all units sold – whether singles or full albums – were digital, according to SoundScan. Is there a lesson to be learned for book publishing in all of this? Are we likely to see the same thing happen to printed content?
According to Nielsen BookScan, the number of printed books declined last year by 8.9 percent. Mass Market Paperbacks suffered the biggest drop – 23 percent. Trade Paperbacks only dropped 5.9 percent, the smallest decline of the varying formats. Audio Books dropped 12.4 percent. The combined drop in print sales from 2010 to 2011 doubled the decline of 2009 to 2010, meaning the pace of print sales’ decline is picking up.
Barnes & Noble Looking To Get Out Of Publishing
Barnes and Noble is looking to end its 10-year marriage with Sterling Publishing, a publisher of nonfiction, children’s, crafting, cooking and self-help books, according to the Wall Street Journal and the New York Times. One has to wonder why?
Barnes and Noble needs to raise money, so perhaps it needs to sell the publisher. Or perhaps it believes the publisher won’t make money and it’s best to sell now. Or BN wants to sell itself to someone else and it finds it needs to break up its units and sell each piece, one at a time. Will they spin the Nook sector off as well? You would think Barnes and Noble would be in better shape with its prime competitor, Borders, gone, but its prime competitor is now Amazon.
It seems BN is going backwards. Amazon expanded into publishing books, not just selling them. BN should be able to run a publishing house profitably since it can easily sell its own books at its stores. These days, diversifying and getting into the business of others seems to be the formula for success so to see BN retreat this way is perplexing.
I spoke to one of my authors a few months ago when we were concluding a PR campaign for his business book. It was the third book I’d promoted for him this decade. But it may be the last one. He told me he’s invested heavily in gold and had more than doubled his investment (if he sold that day) – and was getting out of publishing for good. The riches calling him from Wall Street. Since that conversation, gold has dropped nearly 20% (since reaching an all-time high of over $1900 per ounce).. I don’t expect him to go back to book publishing but I wonder which investment he’s contemplating next.
Brick and mortar stores struggle to compete with e-retailers. In fact online sites struggle to compete with fellow online sites. The competition in the marketplace is fierce and apps, Groupon, and other price-killers like Amazon and Wal-mart, will lead customers to commoditize every product or service. So how does one differentiate? They develop something that’s exclusively available only from them. What can you sell or do that people would want but that you will only sell from one location? Price comparison apps such as Red Laser and The Fund have been downloaded millions of times this past year. Few will be able to survive on price alone. It’ll take something extra to lure a customer in - but what?
Media Monopolies Supported By FCC
The Federal Communications Commission is seeking to lift a ban on companies owning both TV stations and a local newspaper in the country’s top 20 markets. If lifted, be prepared to see the news media decline further. Rather than increasing the number of voices in the marketplace, it will shrink them It will allow for a handful of already powerful people to dominate society with greater ease and legitimacy. Just as we have different branches of government – legislative, executive and judicial – to keep each other in check, the Fourth Estate (media) must have checks and balances – TV, radio, print, and online should not be monopolized and manipulated by a handful. When competition, diversity of free speech, and the news media are compromised, we all lose.
Brian Feinblum’s views, opinions, and ideas expressed in this blog are his alone and not that of his employer. You can follow him on Twitter @theprexpert and email him at firstname.lastname@example.org. He feels more important when discussed in the third-person.