Sunday, November 30, 2008

Twelve Books for Christmas

Dismal sales expectations for all retail including books got me thinking that all of us in publishing and bookselling should be encouraged to support the business in any way we can. My simple suggestion is an echo of the 12 days of Christmas theme whereby we visit our bookstore(s) of choice and buy twelve new books. Naturally, buying more is also an option.

Here is my selection of twelve titles I have put off buying during the year (mainly because I have been working down my considerable back-log). I bought ten of these books in the last couple of days.
  1. Dexter Filkins: The Forever War
    The NYTimes journalist's Iraq war memoir: From Manhattan to Falluja (Review)
  2. Denis Johnson: Tree of Smoke
    VietNam allegory and pre-quell (Review)
  3. Piers Brendon: Decline and Fall of the British Empire 1781-1997
    The accidental empire given up painfully. (Review)
  4. P.D. James: The Private Patient
    (For Mrs PND) Isn't Dalglish getting on? (Review)
  5. John Le Carre: A Most Wanted Man
    A stew of terrorism, spies and duplicity. (Review)
  6. Jon Meacham: American Lion: Andrew Jackson in the White House
    The everyman President from outside the Beltway. (Review)
  7. Peter Mattiessen: Shadow Country
    Winner of this year's National Book Awards. (Review)
  8. Denis Lehane: The Given Day
    The Bard of Irish Boston (Review)
  9. Kate Atkinson: When Will There Be Good News
    (For Mrs PND) Jackson Brodie Solves his third murder case (Review)
  10. Tim Winton: Breath
    One of Australia's new crop of renowned authors. (Review)
  11. Stieg Larsson: The Girl With The Dragon Tattoo
    Financial fraud, murder, family violence. It's the first of a trilogy. (Review)
  12. Don Winslow: The Dawn Patrol
    Ex-PI and stand-up comedian Winslow crafts another mystery. (Review)
  13. (Bonus) George Pelecanos: The Turnaround.
    GP is one of my favorite authors. Again another urban parable. (Review)
Although I don't suggest you buy these at Amazon. com I have created a list in my storefront. If nothing else you can read more about the titles and then buy at your local store of choice. Happy reading!

Feel free to add your own list/recommendations in the comments.

Tuesday, November 25, 2008

Borders Same Store Sales Down 13%

After the close, Borders reported their third quarter results and as predicted they were markedly off the same period last year. Comparable store sales for Borders superstores decreased by 12.8% in the third quarter, and with music excluded, declined by 10.6%. Same-store sales at Waldenbooks decreased by 7.7% for the period. Impairment charges pushed their loss from continuing operations to $172mm ($2.85) versus $40mm ($0.63) last year. Without those GAAP adjustments the profit performance was on par with last year.

From the press release:
"Borders has successfully reduced debt, improved operating cash flow, lowered expenses, improved gross margin-excluding occupancy-and improved inventory productivity during a time of extreme economic challenge," said Borders Group Chief Executive Officer George Jones. "We stated at the beginning of this year that strengthening our balance sheet is our top priority and we are delivering results. We'll remain keenly focused on these critical initiatives, and in addition, will increase our efforts to drive further gross margin improvement. All of the changes we are making will position Borders Group to compete more effectively."
Other items of interest:
  • Management is no longer contemplating a sale of the company so what does that mean.....
  • Cash flow has increase by $110mm however their ending $38mm in cash includes $94mm from the sale of discontinued ops.
  • The company's AP is $12omm less than the same period last year which means they are buying less product.
  • Trade creditors of $613mm exceeds the market cap of the company by 6x
  • Debt, including the prior-year debt of discontinued operations, was reduced from a year ago by 34.2% or $273.1 million at the end of the third quarter to $525.4 million (see above point).
  • The company's cost elimination program is expected to produce $10mm more than planned - an annual total of $70mm
More tomorrow after the conference call. After the report, their shares are off 17% but at this point that's only 30cents.

I Stanzan Opportunity

As an update to this story I originally posted in early October, it seems publishers have indeed recognized an opportunity when it hits them between the eyes. Pan Macmillan and BooksOnNBoard have jumped on the Stanza bandwagon and are offering their titles for use on the IPhone application. More publishers to follow. Earlier this month Stanza reported they had surpassed 500,000 downloads of the reader.

Follows is my original post of October 6th.

Several reports over the weekend have noted the incredible 375,000 Stanza downloads for the iPhone. Stanza is a free eBook reader which currently only offers books in the public domain but that hasn't stopped comparisons with the Kindle. Kindle sales have been estimated at anywhere from one to 300,000+, so does the Kindle have competition? The arguments against cite the following; the Kindle costs a lot so buyers are always going to have real interest in buying books than someone who downloads something for free - a so-called application junkie, reading on the Kindle is designed for content (books specifically) and the iPhone is too small for reading, battery life is short on the iPhone why waste it on a book, and lastly 'good' content is readily available from the store and Stanza only has public domain content.

It occurs to me that any publisher arguing this line is missing an opportunity. Stanza has said they are in discussions with publishers about current content which is great news because 375,000 downloads represents a lot of book selling opportunities. Perhaps some will never read an entire book on an iPhone, perhaps some will never use the app., perhaps some will worry about their battery but 375,000 (growing) iPhones have this software and that's where the opportunity lies. We don't need these iPhone users to use this as their primary reading device - they can - but maybe this is a promotion opportunity (how about 200,000 first chapters). Perhaps this is a reader for casual reading - on the subway or waiting at the dentist office. Maybe this is an opportunity to try new forms of content. The Japanese and DailyLit have proven that readers are willing to read on supposedly substandard reading devices so why not the iPhone?

Lastly, we read different types of content in different formats - comics, novels, reference material, gift and large format books, large type, newspapers, magazines, and on and on. Is it not too much of a stretch to think that perhaps electronic reading devices may vary in a similar way? At editorial development meetings on Monday morning I hope publishers are discussing how they could make their content work for the Stanza readers rather than wish they were all Kindle users because this isn't going to be the last time opportunity rears its' inconvenient head.

Monday, November 24, 2008

SharedBook in Deal with LucasBooks

SharedBook announced today the launch of the personalized edition of Star Wars: Millennium Falcon by bestselling author James Luceno. The book, published on October 21 by Del Rey Books (Random House) and LucasBooks, is the latest bestselling novel in the STAR WARS series. Every book purchased can now be personalized with photo and text on the dedication page, creating a one-of-a-kind, personal edition. Through its custom publishing partnership with Random House Inc., SharedBook launched a line of personalized Golden Books in September, and will enter the frontlist fiction market with this high-profile title.

Promotional links and pages provided by Random House, direct consumers to SharedBook's online store, where they can create a custom dedication with text and photo that appears in the front of their STAR WARS book. Books are then purchased and printed in hardcover and shipped free to the recipient. Thus, the force is with the consumer.

Reader's Digest

Profile this morning in the NYTimes noting the significant changes going on at Reader's Digest led by Mary Berner:

Ms. Berner has been a jolt to the system for this stodgiest of media companies since she became chief executive in a private equity takeover 20 months ago. She has replaced executives, sold unprofitable businesses and even set out to change the company’s name, shaking it up any way she can.

Most important, the company is taking risks, starting dozens of new magazines at a time when its peers are contracting.

One of the biggest new ventures, to be announced Monday, is a multimedia partnership with Rick Warren, the renowned minister and author, hoping to tap into the vast audience for his book “The Purpose Driven Life.”

Together, they are creating a Christian membership organization, The Purpose Driven Connection, built on Mr. Warren’s call to faith and charitable work. Paying members will receive a quarterly magazine edited by Mr. Warren, with DVDs and pull-out study guides in each issue, and access to a social networking Web site.

Sunday, November 23, 2008

Media Week 47

Dismal week for retailing with B&N reporting slower than anticipated sales and a reduced expectation for their full year. No one (in any sector) expects the Christmas period to exceed even the least negative forecasts. B&N:
Sales for the third quarter were $1.1 billion, a 4.4% decrease compared to the prior year. Barnes & Noble store sales decreased 4.4% to $971 million, with comparable store sales decreasing 7.4% for the quarter. Barnes & sales were $109 million for the quarter, a 2.0% comparable sales increase compared to the prior year.
For the thirty-nine weeks ended November 1, 2008, the company had a net loss of $5.2 million as compared to net income of $20.8 million in the prior year. The net loss includes the third quarter charge noted above ($7.0million) as well as a $5.0 million after-tax charge from the first quarter relating to a tax settlement. Excluding these charges, the company achieved net income of $6.8 million year-to-date.
The company explained that they have maintained their gross margins and pointedly noted that they have avoided 'unprofitable top line sales growth with additional coupon promotions and extra discounting' which may not be an argument that Borders will be making next week.

SeekingAlpha Transcript

Speaking for myself, I was more surprised that Random House still had a pension plan. Well, it's now officially closed. AP
The country's largest trade publisher, Random House Inc., has frozen the pensions of its current employees and eliminated them for future hires, the latest cuts in an industry hit by declining sales and anticipating, at best, a difficult 2009.

"Effective Dec. 31, benefits in the Random House, Inc. Pension Plan will no longer grow — but they will not be reduced," spokesman Stuart Applebaum said in a statement released Thursday in response to a query from The Associated Press.

Applebaum added that, effective Jan. 1, no new employees "will be enrolled in the Random House, Inc. Pension Plan." The company will continue to offer matching funds, up to 6 percent, for 401k plans.

Reuters (via Billboard) reports on books by musicians. (Reuters):

But not everyone who has ever cut a record should count on getting a book deal.

"Things are dire in the publishing business, and they are looking to get the big names that already have established brands and platforms," says literary agent Sarah Lazin. And she adds that even some popular musicians face an added hurdle because of their fan base.

"For a long time, publishers made the mistake of thinking that because a band had sold a lot of records, they would sell a lot of books," she says. "I think they've discovered that it depends on the audience. For the Tori Amos (biography "Piece by Piece," which she co-wrote with Ann Powers), we had a huge response, because her fans are readers and book buyers."

"Piece by Piece" has generated hardcover sales of 32,000 units and paperback sales of 9,000 units since its publication in February 2005, according to BookScan.

Personally, I think more imagination could be applied to this genre far beyond the simple tell all but that's just my opinion.

An obit of Fred Newman that appeared in The Telegraph.

e-Publishing company Atypon purchase eMeta from Macrovision, Inc. LINK

The acquisition of this operation from Macrovision supplements Atypon’s existing technologies and services and creates a broader proposition focused exclusively on the licensing and online delivery of publisher content. It creates a single entity dedicated to providing innovative content production, marketing, ecommerce and e-rights management tools to the publishing industry. Through the acquisition of the eMeta operation, Atypon has expanded its highly experienced technical team and added a publishing services consulting team to the company’s existing proposition.

Every Picture Tells a Story

Kevin Kelly writes in this weekend's NYTimes magazine about our migration from words to images; specifically those rendered on video screens. This is a long but extraordinary article and well worth reading.

Here is a taste:

Now invention is again overthrowing the dominant media. A new distribution-and-display technology is nudging the book aside and catapulting images, and especially moving images, to the center of the culture. We are becoming people of the screen. The fluid and fleeting symbols on a screen pull us away from the classical notions of monumental authors and authority. On the screen, the subjective again trumps the objective. The past is a rush of data streams cut and rearranged into a new mashup, while truth is something you assemble yourself on your own screen as you jump from link to link. We are now in the middle of a second Gutenberg shift — from book fluency to screen fluency, from literacy to visuality.

The overthrow of the book would have happened long ago but for the great user asymmetry inherent in all media. It is easier to read a book than to write one; easier to listen to a song than to compose one; easier to attend a play than to produce one. But movies in particular suffer from this user asymmetry. The intensely collaborative work needed to coddle chemically treated film and paste together its strips into movies meant that it was vastly easier to watch a movie than to make one. A Hollywood blockbuster can take a million person-hours to produce and only two hours to consume. But now, cheap and universal tools of creation (megapixel phone cameras, Photoshop, iMovie) are quickly reducing the effort needed to create moving images. To the utter bafflement of the experts who confidently claimed that viewers would never rise from their reclining passivity, tens of millions of people have in recent years spent uncountable hours making movies of their own design. Having a ready and reachable audience of potential millions helps, as does the choice of multiple modes in which to create. Because of new consumer gadgets, community training, peer encouragement and fiendishly clever software, the ease of making video now approaches the ease of writing.

Friday, November 21, 2008

Pardon Me, says Black

According to the Canadian Broadcasting Corp, Lord (Conrad) Black, currently residing comfortably at a federal correctional facility in central Florida, has applied to the US Justice Department for a pardon. In the waning days of this tortuous presidency, LB is hoping that like many prior Presidents before him, GWB will cast logic and justice aside (Mark Rich anyone) and grant him his due. I'm betting GWB to be so ignorant that this one will pass him right by. Having said that I bet some of this will form the basis for the argument.

As an update, Lord Black tells us prison isn't so bad after all. It's justice that's all wrong. (TimesOnline)
I enjoy some aspects of my status as a victim of the American prosecutocracy.

My appeal continues. Given the putrefaction of the US justice system, it is an unsought but distinct honour to fight this out and already to have won 85% of the case and 99% of the financial case. The initial allegation against me of a “$500m corporate kleptocracy” has shrunk to a false finding against me - that even some of the jurors have already fled from in post-trial comments – of the underdocumented receipt of $2.9m. There is no evidence to support this charge.

Elsevier Journals Under Fire

Chris Lee at Ars Technica has some harsh things to say about Elsevier's bundling policy and the quality of their journals:
If the quality of a journal falls, or is filled with pseudoscientific garbage, subscriptions will be cancelled. In this case, libraries will need to start analyzing usage patterns more carefully. Has anyone downloaded a paper from Chaos, Fractals, and Solitons since it turned into a journal of numerology? If the mathematics department at your local university knew about its content, would they still want it in the university? These are questions that should be subjected to regular review, but the bundling practice makes asking them useless. Universities should have the power to cancel these subscriptions without looking forward to a huge increase in subscription fees.

It would be nice to think that Elsevier will listen to scientist, but I suspect that this will not happen until scientists start getting a little more strident. If you are scientist, publish your work in society journals rather than Elsevier journals. Try to avoid citing work published in Elsevier journals. Elsevier lives by a combination of pricing and impact factor, and scientists have direct control over only one of these—impact factor. Librarian could start looking at Elsevier journal usage patterns; perhaps they can follow Cornell's example, and subscribe to just a few Elsevier journals.

Wednesday, November 19, 2008

Reed Business

As an update to yesterday's post about RBI's CEO van de Aast, Bloomberg is reporting that bids may come in at around $1bill. which is half the amount expected. What is unknown is whether that figure assumes an ownership stake in the divested business. For example, if Reed retained a 40% ownership in RBI (admittedly a lot) then this would translate to a value of $1.4billion which is still substantially less than the proposed amount almost a year ago but not as bad as the half off sale price. If the $1bill is for 100% then Reed is in a pickle since they may not want to take such a low price but they don't have a CEO. Not forgetting that they have debt to pay back for Choicepoint.

The Famous Move Books

During Obama’s 60mins interview on Sunday he mentioned he was reading a lot about FDR’s first administration and specifically about the first 100 days. He didn’t mention a specific title and subsequent commentators have noted the Goodwin book Team of Rivals as a candidate. When Obama mentioned the subject, I checked Amazon for a likely candidate and I thought the book could be Alter’s The Defining Moment. At that point the Amazon ranking for the hardcover was 8961. On Monday it was in the 300’s and Wednesday (today) it is 195.

The NYTimes article from yesterday summed it up perfectly: Bingo. Goodwin's and other titles are mentioned in the article.

This tracking of title performance is becoming something of a sport. It is amazing there isn’t a storefront for endorsed books since all the marketing is done for you. Anyone in the book promotion business knows how important Jon Stewart is to driving book interest but if all of those endorsements from his show and all the others could be collected in an easy to search on-line store maybe the influence would be even more pronounced and longer lived.

Tuesday, November 18, 2008

Reed Business CEO to Leave

Reed Elsevier announced yesterday that Gerard van de Aast will be leaving his position as CEO of RBI on December 15th. Kieth Jones will be stepping in to fill the position on a temporary basis. Spectators will understand that this situation further complicates what has been a long frustrating process for Reed in attempting to get rid of this business.

The company has announced that discussions on the sale are at an advanced stage (but that's no guarentee, etc.). Perhaps this move by van de Aast is a precursor. Maybe he is be fronting one of the buyers groups.

Sunday, November 16, 2008

Media Week 46

What's going on in the Indian publishing market. 15% growth per year isn't bad. (Link):
When all sectors of industries seem to be getting affected by the ongoing recession in the world markets, the Indian book publishing market is going great guns. The book publishing market in India stands at approximately Rs 7,000 crore and is growing at a rate of over 15 per cent every year.
German media firms face the crunch but the biggest ones are sufficiently diversified. (Link):
Robin Meyer-Lucht, media thinker with the Berlin Institute, sees a silver lining in these economic storms. "The financial crisis is only the catalyst for the restructuring of the industry," he said to a recent media conference. It’s true. But this dark night with rain, snow, sleet and hail will pass slowly.
No need to visit your library if you live in Shelton, CT. they deliver. (Link)
Even if you can't transport yourself to a library, you can now have access to its materials thanks to a new homebound delivery service. Town libraries will soon kick off a pilot program to work out any problems in the system before making the service available throughout Shelton. Shawn Fields, branch director at Huntington Branch Library, said the service was conceived to help the elderly and disabled who might not be able to drive or walk to the libraries themselves.
In Davis's last year you can bet they are going to do there best to have a bang up year despite the economic downturn. Here they confirm their full year outlook. Reed may be insulated because of the vast subscription revenues they now rely on. If only they could get rid of Reed Business Information. Guardian:

The company, which has a range of business-to-business magazines, websites and exhibitions in the science, medical, business and legal sectors, told investors it was well placed to defy the gloomy economic outlook.

Reed Elsevier chief executive Crispin Davis said: "The business is on track for a very successful year and we expect to deliver Reed Elsevier's strongest constant currency earnings growth in over a decade.

"Whilst the economic environment is undoubtedly challenging, our businesses are more resilient than most and we are in a strong financial position."

Reed Elsevier announced a major restructuring programme in February 2008 and the publisher said today this was "progressing well". The company aims to build up to £100m in annual savings by 2011.

Also, Reed are looking to defer the refinance plan for the loan they needed for the ChoicePoint acquisition (Telegraph):

As credit markets come under increasing pressure and with Reed Elsevier's chief executive Sir Crispin Davis set to step down in March, the group is considering pushing back refinancing the $2bn loan until March 2010. By then, new chief executive Ian Smith, the former chief executive of housebuilder Taylor Woodrow, would have had his feet under the table for a year and the hope is that credit markets would have eased.

A clause in the terms of the first $2bn of the loan, which expires in March 2009, allows Reed to extend refinancing for one year. The second half of the loan, which is $2.175bn, is set to mature in 2011.

Guardian inteviews Blurb founder Eileen Gittins (Guardian):
The idea for Blurb came in her time after Verb, when Gittins, a former Kodak executive, returned to her love of photography: she compiled a photographic essay about people in and around Silicon Valley. In 2003, she wanted to produce 40 copies as gifts. The quotes for publishing it were horrendous; not only that, but there was the huge delay in getting the printing scheduled. Which got her thinking. What if you created a company that would handle the printing using a print-on-demand model? You'd generate the book on your computer with some software, upload a file with all the relevant data, and it would be passed to the printing company, which could do a run of one, or 10, or 10,000. Later that year, Apple launched iPhoto, its photo organisation program - which also included a "design a photo book, get it printed by Kodak" element. Validated, Gittins saw a potential business.

Thursday, November 13, 2008

Google's Ancient Project

In my second post about Google in a day, I note the release of Ancient Rome using the Google Earth application. Anyone with a more than a passing interest in history is fascinated by the Roman Empire and its closely related architecture. Google has created Ancient Rome at the time of Constantine (320AD) and users of the application can navigate through the streets of Rome as it was. How cool is that?

Here is a YouTube video and more information.

The company have also launched a competition for educators.
While Google's suite of geospatial tools--Earth, Maps, SketchUp, and Sky--are used daily around the world by educators hoping to bring a fresh perspective to lessons, every once in a while a new product feature comes along that we believe will knock the socks off teachers and students alike! We're proud to announce the Ancient Rome 3D Curriculum Competition in conjunction with a brand new layer in Google Earth that models the ancient city of Rome in unbelievable detail.

For the first time ever, K-12 educators in the United States will have the chance to highlight their creativity and technical know-how by combining this brand new Google Earth content with classic classroom curricula.

Wednesday, November 12, 2008

The Google Registry

It would be a shame if the opportunity to create a unified (and uniform) bibliographic database itemizing the copyright status of our collective published works only resulted in a copyright database. Perhaps that comment appears strange but I believe the establishment of this 'registry' under the terms of the Google/AAP/AG settlement opens up a opportunity to tie an alphabet soup of identifiers, bibliographic (and multi-media product details), full content and transaction capability together in one form.

A primary reason ISBN was implemented so successfully in the publishing industry was that the number rapidly became integral to the publishing supply chain. Newer standard numbers such as ISTC, DOI - even ISSN in the retail channel - are not widely adopted because they have not become transactional identifyers. The same will be true if/when an Interested Party Identifier is established. The development of the Google Registry (surely the first task of the Executive Director is to come up with a name) may represent the only opportunity to tie each of these ancillary identifiers to one common objective. That objective is the better identification of content - not simply 'book' content, but content we will be using and transacting in an on-line environment.

How the registry may be formed is anyone's guess, but for sake of argument I envision a pyramidal structure. The identifier segment forms the pointy top layer, bibliographic data the second layer, content the third and the 'transaction gateway' the bottom tier. Then again maybe it's a cube and I should be adding subjects, a retail/library segmentation, and transactional details like rights information. Regardless, it seems to me combining each of these segments into a registry might engender significant opportunities to improve the publishing supply chain. But more than that, the combination I suggest works better for the on-line world than the off which is the failing of the current crop of ISBN databases (including

Merchandising and search would be vastly improved if we were able to search by ISTC or IP using one database that would return all renditions of a work or all works/items produced by an author. Additionally, access to the content would be immediately available providing views of the content the searcher was interested in. Of course, all the copyright details about that work would also be available. Importantly, each of the elements in this registry would be linked so if someone happened on work they could rapidly find associated versions (ISTC) or other content produced by the author or publisher (IP).

The most obvious application enabled via the 'transaction gateway' would be purchase but a 'transaction' can be many things: views, queries, checkin-out, use rights, syndication and may more. An open service architecture would enable development of third party API's that could result in all kinds of new applications but existing ones would also benefit as well. Worldcat and Copyright Clearinghouse applications are good examples where users could find the physical content in a library or attain usage rights from CCC.

Google has provided $35mm to fund this registry and the governing board including publishers, and author reps will be forming a company to carry out the objectives of this registry. I hope their vision isn't too conservative because delivery of a copyright database is too simplistic a solution given how our content businesses are developing. Visioning a comprehensive 'bibliographic' solution that marries uniform content identification with an end transaction is what our industry really needs. We don't really need another stand alone bibliographic database.

Fred Newman

The Bookseller is reporting that Fred Newman has died after a long battle with Cancer. Fred started Publishing News 30yrs ago and only recently closed the publication down to concentrate of two of his newer businesses the British Book Awards and BML.

Tuesday, November 11, 2008

Shared Book Grows

I have mentioned Shared Book a few times here and they continue to gain traction with major publishers. In particular, their personalized books for children. Today they announced several new agreements:
SharedBook Inc., the Custom Publishing Platform provider, announced today new affiliate agreements with First Book, a national children’s literacy organization; Tattered Cover Book Store, the renowned independent bookseller in Denver, Colorado; Capitol Book and News of Montgomery, one of the oldest independent book stores in Alabama; Kidmondo, the online baby journal and organizer, and, the premier life-stage destination for a new generation of active grandparents. All will link to , the first direct-to-consumer store featuring classic children’s books that can be quickly and easily be personalized. is the new online destination for personalized editions of Fancy Nancy, The Night Before Christmas, Bad Dog, Marley and more than 100 other well known classic children’s books.

Visitors to SharedBook’s affiliates are taken to a custom-branded store that maintains the look and feel of the originating site. Once arriving in the store, consumers can create a custom dedication with text and photo that appears in the front of the book and, in some cases, can also personalize the back covers. Books are then purchased and printed in hard cover and shipped free to the recipient.

"SharedBook’s first group of affiliates reflects the broad range of companies interested in affiliating with the next wave of digital publishing. We hope these personalized books will spark lots of gift-giving ideas as we head into the Holidays,” said Caroline Vanderlip, Chief Executive Officer, SharedBook Inc. “We are extremely grateful for the support of our affiliate partners, and are pleased they have joined with us to re-think how books can utilize technology to create something lasting and special.”

Bertelsmann Reports Higher Net Income

From their press release:

After nine months of the 2008 financial year, Bertelsmann reported a solid business development. The international media company achieved revenues almost at the level of the previous year in its continuing operations. Operating EBIT remained below that of the previous year. EBIT and net profit increased significantly.

Consolidated revenues reached €11.4 billion to the end of third quarter, down 0.7 percent year-on-year (€11.5 billion). Adjusted for portfolio and exchange rate effects, revenues rose by 1.6 percent. After nine months, Operating EBIT reached €926 million (previous year: €1.03 billion). The return on sales amounted to 8.1 percent. EBIT increased to €823 million compared to €692 million in the same period of the previous year, when high special items were incurred. At €387 million, net income almost tripled (previous year: €132 million).

The company also noted that they continue to manage their operations portfolio notably selling their half interest in the SONY/BMG music business and the North American book club business. No detailed discussions about the performance of Random House although in separate news the company announced that Ian Hudson (Deputy CEO of RH UK) has been named to the Bertelsmann supervisory board.

Enid Blyton - Aged 13

Mrs PND brought some newspapers back from the UK yesterday and this story in The Telegraph caught my eye:

Blyton was recently voted Britain's best-loved author and prided herself on writing about the "jolly, happy things in life", but since her death in 1968 a picture has emerged of a cold, occasionally malevolent figure.

Mrs Smallwood, 73, said that witnessing a particularly upsetting argument between her mother and drunken father, shortly after which he moved in with another woman, could have contributed to Blyton's troubled personality.

"Barbara Stoney, [Blyton's 1974 biographer], suggested the trauma she suffered around about her 13th birthday was so huge that a lot of her emotional development just froze there and I think this is a very good way of looking at her," Mrs Smallwood told the BBC in a new Radio 4 documentary, A Fine Defence of Enid Blyton.

Most of Blyton's stories were written in a different time but continue to be repackaged in new covers and formats. The FT notes there have been some required changes:

Some names have been changed to avoid sniggers or racist overtones - the characters originally named Fanny, Dick and Bessie in The Faraway Tree stories have become Frannie, Rick and Beth. In the Famous Five books, the boys now have to do household chores with the girls. And there's not much left that's "queer" or "gay".

But dig about a bit and it's clear that reports of wholesale PC changes have been exaggerated. Hachette, publisher of the very popular Famous Five, Secret Seven and Naughtiest Girl series, points out that it has changed none of its characters' names. And it says claims that the important Blyton staple food of biscuits had been changed to American cookies were also inaccurate.

It's also wrong to suggest that Blyton's stories are full of entrenched sexist attitudes.

Thursday, November 06, 2008

The War, Dead Trees and Obama

It was an historic event. It was memorialized in countless millions of expressions of exuberance, reflection, fear and hope. Later, someone made a documentary about it and in doing so relied upon all those expressions. These came in the form of photos, letters, news articles and other physical detritus that encapsulated the emotion, urgency and meaning of one of the 20th century's formative events. World War Two was the subject of Ken Burn's The War which aired last year on US television. During this broadcast, I wondered how future generations would capture the same raw emotion that Burns relied on in reading back to viewers the letter home from the soldier on the front.

Not all of this primary material was easy to find. A good proportion will have been found in attics and basements or even dumpsters. Is there an electronic version of the box of great uncle Tom's letters home found in the demotion of that row house? I think not. While there is significant collection and documentation of experiences of the Iraq War for example, will this material be retained? In many respects the ability to capture this experience may be easier than generations ago; Blogs and email make this easy. However, how much of this electronic material will be retained? How will historians access the digital equivalent of all those letters and photos that formed the basis of The War? News reports and 'formal' media will be easy but it is the real life experiences that could be lost.

I am unsure of the answer and this post has been circulating in my head for months since I watched The War last year. I was lacking a punch line but in the last several days I have marveled at how thousands and thousands of people rushed to purchase the dead tree edition of the NY Times to capture the most important political event since reconstruction. Ironic given the imminent demise of paper based media. Our experiences still need to be legitimized by seeing them on paper. Perhaps the moment we cease to need this legitimization and believe in some type of substitute will come to be the true moment we gave up print forms for electronic. I wonder however, whether any of us are cognizant of this dilemma and it will only be when the alternative is forced on us will we really know what we have given up.

Wednesday, November 05, 2008

Five Questions with the Society of Young Publishers

At Frankfurt this year I had the opportunity to speak to Jon Slack current chair of the UK based Society of Young Publishers. He told me about a number of new programs that the SJP is working on to encourage the young people in our industry and also to draw in the old ones. One of the more interesting programs they recently developed was something called Canon Tales.

Here is a description of Canon Tales:
Twelve figures from the publishing industry spoke to a captive audience at the Cochrane Theatre, conveying their own personal take on creativity in publishing. Canon Tales was conceived two years ago, when Doug Wallace heard about a similar event for creative professionals in architecture that proved to be a huge success. Jon shares Doug’s belief that publishing is overlooked as a creative industry, and Canon Tales seeks to redress this.

Each speaker told their canon tale to the backdrop of visual images – 20 images, each lasting for 21 seconds, thus totalling a seven-minute presentation. Some were personal stories, some were focused on the speakers’ own output. First to take the stage was Rob Williams, Creative Director of Penguin. He chose to speak about the launch of the new James Bond book, Devil May Care by Sebastian Faulks. His slides showed us figures and pictures from the marketing campaign for this book, whilst Rob gave the audience some maxims that he has discovered during his publishing career, including ‘Make a story at every stage’, ‘Engage in creative collaboration’, ‘Limit access to the product and create theatre around its launch’, and ‘If nobody wants to talk about it, it doesn’t work.’
In addition to mentioning Canon Tales below, Jon also notes a program the group is arranging for Frankfurt 09 which will be designed to make Frankfurt less intimidating for a young first time visitor. Jon is reaching out to overseas groups and it would be interesting whether we could organize a similar group in the US.

I asked Jon Slack my five questions:

Tell me about your involvement in SYP?

I am the current Chair of our group; as with the rest of our 18-strong Committee, it is a voluntary position and lasts for a year. I've been involved with the group for a little over two years now; in 2007 I held the position of Social Secretary (basically someone who organises the parties!). This year we've run over a dozen and a half events from London alone, with some very prominent names in UK publishing. Our main aim has been to exchange information between 'young' and 'old' publishers that can benefit everyone, and facilitate the networking that goes with that.

How long has SYP been in existence, and is it only a UK based organization or does it go beyond?

The SYP has been around officially since 1949; next year is our 60th anniversary. It started out as a talking shop for young publishers (ie people under 35) and has largely remained that way since. At the moment we are based only in the UK, with another division set up in Oxford, and others being set up in Scotland, Ireland and Wales in 2009. The only country outside of the UK I've seen with a group like ours is Denmark, and to a smaller extent the Young Publishers Group, based in New York.

What are your plans for drawing in the young publishers in other countries – specifically the US and Australia?

I met some fantastic people at Frankfurt from the US who are already helping to get the operation off the ground during 2009. We're hoping to work with groups such as the AAP, the American Collective Stand and also BEA, and use word of mouth and the advantages of the internet to help attract anyone interested in taking part. In Australia, the APA is already setting up events for young publishers and, again, the level of enthusiasm I've seen to make something like this happen is very encouraging. We want to use international events, particularly the Book Fairs in London, New York and Frankfurt 2009, to bring everyone together, dicuss the possibilities, and really explore the potential of a truly global young publishing network.

In another conversation you told me about your upcoming program for Frankfurt; can you tell me a little more about that?

We're working with the Frankfurt organisers on a number of things, including the International Young Publisher's conference which I mentioned earlier, which ties in with our focus on how we can make the Fair work better for younger publishers. We'll be hosting a Canon Tales event (see attached flyer for info on the last one held this July) at a new venue away from the usual publishing hangouts. If possible we'd like to see it made more affordable for younger publishers to come to Frankfurt, and perhaps this network can help make that happen too.

What type of involvement do you look for from old publishers like me and how do we get involved?

Our name is responsible both for our appeal and also for regular confusion; our voluntary committee are publishers all under the age of 35, yet we've always been supported by 'older' publishers, who attend and speak at our events. One of the reasons behind the SYP's longevity is the remarkable good will within the industry to help our events succeed. There are countless publishers happy to volunteer their time and share their views on big issues facing all of us. In the US, or Australia for instance, the independent committees we're forming we'll be hoping for a similar level of support, and from what I've seen so far, there's precisely the level of willingness we need to make this happen. But please get in touch if you want to help!

Jon can be reached as follows: jslack @

Michael Crichton Dies

Sadly, Michael Crichton has passed away after a battle with Cancer. Obit in The Times online. For me I was more a fan of his early work such as The Andromeda Strain, Congo and The Great Train Robbery. The latter became a great movie with Sean Connery and generally is an example of how Crichton's work translated so well to visual representation.

Video with Crichton on Charlie Rose from Feb 2007.

Link: (Starts Immediately)

Reed Name Smith as CEO Designate

Ian Smith has been named to replace Sir Crispin Davis as CEO of Reed when Davis retires early next year. Smith will join Reed in January. Who is he? Well, he has no media experience for a start and comes most recently from the construction company Taylor Woodrow. During his short tenure at TW, he apparently engineered a very large merger with competitor George Wimpey which has lead many to speculate that Reed's board is focused on a mega-merger of its own once the recent Choicepoint acquisition is decided.

As the primary reason for the hire, the association with deal making could be tenuous because Davis engineered a number of large deals during his tenure. As examples, the acquisition and subsequent divestiture of Harcourt, the acquisition of ChoicePoint and the protracted divestiture of RBI. In addition, if the Reed board were looking for a pure deal maker then there would have been any number of media experienced private equity players who could have fit the bill. Nevertheless, without any other logical connection to the Reed business, this is what most reporters are focused on. This argument also allows them to discuss the long protracted idea that bringing Wolters Kluwer and Reed Elsevier together would make great sense. Perhaps for WK but not as much for Reed in my opinion.

In my view, I think the ChoicePoint acquisition is a better indicator of the type of acquisition strategy that Reed may follow. They want to own distinct verticals and to play in these verticals they plan to acquire the biggest player to achieve immediate scale. I think WK may actually be too small for what they may be considering. For example, they don't have a presence in the Financial sector: would they see Bloomberg as a target? Remember they compete with Thomson Reuters in several areas and Thomson has a big financial information business. Wider afield, Reed may be looking internationally to acquire very large information companies that will broaden their current offerings into both mature and developing markets.

One other interesting aspect of the hiring of Smith is what the board must be thinking about the crop of senior executives below Davis. Some of these executives have extraordinary experience both with RE and with other publishing companies. Several (at least three senior executives are in their mid-late 40s to very early 50s) so perhaps the board didn't feel one of these executives was more ready than their colleagues (or they were not willing to risk upsetting the apple cart by promoting one of them). The board may have decided to wait six years or so to make their choice from this crop of executives to choose the next CEO to replace Ian Smith.


Tuesday, November 04, 2008

Borders and Retailing Troubles

The Bookseller is reporting that insurers have backed away from Borders. It is hard to determine how significant this is since most suppliers to Borders will have their own insurance. Terms on which suppliers are selling to Borders are very, very tight at the moment. Should Borders get into cash flow difficulties, this could have a cascading effect across the industry. The balance of on-line retailing, physical retailing and wholesale/distribution could change radically. As many have noted, the expectation is for the Christmas retailing season to be soft (or 'terrible') which will cause a number of January bankruptcy filings across all retailing. Whether book retailing is one of those remains to be seen, and we all hope not as the market changes may not be in our long term interest.

Sunday, November 02, 2008

Media Week 44

The short list for Australia's richest literary prize was announced earlier in the week.

The final five contenders were narrowed down from 12 novels for the inaugural $110,000 Australia-Asia Literary Award.

The shortlisted works are The Lost Dog by Australian author Michelle de Kretser, Blood Kin by Australian and South African citizen Ceridwen Dovey, The Reluctant Fundamentalist by Pakistani and UK citizen Mohsin Hamid, Orpheus Lost by US-based Australian author Janette Turner Hospital and Complete Stories by Australian David Malouf.

Mr Day said the short list demonstrated the literary strength of Australia and Asia.

I've read a few by Janette Turner Hospital and they are pretty powerful novels. The winner is to be announced November 21.

EBSCO has acquired several new database products from NISC which already has EBSCO host their content:
NISC databases include Family & Society Studies Worldwide, Gender Studies Database, Woman's Studies International, and Wildlife & Ecology Studies Worldwide. Many of the databases acquired from NISC are already available on EBSCOhost and several others will soon migrate to the EBSCOhost platform.

Fred Dürr, president of NISC, Inc., says EBSCO and NISC are longtime partners. "NISC content has had a long and rich existence on the EBSCOhost platform. Those NISC users who do not access the databases via EBSCOhost will undoubtedly find the new EBSCOhost 2.0 platform an enjoyable search experience. We expect NISC users to have an easy transition as they continue their NISC relationship directly with EBSCO."
Australian & New Zealand retailer A&R Whitcouls reported results for their year: Link

A&R Whitcoulls says its annual revenue rose 9 percent despite tough trading conditions as the book retailer looks forward to a "strong" Christmas.

However, the company reported a net loss for the year of A$5.2million, hit by a number of one-off items including the acquisition of Borders Asia-Pacific and "considerable" investment in its internet sales platform.

"These initiatives were undertaken to drive sales, lift profits and, in the case of the Borders acquisition, gain significant benefits from synergies as a result of the union of the major brands," A&R Whitcoulls said.

Sydney-based Pacific Equity Partners, Australia and New Zealand's largest private equity fund, which owns A&R Whitcoulls, bought the 30 Borders stores in Australia, New Zealand and Singapore for $137.6 million in June.

The company is rumored to be planning a flotation sometime within the next two years and they also said that pre-Borders operational planning focused on cost reductions is on plan.

ALA looks for a $100mm handout for libraries. Can't say I agree with this one. Link

The American Library Association (ALA) is asking Congress for a one-time infusion of $100 million in stimulus funding to help libraries aid Americans as they deal with the nation’s current fiscal crisis. At a time when Congress is considering another economic stimulus package, ALA points out that public library usage has risen during this tough economic time while their budgets face severe budget cutbacks. While public libraries depend heavily on local property taxes to maintain operations, increased foreclosure rates, lower home values, and fewer sales have sharply reduced available funds, forcing libraries to cut services and hours.

They're not going to get it.

Future VP Joe Biden gets interviewed by fifth grader Damon Weaver. "What is the job of the VP" Cute. LINK

Reed continue to offer incentives for any purchaser of Reed Business Information. There are still three possible buyers involved in the process. Something has to break soon. LINK.

Second-round bids for RBI were made last month, but details of a deadline for the next stage of bidding are unclear. Buyout firms still in the process include Bain Capital, which has taken on Helen Alexander, the former chief executive of The Economist Group to advise on the deal, and a consortium of TPG and DLJ Merchant Banking Partners.

The vendor financing on offer from Reed comes as the credit crisis has made financing of large leveraged buyouts difficult, therefore limiting the ability of private equity firms to invest money. The original price tag for the deal was £1.25bn, but sources have said that next-round offers could come in at below £1bn, particularly as a difficult advertising market is understood to have put pressure on trading at the magazines unit.

Some obvious suggestions from ex-RBI CEO Jim Casella: Lower the price and/or break it up. PAIDContent. He also mentioned Reed may hold some innvestment as they have with the Harcourt disposal which I mentioned when they announced the proposed disposal. He notes below the separation from Reed Exhibitions:
Casella - now CEO of his Case Interactive Media investor - told our moderator and ContentNext publisher Rafat Ali that RBI isn’t a perfect acquisition right now: “It’s logical that you’d (have to) be looking to buy events to go along with the company since exhibitions don’t come with the property.” Could it be broken up? “I think there’s a very good possibility there’s certain assets (buyers) want to focus on and others they want to dispose of. A new owner is going to want to follow a more focused strategy; I think there will be disposals.”

Saturday, November 01, 2008

A Cruise to Yankee Stadium

Mrs PND and I visited Yankee stadium for the first time seven days before they held their last game before the move to the new one being erected next door. We chose to go on the Ferry which we had read about and which proved to be an idyllic and relaxing trip. We travelled from the PND offices, down the Hudson river, around the tip of Manhattan and up the East River to the stadium. Highly recommended. Yankees won.

There are comments on each photo but you need to click on the stream to open up the window and then click on the image. Possibly too much work.

Link: Here