Authors and publishers are horrified that the Productivity Commission (PC) has reduced our industry to a cultural externality to be balanced against economic rationalism, and argue the industry will be decimated, but I can't help feel they have a rose tinted view of where the industry is, and where it's going.
1. Unlike 'protectionism' of other Australian industries, the PC rightly points out that on balance the global publishers benefit far more from the current rules than Australians.
2. There are three classes of booksellers who are experiencing growth in the current Australian market, Amazon, the larger independents (who compete on their selection and engagement with readers) and most noticeably the discount department stores (DDS's) BigW, Target and Kmart who are currently doing extremely well (greater than 10% growth) thanks in the most part to their globally competitive pricing.
3. Traditionally, department discounters (DDS) have focused on the pulp fiction sub $10 book market which is where the invisible giants, the romance and anonymous writers live, but also on the first release bestselling books where they can undercut the rest of the market. Because of the pressure globally on booksellers and higher wholesale price to booksellers in the protected Australian market, the DDS's are taking the bookseller's traditional ranged market and ironically making publishers pay extra for the privilege in volume rebates.
4. The multinational publishers target returns on average of 10-15%. How this is returned to the parent is irrelevant to the parent, though certainly the local publisher can balance a mix of staffing, new author development and pricing of their 'protected' successful authors. Their RRP will be influenced by the increased costs of dependence on economically efficient DDS's
5. Multinational publishers use their pricing protection advantage to outbid smaller publishers on advances for promising authors. Smaller publishers have to be more agile on staff costs and be prepared to risk lower returns to compete.
6. Authors base their fears on the way rights are currently traded, but they evolved that way because of PIRs. Since there is no benefit of fixed price rights post PIR, it stands that other contracts may become favoured which could equally be of greater overall benefit to authors or rights holders.
7. Forget cherry picking prices - the arguments are essentially about the average Australian bookseller being able to sell the US and UK mass market 2nd release bestsellers at $10-$15.00, at which price point books are less of a discretionary purchase, and there is less real price difference across the market between booksellers and discounters.
8. The elephant in the room is the electronic edition. Removal of PIRs in advance of the ebook becoming mainstream is practically doing the industry a favour in forcing it to adjust to the impact of the ebook against printed books.
9. Ironically booksellers, still somewhat suspicious of the campaign for the removal of PIRs voted best marketing campaign the revival of the most famous cheap books ever - the Penguin Classic, which is selling thousands of copies of popular backlist authors at $10 each in real bookstores.
10. Still not convinced? Imagine books are cigarettes. Now imagine the government put a 30% tax on cigarettes (which is about what they have done). Why do they do that? Well because it is proven the higher cost of cigarettes reduces the number of cigarettes sold, and the overall number of smokers and increases government revenue. Coincidentally the price of a packet of cigarettes is now about the same as a popular book, so the approx 30% 'tax' on popular 2nd release books reduces the number of readers and books sold for the sake of increased revenue. Except that unlike the tax on cigarettes 60% of the 'tax' goes to outside Australia, while the remaining 40% gets split amongst the local publishers/printers/retailers and authors.
I leave the final words to the original Penguin Classics which were "generally viewed with suspicion and uncertainty by traditional publishers. Hardback fiction sold at seven or eight shillings, and it was feared that the new cheap paperbacks might undermine this market." One famous author opined: "In my capacity as a reader I applaud the Penguin Books; in my capacity as a writer I pronounce them anathema. Hutchinsons are now bringing out a very similar edition, though only of their own books, and if other publishers follow suit, the result may be a flood of cheap reprints which will cripple the lending libraries and check the output of new novels."
The more things change the more they stay the same.
0 comments:
Post a Comment