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Thursday, July 24, 2014

Book Publishing Needs Socialism to Save It


Let me just state up front that I love America and wouldn’t live anywhere else but, I also believe there’s room for a blend of socialism and capitalism to exist in a democratic society, and when it comes to how books are sold or treated, I prefer what the French and other advanced nations do.

They protect books and the printed word. I applaud them—and so should you.

Here in the U.S., thanks largely to Amazon, books have become commoditized. You can buy clothes based on price—or a desk or the hotel you vacation at. But books should not be purchased based on price alone.

Sure price is a factor. One may buy a used book vs. a new one, to save money. Others will buy a paperback rather than the higher-priced hardcover. But when books become so devalued and sell at a loss, you have to question how such pricing helps the long-term viability of books.

In the U.S. it seems the publishing market is ruled by one company—Amazon—and five major conglomerate publishers—and one physical retailer (Barnes & Noble). When Amazon makes a change, the publishing industry trembles and acquiesces.

But the Hatchette-Amazon battle is now being waged and the repercussions of it could dictate the fate of publishing’s long-term viability. However, in other countries, books are a much healthier product.

In France, where Amazon only owns 10-12% of the book market—but 70% of online sales, Amazon is contained because of laws passed to protect and support bookstores and publishers.

The law says online sellers can’t offer free shipping on discounted books. Further, booksellers can’t offer more than a 5% discount off a book’s cover price.

I wish it were that way here.

In Germany, books can’t be discounted. In fact, six of the 10 biggest book-selling countries have versions of fixed book prices—Japan, Italy, Spain, South Korea, Germany, and France.

Britain used to have a fixed-price system into the 1990s—but once it abandoned it the book world was hit hard. A third of its independent bookstores closed in the past nine years, as supermarkets and Amazon discounted some books by more than 50%.

In France, where only 3% of book sales are e-books, 70% of its citizens report having read at least one book last year. The average among French readers is 15 books a year.

Many products and services can and should compete, in part, on price, but I believe staunchly that books cannot be commoditized. To preserve the value of books, we must take the finances out of the equation. Yes, I want a touch of socialism to support the liberty of books. Save the price wars for sales of widgets, not books.


Brian Feinblum’s views, opinions, and ideas expressed in this blog are his alone and not that of his employer, Media Connect, the nation’s largest book promoter. You can follow him on Twitter @theprexpert and email him at brianfeinblum@gmail.com. He feels more important when discussed in the third-person. This is copyrighted by BookMarketingBuzzBlog © 2014

18 comments:

  1. Oh dear! Oh dear! The more I read your blogs, the more hand ringing I do. Still, glad to be informed

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  2. Brian - Socialism and liberty shouldn't be used in the same sentence, as socialism's prime motive is to kill liberty--and initiative. What you'll find if you support such an idea (it's anything but an ideal) is that eventually you'll have to support the idea of authors who sell a lot of books giving up some of their royalties to support either authors who don't sell a lot of books or publishers or booksellers who bet on the wrong horse. Why not? Why should a small group of authors get all the rewards while other authors who work just as hard (but who are not as good) aren't being rewarded?

    It's the nanny state. And nothing good ever comes of it. And once it's out of the box, there's NO WAY to contain it. Let's keep that box closed tight.
    We're living through the most exciting change in publishing since Gutenberg invented moveable type for the printing press, and that's great. It makes it possible for so many people to enter publishing who could not do so before. To me, that's all the democratization the industry needs. Something like 30,000 books a MONTH are being published now, a number that was unthinkable just a few years ago. Now it's happening. Anyone can be part of it. And isn't that great?

    Time and the marketplace will shake out the winners and losers, as they always have before. Let the free market do its thing, and keep government (which is the only entity that can promote socialism) the hell out of it. It has no business being there. Ever.

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    1. You post is very offensive. I don't think you grasp the differences between what you may perceive as "socialist" and "capitalist" nations. Of course you think socialism is something to fear. That is something Americans are told to think. Many believe it. Many others have the awareness to question it. You may think you pay less taxes, but you get what you pay for,and that is why America is falling behind other nations in nearly every measure, from the standard of education to its infrastructure, to life expectancy and healthcare, to the quality of its food and environmental standards. In the end you pay more for living in a sub-standard nation and also having to pay almost a fifth of GDP on healthcare, extortionate insurances on just about everything, and subsidizing the super-rich. Driven by corporate greed and a lack of humanity for others, ultimately, you end up with a divided nation that in many respects is getting dumber, fatter and declining. What is the point in reading anything other than the bible, anti-science books and political or self-help books that make one side feel superior to the other?

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    2. His post isn't offensive. It's accurate.

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    3. 26a5eea0-14dc-11e4-9b36-ef9e3eb0aab8 - Socialism is two grasshoppers and an ant voting on whose stuff they get to take.

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    4. 26a5eea0-14dc-11e4-9b36-ef9e3eb0aab8 - lots of absurdity in your reply. Where you see us declining - it is BECAUSE of SOCIALISM. Our K-12 schools suffer from 'single payer Government State Schools' where tenure protects the incompetent without concern for the poor students.

      Our health care system was the top of the world; it is the destination of many foreigners requiring special state-of-art treatment. It is government mandates and government controls and policies to permit monopolist practices is what is killing our health care system. Falling behind most other nations in nearly every measure....what an absurd statement. Consider France - where it has a declining population being buttressed by foreign immigration - millions of people from 3rd world nations refusing to assimilate, and I watch with a bit of humor AND concern when I see areas of Paris aflame by Muslim rioters, and read about 'Police No-Go Zones' where it is too dangerous for the police to venture. Yup...France should boast about how the US is slipping behind France? (Only in your dreams and our nightmares.)

      We have a divided nation because we have a lot of lazy takers that want to stay home and receive welfare...and they might riot, sort of the way, in 2010, many French rioted when the French government talked about raising the retirement age by 2 years. (But what the heck ...lazy people or French want the government to keep printing money even though the government is bankrupt - morally and financially!)

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    5. Bravo! Well stated. Well reasoned. And, most definitely NOT-offensive.

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  3. Here we see that even the publishing market isn't immune to greed. Farmers want subsidies, unions want wage protection and now, authors want price guarantees, to force out their lower priced competition.

    I found two of my favorite authors, because of discounts. I can absolutely guarantee that I would not have paid full price for either of their books, based solely on the blurbs and reviews. But now, having been enticed by a very low price, I have become a fan and would gladly pay full price for their upcoming works.

    Introduce the French style of price controls on books and you force unknown authors out of the equation. A person is far less likely to buy a book from an independent or unknown author, if it will cost him the same thing to buy a similar book from a highly acclaimed author.

    I write primarily non-fiction. But to be more specific, I write books on economics, taxes and the like. Moreover, I'm a student of history. If certain economic policy changes have caused certain effects in the past, then it's highly likely that if tried again, they effect will be the same.

    That said, throughout history, price controls on anything have ALWAYS been to the detriment of the small producer and benefitted the corporate giants. Why should we expect price controls to have any different effect on books?

    Albert Einstein defined insanity as doing what had been tried before and expecting a different result. Price controls have always driven small operators of all kinds out of the market. Price controls on books would do the same thing.

    But if you are new to any market and build a quality product or write quality books, then discounts are a tool that an effective marketing campaign must use to bring the newbie to the attention of the larger market. It is not necessarily a sign of greed to not discount, since many established companies use no discounts on their products to emphasize their quality (Apple comes to mind). But when one seller or group of sellers wants to force all other sellers to adhere to their no-discount policy is a clear sign of greed, by those sellers.

    Just remember that most elected officials, in all governments around the world, have never been in a position of running a business and having to make a profit or lose everything they have. I would rather trust my business future to someone who manages the night janitorial staff at Walmart, than most politicians, since by having risen to the rank of manager, it shows that he has at least proven that he has excelled at something more than lying to get elected.

    The free market is the best tool ever invented for insuring the market viability of good products, regardless of the size of the company or person producing that product. Price controls, by contrast, are the tools of greed and envy, and just because you apply it to books doesn't change that fact.

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  4. I think you have a well-intended concept, but it would be difficult to sell in this business climate or should I say era of polarization. When you start a conversation about socialism and government intervention, people generally run to one corner or the other. The one corner which has the loudest voices will go so far as to instruct you to leave the country if you don't like capitalism in its current form. The other corner can see the merits of a blend of socialism and capitalism, but don't have a clue how to sell it, still trying to persuade profit-driven decision-makers to "do the right (moral) thing"... which is almost laughable.

    Actually, capitalism can't survive without government intervention. Ask AIG, Morgan Stanley,General Motors and the Wall Street ole timers that received the 1989 Savings & Loan welfare ... I'm sorry, corporate bailout. We could go all the way back to FDR’s (social) bailout programs because, contrary to popular belief, the War did not exclusively rescue us from the Great Depression. But people are reluctant to talk about the dirty word “socialism” for may historical reasons. They would much rather refer to it as a ‘bailout’ or ‘an emergency initiative to save jobs’ or ‘a temporary effort to address an anomaly in the system’.

    You’d be surprised to know the toxic derivative meltdown was spotted nine years ahead of the 2008 catastrophe by a courageous lady in Washington named Brooksley E. Born. She tried to use her government position to stop it. But Alan Greenspan, the US Congress and other financial power-brokers put their feet on her neck, took away her power and sent her home. They said (listen to this closely), “there is no need for the government to take action. The market would correct itself.”

    Back to your idea of government protectionism in the publishing industry. China does it all the time in all industries; that’s how they became the largest economy in the world. Remember how they subsidized their private steel companies to run American steel companies out of business? Have you ever tried to get your book into the China market? You’ll see pro-China socialism ninjas with big bats standing at the gate.
    And let’s not talk about how they manipulate their currency to make our products higher there.

    But the idea of American private businesses yielding to a dictatorial overseer committee that has the entire nation’s best interest in mind is a very hard pill to swallow in America, especially when the most powerful people are benefiting exponentially from the status quo. Yes, the rich are getting so much richer from the current hands-off system. Your idea to tamper with the dynamics of “Free Capitalism” would not be well received. Yes, we see the problem. But let the market ... the monopolistic Amazon, big publishers market correct itself. Don’t interfere with healthcare, global warming and the publishing industry’s self destruction. The market will ... well, you know ... correct itself.

    Leander Jackie Grogan
    Author: What's Wrong With Your Small Business Team

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    1. Crony capitalism is the government and corrupt businesses working hand-in-hand to screw the public. Sometimes, businesses get 'co-opted' and coerced into crony capitalism...and they profit from bad rules.

      The sub-prime loan debacle was such a case - where the Federal Government forced banks to issue sub-prime loans -and the banks were encouraged to not perform due-diligence on the applicant's ability to re-pay the loan. Perform due-diligence - the bank is called racist, accused of red-lining, and the bank takes a hit in public opinion. Stop looking carefully, give loans to deadbeats and make big money. Tough choice - even for ethical banks. The the government promises that Fannie Mae and Freddie Mac will buy up lots of these bad loans. Then the SEC doesn't investigate the repackaging of loans into Derivatives - because to do so would cause banks to stop issuing sub-prime loans. Republicans warned of the problem in 2001, 2002, 2003, etc. Bush went on record more than 17 times (all posted on YouTube) - warning about the pending problem with sub-Prime loans...but the Republicans were accused of being 'racist' for wanting to end a perfectly good program helping so many people to own their own homes. When the sub-Prime loan housing bubble blew up - the media and Democrats now blamed the banks and Republicans, and the mostly stupid uninformed public bought it....AND -we are getting ready to do the same thing again - Obama wants banks to issue sub-Prime loans!

      We don't have free markets in the US. We have crony capitalism, socialism and corrupt government - and that is why we are over $17 Trillion in debt that can't be repaid, and almost $90 Trillion in unFunded liabilities. The government hides the real inflation rate and unemployment rate by the way they change the accounting - but things are far worse than what the government and media report....

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    2. Interesting how one side is portrayed as thoughtful, just not good at explaining what they know, and the other side is portrayed as bombastic non-thinkers.

      All under a post promoting changes that would shut out the unworthy and promote and support Big Publishing by creating yet another situation where government is empowered to choose the winners.

      The following in a plumy tone:
      "Someone let the rabble in, vulgar and low class as they are, and someone, quite rightly, wants to get them out again in order to "protect books" because common people simply will buy that commoditized trash."

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  5. "Book Publishing Needs Socialism to Save It"

    This is a super idea and is particularly relevant because newspaper publishing, CD makers and DVD makers are all also facing extinction today because of digital publishing and streaming. And just think, if socialism for buggy whips had been around at the turn of the 19th century, we'd still have plenty of buggy whip makers around even today. And don't forget that power looms devastated the hand weaving industry even earlier. Linotype operators were thrown out of work, as were switchboard operators. Why the list is almost endless. And if we had JUST had socialism, we could have saved all of those industries and all of those jobs.

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    1. Except this is not about progress (which is, itself, only what we make it and as virtuous as we make it) but about bad old fashioned monopolism, much like Standard Oil a century or so ago.

      I am sure online retailing and digital distribution in and of themselves do represent a genuine competitive threat to traditional retail and publishing, but trying to strongarm publishers, get special "sweetheart" deals to expand your business, and unfairly exploiting tax loopholes (that your competitors wouldn't dare) which should be closed are not. Monopolies (as Amazon is becoming) often do not act in the best interests of

      If it's pure progress we're talking about, perhaps there will be a social cost to the loss of traditional retail in the way it impacts upon the community and social interaction. Traditional bookshops have staff in them you can get to know, can hold events, book signings etc. which Amazon cannot, etc.

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  6. Your argument doesnt go far enough. The printing press lowered the price of books to the point where scribes could no longer earn a living, this in turn destoyed many monesraties and displaced monks and vellum manufacturers. Whole communities were devastated and all so common folk could afford their own books. The goverment must enforce the price of books at a level that makes hand written books profitable once again.

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    1. It's refreshing and enlightening to see where that crazy socialist scheme would lead if one took it to its logical conclusion.

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  7. You seem to think that France's new law against free shipping for books was to somehow save books, book culture, or even the book industry against greed.
    You are mistaken.

    France's new law was purely to save politicians from Big Publishers' Big Money going to their opponents in the next election.

    How do we know this is true?
    Because they made a law saying "you cannot provide free shipping", knowing full well that the simple way around that was to provide shipping for a paltry amount - such as one penny; and that workaround would render the law impotent.

    It's called Lip Service. The politicians now get to keep their Big Publisher donations (or at least stave off donations to the competition) by saying "See? I made a law to protect you!" while not actually attempting to accomplish anything.

    Had they actually *wanted* to protect books, book culture, or the book industry, they would have put a minimum price on the shipping of books that brought the online purchase price of a book up to a point where it was equal to, or more expensive than, buying a book at your local brick-and-mortar.

    Don't let the politicians' pretty prose and stirring speeches fool you - it's all lip service designed to protect one thing and one thing only: their seats.

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  8. I buy, on average, about a hundred books as year from Amazon, Barnes & Nobles (stores), and whatever other physical bookstores are still in existence in my area. Under your socialist scheme, I might be able to afford ten----maybe. Also, as the author of Get What You Want, I don't want the government controlling what retailers, both physical and online, can charge for my book or any book. The unintended consequences of your idea would be the deathblow to what's left of the publishing industry, book stores, and avid readers like myself. Get real, please.

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