Thursday, March 26, 2020

Barnes & Noble College Stores Takes a Pill

News today that B&N have closed about half their stores.  That’s going to hurt.

On the education side (these are entirely separate businesses) the Barnes & Noble board are worried the company might be acquired for a song due to the very low share price and have implemented a poison pill defense.

This from Publisher’s Lunch today:

Barnes & Noble Education Adopts Poison Pill:
In early December Barnes & Noble Education announced they would hire a financial advisor to "review strategic opportunities" — e.g. help try to sell the company — following yet another disappointing quarter, and claiming "a number of unsolicited inquiries" in rescuing the company from the management that has run it down. On Wednesday, with the stock trading at deep lows over the past few 10 days in the wake of broad campus closures, BNED adopted a poison pill (aka "shareholder rights plan"), to make sure no one actually buys the stock thinking they could gain control of the company.

BNED said "the rights are designed to ensure that all of the Company’s stockholders receive fair and equal treatment in the event of any proposed takeover of the Company and to guard against tactics to gain control of the Company without paying all stockholders a premium for that control." The pill kicks in if any person or group acquires 10 percent or more of the common stock.

That plan follows an SEC filing from Monday by competitor James Barnes at BBA Holding Corp. (and his wife), indicating that they had increased their holding of BNED stock modestly from a string of recent purchases. They own 6.40 percent of BNED shares now, up from just over 5 percent when they first were required to file in late October 2019. (That initial investment has lost millions of dollars in value so far.)

BNED had to update their "risk factors" in adopting the new rights plan, but their candor in the face of broad campus closures is underwhelming: "The recent outbreak of COVID-19, and any other outbreaks of contagious diseases or other adverse public health developments in the United States or other countries where we operate or our customers are located, could have a negative effect on our business, results of operations and financial condition. These effects could include disruptions or restrictions on our employees’ ability to work effectively, as well as temporary closures of our facilities, retail stores, and the institutions we serve. The extent to which COVID-19 could impact our business, results of operations and financial condition is highly uncertain and will depend on future developments."

Morgan Stanley is the bank conducting the sale.  In this environment it is going to be a difficult sell. 

How much the COVID-19 imposed change in behavior has pushed even more people (students) to web purchase and what the impact that will represent for campus stores may only be seen in the fall.  Hard to project revenues in that circumstance.

This is their share chart over the past five years – not so great.  You can see it has really tanked the past three months.

And here is their earning call transcript.

Wednesday, March 25, 2020

Annual Publishing Technology Report: A Review of ERP & CMS Software Built for Publishers Download

Industry Leading Software Vendors Reviewed in this Technology Report. Available now.

In this 90 page report, we have identified over 100 software companies in our market map which cover segments including Order to Cash, Financials, Title (Product) Management, Production Scheduling, Contract Rights and Royalties, Editorial Services, Membership Management, Digital Asset Management, Digital Asset Distribution, Intellectual Property Management and Content Analytics.

You should buy this report if you are a publisher looking to invest in new and/or replacement solutions to support your business and/or you need insight in to the market for publishing technology products and services. 

Priced at $950, the report identifies more than 100 companies and reviews in detail more than 50 software and services products (from more than 20 vendors) specifically designed to support publishers, content-centric businesses and professional organizations.

Please use this link to purchase the report: 

 The report will be emailed to you immediately on purchase.

In this report we also discuss the technology the vendors actually use and the investments they are making to improve their platforms - particularly in the area of SaaS and API development.  As a buyer of these solutions it is important that there is an awareness and appreciation of how 'future proof' are these applications.

The following companies were profiled in detail:

Aries Systems
Advantage Computer Systems
Media Services Group/Newscycle
Schilling A/S
Typefi Systems

Related recent posts on this topic:
News Ticker for Publishing Technology Companies

Tracking the Technical Velocity of Publishing Software - Looking at how software companies are investing in new technology

Monday, March 23, 2020

Some Bookstore Reactions to Covid - 19

From BBC:
So, it feels especially painful that during this global pandemic, bookshops – at least physically – have become increasingly out of bounds. As Covid-19 spreads around the world, many countries are entering periods of total lockdown, with all but essential services closed and people ordered to stay inside. Even where official lockdowns are not in place, social distancing and avoiding unnecessary contact is urged. Many people are choosing to self-quarantine because they are at high-risk or want to help stop the spread.
“Booksellers are among the most resilient, warm and resourceful of people, and bookshops have been swift to adapt to the obstacles of social distancing and self-isolation to provide incredible services for their customers,” says Meryl Halls, managing director of the Booksellers Association of the UK and Ireland. But she says it’s vital to remember that, while many bookshops are demonstrating pragmatism and optimism, they still desperately need the support of the public, the publishing industry and their governments to weather this new landscape.
It’s not just adult readers affected by bookshop closures, but children too. In the town of Kyneton in Victoria, Australia, Squishy Minnie is used to up to 100 kids cramming into the shop for a weekly story hour – some feat for a place with a population of 6,000. When owner Kristen Proud made the decision to shut up shop, she wanted to keep the community connected, so they have moved their story-time to YouTube. “After our first one went live we had an overwhelmingly positive response, with many people in self isolation contacting us with photos of their children enjoying it and people thanking us for keeping some routine in their lives.”
From The Guardian:
The British businessman, who is self-isolating after recently returning from the US, said Waterstones was “providing a real social benefit” and was not “slave-driving our booksellers into working against their will”.  Hours later, Daunt told staff he was closing the stores “with great regret” and “having heard from many booksellers that they feel obliged to continue to work as long as the shops are open”. He said shop-floor staff had responded heroically in exceptionally difficult times.
From Vox:
What did I learn from making this list? That perfect murders, at least the artful kind we find in books, are all about concealment and misdirection. They have a lot in common with well-executed magic: it’s all about fooling the detectives (and the readers), making us look away from where the crime is happening. Agatha Christie’s The ABC Murders, another book on Malcolm’s list, is a textbook example: it appears as though a psychopath is bumping off victims according to the initials of their names, but the truth is something else altogether. Poirot, naturally, is not misled, and the world can be set to rights.
From Goodreader:
Barnes and Noble is in a precarious position due to the Coronavirus. Dozens of stores already have closed and it is inevitable that the chain will fully close in the coming days. B&N CEO James Daunt told his staff that, should store locations have to close their doors, staffers will “first make use of their Paid Time Off.” After that, employees with a year or more of service will receive “up to” two weeks of pay. “Temporarily, and with sincere regret, on closure we lay off all those employees impacted with less than 6 months employment on the day of closure.”
From Campus Technology:
VitalSource is offering free access to digital learning materials through the remainder of the Spring 2020 semester, to aid those students attending colleges and universities that have closed in response to COVID-19. Beginning today and going through May 25, 2020, students may access "an expansive catalog" of digital content if they attend a participating institutionWith Barnes & Noble.

20 books local experts recommend while you’re social distancing

Thursday, March 19, 2020

Machines and Education

From the Guardian an interesting long read on how technology is revolutionizing learning,
When we met, Li rhapsodised about a future in which technology will enable children to learn 10 or even 100 times more than they do today. Wild claims like these, typical of the hyperactive education technology sector, tend to prompt two different reactions. The first is: bullshit – teaching and learning is too complex, too human a craft to be taken over by robots. The second reaction is the one I had when I first met Li in London a year ago: oh no, the robot teachers are coming for education as we know it. There is some truth to both reactions, but the real story of AI education, it turns out, is a whole lot more complicated.

Huang had begun his English course, which would last for one term, a few months earlier with a diagnostic test. He had logged into the Squirrel AI platform on his laptop and answered a series of questions designed to evaluate his mastery of more than 10,000 “knowledge points” (such as the distinction between “belong to” and “belong in”). Based on his answers, Squirrel AI’s software had generated a precise “learning map” for him, which would determine which texts he would read, which videos he would see, which tests he would take.
The answer, Li decided, was adaptive learning, where an intelligent computer-based system adjusts itself automatically to the best method for an individual learner. The idea of adaptive learning was not new, but Li was confident that developments in AI research meant that huge advances were now within reach. Rather than seeking to recreate the general intelligence of a human mind, researchers were getting impressive results by putting AI to work on specialised tasks. AI doctors are now equal to or better than humans at analysing X-rays for certain pathologies, while AI lawyers are carrying out legal research that would once have been done by clerks.

Tuesday, March 17, 2020

Going Mobile. Are you Muted?

It is his first year of law school and Danny Levin is disappointed. He believes that the constant exchange of ideas, philosophical arguments and law school politics died when Harvard told students to pack up, go home and check their fast internet service. Harvard, like all colleges and universities in the US, has gone online only for the rest of the academic year. It goes without saying that not everyone is going to be prepared. And in all likelihood, as this forced migration extends through the summer, we may be witnessing a fundamental change in academics. Sure, we have online schools and certainly traditional 'brick and mortar' institutions offer online courses to complement or replace in-class learning. But the impact of Covid-19 on the delivery of educational materials and the relationships between faculty and students will produce radical change.

Many faculty have resisted the adoption or transformation of their course materials to online delivery. Why change? Their materials and the supporting text content represent years of work and are fine-tuned to deliver the best outcomes possible. No matter that better materials are available and new teaching methods (like assessment-based products) are changing education; change is hard, and if it can be avoided, that's easier. Being unprepared makes today's events difficult to manage for faculty and students.

Without generalizing, just the technological hurdles challenge even the most adept of us who - especially in the commercial world - work with technology every day. Who among us hasn't wanted to throw the laptop across the room when Zoom or Skype won't connect? If you've never convened an online meeting then there is a steep learning curve. At Harvard, Danny is excited to go to class because of the direct interaction with his fellow students and the professor. The professor works the room, calling on verbose or non attentive students, asking deeper and more probing questions. This interactivity is the value. Replicating that on-line takes artistry and practice and unfortunately converting mid-semester is the worst of all possible scenarios. As one professor said, perhaps the best that can be managed is to avoid mediocrity and the worst mistakes.

Most mistakes will probably stem from poor use or adoption of technology. And, to address this, faculty should be ready to engage with their students and departmental colleagues to educate and support. After each on-line session, faculty should open up the floor for feedback with the proviso that 'we are all in this together' and are all learning from the process. It is almost certain that, as students progress through their careers, on-line course delivery and other professional communication will become the norm no matter what their discipline. Therefore, from a practical standpoint, this experience and opportunity will not be wasted. Online depositions and legal proceedings are already used frequently in the wild.

Stories about the kind of technology issues students are facing today aren't hard to find. As one student lamented, "I've been faced with screen-sharing problems, poor connections, a platform user limitation and general time wasted trying to address the problems". More amusing was this from "Javi":
our professor was 20 minutes into lecture before realizing 1. he wasn’t sharing his slides 2. he wasn’t recording the lecture 3. he had his computer muted so he couldn’t hear us 4. wasn’t checking the chat and 5. had his phone on silent so the TAs couldn’t get a hold of him hahaha
One student noticed that when their professor hit screen share they had a file folder prominently labeled DIVORCE on their desktop.  So, practice safe sharing.

The more fundamental issue will be the preparation and delivery of the content itself. Faculty will not become proficient at this in the short term, but they will gain insight and valuable experience through this exercise, especially if they involve their students in the adventure. Perhaps faculty will accelerate their experimentation with online and adaptive learning products already available from education publishers. Some faculty with more experience will share their skills and experience to others.   (I am currently working with a publisher on this currently).  Online course development takes time (just like it does in the old model), but I hope we will see a faster adoption of online course materials in succeeding years because of this experience, once COVID-19 is behind us. For now, however, students and faculty will have to make the best of it

Michael Cairns is a publishing and media executive with over 25 years experience in business strategy, operations and technology implementation.  He has served on several boards and advisory groups including the Association of American Publishers, Book Industry Study Group and the International ISBN organization.   Additionally, he has public and private company board experience.   He can be reached at

Read more articles on my Flipboard magazine:


Are you considering an investment in new technology?  Check out my report on software and services providers.  (PubTech Report)

Friday, March 13, 2020

Nine Books on Bugs - The Pandemic Kind

The Satan Bug - Alistair McLean
Gripping and tense story of secret agents, even more secret government facilities, and a deadly virus, from the acclaimed master of action and suspense.

The Stand by Stephen King
Stephen King’s apocalyptic vision of a world blasted by plague and tangled in an elemental struggle between good and evil remains as riveting and eerily plausible as when it was first published.
The Andromeda Strain by Michael Crichton
A military space probe, sent to collect extraterrestrial organisms from the upper atmosphere, is knocked out of orbit and falls to Earth. Twelve miles from the crash site, an inexplicable and deadly phenomenon terrorizes the residents of a sleepy desert town in Arizona, leaving only two survivors: an elderly addict and a newborn infant. 

Outbreak by Robin Cook
Murder and intrigue reach epidemic proportions when a devastating plague sweeps the country. Dr. Marissa Blumenthal of the Atlanta Centers for Disease Control investigates—and soon uncovers the medical world's deadliest secret...
Vixen 03 by Clive Cussle
1954: Vixen 03 is down. The plane, bound for the Pacific carrying thirty-six Doomsday Bombs—canisters armed with quick-death germs of unbelievable potency—vanishes. Vixen has in fact crashed into an ice-covered lake in Colorado.
I am Legend - Richard Matheson (The Omega Man)
Robert Neville may well be the last living man on Earth . . . but he is not alone.
An incurable plague has mutated every other man, woman, and child into bloodthirsty, nocturnal creatures who are determined to destroy him.
By day, he is a hunter, stalking the infected monstrosities through the abandoned ruins of civilization. By night, he barricades himself in his home and prays for dawn
Love in the Time of Cholera by Gabriel Garcia Marquez
In their youth, Florentino Ariza and Fermina Daza fall passionately in love. When Fermina eventually chooses to marry a wealthy, well-born doctor, Florentino is devastated, but he is a romantic. As he rises in his business career he whiles away the years in 622 affairs--yet he reserves his heart for Fermina. Her husband dies at last, and Florentino purposefully attends the funeral. Fifty years, nine months, and four days after he first declared his love for Fermina, he will do so again.
The Road by Cormac McCarthy
A father and his son walk alone through burned America. Nothing moves in the ravaged landscape save the ash on the wind. It is cold enough to crack stones, and when the snow falls it is gray. The sky is dark. Their destination is the coast, although they don't know what, if anything, awaits them there. They have nothing; just a pistol to defend themselves against the lawless bands that stalk the road, the clothes they are wearing, a cart of scavenged food—and each other.
The Plague by Albert Camus
A haunting tale of human resilience in the face of unrelieved horror, Camus' novel about a bubonic plague ravaging the people of a North African coastal town is a classic of twentieth-century literature.

Wednesday, March 11, 2020

ViaNOT: Simon & Schuster Nolonger a Fit at ViacomCBS

Almost apologetically, ViacomCBS Chief Executive Bob Bakish announced that Simon and Schuster (S&S) wasn’t a real fit for his media company, this despite the fact that S&S has been part of the family for 25 years give or take. That said, he did confirm what many in the industry have seen for a while, that ViacomCBS has been interested in off-loading S&S for a while. It’s pretty unfair on S&S too: The company has a strong backlist and stable of reputable authors, has avoided some of the bigger controversies such as library lending and Amazon conflicts and has managed to produce decent operating margins in a trade publishing business that historically struggled to achieve 10% profit margins.

Left unsaid in Bakish’s admission is that a strategic buyer may not be on the cards. For HarperCollins, Macmillan, Penguin Random House and Hachette that deal has been but a phone call away for the past 3-4 years, but no deal is in the offering. Bakish has been forced to announce publicly the chance to purchase one of publishing’s most iconic publishers to gin up some interest. Perhaps if this effort doesn’t produce a buyer then VIacomCBS may moderate their price expectations to make a deal with another publisher more likely. While efficiencies are likely in a combination with another publisher cost savings may not be as significant at first glance. Publishing has been running lean since the financial crisis (not the current one).

S&S had revenues of $814 in 2019 according to industry sources which was slightly lower than those in 2018. Profit is likely to be around 10-15% which may broadly imply a valuation in the $500mm range. With market power of both Amazon Publishing and Penguin Random House potential buyers would be wise to be cautious in overpaying for an expanding and growing market opportunity which simply isn’t there.