Publishing’s Problem is not a Tech Problem

April 28th, 2021

Three different items “crossed my desk” this week that made me think more about the role of technology in the future of book publishing. They’re from different sources, but the messages converge.

The first item was a March blog post by Benedict Evans. (His excellent free weekly newsletter is a ‘must-subscribe’; the paid version is at hand for after you get hooked on the free one.) Titled “Outgrowing Software,” Evans looks at the fundamental shift in the role software plays in multiple industries, including music and books.“In the past,” Evans writes, “IBM, Oracle or Microsoft sold technology to other companies, as a tool.” Many of the tech companies today have moved beyond that, where, although they have a base of sophisticated software running their various platforms, it’s not software that they sell. “Uber and Airbnb don’t sell software to taxi companies and hotel companies,” he writes. They provide transportation and accommodation services — the underlying software is all but invisible, and is certainly not the “product.”

Not a software company

1. Music and Books Have Already Been Disrupted

Evans takes his analysis to the next level by looking at some specific industries “that have already been destabilized by software, and at what happened next.”

He starts with recorded music, where tech had “a huge effect” on the business. But who in the tech industry — Amazon, Apple, Google, Microsoft et al. — today spends an effort strategizing about their next steps in the music business? The industry, though completely reliant on technology, isn’t driven by technology. Content drives the industry, and business models, and marketing. Why would Apple bother with music anymore? Music industry revenues were $20 billion last year, while Apple’s were more than ten times that number.

Evans doesn’t visit the retrospective numbers. If you go back 20 years (2001), U.S. recorded music revenues were more than two-and-a-half times larger than Apple’s sales that year — the company was taking aim at an industry far larger than its own.

More interesting for book publishers is Amazon’s changing role over time. When Amazon launched the Kindle in 2007, U.S. publishing industry revenues were nearly twice Amazon’s ($27b vs $14b); Amazon’s sales are now ten times those of the publishing industry. The result, Evans says, is that “no one in tech cares about online book sales or ebooks.” They’ve moved on.

2. Technology Within a Social World

John B. Thompson’s Book Wars: The Digital Revolution in Publishing will be published in the U.S. next week (two months after the U.K.). I’ll be returning to the book in multiple blog posts, but even in the preface (and mirrored in the conclusion), Thompson has trenchant observations to share about technology’s role in publishing.

I’ve been following book publishing startups for more than a decade. The first output from my interest is a 2017 report, An Authoritative Look at Book Publishing Startups. I’m in the midst of updating the list of the over 900 startups that I’ve tracked and expect to publish a second edition of the report this fall. There are unique questions posed around each startup, but the most vexing one is outcomes: each firm’s eventual success or failure. The outcome is sometimes uncertain: “many startups are essentially dead, but limp along for years in zombie-like fashion.” When they fail, is it a failure of technology or of marketing? Or is it for some other reason?

Thompson suggests a different way to think about technology and its impact on the book publishing industry.

The claims of the pundits, he notes, when they’ve looked at the digital disruption of established industries, have focused “far too much on… the technologies themselves. They believed, often blindly, “that new technologies, by virtue of their intrinsic and advantageous features, would prevail eventually.”

What they’ve missed is an appreciation of “pre-existing social institutions, practices and preferences.” Most of the analysts lacked “any real understanding of the forces that were shaping the particular social space or ‘field’ within which these technologies were being developed and deployed.”

“They focused on the technologies themselves, enthralled by their power,” Thompson writes, “without taking account of the complex social processes in which these technologies were embedded and of which they were part.”

And the zinger: “The social world is a messy place and it’s much easier to predict the future if you ignore the messiness of the present… the social, economic and political factors that shape the contexts within which technologies exist.”

While I like to imagine I have a nuanced appreciation of book publishing and its role within society, I can think of several instances where I’ve climbed aboard the technology train, looking neither left nor right.

3. Big Tech and the Movies

With the Oscars fresh in our minds it’s a good time to consider the longer-term impact of technological disruption on the movie industry.

Only a marketing tool

Or has had. As with music and books, Benedict Evans sees the industry as post-disruption. “Netflix.” he notes, “used tech as a wedge to enter the TV industry; Amazon uses it “to drive Prime subscriptions,” while for Apple, it’s “only a marketing tool.” As a result, “the questions about the new models are TV and cinema questions, not software questions.”

Screenwriter and director Paul Schrader talks about the state of movies and TV in an April 22 New Yorker interview, covering a lot of history, from the early days of movies, up to today, based in part on technology, and certainly within a social context. He sees three tectonic shifts. The first goes back to The Birth of a Nation, a three-hour silent film, released in 1915, two years after the opulent Regent Theater opened in New York. Well before television, movies were an event, unlike any other.

The second era was the rise of the “serious” film, a response to television. This was a time when people said not “Let’s go see a movie” but “Let’s go see a specific movie. Let’s go see this movie we’ve been hearing about.” These movies “were about something.”

Third is our current era, the Netflix era, where streaming TV created “a pool of entertainment so large that people didn’t need to go anywhere else.” Now “you don’t have to read reviews, and you don’t have to check the newspaper. You just go to Netflix and within ten minutes you will find something you want to see.”

The interview is a great read.

This segues nicely into a pre-Oscars article in the Los Angeles Times, mainly lamenting the declining viewership of the awards themselves.* What’s interesting is its brief analysis of the changing nature of the big movies and the cinematic experience.

“The studio model is really geared to bringing butts in seats into the theater,” said one analyst interviewed for the article. “It is less geared to secondary or tertiary channels like streaming.” The article’s author notes that “theatrical releases do have a way of ‘eventizing’ films, creating that sustained level of awareness that jams a film in the public’s consciousness. Studios haven’t quite figured out how to create the same effect when it comes to their online releases.”

I thought this could be also of interest to book publishers, with an apparently growing problem with frontlist sales. Bookstores are the venue where publishers can “eventize” a major new release, not unlike the movie theaters today. With books piled high on front tables, and a live reading next week, it’s just not the same pre-ordering the title on Amazon.

* Footnote: There’s an irresistible snippet in the article, quoting the award’s 2021 producer, director Steven Soderbergh, and his refusal to allow acceptance speeches on Zoom. “It’s the f—ing Oscars. It’s not a webinar,” Soderbergh said.