There is a post on The Idea Logic blog about the seven changes that are coming in publishing over the next several years. The Idea Logic Company is the creation of Mike Shatzkin who, according to his website, is “a widely-acknowledged thought leader about digital change in the book publishing industry. In his nearly 50 years in publishing, he has played almost all the roles: bookseller, author, agent, production director, sales and marketing director, and, for the past 30 years, consultant.”
Mr Shatzkin begins by describing the evolution which has already taken place in publishing, beginning when a publisher needed to own a substantial infrastructure to deliver printed books to thousands of retail locations. “Now more than half the book sales and an even greater amount of the “discovery” takes place online and a lot of the discovery and a lion’s share of the purchases happen at a single account: Amazon. You don’t need a big organization to cover a single account nor a big infrastructure to service it. The other half of the sales in the US, and sales around the world, are now facilitated by another single account, Ingram Content Group. Ingram provides every component of the fixed-cost infrastructure that any book publisher requires and, in fact, provides all or any part of that infrastructure to an ever-growing number of publishers. . . . All the things that publishers do that don’t require a big infrastructure: finding and developing books, editing them, designing them, and marketing them (increasingly using digital opportunities to talk directly to consumers) can be delivered by a vast network of freelancers and small company service providers.”
Mr Shatzkin continues with his predictions which are excerpted below:
“1. Sales will continue to move to online. The movement of book sales from physical stores to online has been unabated since Amazon began. There is no reason for it to stop. Books have a ton of characteristics that make them perfect for online shopping. You want to shop from a full selection no store has.
2. The other big general online retailers will be Amazon’s biggest competitors for book sales. So far, Amazon has been about the only beneficiary of the shift to online buying. That may be changing. Other big retailing brands like Walmart and Costco have built robust online businesses. Ingram now enables them to carry a full line of books as well.
3. The bifurcated book market will continue. There is a whole digital-first publishing world, spawned by self-publishers, that offers (mostly) genre fiction at prices commercial publishers can’t match: $4.99 and under. The net result has been that commercial publishers are finding it increasingly difficult, if not impossible, to compete in the genre fiction market of customers who measure their reading in books-consumed-per-week.
4. Publishers will progressively shed overheads for service providers. As the commercial publishing business shrinks because of reduced shelf space and increased competition from publishers enabled by the new circumstances, the big publishers will find it increasingly difficult to support their overheads. We’ll see the number of sales forces calling on bookstores and the number of warehouses shipping to them decline progressively in the next few years.
5. Big publishers will see an ever-growing share of their own sales from their backlist. While it is getting increasingly difficult for publishers to successfully launch new books, there are new opportunities appearing on the radar every day for titles on the backlist. This is true both because digital information sources find and publicize books regardless of their age and because publishers don’t need to position inventory in stores to make them accessible to the public.
6. Amazon Publishing will continue to make inroads signing big authors; only a ruling from courts could eventually stop them. When Amazon launched their book publishing program ten years ago, they probably had about half the market share they have now. Big authors want to reach the whole public, and when indie and chain bookstores combined to effectively boycott Amazon titles, it meant large parts of the consumer base were hard for them to reach. From here it looks like Amazon exploits an unfair advantage, being the biggest retailer competing with their suppliers for customers that Amazon owns. But for that to matter, it has to be a court’s opinion, not just mine. Perhaps as the effect of the current market circumstances on competition become clearer, a court will see it that way.
7. “Entity self-publishing” will increase dramatically, presenting more challenges to commercial non-fiction publishing. The pieces are all in place for “publishing books” to become part of any big entity’s marketing strategy. You don’t need to own a book publisher to issue them any more than you need to own a newspaper or magazine to get a story out. Over the next few years, we will see a tsunami of non-fiction publishing from capable entities much like the tsunami we have seen of genre fiction publishing direct from authors.”
All of this makes sense to me.