Friday, April 16, 2010

Repost - How do I love books, let me count the ways.

Bowker released their annual industry stats this week but as Publisher's Lunch showed in their editorial on Thursday, the report tends to the obscure rather than the enlightening. It reminded me of something I wrote in January, 2009.

Well, Elizabeth Browning may not have put it quite that way, but she might have done if her annual bonus depended on it.

Moves are afoot to revise the way in which publishing industry stats are computed but, as we all recognize the industry is changing, so we should be anticipating new benchmarks and methodologies for calculating success in tomorrow’s publishing industry.

In years past, some publishing executives’ annual compensation was partially dependent on how many best sellers and the level of sales they achieved, or how their revenues and expenses compared with their competitors. Historically, those calculations would have been straightforward - just add up the best sellers in the New York Times, or take a look at the annual AAP statistics. It didn’t matter that the “Times methodology” was later called into question because, by then, we had Bookscan and the industry continued to use the AAP numbers even as the industry became more complex. With all the standard measures in use, there was always “leakage” and, just like that above-ground pool that loses a little more water with each passing season, book industry sales have been spread across a wider array of outlets which have not been computed in the industry numbers. Moreover, self –reporting (a component of the AAP’s reports) was also spotty and/or inconsistent as the business grew in complexity. Add the increasing prevalence of used book sales in major retail channels and defining the real level of sales for today’s publishing industry is very difficult indeed. And, of course, some companies refuse to report at all.

On a discussion list I belong to a minor scuffle erupted recently over defining the ‘real’ level of publisher revenues for the industry. (See my recent Frankfurt Supply Chain presentation). Qualifications abound regarding segmentation, used book sales, front list/back list, consumer versus wholesaler - you name it. It is very difficult to pinpoint the real number. To address this issue, BISG will
evaluate and define a new methodology for tracking publishing industry sales numbers for Book Industry TRENDS and the first results will be published in June. This is a laudable project that should be completed, and I think everyone in the industry will be looking forward to hearing about and analyzing these reports when they are published. (AAP continues to publish their own set of data for the industry).

Attempting to calculate today’s performance metrics will be simple compared to our collective future which is likely to be far more complex and confusing if we don’t get in front of the issue. We will also need to cooperate if - as we all like to do – we wish to generalize about the size of our market, measures of success and whether one type of content could be considered the “best of” anything. Recently, there have been some harbingers of how complex the future may be. For example, Overdrive released a slew of data indicating how rapidly eBook downloads are growing and Fictionwise say they have 'served 2 trillion words'. Stats like these are quickly becoming markers in our conscious view of publishing success. How soon will it be that we casually mention that so and so had 100,000s of downloads rather than (or in addition to) retail sales? But those references to downloads, pageviews, comments, searches, hits, subscribers (and on and on) will not mean enough unless we, as an industry, have some mechanism of comparison or some degree of standardization in how we reference these data points.

The publishing industry is a relatively small media segment but the boundaries increasingly blur. To give some indication of how complex the measurements may become you only have to hear about some of the numbers thrown out at this year’s Consumer Electronics Show in Las Vegas. Sony announced that the Playstation network has 17 million registered users and added 2.1 million accounts in December. Games on the network have sold in the millions and users number in the 100,000s for each game. also stated that they delivered, via their episode player 500 million episodes and 1 billion ad views. (Paidcontent), the site for NBC and Newscorp content, receives 3.8 million visits per day (24 million uniques in October) and users are streaming over 63 million videos per month. These numbers gloss over the fundamental change in how media counts itself and, as the change in publishing accelerates, it will no longer be enough to count books sold via a cash register.

We will need a wholesale revision of our thinking and our perspective if we are to retain any semblance of cohesive, representative reporting as we move into the 21st century.

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