Spin Control

By PT Editors
December 1, 2000
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Agents Sound Off on New Media

Given their relatively negligible treatment in the media coverage of the e-book biz over the past few months, you could reasonably conclude that literary agents are mere bystanders (or at best, nagging backseat drivers) in the mad dash to forge a viable new-media publishing model. Below, two agents respond with contrasting takes on the evolving e-space — and the agent’s role therein.

Abate: We Need Publishers
Richard Abate, an agent as well as the director of new media for ICM’s literary group, has his hands full these days. He’s the one who fields all those e-pitches and inquiries that now inundate agents’ offices, from dot-coms targeting the publishing community, to author-focused websites hoping to lure a few authors to their advisory boards, to publishers wanting to discuss backlist, print-on-demand, digital audio, and a litany of other rights to ICM authors’ works. Considering that he’s also on the front lines of what the New York Times’s David Kirkpatrick called the “long-running battle between authors and publishers over how to split the putative proceeds” from e-publishing, he’s amazingly upbeat about how it will all turn out.

Abate admits that, prior to Random House’s move to split net revenues with authors, he and his colleagues always asked “that simple question: If e-books are less expensive to make and distribute, why have the royalty rates remained the same?” But in the wake of the RH announcement, he believes the issue of royalty rates for e-books “will be resolvable in the near future,” and therefore questions about the supply of content will take care of themselves. As for print-on-demand titles and their royalties, he takes the position that it’s reasonable for publishers to pay standard p-book royalties on them, because they are even more expensive to produce than traditional books. (See Lipskar’s markedly contrasting view, however.)

As to whether there will be any real demand (harking back to Richard Curtis’ remark that the only two problems e-books face are supply and demand), Abate thinks electronic editions will be slow to catch on with those thirty and over who’ve been raised on p-books — and perhaps not until electronic book manufacturers stop trying to emulate a book, and instead “make an affordable reading device — under $100 — devoted to the total reading experience, with a large screen that comfortably holds all of our magazines, newspapers, e-mail, and other content as well as books.” Regardless of when they catch on, though, Abate believes there will be a place for publishers in the process of getting books to readers. “People don’t buy books just because they’re available,” he says. “There’s a lot more to publishing a book, and we need publishers.”

Lipskar: Authors Are Not Guinea Pigs
Writer’s House agent and new media director Simon Lipskar isn’t pleased about the slighting and dismissive treatment he feels publishing journalists and publishers themselves are dishing out to agents amid the ongoing e-publishing skirmishes. He also feels strongly that asking authors to share the burden of developing the electronic market — and to commit to terms without any analysis — is unfair. An author is not a guinea pig, he insists, arguing that more authors and titles would come to market if publishers would bother to spend a few minutes in agents’ offices, explaining the rationale for the terms they are offering — as does Time Warner iPublish’s Clare Zion.

But given the fact that publishers are resolutely refusing to negotiate on the e-publishing front, Lipskar says, his role as an agent has assumed a critical importance in the new-media field. He says that his duties are two-fold: to identify e-publishing opportunities for his clients and those of the agency, and then to negotiate and mediate the divergent needs of author and publisher. Case in point: Contractual terms, royalties, and discounts for p-books have evolved using time-honored methods and involve careful margin analysis. In the absence of a developed marketplace (and an installed base in many instances), publishers should be prepared to offer — à la Random House — an equal division of revenues, provided that this will be revised accordingly when an industry standard has been developed. Failing that, Writer’s House will accept a shorter term (three to five years, as opposed to term of copyright) of license which will allow for renegotiation as the market matures.

Lipskar cites another example of a completely unacceptable royalty: that offered by most publishers for print-on-demand titles. POD is not a paperback edition of an out-of-print book, he says. It is a digital file whose costs, when rendered into book form, are borne entirely by the consumer — including any shipping and handling — and of course there is no warehousing. The standard POD royalty offered is 6–7.5%, comparable to that for a trade paperback edition, all of which seems to leave the publisher with a big chunk of change.

Taking a longer view of the issue, Lipskar wonders if some day e-book deals might become a function of the value of the client. For example, if Grisham is worth more than an unknown author, perhaps he ought to receive a much larger share of the revenues. Indeed, while publishers can’t seem to think beyond their traditional operating schemes, Lipskar tosses out numerous ideas, such as a notion that publishers offer a uniform amount of money per unit, rather than royalties. A publisher might pay $5 per unit — hard, soft, e-book, what have you. But for the present, Lipskar warns, publishers must drop their contentiousness over electronic royalty rates. It’s a major tactical error to hand ammunition to agents that will only prove infuriating, he says. And that’s precisely what is happening now.

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Content for Hire

By PT Editors
December 1, 2000
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Book Packagers Make the Best of a Worst-Case Scenario

“The advantage of working with packagers,” says Mark Magowan, associate publisher at Abrams, “is that when the math of a series goes down, you don’t have to fire your own staff.” Though Magowan may be grinning as he says it, it’s no joke that book packagers inhabit a lowly rung on the publishing food chain. Squeezed more than ever by thinning profit margins, tightening print runs, and grudging production grants, packagers have found themselves hatching a variety of schemes to avoid having to put their iMacs in hock. As packaging veteran Dan Weiss puts it, “Book packagers are moving along the value chain, either closer to publishing or closer to the creation of the brand.” Newly reinvented as “content producers,” “multimedia companies,” and “communications partners,” some of them seem to be finding that in the age of corporate gigantism, scrappiness can be a virtue.

“I know a lot of packagers who have gone out of business or who are incredibly marginal,” says Charles Melcher of book packager Melcher Media. “Publishers are trying to print the very smallest quantity they can. Where they used to say, ‘This is a great book, I’ll take 50,000 copies,’ now they’ll take 20,000.” The cut in print runs is a challenge, says Melcher, because of the large up-front costs to produce the books. He adds, “It reflects a growing trend in the publishing industry as a whole towards creating cheaper widgets.” Melcher has staved off the widget factor by producing only six books per year with a six-person staff. “Keeping a small, focused list is a real asset in this marketplace,” he says. “Less is more.” (With an average printing of 120,000 copies per book, he’s got a point.) At the moment, however, Melcher’s tapped the cultural imagination with DuraBooks, his patented, waterproof volumes. There’s Aqua Erotica (done with Crown’s Three Rivers Press) and a series of six Soapdish Editions for Chronicle. The publisher sold all 40,000 copies of Aqua Erotica in six weeks (they’re desperately reprinting 25,000 for Valentine’s Day), and the success has spawned a whole slew of water-related concepts such as The Amazing Book of Paper Boats, which comes with 18 cut-out boats that — you guessed it — actually float.

Surfing for Content

While packagers such as Melcher keep fishing for novel species of books, others are diving deep into the digital lagoon. “We’re definitely doing fewer books,” says Rodney Friedman, founder of health and wellness packager Rebus, which publishes the UC Berkeley Wellness Letter and packages books for Reader’s Digest, Time Warner, and others. “But we’re spending a lot more time doing digital work. That’s where the growth is. That’s where the new creative challenges are.” The digital deep can be perilous, though. Rebus helped launch WholeHealthMD, an alternative medicine site that rolled out with 25 editors on board and backing from the managed care firm American Whole Health. Though the site drew plenty of traffic, Friedman says, it couldn’t survive the riptide of Internet investors fleeing for their lives. “There’s just no funding for the content business model anymore,” he says, adding that while the site is still being actively refreshed with content, “we’re building it at a decelerated rate.” Staff has been moved to other Internet projects the packager is working on, and ironically, WholeHealthMD’s online content is now being salvaged for reuse in packaged books. “Simply existing in one business may be too difficult,” Friedman explains. “In the early days, you always needed to sell foreign rights or book club rights or paperback rights to make a business of it. If everything’s shrinking, why not take the one place that isn’t shrinking and try to build that into the model?”

That was precisely the theory behind Dan Weiss’s 17th Street Productions division, which he sold to Alloy Online, a teen portal, a year ago in order to move into consulting and other new ventures. Weiss says he began seeking an exit from his traditional packaging business when the market for his specialty — fiction series for kids and teens — began to dry up. “Generally speaking, it was a very mature business,” he says. “But packaging in general has become much harder. Consolidation has made every investment decision more complex. Getting a publisher to commit to a project is simply harder given the layers of bureaucracy that are now in place.” Being liberated from the series fiction niche has had its upside, however. He worked as a consulting producer for LiveReads in their recent launch of the Kerouac e-book Orpheus Emerged (which is being sold exclusively at bn.com until Dec. 20).

Consolidation, in fact, has provided opportunities for packagers with the appropriate, er, skill-set. “Our client base is greatly reduced,” says Susan Meyer, director at Roundtable Press. “But some of the heavyweights have gotten so big that in spite of all the attempts to create a sense of synergy, frankly the divisions are too big to talk to each other. We’re working with Gruner + Jahr, Broadway Books, and BookSpan. They’re all owned by Bertelsmann, but they all have their own needs. Our job has become to see what we can create that will be of service to all of them. I call it shuttle diplomacy.” Consolidation also means that paradoxically, publishers have a desperate need for packagers. “Time Inc. used to have a huge editorial and design capacity,” Meyer says. “But their merging and purging has stripped them down to the point where they go outside for books.”

Others are quick to note an opportunity there, as well. “I’ve always thought that publishers should have packagers on the payroll like studios have independent producers hanging around,” observes Michael Cader, founder of Cader Books and another packager who’s jumped into the e-world with his newsletter PublishersLunch.com. He describes that project as part of a natural continuum of what he’s always done as a packager. “In retrospect, Lunch looks to me like a packaged product,” he says. “It draws a lot on what I’ve naturally done as a packager: gathering information, refocusing it, and giving it a hook that makes it appealing.” He’s now expanding into e-packaging, including a couple projects with Al Lowman to publish authors “whose work doesn’t necessarily fit the agenda of the largest commercial houses, but which we think appeals broadly to commercial audiences and lends itself well to viral marketing.”

But others say that packagers must shoulder a share of the blame for their own hard times. “For a lot of packagers, their own success has come back to bite them,” says Judith Joseph, the former publisher at Van Nostrand Reinhold and Rizzoli, who now consults for publishers and packages a few books per year. “In too many cases, packagers have insisted that a publisher take too many books. That means there was a write-down at the end of the process, and that’s a losing transaction.” In her packaging work, Joseph says she has created an economic model that is “completely different than the model on which ordinary packagers work.” A typical packager, she says, comes to the table with a book and demands that the publisher take, say, 12,500 copies at $11.25 a piece. “The problem with that,” she says, “is that $11.25 may be a good price, but the 12,000 copies is too many, and everyone in the publishing house knows that.” Without divulging precisely what her economic model is, Joseph says that she does not charge a price per book or insist that publishers take a certain number of copies. “We find a way for everybody to do well and not have excessive liability on the part of the publisher.”

Velveeta, Anyone?

Then there’s the vast world of branded books, which takes custom publishing somewhat far afield — namely, the wire racks at supermarket checkout counters. “I think more packagers as well as publishers are looking for corporate sponsorships to help fund their operations,” says Julia Molino, director at Meredith’s Integrated Marketing division, which produces corporate-branded books (i.e. Kraft No Oven Summer Sensations and Home Improvement 1-2-3 for Home Depot). The Home Depot title sold hundreds of thousands of copies via trade channels, although most of Meredith’s books sell in warehouse or book clubs. Meredith also specializes in point-of-purchase digest magazines, which are often repurposed for books, custom magazines, newspaper inserts, and presumably any other printed surface. “A lot of publishers want to do custom books, but they’re not always successful because they don’t have the capabilities that Meredith does to tie it all together,” Molino says. “We really cross those lines and become a communications partner for our clients.”

Luck never hurts, either. Just ask David Borgenicht, who launched Book Soup over two years ago. He struck gold last year when his Worst-Case Scenario Survival Handbook, produced with Chronicle, hit the New York Times list and sold a million copies. “We try to create hybrids of genres in order to make the books more entertaining and theoretically more marketable,” he says. But isn’t he jumping into the packaging business at the same time seasoned players are bailing out? “We’re probably too young to know better,” Borgenicht jokes. “But we’re getting out of packaging, too,” he adds. “In order for us to be successful, we’ll need to find new ways to market our content and not just rely on books as the only revenue stream from that content.” It may be the new mantra in the content biz, but you gotta hand it to them. At this moment in publishing, a worst-case scenario survival handbook is just what every packager needs.

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Book Clubs: Forgotten But Not Dead

By PT Editors
December 1, 2000
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ORIGINALLY PUBLISHED AT INSIDE.COM (12/6/00)

When Stephen King pulled the plug last week on his online serial story The Plant, citing a dwindling base of readers willing to pony up a buck for the latest installment, pundits rushed to declare electronic self-publishing dead on arrival. But many of them failed to notice that King’s supposed rout was actually a striking vindication for something known in direct-to-consumer lingo as ”inertia marketing,” the very model on which book clubs are built.

Yes, book clubs. Remember those?

Alas, long gone are the days when the Book-of-the-Month-Club ”wasn’t just a company; it was an institution — one of those lucky businesses that have slipped into the American vocabulary, instantly recognized in jokes and conversations,” as author William Zinsser wrote on the occasion of BOMC’s 60th anniversary in 1986. ”I remembered a cartoon in the New Yorker by Helen Hokinson,” he continued, ”that showed one of Miss Hokinson’s earnest ladies breaking the difficult news to her local librarian: ‘I’m afraid this is goodbye, Miss MacDonald. I’m joining the Book-of-the-Month-Club.’ ”

Nobody even shed a farewell tear last March, though, when a joint venture was announced between the nation’s two oldest and largest book clubs, and BOMC effectively ceased to exist. With the coming together of Time Warner‘s Book-of-the-Month-Club and Bertelsmann‘s Literary Guild — once archrivals for readers, books and profits — a monopoly was created that would be intolerable in most industries. The partnership controls more than 40 clubs in total, with access to 10 million active members who buy books that are licensed at very favorable terms from publishers. But the Federal Trade Commission could hardly bestir itself to look into possible antitrust violations, as it so fervently did with Barnes & Noble’s attempted purchase of wholesaler Ingram Books.

No, not even the bookstores, which have long been the clubs’ natural foes, seemed to take notice as they battle for readers on what the retailers perceive to be a radically skewed playing field. Indeed, shortly after the announcement, BookSpan, the newly named co-venture, began testing clubs in conjunction with BN.com, in which Bertelsmann also has a hefty investment.

But as direct marketers will tell you, clubs aren’t dead yet, and they’ll give you a two-word explanation why: Inertia happens. Where there’s a lack of will, you might say, there’s a way.

And that’s the problem with Stephen King’s installment plan. His numbers were good, direct marketers say, even at the end. (About 120,000 people downloaded the first chapter. By the sixth installment, the number was 40,000.) The numbers were especially impressive considering the effort readers had to go through — remembering to go to the site, writing their checks (or going to Amazon’s site for the credit card payment), and then downloading the next chapter, never knowing whether King would pull the plug before the story’s end.

Most book marketers don’t take those kind of chances with potential buyers; companies like Reader’s Digest send out a condensed book on a regular basis to subscribers, until that subscriber tells them not to. Book clubs send members the monthly main selections unless they’re told not to. The trick is to make the incentives for remaining with the program attractive enough to outweigh the inconveniences. King’s ”defeat” was in fact a personal triumph against the forces of inertia — and an encouraging sign for less-demanding online book club business model.

Don’t think the clubs didn’t notice, either. Using the traditional marketing methods (negative option, commitments to buy, etc.), but now updated for a wired world, ”we’re going gangbusters,” says Markus Wilhelm, president and CEO of BookSpan. Wilhelm thinks there will be ”over a hundred clubs” in the BookSpan stable in the next couple of years. At some future date those sites will be accessible from PDAs or other e-book readers. As most clubs are hybrids — mailings are sent out, but the member has password access to the club Web site — members can choose how they want to buy (or refuse) books; in certain clubs, they can chat online with fellow readers, as well as with the editors. Meanwhile, new clubs can be tested in a snap (over 10 have been launched this year alone) and increasingly narrow markets can be targeted. An Antiques Roadshow club, an equestrian club and a Teen People club (in coordination with the magazine) are among those being tested.

Neal Goff, senior vice president of marketing at BMG Direct, which oversees Bertelsmann’s music clubs, give credit to another continuity concept: ”negative option,” where members receive that month’s selection unless they remember to cancel. Goff says negative option has turned members into ”perpetual recidivist visitors” to BMG’s site, which is now ranked the top music-focused retailer, drawing 3.7 million visitors a month. Clubs make money, Goff pointedly notes, while e-tailers don’t.

But ask knowledgeable insiders about the future of book clubs, and you’ll find sharply contradictory assessments. Ruth Stevens, president of direct marketing consulting firm eMarketing Strategy (and herself a club veteran), contends that the book club ”value proposition” is fast disappearing. First there was the rise of the chains and superstores, which offer greater choice than the clubs do, and then along came Amazon.com, which, like other e-tailers, offers the variety of a superstore, plus superior customer service, low prices and no annoying deadlines by which a reader has to either send back the ”no book” card or risk receiving unwanted books. ”The ability of the clubs to compete is already deeply eroded,” Stevens says. ”Mamas, don’t let your babies grow up to work at bookclubs.”

What do publishers think about clubs? One subsidiary rights director, who did not want to be identified for obvious reasons, says she doesn’t know whether publishers can make the transition to the online world fast enough to keep members from defecting. From her perspective, the growing emphasis on smaller numbers of books for specialty clubs and the declining sales at the general-interest flagship clubs means that potential book club money is rarely factored into a publisher’s acquisition budget. A publisher has traditionally sold off book club rights, hoping for an auction that would raise the advance, but knowing that the prestige of being selected by a club — and the advertising that the club might give the book when soliciting new members — would make the modest royalties (under 10 percent) that the club pays for each copy of the book sold easier to accept. With a proliferation of niche clubs, however, many of those benefits evaporate. Another rights director summed up his experience selling books for as little as a $1,000 advance as ”very depressing.”

Anyway, what could possibly be in it for the consumer? Why commit to buying a set number of books each year, plus having to exercise ”negative option” every time the club’s mailing doesn’t appeal? Even with an increasingly sophisticated system for offering members the kinds of books they’ve shown a predilection for, the truth is that most members end up turning down most selections.

Wilhelm points out that club prices are often lower than competitors’. All books in The Literary Guild, for example, are 50 percent off the retail price. Meanwhile Amazon’s prices, Wilhelm notes, have increased 15 percent. Plus, according to Christian Friege, once marketing director for BookSpan and currently CEO of Bertelsmann’s U.K. division, Book Club Associates, now that the clubs are online, there is the chance to chat with other, say, railroad aficionados (yes, BCA has a book club for train buffs), as well as taking advantage of the editorial selection and direction that each club’s editors offer. Friege’s clubs provide those perks not just to U.K. members, but also to those in other countries who want guidance on their choice of English-language books. There are Bertelsmann-run English-language book clubs in 12 European countries so far, with more planned.

Though they may not agree on the future of book clubs, those in the club biz make one thing perfectly clear: what has raised the bar — on service, on offers, on prices — is Internet bookselling in general and Amazon in particular. Mail-order may always be a component to the relationship with members, say book club managers, but as the Web has forced clubs to be more responsive to their members, it has afforded them a new lease on life. As with everything else in commerce, it seems, the Internet has made inertia viable. Now it’s just one click away.

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Move Over, Buffy

By PT Editors
December 1, 2000
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17th Street Productions Takes On Hollywood

What do you get when you take a teen-oriented book packager, implant a Silicon Alley–style “convergence media business model,” and throw in a few Hollywood film options? As Leslie Morgenstein, president of 17th Street Productions, puts it, “We’re becoming a multimedia company rather than a book packager,” and that fairly describes one production outfit’s quest to take book packaging to new frontiers. Last January, Morgenstein and partner Ann Brashares, who had bought out their partner Dan Weiss’s interest in 17th Street, in turn sold the company to Alloy, a web-focused marketing company that hosts a teen website — alloy.com — and mails 40 million catalogs per year. Alloy also owns CCS, a direct marketer of skateboarding gear. Now teamed up with 17th Street, the budding teen e-media conglomerate is making a gender-targeted play — Alloy’s the girl brand, CCS is the boy brand — to leverage book-based content into media properties for film, television, and the Internet.

To take one example, Fearless is a book series by teen mega-author Francine Pascal about a girl “born without the fear gene” — and positioned as a somewhat grittier version of Buffy the Vampire Slayer — which 17th Street and Simon & Schuster had in galley form when they took it to Alloy over a year ago. TV options had already been sold to Columbia TriStar, and the Alloy team jumped on board to design a “microsite” for an interactive component to the series, complete with a sort of pop-up feature that enables users to nose around in a simulation of the protagonist’s laptop computer. In a similar vein, the company has produced The Black Book: Diaries of a Teenage Stud, a property optioned for Hollywood by Storyline Entertainment and the Greenblatt Janollari Studio; a publishing deal is in place with HarperCollins.

The convergence comes in with Alloy’s capacity to market these properties via its six-million-name database and what it claims is a total reach of 10 million individuals per month. According to Morgenstein, viral marketing is essential for developing projects for Gen Y. “Alloy knows how to get the audience engaged and get them to market to their friends,” he says. “We get a thing living out there in the online world, and we say, hey, this is a book series.” 17th Street has also created AlloyBooks, a partnership with Penguin Putnam Books for Young Readers that launched with four titles last August. The idea is that the books gain from Alloy’s credibility with teens, and draw from what’s been billed as Alloy’s “focus group” for book ideas and even content scooped up from all those message boards. Then there’s television. A handful of options deals last season netted two TV pilots, one of which is based on the book Spy Girls, which 17th Street produced for Pocket. If the pilots spawn series, Alloy will promote the shows on the web and in catalogs.

As other packagers have found, though, dot-coms can be bruising partners. Alloy’s second-quarter losses mounted to $6.9 million, and its stock value has been drifting southward for a year. With a backlist including Pascal’s Sweet Valley High series (a veritable cottage industry of its own), Morgenstein knows a steady gig when he sees one. “We’ll always be developing for book publishing. We want to monetize our content,” he says, sounding like the MBA he is, “and the best way to do that is to be in business with the Random Houses and the Harpers.”

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Syndication With Aforethought: eSubstance Puts Licensing
In Its Sights

By PT Editors
November 1, 2000
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In Its Sights

Though there were e-items all over the Frankfurt Book Fair, and a press release from the fair went so far as to assert that 75% of all companies exhibiting had some e-thing on display, there was not a lot to get excited about — except, that is, the Anglo-American newcomer, eSubstance.

In a sleek booth nestled into — where else? — aisle “E,” eSubstance continued to make the inroads it has been working on since CEO Jeffrey O’Rourke (ex-iCollector and WQED), MD Adrian Sington (cofounder of Boxtree), and CTO Hishaam Mufti-Bey (VP Technology for Morgan Stanley Dean Witter in London) set up shop earlier this year. The company is attempting to distinguish itself from competitors by focusing on a range of both licensors and licensees, and by automating as much of the process as it can, including the matching of content provider to potential licensee. The former could be offering books and magazines and eventually video or music, and the latter could be a corporate client, an online catalog, etailer, consumer site, etc. Few licensors are officially on board as yet, but they include Country Life magazine and Carlton Books. Licensees include Mothercare and Tesco. eSubstance tracks and controls rights and alerts both rights holder and licensee when the term is expiring.

Revenues to eSubstance come from a percentage of the price of the licensed content; advertising (though not, Sington is quick to point out, in the content), and further syndication of the content. eSubstance recently announced it had commissioned a series of articles from Earl Spenser about the family’s ancestral homes, which it is syndicating both on- and offline.

The company is using state of the art equipment provided by Vignette, which is also an investor, along with 3i and Vesta Capital Partners. Several book publishers have expressed interest in investing, according to Sington.

eSubstance’s flexibility could give them an edge over longtime syndication leader Screaming Media, which feeds content to websites and wireless devices, as well as services like iSyndicate and Themestream. The latter boasts more than 200,000 articles on its site (contributors used to reap a full 10 cents per page view, but that has since been slashed to 2 cents), and has tried to drum up business with its publisher program, through which users receive free email newsletters with publisher-branded content pertaining to their interests. iSyndicate has meanwhile extracted content from “1,192 leading brands,” and earlier this fall launched a 50/50 European joint venture with Bertelsmann — part of a strategy to funnel Bertelsmann content throughout the digital stratosphere. The company also has plans to hook into the Latin American Internet market, which is predicted to double by the year 2003 to $8.4 billion in B2B web spending. Then again, eSubstance’s full-service offerings could potentially grab business from more established DRM systems such as Yankee Book Peddlar spin-off Copyright Direct, which has staked its claim on the notion of increasing revenues through copyright compliance. Such has also been part of the plan for digital upstart PublishOne, a secure content distribution platform which hopes to “slice and dice” publisher content to targeted markets. At this stage, eSubstance seems to make protecting copyright part of the larger syndication package.

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Poaching the Publicists

By PT Editors
November 1, 2000
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The Latest Truism: A Good Publicist Is Hard to Find

Judging by reports of empty cubicles in publicity departments at several large publishing houses, it seems the latest truism in the book biz is this: a good publicist is hard to find. While entry-level publicity jobs have always had precipitous burn-out rates, it seems that larger workloads, tighter media markets, and the promise of dot-com riches have combined to make the candidate pool as shallow as ever. And it doesn’t help that the publicist’s lot — described by one veteran as a service job akin to being “hairdresser to the stars” — has grown even more brutally unsatisfying in recent years.

“For the people in the trenches, the job has gotten harder,” says Jacqueline Deval, publisher at Hearst Books, who was previously publicity director at Morrow. “You used to say, this tour will book itself. Today, there’s nothing that books itself.” Because the media market has contracted, long gone are the days when you could blithely send an author on a 15-city tour and book a full day in each market. So as publicists work harder for each title, consolidation has resulted in more titles on everyone’s plate. All of which is compounded by the brunt of accumulated dissatisfaction that gets heaped upon you-know-who. “The publicist is the last great hope for the book and the author,” Deval adds. “There’s a lot of pressure put on junior people who often haven’t had much training. There’s a lot of acting out on them.”

Pamela Duevel, former publicity director at Pocket (she left when she had a daughter, and is now pursuing a writing career), adds that where books should be prioritized, editors tend to push for a campaign for every title, particularly when one is doing poorly. “It’s a way to save face and present an image to the agent and the author that the publisher is doing something,” she says. “But it drains the resources of the publicity department.”

The upshot? “Our biggest problem has been people leaving to go into dot-coms,” says Carol Schneider, dvp publicity for the Random House trade group, who just hired for two positions, one of them from S&S. “It’s partly glamour, and it’s partly rock-bottom economics.” Indeed, it seems that while cash obviously matters, there’s another factor driving the talent drain. “I’m not seeing floods of entry-level people the way we once did,” Schneider says. She notes that Random’s entry-level salary increase and other “enrichment programs” are aimed to keep the recruitment and retention gears in motion. However, “You have to believe in what you’re selling, and I think that’s easier in book publishing,” she says. As a cautionary tale, she mentions a publicist who once left to work at a regular PR firm. Schneider happened to be in the offices of a national morning show when the same person called — to pitch Mr. Potato Head.

Of course, there’s no such shame at One Potata Productions, the publicity firm Diane Mancher launched eight years ago after she tired of the routine as a publicist at St. Martin’s. She advocates the independence of the freelance life, which has been luring many in-house publicists with the promise of making more money with less experience. “All of my staff came from in-house positions,” she says, “and they left because they felt they couldn’t give the projects they were working on the kind of attention they were worthy of.” Similar frustrations lured away Marian Brown, a former publicity director at Basic who has been freelancing for a year and a half. “You can take on different projects without getting bogged down in the administrative and political complications that a full-time directors’ position would entail,” she says of the freelance life. And, says Caroline O’Connell, who has owned her own book-based public relations firm since 1984, most in-house positions call for three years of working experience, which limits the pool significantly. By contrast, she says, “I hire people right out of college and train them, and then the salaries aren’t sky-high.”

It may be well to note in closing that though the work can be punishing, publicity positions do offer rewards for those who stick with the book business. “Publicity trains you to think hard and nontraditionally about what you’re publishing,” says Hearst’s Deval. “I call on my publicity background every day.”

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Just-In-Time?

By PT Editors
November 1, 2000
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More Reprints, More Often Put Publishers In a Bind

Like many small and not-so-small publishing houses this year, Steerforth Press has done its share of begging. With printers, that is. Print capacity is so scarce, according to publisher Chip Fleischer, that trying to get books delivered on time is like contending with a creeping flight delay on a foggy night at JFK. “This is definitely the tightest we’ve seen it in seven years,” Fleischer says. “In a couple of cases this fall, we’ve had to pull film from a printer and move the job to another printer. Even then it still ended up being a couple weeks more than we had expected.” Other publishers are sharing the pain. “We are feeling the pinch of extended reprint periods,” says Laurie Brown, vp at FSG. “It’s not only that you get unacceptable dates to start, but then printers are failing to make even those promised dates. And of course, the reprint comes in, and the demand is long gone.” Even the bigger houses, it seems, are biting their nails. “I don’t think we’ve actually been out of stock,” says Tim McGuire, vp production for Simon & Schuster, “but we’ve had many more close calls and have worked much harder in forecasting. We’ve focused on our fast-selling frontlist, and we’ve struggled with our backlist reprints.”

It’s a litany that many ascribe to publishers’ efforts to get a handle on their out-of-control inventory. So-called just-in-time inventory management — lowering print quantities, keeping fewer books in stock, and reprinting more often — has undeniably saved publishers money. But those savings have come at a cost. Couple higher reprint frequency with booming educational and religious markets, factor in a labor shortage in a consolidating printing market, and throw a few million copies of Harry Potter into the works, and you’ve got a major production problem. Though the seasonal print crunch may ease up after the holidays, some observers are concerned that despite the best of intentions, just-in-time may turn out to be too late after all.

Riding the Logjam

“It doesn’t take too many titles to tie up a printer,” says one remainder dealer who’s been the indirect beneficiary of lagging delivery dates to publishers, “so you wonder what everyone was thinking when they invented these 3,500-copy reprints.” Indeed, for people like Fleischer, the print backup has certainly changed the way he does business. He reports that for the first time, printers have been fiddling with their promised delivery dates, and in one case, a printer called the day before a book was set to ship, to tell him it would actually ship the following week. He’s now learned to regale his account rep with complaints, which generally gets results. “You have to be a squeaky wheel more than you used to,” he says. “The printers were trying to fit in more important customers, and go back to press whenever they could.” Now, Fleischer has bumped up schedules for Steerforth’s winter and spring lists, the irony being that if the printers actually meet the current schedules, the books will arrive early.

Even a house like Hyperion has been caught between increasingly rapid production schedules and backed-up printers. “The logjam is easing up for Hyperion,” reports production director Linda Prather. But it hasn’t been easy. “Reprints used to have a two week schedule, and now you were looking at five, six, and eight weeks. And if you didn’t have a book scheduled, it was impossible to get print space. We have eight bestsellers on various lists, and a number of those went out and needed reprints immediately. I did a lot of begging.”

Of course, certain larger houses are the ones who are bumping the little guys off press. “We’ve consolidated our business to just a few vendors, so we have tremendous clout with the suppliers we’re doing business with,” says John Vitale, vp book production for HarperCollins. He explains that though printers are reluctant to add new equipment — having seen presses sit idle in years past — they’ve been able to increase productivity with their existing equipment. “One of our major vendors actually produced more books this past January than they did the year before,” Vitale says, “and they were full the year before.”

S&S’s McGuire doesn’t think squeezing more books out of the presses will have much effect, however. “It’ll be a permanent situation,” he says. “Publishers and book manufacturers will have to forecast their work better in the future, and very small publishers will have to find some alternative manufacturers they can partner with.” As for the present jam, McGuire cites slips in productivity at Quebecor and Donnelley, noting that plant production at certain vendors was off as much as 30%. “The closing of Quebecor’s Vermont plant in April at least temporarily took some capacity out of the industry,” he adds, noting that most of the equipment was moved to a new location, but did not come on line as quickly as Quebecor had hoped. (A Quebecor World spokesperson denied that the closure affected operations.) In the end, McGuire says, just-in-time management is crucial for publishers because their product is fully returnable. As corporations rush to cut returns across the board, though, it seems few actually gave the issue a title-by-title reality check — nor did they bother to tell the printers. And another attack on the persistent problem of returns has been nipped in the bud.

‘It’s Kind of a Crazy Business’

The presses may be rolling nonstop, but the printing market remains as competitive as ever. “We’ve been full or over the top for the last six months,” says John Edwards, president of Edwards Brothers. “Our problem is that we could make more books if we could get more skilled bodies. Unemployment in Ann Arbor is 1.2%.” Furthermore, with elementary and high-school enrollments “off the charts,” and as the baby boomlet moves through college, the educational demand will move right along with it. Edwards says printers and publishers must work to improve long-term planning and communications. “There’s a lot of horse trading going on as you get down to the wire,” he says. “It’s actually driving a better understanding of publishers’ needs.”

Peter Tobin, vp of Courier Corp., says that demand has been high for all of this year, and he’s one of the few printers actually investing in new equipment. “We spent $15 million in 2000, and we’ll do it again in 2001,” Tobin says, emphasizing that just-in-time is not bad for printers who have a structure that allows them to manufacture short runs or have digital presses. Unfortunately, the hope that digital technology might come to the rescue is a pipe dream for the immediate future, says Ron Weir, senior vp of portfolio management for Donnelley. “The technology is continuing to evolve in digital printing,” he says. “But the cost-effective point for those runs is still rather low. There was promise at the last DRUPA show, but for this fall it’s not a technology that’s solid or in place.”

Printers also cite the feverish pitch of the third- and fourth-quarter publishing cycle. “The big guys are very upset that their equipment doesn’t run at full capacity for six months of the year,” says Michelle Gluckow, executive vp at Book-mart Press. “The big cry was to even out the loads throughout the season. Publishers have tried to do it, but it just doesn’t work very well.” Now, everything comes at one time. “In March and April, we’ll all be looking for work. It’s kind of a crazy business, actually.”

The Remainder Game

Also crazy is the fact that despite just-in-time practices, the remainder business has never been better. “It’s an odd situation,” says Steven Sussman of Siegel/Sussman Associates. “On the one hand, you have publishers screaming that they can’t get print time, but on the other hand you have a CIROBE where they’re all talking about how great business is.” Sussman notes that a happy medium is hard to find. “If you run a one-out, one-in system, you’re in trouble if a book isn’t in the warehouse when the order comes in. To me, ‘just-in-time’ means losing sales.”

Remainder buyers, at least, report plenty of product coming down the pike. “If it is a tight printing market, it certainly hasn’t seemed to affect availability of remainders,” says Fred Eisenhart, director of remainder acquisitions for Barnes & Noble. Tamara Stock, co-owner of remainder dealer Daedalus Books, hasn’t seen a slow-down either. “From the big publishers that would use the just-in-time inventory, we’re seeing the same huge quantities that we always saw,” she says. Marshall Smith, CIROBE cofounder, thinks remainders are here to stay. “Even with just-in-time,” he says, “if you take the keenest publishers, nobody hits the mark with less than a 10% margin of error.” And now, if reprints are being delayed a month or so, it probably means more remainders, as books get funnelled into the system too late. Furthermore, as publishers bump up initial print runs to allow for delays — à la Walker’s George Gibson, who is hiking major runs by as much as 20% — this too may add to overstock.

If it’s any consolation, publishers aren’t alone in their struggles to perfect just-in-time inventory. As The New Yorker recently noted, product shortages have afflicted the electronics industry as well, partly because just-in-time simply shifts the inventory burden from manufacturers to suppliers: “Call it the conservation of uncertainty: you can pass it down the supply chain, but you can’t get rid of it.” Of course, wherever the uncertainty happens to land, some point out that a tight printing market is not exactly a bad thing for publishers. As Hyperion’s Prather says, “Most of us are happy to know that people are still buying books.”

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International Fiction Bestsellers

By PT Editors
November 1, 2000
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Beat the Devil
Coelho Back in Brazil, Mortier in the Netherlands, And Pleijel Shakes Up Sweden

Brazilian high priest of letters Paulo Coelho has conjured up The Devil and Miss Prym after two years of soul searching, and the result is a half-million-copy catechism that’s been deemed a “parable in which the characters show all the contradictions of the human soul.” Taking on the cosmic themes of Good and Evil, and probing the consequences of human free will, the novel follows the ironically named Miss Prym as she and her Satanic sidekick tempt the righteous citizens of a remote community into breaking a couple of the Ten Commandments. (Meanwhile, on the domestic front, Coelho’s The Alchemist is nearing a million copies sold in the US, 200,000 of those in paperback, according to sources at Harper.) The new book is being simultaneously published in Brazil (Objetiva), Italy (Bompiani), and Portugal (Pergaminho), with numerous other rights sales made to date, while Harper has rights for the UK and will “most probably” publish in the US as well. See Mônica Antunes at the Sant Jordi Asociados agency, which controls rights.

Investigating temptation of a different sort, Erwin Mortier’s novel My Second Skin has hit the list in the Netherlands. Described as an “ode to the awakening human body,” the work follows protagonist Anton Callewijn as he ponders his preoccupation with an older male cousin, and consummates a relationship with classmate Willem. Though it ends on a note of desolation, along the way the novel gives rise to some exceptional prose (Mortier writes of one character: “his long arms had a way of slinging around his rump like the empty sleeves of a coat that didn’t fit”). Mortier’s 1999 novel, Marcel, is said to be a “sharp and at times hilariously ironic picture” concerning a young boy raised by his grandparents in the Flemish countryside. Critics called it a “dream of a debut,” and it won the 2000 Van der Hoogt prize, among other awards. English rights to that one went to Harvill, while other sales were made to Suhrkamp in Germany and Pauvert in France. For rights to the new one, see Gerda van Boom at Meulenhoff.

In Sweden, Majgull Axelsson’s Random Walk is meandering up the list. The book covers three generations of women and is a “sad but breathtaking” story delving into women’s sexual vulnerability and its potentially fatal consequences. The author’s earlier work, April Witch, sold 400,000 copies in Sweden and rights went to 13 countries, including the US, where Random will publish next year. The new book had a 60,000-copy first printing, plus 30,000 for a book club, with rights to Germany (Bertelsmann), the Netherlands (De Geus), Denmark (Lindhardt & Ringhof), and Finland (Werner Söderström). See Inga-Britt Rova at Prisma for rights.

Also in Sweden, Agneta Pleijel’s fifth novel Lord Nevermore has been dubbed “one of the major Swedish novels this autumn” (though it’s not currently in the top 10). With 50,000 copies in print, the book spans the 20th century and a few continents to boot as it follows the friendship of two young Polish men and explores love’s sweet sorrow during World War I. One critic’s appraisal: It “shakes you about a bit.” Pleijel won the Great National Book Award in 1987 for a first novel, He Who Observeth the Wind. The new book has been sold to Denmark, Norway (both Gyldendal), and Germany (Piper). See Agneta Markås at Norstedts.

In France, Camille Laurens hits the charts with In These Arms, a “splendid, smooth-reading literary novel” informed by the author’s interaction with men throughout her life. Laurens’s sixth novel delves into a woman’s relationship with her psychoanalyst, which is played out in a series of portraits of other men in the protagonist’s life. It’s been nominated for the Prix Goncourt, and rights are available from the French Publishers’ Agency. Also in France, Christian Signol’s White Christmases is the first volume in the series Thus Does Man Live, a multigenerational trilogy that will trace the upheavals in the town of Barthelmy over the past century. The first volume kicks off on a family farm at the turn of the century, but World War I soon drags the three children into its stupefying and interminable clutches. See the FPA.

In news from Spain, Pedro del Carril and Sigrid Kraus have acquired 100% of Emecé Editores Spain, and will be publishing under a new imprint, Ediciones Salamandra. All reprints and new titles for Emecé Spain will now be published under the Salamandra logo and trademark. The owners note that the salamander was chosen as a mascot due to its “shrewd and nimble” ability to survive in the most adverse circumstances: “This is the spirit with which we intend to face our future as independent publishers!”

Germany is atwitter about Urs Widmer’s Mother’s Lover, “a homage to a life difficult to live” that explores a woman’s “dumb, obsessive passion” as described by her son. The young, beautiful, and wealthy woman falls for a dazzling but penniless composer who ends up being a famous conductor, while she languishes in destitution, wracked by her obsession with him — which neither he nor anyone else knows about. The work “almost transforms pain into serenity.” See Diogenes for rights. Also in Germany, Walter Moers’ new novel, Hansel & Gretel, has been on the list for more than 10 weeks. Moers’ first novel, The 13 1/2 Lives of Capt’n Bluebear, has been on German lists for 47 weeks and is out in English from Secker & Warburg, and takes place in the same setting as the new one — the zany world of Zamonia, where “headless giants roam deserts made of sugar.” See Annika Balser at Eichborn.

A few notes from Greece: Maira Papathanassopoulou has brewed up The Toxic Compounds of Arsenic, a three-men-plus-one-woman admixture that turns flammable when three male roommates come to terms with the charming presence of Zoe. The author’s 1998 novel, Judas’ Wonderful Kiss, has sold more than 250,000 copies in its Greek-language edition, and rights have been sold to numerous countries, including Spain (Destino), France (Plon), and Sweden (Forum). Rights to the new one are controlled by Patakis Publications. Also in Greece, from the late Freddy Germanos comes The Object, a “shattering read” based on the life of Nikos Zachariadis, who was secretary to the Greek Communist party during the nation’s civil war. The book sold 20,000 copies in two months, and no foreign sales have yet been made; see Sophie Catris at Kastaniotis.

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Frankfurt Babylon

By PT Editors
November 1, 2000
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Nick Webb, MD Europe for Rightscenter.com, serves up an author’s-eye view of Frankfurt in this dispatch, which will appear in a longer article in the journal of the Society of Authors.

If you’re one of those authors who secretly feels low after nipping into Waterstones and seeing the sheer variety of books jostling for shelf space — all of them less worthy than your own — then the Frankfurt Book Fair is, in a word, depressing. The celebration of the competition is so vast that just in Hall 9, the Anglo-American axis, there are nearly 400,000 new titles on display. And here’s what you got: Wheelbarrow Decoration, Deathbed Visions, books on dinosaurs (still), Vocational Diseases of Professional Cooks, novels too numerous to count, anthropomorphic cutesie-pie animal character series (known as “merch”), How to be a Millionaire and Remain a Nice Person, How to be a Millionaire by Being a Complete Bastard, Salads with Edible Flowers, Porn, Porn with Marmite: It’s a body blow to any sense of uniqueness.

Don’t kid yourself that your publisher wants you there, either. No matter how urbane the professions of pleasure when you announce your interest in a visit, the publisher is thinking, “Oh, bugger.” Frankfurt is a market. The rights directors are copyright traders, and your work is currency. The presence of every one of them during the Buchmesse is a catastrophe for the old cash flow. They work like dogs. Let them get on with it. Authors are a pain, you see. They wander up and down those kilometers of exhibits getting melancholy and making injudicious comparisons between their display and that of Stephen King. Occasionally they get drunk, maudlin, stroppy, or randy, and they always need attention.

But, you might ask, what of the publishers? Aren’t they vain media trendies, staying out late at parties, drinking too much and shagging each other? Yes, some are. A bit of Frankfurt apocrypha would have us believe that the city’s prostitutes take the week off during the show because publishers only sleep with each other. Some publishers maintain an annual three- or four-day affair with the same person, an arrangement that may have lasted twenty years. It’s rather like the Book Fair itself, which feels like a continuous event from which you have 51-week breaks. As for publishers’ vanity, authors are the beneficiaries. When some wally wants to make a statement to the parish that here is a major player with a big swinging chequebook, it usually means a fat advance that will earn out when the sun goes nova. Undoubtedly there are some publishers who will be driven by winning rather than by passion for the text. But if publishers bid each other up for a book, the author can only chortle. Frankfurt fever is the name given to this syndrome; fortunately the condition has become less virulent as the importance of Frankfurt as a stage has dwindled.

Though you might think that the more senior the person at Frankfurt, the less he or she does, most publishers work very hard and are suffused with honourable fatigue by fair’s end. You can almost hear the relentless trading: the white noise of people air-kissing and crying, “Darling, super” against the hum of 20,000 people saying, “Oh really, how interesting” and maintaining those affable but non-committal conversations you have with people you know but whose names you cannot remember. But the real heroes are the rights directors and those agents who have non-stop appointments every half hour. By the weekend their eyes are the colour of Spam and their skin grey with exhaustion. Be kind to them if the translation rights into Estonian are taking longer than they should. It’s not for want of effort.

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‘Caveat Vendor’ at DMA

By PT Editors
November 1, 2000
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The prognosis for global clicks-and-mortar convergence was rather dire at the 83rd Direct Marketing Association annual conference — which is saying something, considering that this was where e-commerce and one-to-one marketing gurus had gathered to assess the state-of-the-art in web-based consumerism. Officially, of course, conferees boasted about the soon-to-be billion Internet users, and celebrated “The End of Business as Usual,” as The Cluetrain Manifesto author Christopher Locke put it. In his keynote address, DMA President H. Robert Wientzen even invoked a “Web-O-Rama!” and told his audience that “we have an amazing talent for adapting to the new!”

But in fact, our correspondent reports that the “end of business as usual” seemed all too near for a few direct-to-consumer strategists in the audience. First, there were jitters in the wake of Williams-Sonoma’s 30% stock plunge last month on news of flagging catalog sales and rising costs. Despite a bullish approach to its book program (see last month’s PT), sales were down for all catalogs, a drop linked to a dip in consumer purchases. (It didn’t help matters any that CFO John Tate jumped ship to take a post at Krispy Kreme.) Then the Federated department store empire announced layoffs in its Fingerhut catalog unit. The company will cut 25% of the Fingerhut work force, which supports Internet orders for Wal-Mart, and had been expected to aid the e-commerce sites for Federated units Macy’s and Bloomingdale’s.

Book publishing seemed even lower on the DMA radar than last year, though it did pop up here and there. In his presentation on “Writing for Eyeballs,” for example, design maven Otis Maxwell looked at the creation of e-commerce communities, comparing the websites for textbook retailers Bigwords and VarsityBooks. He found the former chock full of “value-added features” (the front page changes constantly, a free online magazine offers “content for the discontent,” and there’s a handy “big word” dictionary). VarsityBooks, on the other hand, was “based around selling textbooks, not building a relationship,” and its interactive features were designed to help the retailer rather than engage customers. The upshot was that far fewer people had heard of VarsityBooks than Bigwords prior to visiting the sites, and after viewing, 56% of users preferred Bigwords. Perhaps that’s why Varsity Group recently rebranded itself as a campus marketing juggernaut that will target college students for other companies, and junked its contract with ICQ. Elsewhere, Maxwell pointed out that “soft offers” are perfect for the web, because they’re great for building opt-in lists, and customers actually give you their correct contact information (hoping they’ll win a product or service), so you can hit them up later.

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