Some Reflections on Our Industry

A Saturday Rant 4-3-04

Another major Book Expo  is almost upon us. For those who have been there
before, I'm sure you have come away with your own lessons for success. A
funny thing happens when you attend an industry convention. You become part
of the "we can do anything" mindset and all the excitement tends to insulate
and isolate you from true reality. Keep this in mind as you read further.

I have written my diary of these shows, which were a rather visceral
reaction to the events and goings-on about me. I'm sure all who have
attended could relate. But when the cold light of dawn arrives to strip
away the drunken haze of giddy enthusiasm it is time that those of us in
this industry take a good look around and realize that all is not well in
Ingram-land; as you surely can't call it Book-land.

Ingram is all I heard about at past BEA shows. Ingram is doing
print-on-demand. Ingram wants to become the Microsoft of books. Ingram seeks
a vertical monopoly. Ingram can do what it wants, when it wants, and the
rest of us have to just accept the fact that this one company holds the keys
to distribution, and soon production.

It only takes about ten minutes of walking through the exhibit hall or any
large B&N/Borders to realize that the world is awash in books. I estimate
that there will be some 90,000  different titles on display at the next BEA.
Are there ample readers out there to absorb all of this product? I don't
think so. Do you? Does Ingram?

Well, to you and me, it makes a difference. But to Ingram, it does not. They
take little risk and in return they make a huge reward. If I were to give a
"Bogus" Ben Franklin award to the one company that has been right far more
often than it has been wrong, that award would go to the evil empire of La
Vergne. Nothing happens nor will it happen without the direct input,
acceptance, and perhaps permission of Ingram's CEO. If the Merck Manual can
win the Ben Franklin Book Of The Year, than there is no doubt that Ingram
would win had there been a category for Monopoly Of The Year. Bill Gates and
Microsoft? I wish the Justice Department had looked at Ingram instead.

Is an Ingram monopoly a bad thing? I think it is. But some disagree.
However, it is hard to find anyone in this industry with the courage to
speak out against what is most assuredly a monopoly at best, or a major
controlling interest at worst. We all just lay back and accept that Ingram
will have its way with us. What can you do against the only entity that
holds the keys to the conduit to billions of dollars of retail book sales?

Having talked with many thousands of publishers over the past several years, I
come to the simple conclusion that we publishers do not control the
publishing industry, but that the distribution channel is our goddess. This
sector sets the discounts, they determine our cash flow and they make the
decisions on what will be available to the book buying public and what will
not. And they are so good at it, that they even have us believing that it is
we who are in control. But we publishers are not that stupid. We know who
controls the trade sector of our industry. It is not B&N or Borders or
Amazon. It is Ingram. There is not a part of this industry where they are
not a controlling factor.

I will be accused of not citing specific examples and for making some kind
of ad-homonym attack on the sainted wholesaling entity that purports to be
our rock and our redeemer. And maybe I overstate my case. But in my heart of
hearts, I firmly believe that nothing happens in the retail and distribution
sectors without the express consent of Ingram and their band of merry
monopolists.

Who is strong enough to stand against the tyranny of Tennessee? Maybe it is
the PMA?

...SO I ISSUE A CLARION CALL TO THE PMA

In talking with publishers of all shapes and sizes over the past few years,
I am more certain than ever that only we, the members of the small/mid-size
press can make a difference. Most of the large houses are caught up in their
own internal strife, consolidations, and general ignorance about this
industry; being run by mostly bean counters most of whom have never seen a
book, much less read one. So who is listening? So who is there to speak out?

Is it Pat Schroeder at the AAP? No it is not. She and her band of corporate
conglomerates are more interested in copyright issues than in seeing that
our industry survives against the onslaught of electronic and digital media,
to say nothing of the creeping monopoly of the world's largest distribution
entity. I always hope for a merger between the small and large houses, but I
don't see it in the cards. We have different agendas.

Is it  the Book Industry Study Group? No. They are academics who are more
interested in what has already happened then in what is destined to occur.

Is it us? Is it PMA?

Taken as a whole, the vast majority of this industry is made up of small
10-50 book-a-year publishers like you and me. We don't make a
majority of the profits, but we do produce the majority of the product. And
we are without a strong, firm voice in the industry. Indeed, we are the
sleeping giant that, as one high level executive from John Wiley once told
me, "we never want to awaken."

Even if you are a one-book publisher you are part of a huge number of
similar publishers. Even if you publish books that are so esoteric that they
have created their own genre or category, you are part of a huge number of
similar publishers. Even if you are a non-profit, or a university press, you
are part of a huge number of similar publishers who share similar problems
with distribution, slow payment, damaged returns, and low profitability.

Now what follows may make some of you uncomfortable. But it is the truth,
like it or not. No matter what kind of publisher you are, how many titles
you produce, or how much money you make or lose, there is only one
organization that has the ability to speak for your interests. That
organization is the Publishers Marketing Association.

It is Jan Nathan and PMA that is the entity that can and should speak for
us. It is the PMA that has the legitimacy to act on our behalf. It is the PMA that
has the power to change the returns structure, to help open the distribution
channel, to spearhead the vision of electronic media, to insure that the
one-book publishers of this business have an outlet to the retail channel,
and to define what the future of book publishing will be.

I have tried my best the past ten years to open the ears of the PMA board
and staff to the needs and callings of the membership. I have spoken out on
behalf of all of us who are tired of the same old, same old. I have ranted,
raved, cajoled, debated, and instigated in an effort to get small and
mid-size publishers to realize the power that we have, and to energize our
spirits with the confidence to fight against the tides that hold us back.

And I have failed miserably.

I wanted to say that "we" failed miserably. But in truth it is I who have
failed. Not one of my proposals has been adopted nor even considered
important enough to be brought to the PMA annual meeting. It is a humbling
defeat which I bear, but not lightly.

While I am not confident, maybe there will be some serious discussion of
them by the PMA and its board, I am hopeful that a new PMA
will not be as conservative as their predecessors. I am hopeful that a new
board will see as its mission the need to enlarge the scope of
PMA and to make it a strong and viable spokesperson for the needs, interests
and desires of the small and mid-size publisher. As I said at the start of
the previous paragraph, I feel that I have lost the battle. But I'm not sure
that we have lost the war; for I will continue to see things not as they
are, but to see them as they have never been. For in my heart of hearts, I
deeply believe that we small publishers can
make a difference in our industry.

I call upon the PMA board members to listen to the
membership, to abandon the protection of special interests of the previous
administrations and to embark on a new term directed
toward leadership within the industry, toward a mission of having the voice
of the small and independent press heard throughout the industry, toward an
administration with clear cut goals and achievements that will be for the
benefit of the majority of the members, not the university presses, not the
vendors, not the retailers, not the distributors, and not the large members
who are a distinct minority.

I call upon the PMA to open up OUR organization to direct
participation of the members, via direct elections.

I call upon the PMA to present to us a well reasoned
charter with respect to returns and to let us vote on it.

I call upon the PMA to begin the process of a full and
complete outside audit of PMA programs.

I call upon the PMA to publish the budget of the organization, to
create formal procedures for communication with the membership, and to be
frequent contributors to the pub-forum listserv.

I call upon the PMA to establish the groundwork for our
future in electronic commerce.

I call upon the PMA to aggressively take our rightful
place at the table with the other industry power brokers; to actively call
upon B&N, Borders, Amazon, and Ingram and open a dialogue on issues that
effect all of us: returns, payment, slotting, copyright, etc.

I call upon the PMA to consider the advice of the vendor
members, but to never lose sight of the fact that PMA is an organization of
publishers, not web-site providers, not printers, not distributors, and not
retailers The PMA charter should be changed to prohibit vendors from having
voting and veto power on our board.

I call upon the PMA to dream, to think, to hypothesize,
and to position our segment of the industry into a position of potential
success in the new millennium. We must evolve from an organization dependent
on trade shows and mailings into an entity on the forefront of electronic
commerce.

With a a strong PMA, we have the ability to put aside
old animosities, old petty differences, and to forge ahead with vigor and
energy to make our organization, our industry sector, and perhaps our entire
society better when we leave it, than as we found it.

This is my clarion call, this is my challenge, this if my trumpet to battle.
I call upon all PMA members and all publishers to not only help make this
board and administration the best that it can be, but to demand the same. It
is our job to communicate our needs, wishes, desires, and problems tothe
PMA and the board, and it is the job of PMA and the board to
communicate back to us that they indeed have heard us. We have been ignored
for too long. We should not be ignored any longer. And if I have anything to
do with it, our voice shall be heard.

I do not call for miracles or for overnight successes. All I ask from the
PMA and the board is that we be heard, that we be listened to, that we be
acknowledged, that we be taken into account and that the greatest good for
the majority (as opposed to the vendors) be always enacted into what becomes
PMA policy and programs.

This can be a new adventure for us. We can achieve greatness. We can
overcome. This can be our time. We have the ability, we have the need, we
have the power, and we have the will. I only ask that the PMA remember that it is us, the "keepers
of the culture" who are the heart and soul of PMA.

We are the publishers. We keep the culture. It is important that we survive.

I ask no more than that. And I demand no less.



Alan N. Canton, Vice President
Adams-Blake Company, Inc.
http://www.adams-blake.com

[Copyright 2004 by Alan N. Canton. This material may be re-published on any
Internet listserv or Usenet  newsgroup without prior permission by the
copyright holder. Any other re-publication is prohibited without express
permission of the copyright holder.]