Amazon.com Buys Shelfari - Updated

Via Paid Content. Hot on the heels of their acquisition of ABE books, Amazon has purchased the rest of Shelfari. Amazon had invested in the company some two years ago and had hoped it would come to rival librarything in popularity. Interestingly, librarything now also counts Amazon as an investor in it thanks to the investment ABE made in librarything 3-4 years ago. It is likely that librarything owner Tim Spalding will negotiate with Amazon to buy back the share they now own (and I would assume there was a 'change of control' provision in his original deal with ABE). It will be interesting to see who he jumps into bed with next - if anyone.



Personanondata Bookstore

Universal Mccann Review of Social Networking Trends

Universal Mccann International Social Media Research Wave 3

View SlideShare presentation or Upload your own. (tags: socialmedia research)

MediaWeek (Vol 1, No 34):

TimeOut wants BBC out of Publishing (TOLine):

Tony Elliott, the owner of Time Out, the entertainment listings magazine, called for a break-up and sale of the BBC’s commercial division yesterday as he accused the corporation of overreaching itself with the £75 million acquisition of the Lonely Planet travel guides. The magazine proprietor said that Time Out, publisher of its own travel guides, could not compete with the BBC’s promotional muscle - and that the BBC should not publish books and magazines.

The TimesOnline profiles City Lights in San Francisco:

It was established in 1953 by poet and ‘beatnik’ Lawrence Ferlinghetti and Peter D. Martin to provide a progressive, all-paperback alternative to books available at the time. It’s where the Beat Generation laid their hats and where publishing and selling Allen Ginsberg’s Howl got Ferlinghetti and bookseller, Shigeyoshi Murao, arrested in 1957 on obscenity charges. Their victory in court guaranteed the sale of other previously banned books – including D. H. Lawrence’s Lady Chatterley’s Lover and Henry Miller’s Tropic of Cancer. (Three years later British readers achieved similar rights after the failed prosecution of Penguin for publishing Lady Chatterley’s Lover.)

Enid Blyton rocks and is the subject of a preview in TOL:

With its sense of adventure and advice on derring-do for juniors, The Dangerous Book for Boys was the sort of “how to” manual that could have been dreamt up by Enid Blyton, the creator of the Famous Five, the Secret Seven and a host of other dearly loved children’s characters. Now the inevitable has happened. Booksellers are eagerly awaiting the launch on September 4 of the Famous Five’s Adventure Survival Guide, a similar tome but with the bonus of a brand-new mystery starring the ginger-beer-loving youngsters.

For my librarian friends a comparison of JCR and Scopus Impact Factors: LINK

Impact factors for journals listed under the subject categories "ecology" and "environmental sciences" in the Journal Citation Reports database were calculated using citation data from the Scopus database. The journals were then ranked by their Scopus impact factor and compared to the ranked lists of the same journals derived from Journal Citations Reports. Although several titles varied significantly in impact factor and rank, the Journal Citation Reports and Scopus lists had a high degree of statistical similarity.

Common Sense contractual terms from Random House via BoingBoing:

Random House is asking some of its authors of young adult books to sign contracts with "morality clauses" that allow the publisher to take back your advance and cancel your book if you're caught doing anything that "damages your reputation as a person suitable to work with or be associated with children, and consequently the market for or value of the work is seriously diminished."

BusinessWeek ad topic pages NYT. NYTimes has been doing this for years. (NYT via Blogrunner). ExLibris was sold by one fund to another. PR Slow week....

Publishers Worry About Amazon

Mike Shatzkin and I were intereviewed for an article published by SNL/Kagan about Amazon.com's relationship with publishers in light of the Hachette UK situation, Booksurge and the Kindle.

Excerpt:

Mike Shatzkin, founder and CEO of the publishing advisory firm The Idea Logical Co., said in a June 26 interview with SNL Kagan that Amazon is likely not getting those titles from publishers for under $9.99 and is probably taking a loss on those books. But Shatzkin added that situation could change if Amazon succeeds in establishing the Kindle as the dominant e-book platform. "If the Kindle reaches a critical mass, Amazon will have the ability to tell publishers that if they want their books available on the Kindle, they will have to sell them to Amazon for $6 or less," Shatzkin said. "That's going to be pretty rough." One reason it is so hard for publishers to meet Amazon's demand for increasingly lower prices, Cairns said, is because they must continue to offer their authors competitive advances and royalty packages to ensure they get the best titles. "Particularly for the brandname authors, publishers have to pay a very high price for that content," Cairns said. "It would be difficult for publishers to go back to their authors and say 'Give me a better price for your books.'" As a result, when Amazon asks for steeper discounts on titles, publishers are left trying to maintain their margins in other ways — such as by putting their marketing and distribution expenses. "And in this day and age, many of the larger publishers have already sweated out as much expense out of those cost areas as they possibly can, so there's not very much room left at all for them to do that," Cairns said. "It's very tight."

B&N Reports: Operating in Soft Retail Environment

B&N reported slack sales typical of many retailers this morning and even excluding the huge impact of Harry Potter in the comparable quarter numbers were down versus last year. Here is their press statement:

Sales for the second quarter decreased 1.6% to $1.2 billion largely due to last year’s record sales of J.K. Rowling’s Harry Potter and the Deathly Hallows. Barnes & Noble store sales decreased 1.6% to $1.1 billion, with comparable store sales decreasing 4.7% for the quarter. Barnes & Noble.com sales were $99.8 million for the quarter, a 3.6% comparable sales increase. Excluding prior year sales of the Harry Potter book, comparable sales decreased 1.5% in stores and increased 13.9% online. Bestselling titles during the quarter included Stephenie Meyer’s Breaking Dawn, Randy Pausch’s The Last Lecture, Lauren Weisberger’s Chasing Harry Winston and David Wroblewski’s The Story of Edgar Sawtelle. Second quarter net earnings were $15.4 million or $0.27 per share. Included in second quarter net earnings was an after tax benefit of $0.12 per share, resulting from a more favorable physical inventory shortage rate than previously estimated and accrued. Excluding this benefit, second quarter net earnings were $0.15 per share, higher than guidance of $0.08 to $0.13 per share. Despite the softer sales environment, the company’s management of operating expenses and higher than forecasted gross margins enabled it to exceed its second quarter earnings per share guidance. Gross margin was stronger than expected due to greater utilization of the company’s distribution centers and a lower markdown rate.

Other points from the conference call:

• Last year for the same period comp store increase of 4.4% and online increase of 17.9% for a total sales increase of 7.6%
• This year 1.6% decrease versus last years 7.6%.
• Excluding Harry Potter effect same store sales declined 1.5% this quarter
• Opened 10 and and closed 4 B&N stores for 723 total. Continued to close Dalton stores for a total of 73.
• Sales at B&N.com were $99.8mm for the quarter up 3.6% on top of last years 17.9% increase. The company noted that excluding HP sales at B&N.com were up 13.9% and this quarter was the 7 straight quarter of increased sales.
• Gross margins were up 150 basis points as a result of less highly discounted HP books and an significant quarterly improvement in stock shrinkage. (after tax benefit of 12cents per share)
• Guidance: The company is lowering its full year comp sales to slightly below 1%. Keeping EPS at previously issued guidance based on improved financial performance.

The company may have got off easily on the question period. No one asked about the recent resignation of Marie Toulantis (CEO of B&N.com) especially in light of the continued performance gain. Riggio commented that internet sales "were clearly a bright spot in the quarter" and traffic to the site, conversions and sales are up. In addition, the company continues to improve the site and is experimenting with web only offers. Given this performance is there a risk factor introduced with the departure of Toulantis and if she was asked to leave what do they want to do differently given this track record of continued improvement? No one asked about the competitive threat from the launch of Borders.com which based on the following chart could be a factor.



Lastly (and thankfully) no asked about their decision not to go after Borders but someone did ask about thoughts on the Kindle which they deflected.

Social Recommendations

In Business Week, author Sarah Lacy has some suggestions for publishers on how to develop, market and sell books by taking advantage of Web 2.0 opportunities. This is only one of her five suggestions:

Create stars—don't just exploit existing ones.When an author is established, publishers have to do less to make a book sell. So bidding wars start. As a result, even some best-sellers aren't very profitable. Instead, publishers should take a page from the handbook of Gawker founder Nick Denton and create stars. Find micro-celebs with a voice, talent, a niche base of readers, and most important—enthusiasm. Then leverage the publisher's brand (and the techniques I advocate, of course) to blow them out. Require as part of the contract that the author blog, speak on panels, attend events. Give them incentives for delivering—say, though Web traffic of the number of followers they amass on Twitter. Sure, publishers would have to spend more on promotion. But because they're spending less on an advance—say, $50,000 for a lesser-known writer than the hundreds of thousands of dollars (or more) they'd spend on a star—they can afford the bigger promotional budget. "It's taken some time for publishers to recognize that a successful site is as
strong a 'platform' as a magazine, newspaper, or TV gig," says Patrick Mulligan,
my editor at Gotham.

Bertelsmann Interested in Reed Business

Reuters reports that Bertelsmann's magazine unit Gruner & Jahr maybe in the mix to acquire the RBI unit from Reed Elsevier. Reuters learned of the tip via a German newspaper. In the report, Reuters also notes that indications of interest for the RBI business unit have been received and offers range between £1.0bill and £1.25bill. If correct, this range appears to match Reeds initial expectations for the deal. Reuters expects final bids to be submitted in October. Followers of Bertelsman may recall they have created a sizable fund with some PE companies with the express view to make some large (or one very large) deal. They objective was to be able to participate in the bidding process for these large media deals and not be priced out by pure PE deals. As a case in point they were very interested in the Cengage auction last year and by some accounts came quite close.

Reuters

Melbourne, City of Literature

Sydneyites (namely my cousin) used to say the only good thing to come out of Melbourne was the Hume Hwy. Unfair and untrue and in reflection of its world status, the city has been named a City of Literature (The Age).

Three days before the opening of the Melbourne Writers Festival, UNESCO has named Melbourne as its second City of Literature. Edinburgh became the first in 2004. The United Nations' cultural arm responded to an ambitious bid by the State Government that has as its centrepiece the establishment of the Centre for Books and Ideas at the State Library of Victoria. Arts Minister Lynne Kosky said the decision was confirmation of the value of a lot of people who have been working in the literature industry - writers and publishers and those who support writing and publishing.

Melbourne is a great place and this is well deserved in my view. Thanks to my Australian stringer for the tip.

Another Obama Book Controversy

No doubt Chelsea Green publishing thought they had come up with a reasonable marketing concept when they agreed to POD their upcoming Obama title (Obama’s Challenge: America’s Economic Crisis and the Power of a Transformative Presidency) with Booksurge and offer Amazon a three week exclusive sales window. Whether this promotion had its genesis in an inefficient editorial and manufacturing process that failed to deliver what must be their single most important title in the company's history on a date that's been on the schedule for months, becomes immaterial when considered against the antipathy that has resulted. The small company has succeeded in upsetting both independents and B&N by giving Amazon this exclusive.

B&N has now cancelled their order for the non-POD version and will only sell the title on their web site via special order. Admittedly, my immediate reaction would have been much the same: Cancel the orders. On reflection however, why didn't B&N double the order and publicise that they would honor the discount coupons once the book hit the stores? Even better, offer a special discount on pre-orders. Secondly, surely the number of attendees at the convention who will actually purchase the book is small compared to the market spread of customers walking into B&N stores across the country.

The publicity surrounding this book may now have more to do with the B&N reaction (perhaps more so within the publishing community) but assuming the publicity and enthusiasm continues to grow for this book, B&N's reaction will seem increasingly ridiculous. With a little more perspective and strategic thinking B&N could have stolen a lot of the thunder from Amazon; that is, if it even existed before B&N made such a big deal about it. On a larger point, if this is how non-Amazon retailers react, how soon will it be before Amazon, encouraged by this reaction, can claim that their retailing competitors don't have the product spread they do. I don't think that is a vortex any retailer wants to be on the cusp of.

Unprecedented!

The Gossip Girl book is being packaged as part of a DVD release of the TV show. The NYTimes notes the 'unprecedented' twist on how 'publisher's hitch their wagons to Hollywood projects:

Now, however, the DVD set “Gossip Girl: The Complete First Season,” which goes on sale this week, includes a free electronic version of the original novel by Cecily von Ziegesar on which the show is based. But — OMG! — it is totally not a book that you read! It is, rather, an audio book narrated by Christina Ricci, with other bonus material like scenes that were not broadcast and “LOL: Gag Reel.” The three-hour abridgement of the novel, which Hachette Audio first released in CD format in 2003, can be transferred to an iPod. This collaboration, by Hachette Audio and Warner Home Video, which made the DVD, is an unprecedented twist on how publishers hitch their wagons to Hollywood projects. With films, publishers typically reprint a paperback with movie-poster artwork, and audio divisions similarly repackage audio books.

The article goes on to briefly discuss why audio books don't appeal to youngsters which would have been a far more interesting analysis than suggesting publisher's product development is dependent on ride-alongs with Hollywood.

First Chapters Grows in The UK

Dial a Book which owns First Chapters has announced the addition of a major UK partner in Gardners. DAB will be licencing all 210,000 first chapter files to Gardners for their use with their publishing and retail partners. From the press release:

Dial-A-Book Inc, the largest creator and distributor of book text excerpts in the United States and Gardners Books Ltd., the largest book wholesaler in the United Kingdom, have announced a joint book excerpt distribution program.

The excerpts of US books which Gardners will distribute in the UK and throughout the world contain full bibliographic data, tables of contents and five to nine pages on initial text.

"Gardners are pleased to bring this invaluable sample material, which has reviously only been available within the USA, to retailers, librarians and book buyers, through our Digital Warehouse. Giving professional book buyers in retail and libraries, and consumers buying on our customers retail websites, access to sample content prior to purchase will greatly enrich their buying decision." said Bob Jackson, Commercial Director of Gardners Books Ltd.

Stanley R. Greenfield, President of Dial-A-Book Inc. indicated that the extended distribution of this book data will means more widespread sales of US works in the global marketplace.

MediaWeek (Vol 1, No 33):

The NYTimes looks at The Daily Show's Jon Stewart. NYT. Gannett is the latest Newspaper to cut headcount. SFGate. A very interesting application of Anti-Span technology used to translate text. TimesOnline

Captchas are little boxes on web pages which show a squiggly set of letters and numbers that the user is required to transcribe correctly in order to register or enter the site. They were devised eight years ago as a way of preventing computers from setting up e-mail accounts automatically which could then be used to send out spam, but a clever tweak means they are now being used to transcribe newspapers dating from the nineteenth century and earlier. Instead of displaying a random collection of letters and numbers, the newly designed Captchas present the user with a word from an old manuscript that a computer, somewhere, is having trouble deciphering.

The Telegraph reports on a half dozen interested parties moping around the Reed Business Assets. And the Informa deal is still generating some interest and the Telegraph notes Blackstone's interest in perhaps joining an existing consortium. And more from Reuters and an earlier Telegraph report. Jemima Kiss at The Guardian reports on an interesting new application in the printing industry. "In the same way that you'd use Expedia to find flights from many airlines, you'd use our service to buy exactly the prints you need from any print provider on the network." It's never too late to write that book. From the Guardian. "A raunchy novel with a dauntless heroine has transformed the lives of a 93-year-old author and three of her friends who were living in nursing homes. Pushed by her daughter-in-law, who found the manuscript and couldn't put it down, Lorna Page has become one of the oldest debut writers on record, with equally unusual social results." We did so much for everyone but now they're all against us and we were always misunderstood. The world according to Mrs. Conrad Black. TimesOnline.

But if the rich and well-connected cannot get justice, what chance for anyone else — a question I asked in columns about the law long before I married Conrad. What chance for the orange jump-suited, marginalised young men I saw shuffling in front of the judge in Chicago, silent while their court-appointed attorneys negotiated their freedom away in that tight little legal world, where a client’s fate never disturbs the bonhomie between lawyers. If ostensibly privileged defendants like us can be baselessly smeared, wrongfully deprived, falsely accused, shamelessly persecuted, innocently convicted and grotesquely punished, it does n’t take much to figure out what happens to the vulnerable and the powerless: they land, finally, in the 8:45am courtroom parade that takes place all over “America the Free” — the country that “wins” 90% of cases and imprisons more people than any other in the world.

GB Gold Overflow

Just an unbelievable performance by the Great Britain team over the weekend. Four gold medals on both Saturday and Sunday has pushed us up to the heady heights of third on the medal table. We're running just ahead of Michael Phelps. And it's not over yet.

How good a Games has this been for Team GB? Well, a gold today will make this our most successful since 1920. The 11 collected so far matches our total in Sydney in 2000. We are well on course to make this our second best Olympics ever. BBC

Best of British: 1908 (London): 55 golds

1900 (Paris): 14 golds

1920 (Antwerp): 14 golds

2000 (Sydney): 11 golds

Random Searches

A curious search string delivered someone to my site today:

"if you have a felony conviction can you travel to the UK"

The answer to that cannot be found on this blog. Nor can I offer any guidance.

Personanondata Bookstore

People ask me whether there are any good books written on the publishing industry and of course there are. There are also many research reports that to varying degrees profile the industry and segments of the industry. With the aid of Booksinprint - I found the exercise of narrowing down my 'publishing books' selection intolerable on Amazon.com - I have built a small bookstore containing books about the publishing industry. The Amazon bookstore application building is brain numbingly easy to implement and I don't see why anyone wouldn't have a store on their own site.

You will notice I have placed the block on the upper right of my blog page. Here is the link.

The downside for me is that many of my readers are RSS subscribers so won't be seeing the Bookstore block. My attempt to add some xml script to the RSS feed has thus far been farcical but as a history major I should get points for trying. I shall not give up. As an Amazon 'associate' I get a small commission which will help pay for food for the company mascot.

Feel free to recommend some titles but please make use of the store especially if you are in need of some expensive research publications.

Is Jerome Corsi on Drugs?

Jerome Corsi says you can't trust a drug user when they say they've given up drugs. Using an argument childishly similar to 'he who smelt it delt it', Corsi and his publisher are refusing to acknowledge that Senator Barack Obama has repeatedly stated he gave up his use of drugs - other than cigarettes - long ago. Noted this drug use was never more than casual and certainly no more than the average college student is exposed to, even those from Harvard - like Jerome. Certainly, the current President has lied about a lot but has anyone suggested he has lied about giving up blow? Or Drinking? Maybe we should ask Jerome.

Jerome Corsi has no intention of correcting the errors in his book The Obama Nation: Leftist Politics and the Cult of Personality. This is despite the fact he views his effort as investigative rather than prosecutorial (why either would require a lesser degree of accuracy is beyond me). Simon & Schuster the silent publisher is only likely to be interested in the revenue which is why they signed up Mary Matalin to become a 'publisher' in the first place. Fiction or non-fiction what's the difference anymore? The book hasn't been fact corrected. It may not even have been read by Matalin who commented (NYT) that the book “was not designed to be, and does not set out to be, a political book,” calling it, rather, “a piece of scholarship, and a good one at that.” What is she doing at S&S if not political books? And given the level of scholarship and the errors cited by numerous sources perhaps this book should be excerpted in the National Enquirer.

Corsi's name is emblazoned on the cover of this book with the attendant "Phd" in a visual attempt to imply scholarship. The central points made in this book are no more accurate than those in the CIA ghost written memo noted in Suskind's book The Shadow War which came out earlier this month. Interesting that the two books are published by the same publisher. There has been no discussion about inaccuracies in the latter and indeed Suskind stands on solid ground for his diligence in reporting the facts what with all the actual interview recordings. Not so Corsi who says “The goal is to defeat Obama,” Mr. Corsi said in a telephone interview. “I don’t want Obama to be in office.” Obviously, at S&S the standards vary widely depending on the purpose. On the one hand you might have factual grounds for impeachment on the other simple political mud raking.

Court Reverses Steinbeck Copyright Ruling

The son of famed author John Steinbeck who won control over some of his father's works has had the decision reversed by the US Court of Appeals (2nd Circuit Court). In mid 2006, a judge in California ruled that the rights to Steinbeck's novels should revert to the family. LATimes. (A review from a legal perspective). From the AP:

The ruling by the 2nd U.S. Circuit Court of Appeals will leave the rights in the hands of Penguin Group Inc. and the heirs of John Steinbeck's widow, Elaine. Author John Steinbeck died in 1968; his wife in 2003. The appeals court said a lower court judge misapplied copyright law in awarding the rights in 2006 to the son, Thomas Steinbeck, and granddaughter Blake Smyle. Both already receive a portion of the proceeds of sales. The case was returned to the lower court with instructions to leave the rights with various individuals and organizations, including the publisher Penguin and Elaine Steinbeck's heirs. The heirs include her sister, four children and grandchildren.

No word on any further action that may be contemplated by either side.

MediaWeek (Vol 1, No 32):

The Guardian reports that British magazine publishers are facing pressure from retailer ASDA for more quid-pro-quo on shelf space in their stores. Some close readers will recall some aggressive actions by Amazon and also the stance taken by A&R in Australia regarding book titles with small volumes. Perhaps an increasing trend in media retail.

The idea of a magazine giving Asda advertising space in return for appearing on its shelves, for example, is wholly implausible. Every supermarket chain would then be bound to require ads too, leading to the logical, if surreal, result that all magazines would carry several pages boosting Tesco, Sainsbury's, Somerfield, Waitrose and so on. Then there's the question of context: one publisher told me that, for many magazines, supermarket advertising would be inappropriate. How would readers of Cage & Aviary Birds or Model Railway Enthusiast take to Asda boasting of its latest cut-price offers on groceries, for instance?

Will a major city newspaper fold this year. Houston, Miami, Chicago, SF? There are sellers but no buyers according to the NYTimes. Ad revenues are off substantially at some of those free daily newspapers but in the UK Metro is starting their first online version. MAD.co Press Gazzette is giving up their print to go online. Guardian Rodale announced impressive results in face of an industry slow down.

Revenues for all operations grew by 7.6% compared to the second quarter of 2007. Rodale print advertising revenues were up 8.3% compared to an industry-wide decline of 4.9%. Revenues from all online activities increased by 27.1% over the second quarter of 2007, and uniques and page views for Rodale?s sites were up by 74% and 94%, respectively, compared to the same period last year. Revenues from international operations through June are up 14% compared to the first half of 2007.

AlleyInsider.com: Gawker notes their performance versus traditional media. Note that the chart looks like Batman. WSJ reports on the trend in Children's fiction towards more gore in an effort to appeal to more boys:

Scholastic and other publishers are heeding the research of such academics as Jeffrey Wilhelm, an education professor at Boise State University. Prof. Wilhelm tracked boys' reading habits for five years ending in 2005 and found that schools failed to meet their "motivational needs." Teachers assigned novels about relationships, such as marriage, that appealed to girls but bored boys. His survey of academic research found boys more likely to read nonfiction, especially about sports and other activities they enjoy, as well as funny, edgy fiction. Boys' literary depth is an abiding concern in educational circles. Boys have persistently lagged behind girls in reading on the National Assessment of Educational Progress, an influential federal test for gauging achievement. The gap widens by the time they reach 12th grade. Many experts attribute the lag to the time spent with the printed page. In a survey of bookstores this year by Simba Information, a publishing-industry market-research firm, only 2% said boys made up most of their children's book customers. As adults, females also outscore males on literacy exams, and continue to read more. In an age when the Internet is pulling many away from books, boys in particular spend more time than girls do on computers and videogaming.

Long article in Sunday's NYTimes magazine about Hanif Kureishi who wrote My Beautiful Laundrette.

This is, after all, the man who co-edited “The Faber Book of Pop” and whose films and novels — including “My Beautiful Laundrette” and “The Buddha of Suburbia” — are filled with raucous sex, drugs and rock ’n’ roll. But this is also the man who had the presence of mind to poke around in English mosques in the late ’80s and early ’90s, sensing that something might be stirring there, as indeed it was. Kureishi’s novel “The Black Album,” set in 1989 and named after a Prince album, explored the growing discontent, disenfranchisement and radicalism of some young British Muslims.

NYTimes notes the Waking up to Content is King at Time Warner. Profile of new Zondervan CEO Maureen Girkins. Grand Rapids Press.

Everything's Live in Prime Time

I grew up in Hawaii. Lucky me. When John Lennon died we got to experience it twice. Why, because of ‘satellite delay’. Hawaii is so far west that most ‘live’ television was taped. When most of the nation heard Howard Cosell on Monday Night Football announce that John was dead we didn’t hear him say that for more than three hours, and by then we had been listening to the monster block to end all monster blocks. Almost 30 yrs later, you could be forgiven for thinking ‘satellite delay’ had disappeared along with wooden tennis rackets, members only and Journey. Not so.

When NBC and USA broadcast Wimbledon this year they showed the majority of the matches live; that is, except for the first men’s semifinal which Federer won. Unaware viewers found out the result of the first match during the second match which was shown live. There was some hue and cry about this at the time but tennis fans are generally a polite group. Remember the world cup in Japan/Korea? Well, luckily I was in Australia but in the US fans were left scratching their heads when live games were delayed.

In 1980 there wasn’t any alternative to watching events live if the broadcaster didn’t want us to. We had no choice. Clearly that is not the case now yet NBC continues to believe they know best what the viewer is interested in. NBC believes viewers want to see ‘live’ action in prime time. Forget the fact that this morning the NYTimes had images from the opening ceremonies, we won’t see the pictures live until later tonight. Which is just about when day two action starts.

Gary Zenkel, president of NBC Olympics, said. "We have three main constituency groups: our affiliates, our advertisers and our audience. To our affiliates and our advertisers, our responsibility is to (generate) the biggest audience that we can. And to our audience, our extensive research shows, that means putting it on when they say they want it, which is when they're available to watch it - and that's in prime time." Guardian

This type of ostrich like behavior is what’s so wrong with established media. While everything has changed the media companies try to pretend by force of will they can impose the old paradigm (on the ‘audience’). We’re all smarter than that and despite the 2,000+ hrs NBC are set to broadcast many viewers are going to be disappointed. NBC is not giving us the choices we have become accustomed to in the internet world. How far out of touch are they? An amusing anecdote regarding the LA Times which publicly patted itself on the back for a huge boost in on line traffic. Only the problem was their traffic was dwarfed by upstart Gawker media. SiliconAlleyinsider

Paradoxically, NBC maybe its own worse enemy; they recently launched Hulu.com which is a fantastic site and exactly what choice, selection and access is all about. Every Olympic event should be on Hulu the minute it finishes. I bet the traffic would be immense. On top of that I would guarantee viewers would settle in during prime time and watch again.

There are work arounds. Several web sites have jumped on this issue already. So if you are willing to stay up all night to watch curling check out alleyinsider.com for all the details.

Too Late for The Sony Reader

John Gapper in the FT believes Sony has irretrievably lost the beach-head that the first to market Sony Reader established. Is it now too late to gain back some share? Since he compares Sony's Walkman with the iPod the likely answer is yes.

The danger for Sony is that it is already too late. Amazon has grabbed the market-leading position from Sony and established a stronger brand, which is what happened with the iPod and the Walkman. Sony never managed to recover, despite trying repeatedly to match Apple. The Reader is arguably less important to Sony than any of its core entertainment businesses. Even if the Reader stages a comeback, it will not become one of Sony’s “trillion-yen” businesses like its PlayStation and Bravia franchises. But books should not be written off. Annual US sales of fiction and popular non-fiction books match those of recorded music, so there is enough revenue to be worth fighting for. Sony obviously thought it was worth staking a claim to e-books when it launched the Reader.

Why The Embargo Doesn't Work

LA Times on book review embargos and the particular case of Ron Suskinds The Way of the World. They see something fishy:

As Ulin said Tuesday, publishers' "embargoes are contrivances designed not to protect the contents of the book but to create a media feeding frenzy when a book comes out. Often, the entire purpose is to protect some kind of exclusive arrangement with a particular news outlet. That's not about news; it's about publicity, and it implicates the news media as part of the publicity juggernaut, reducing us watchdogs to lap dogs."The willingness of major publishing houses to take on projects like Suskind's is an act of public service as well as commerce. Projects such as Suskind's don't need to be marketed with the sort of calculation routinely reserved for celebrity tell-alls. In fact, the aura created by an orchestrated publicity campaign can even undermine the authority of the sort of journalism Ron Suskind practices.

Free Books

One of the funny things about writing this blog is that I have started to get some free books. This is strange since I don't review books. I read a lot, but I generally only read the stuff I like. I don't have time to read things people send me. I also find this interesting because as President of Bowker - the publisher of books in print remember - I may have received three books in seven years. Two of those were sent by Jane Friedman. So, as a blogger operating in no official capacity I get some books, but as head of house I don't. Curious.

In the past twelve months I have received four books; not a lot thankfully. I haven't read any of them. Two management books (one from Wiley so I may end up reading it), one on being more green and one from a trade publisher. The green title had me slightly concerned since the title was so precise: "78 ways to change the planet" or something. Surely if they concentrated a little more they might have reached 100. No doubt my experience with review copies speaks both to the desperation of smaller publishers to get their titles seen and to the general indiscriminate nature of the process: Send them out in the hope that someone will review them.

I am not sure how much other heads of house share their books with one another. Do they call each other up and ask for a particular book I wonder. Would they be embarassed? If I were publishing something more compact that an 8 volume directory I would have routinely sent my titles to other publishers. I would be proud of them and I would want my peers to enjoy them as I did. (I did consider sending the CD version to publishers but discarded the idea just as quick. I didn't want to visit their office and find it under a wine glass).

About 18mths ago, I realized that my unread pile extended to 60+ books, but the back log is winding down now and so sometime in the next six months I might actually be reading books that have some currency. (At the moment I am reading a biography of Sir Christopher Wren that was published in 2001). Perhaps then I might comment a little.

Paris Hilton On Oil Dependency

Remember that tasteless ad the McCain campaign ran denigrating Obama as a "celebrity?" Well, I think the celebrity just got the better of them:

See more funny videos at Funny or Die

Here is the link for those on email or if you are using MS Explorer. Firefox seems to work fine.

I am curious why they can't afford towels at the Hilton mansion. Nice suit.

Back to our regularly scheduled programming later.

Harpercollins Closes Year Flat

Harpercollins saw a 18% increase in fourth quarter revenues that helped the company finish the year with operating income flat with 2007. Revenues for the quarter were $350mm versus $295 in the prior period. Full year revenues were $1,388 versus $1,347 in the prior period.

Here is the relevant section from the NewCorp press release:

HarperCollins reported fourth quarter operating income of $28 million and full year operating income of $160 million, an improvement of $7 million and $1 million as compared to the prior year periods, respectively. Current quarter results were led by strong sales of Bright Shiny Morning by James Frey, Stolen Innocence by Elissa Wall and an updated edition of YOU:The Owner's Manual by Michael F. Roizen and Mehmet Oz. During the fourth quarter, HarperCollins had 62 books on The New York Times bestseller list, including Read All About It! by Laura and Jenna Bush which reached number one. For the full year, HarperCollins had 165 books on The New York Times bestseller list, including 14 titles reaching the number one spot.

Thus the company had a margin improvement of 1pp in the final quarter but a slight decline over all. Well reported has been the change in senior management at Harpercollins with Brian Murray replacing Jane Friedman. Murray, in turn, has made changes in the executive suite notably the replacement of Glenn D'Agnes who was the long term COO.

Details on Harpercollins are always sparse in the NewsCorp disclosures and the company is rarely mentioned in the earnings conference calls.

When You See a Fork in the Road...

Lorcan Dempsey (OCLC) on the future of libraries,

We can see two important directions, one towards concentration and one towards diffusion.

First concentration, which we see at at least three levels. At the institutional level, there is a strong push to overcoming fragmentation by moving towards new institutional discovery layers (Primo, Encore, Worldcat Local). At the group level we see the emergence of more state or national systems which pull together resources in user-facing services. These are attractive because they present more resources to the user. And at the global level, we see library resources being represented - through linking or syndication strategies - in search engines, Flickr, Google Scholar, Worldcat and other network level resources.

The second is atomization of content and services so that they can be better integrated into diffuse networking device and applications environments. Here think of RSS/AtomPub, mobile interfaces, APIs, alerting services, portlets and widgetization, persistent links to library services and content, etc. Issues here are technical and licensing. Users increasingly value convenience and relevance, and packaging materials in ways that make most sense for them is not always straightforward.

How far off are we from the new library that has no physical holdings, no ILS system, no repositories, no nothing except the building, a patron database, some furniture and some terminals?

Author as Brand

Following on from my post on branding last week, Jeff Jarvis interviews Paul Coelho and finds the perfect example of an author embracing his power as a brand. He's making more money in the process as well.

He is a pirate. Coelho discovered the power of free when a fan posted a Russian translation of one of his novels online and book sales there climbed from 3,000 to 100,000 to 1m in three years. "This happened in English, in Norwegian, in Japanese and Serbian," he said. "Now when the book is released in hard copy, the sales are spectacular." So Coelho started linking to pirated versions of his books from his own website. But when he bragged about this at the Burda Digital Lifestyle Design conference in Munich last January, he got in trouble with his US publisher, HarperCollins, whose then head, Jane Friedman, called him.

Trust in Book Lovers Not Reviewers

The termination of several book review sections across the country in recent weeks has reignited the same discussions that took place last year regarding the future of reading and books generally. The arguments remain sentimental suggesting a Utopian book-centric world where every reader weighs the careful words of the reviewer before making a particular purchase. Yesterday, Lissa Warren in HuffPo lamented the demise of the book review section of the LA Times and calls out those who believe (like I do) that blog reviewers are filling the void left by 'official' reviewers:

But I'll tell you what does make my jaw drop: the seemingly widely-held notion that these book sections are being adequately replaced by blogs. To be sure, there are some excellent book blogs out there: Mark Sarvas's The Elegant Variation. The National Book Critics Circle's Critical Mass. MediaBistro's Galley Cat. Jessa Crispin's Bookslut. The Boston Globe's Off the Shelf. And, of course, the New York Times' Paper Cuts. They're all bookmarked on my computer. I read them often for news on new titles (and older ones I missed) and Q&As with authors. Many of them are also good for stories on publishing trends, which as a book publicist and editor I appreciate a great deal. But, for the most part, these blogs don't actually review books.

In my view there is a macro point that makes her argument largely irrelevant; that is, we are beginning to see the development of trust networks. As consumers of information we are starting to build our own networks of people and entities we rely on to support everything from our political philosophy to our choice in vacation spot. Reading falls squarely into that paradigm and it no longer matters whether a book review is produced to the standard of the LA Times or The NYTimes book section (and many blog reviews do), what matters is the impact the review has on a purchase decision. Those interested in reading are finding bloggers that they 'trust' (even of the blogspot variety, a comment which baffles me), and these reviews do indeed 'adequately' fill the void created by the demise of some of the larger newspaper reviews sections. Interesting, some of the arguments presented by Warren as to why these blogs are not of a standard are precisely the items that lend reality, personality and connection to the readers of these reviews.

I'd also advise that book reviewing bloggers jettison the use of personal pronouns (yes, I've used a slew of them here; you can nail me in the comments). And for goodness sake, I wish they'd stop telling me what their father and their girlfriend -- or their father's girlfriend -- thought of the book. Also, I don't need to know how they came to possess the book -- how they borrowed it from the library, or bought it at B&N, or snagged a galley at The Strand, or got the publisher to send them a copy even though they average four hits a day. The banal back-story is of little interest.

It is my own personal view that the back story is of little interest; however, that might only be because I haven't found a (blog) reviewer that I identify with. The point is, many consumers reading these blog reviews do find the back story interesting and the great thing is they can move on to someone else if it becomes too tedious. Warren also speaks of 'self-indulgence' and surely nothing could be more self-indulgent than reading a Salman Rushdie review of a Martin Amis title in the NYTimes book review section. (If you would).

Trust networks will define how many people (maybe all of us) communicate - that's what myspace, facebook, linkedin, etc. are starting to show us. The blog network is a fundamental part of that and the continued development of trust networks has implications for all consumer interaction including recommending and buying books. The word 'recommend' is better than review. The word 'review' in conventional terms and as used by Warren is used pejoratively when referring to blog reviews. This is wrong, because a book review doesn't have to conform to a standard; this is a convention that has been constructed by old school journalists. What is relevant is what the opinion/review/recommendation means to the consumer. Someone yelling over the back fence to their neighbor that they really liked The Corrections is a 'review'. And that's synonymous with replying to the Facebook 'what are you doing' by typing "I'm reading The Corrections and I really hate it".

Lastly, who was reading the reviews in all these newspaper reviews sections anyway? Most people in the US who read (and that's not many) only read one book a year. That book is likely to be something like the Da Vinci Code, a diet book, Dr Phil or an Ophra pick so what's the return? It is (was) a mystery. Not so on the web. These evolving trust networks concentrated around people who love books, talk about books and opine about books provide publishers with a window on the community they never had. Stop with the whining and recognise that as a publisher you have a tremendous opportunity to understand your consumer in ways you never could before. Rather than lamenting the demise of the newspaper, publishers should be rejoicing in front of the window to a vibrant community of book lovers and opinion makers.

To answer Lissa Warren's question: Blogs may not save Books but they may be all we have so pay attention.

MediaWeek (Vol 1, No 31):

The Telegraph reports on another media deal in the works concerning Wilmington a publisher of Press Gazette and legal and charity databases. ReadWriteWeb note the publication of study suggesting females rather than males rule the web:

Online reputation company Rapleaf has released a new study of 49.3 million people, revealing gender and age data about social network users. On most of the main social networks - including MySpace, Facebook, Bebo, Hi5 - women outnumber men by a considerable amount. On Facebook, the 18-24 age group is largest, with 1,685,029 women in that age group compared to 977,753 men. In MySpace, the same age group dominates, with 7,091,214 women and 5,226,788 men.

Informa announced late last week that they had received an indication of interest from a new group. The Guardian finds out it's Dubai. But Blackstone is seen as a favorite by The Times. The Times Online reports on the self-publishing market for authors with a provocative lead-in. One Kindle, Two Kindle, Three Kindle... TechCrunch tries to get to the bottom of the sales numbers. Torstar reports better quarterly results for Harlequin:

Book Publishing revenue was $118.9 million in the second quarter, up $2.9 million from $116.0 million in the same period last year. Underlying revenues were up $6.3 million in the quarter with strong growth in the North America Retail division partially offset by a decrease of $3.4 million from the unfavourable impact of foreign exchange rates. Operating profit was $18.5 million in the second quarter of 2008, up $6.0 million from $12.5 million in 2007. Corporate costs were $4.2 million in the second quarter of 2008, down $0.6 million from the second quarter of 2007.

Guards say they locked him up in a cupboard. Not true, says Rushdie and threatens to sue. He may have a chance. Guardian (no relation) Some spectacular declines in magazine readership in the UK. BrandRepublic

Maxim will be the hardest hit of the men's monthlies, but Bauer Media-owned titles Arena and FHM, with news-stand circulation expected to be down 20% and 17% respectively, IPC-owned Loaded (expected to be down around 20%) and NatMags-owned Esquire (expected to be down 19%) are all understood to have suffered in the latest ABCs, released on 14 August.

Things continue as expected at Voyager Learning. Still no filings, revenues are in decline and cash is tight. SEC

The Company anticipates it will file its 2006 10-K by July 31, 2008. It further expects that the 2007 10-K will be filed four to eight weeks after the filing of the 2006 10-K. The Company provided preliminary and unaudited 2007 financial results for the Voyager Learning Company operating business by means of a conference call on April 15, 2008. As the Company has continued its efforts to file 2006 and 2007 financials, certain estimates made April 15, 2008 have been updated resulting in a change to the projected 2007 earnings before interest, taxes, depreciation and amortization (EBITDA). EBITDA is now expected to be in the range of $28 - $29 million versus the previously reported $30 million.

Amazon Buys ABE Books

In a deal likely to further infuriate publishers, Amazon.com The Bookseller is reporting that Amazon has agreed to by ABE books a second hand and rare book seller.

Russell Grandinetti, vice president of books for Amazon.com, said that the acquisition would add "breadth and expanded selection" to the company's customers. "AbeBooks provides a wide range of services to both sellers and
customers, and we look forward to working with them to further grow their business. We're excited to present all of our customers with the widest selection of books available any place on Earth."

Hannes Blum, AbeBooks' chief executive, said he was "very excited" about the acquisition. "This deal brings together book sellers and book lovers from around the world, and offers both types of customers a great experience," he said.

Many of the retailers that participate in the ABE network may already participate in the Amazon network nevertheless this will solidify the persistent mingling of new and second hand titles that publishers have grown to loath. Amazon purchased another second hand and antiquarian book network (may have been more of a search tool) name biblio(something - can't recall) which established their early position in this segment but the acquisition of ABE will radically broaden their reach. Where this leaves Alibris is also of interest. Will they see a need to merge with a larger retailer. We all know Steve Riggio likes old books....

Librarything notes the deal as well and points out Amazon will have a stake in their company.

Hat tip: Brantley (again)

Archives Are Good to Have

Encyclopedia Britannica announced they are making their visual content archives, including photos, maps, illustrations, natural science drawings, slides and animations, available for distribution and stock licensing.

Details are sparse but I found the notification on abouttheimage.com.

Virtual Picture Desk the third party organization that is managing the licensing is a, Management Services and Consultancy Business providing content management advice, global & international syndication of picture libraries for distribution and the assistance in the mergers & acquisitions of photographic and illustrative collections.

Forrester Buys Jupiter

Forrester Research (Nasdaq: FORR) (http://www.forrester.com/) has acquired JupiterResearch, LLC (http://www.jupiterresearch.com/) and its parent company, JUPR Holdings, Inc., from MCG Capital Corporation (Nasdaq: MCGC) (http://www.mcgcapital.com/) for $23 million in cash plus assumed liabilities, subject to post-closing adjustments. (JEGI reports).

JupiterResearch has 83 employees and 2007 revenues of approximately $14 million. Forrester, with 2007 revenues of $212 million, now has more than 1,000 employees. This strategic purchase complements Forrester’s syndicated business model, as JupiterResearch joins Forrester’s Marketing & Strategy Client Group, which contributed $46.4 million to Forrester’s total revenue in 2007.

“Uniting JupiterResearch and Forrester brings together the two leading research brands used by marketing and strategy executives,” said George F. Colony, Forrester’s Chairman of the Board and CEO.

Reed Shares Up 5% on Buoyant News

From the Reed Elsevier press release:

• Strong business momentum and financial performance
• Restructuring programme on track to deliver further margin improvement
• Sale of Harcourt Education fully completed; net proceeds of £2.0bn/€2.7bn returned to shareholders
• Divestment of Reed Business Information in progress
• Agreed £2.1bn/€2.7bn acquisition of ChoicePoint, Inc. expected to close in H2

Reed Elsevier's Chief Executive Officer, Sir Crispin Davis, commented:

"We have seen a strong performance across our businesses in the first half despite a more challenging economic backdrop and we remain on track to deliver on our goals this year of good revenue growth, meaningful margin improvement and accelerated earnings growth. We have made good progress in implementing our plans announced in February to accelerate growth: the planned divestment of Reed Business Information is progressing and we are seeing strong buyer interest in the business; the agreed £2.1bn/€2.7bn acquisition of ChoicePoint, Inc. in the fast growing risk information and analytics markets is moving through US regulatory review and is expected to complete in the second half; our major restructuring programme to deliver £245m/€310m of cost savings over the next four years is on track with the initial targeted £15m/€19m of savings to be delivered this year. Whilst the professional markets we serve are not immune to economic cycle effects, they are more resilient than most. This, together with the changes we are making in the business and the growing demand for our online information and workflow solutions with the customer productivity they provide, gives us confidence in the outlook.”

Further notes from their presentation:

• Online revenues growing at 10+%
• Online revenues exceed 50% of total revenues.
• Aggressive program of infrastructure cost management including outsourcing and real estate
• RBI: staple financing in place, strong interest, divestiture expected in second half, good operating performance despite difficult environment
• Choicepoint integration well advanced. Synergies on track
• Outlook: Strong across the board with Elsevier book program, LN online solutions, Exhibitions cycling all noted as positive drivers for H2
• RBI H1 Revenues up 3% and Op Income up 7%. Online growth up 20% to 34% of total RBI revenues. 4% print decline.

Meredith Reports Continued Negative Impact from Book Program

Meredith Corporation reported a significant decrease in fourth quarter revenues. Revenues were $385mm versus $428 for the prior period. Earnings per share were $0.41 in 2008 versus $1.05 in the fourth quarter Fiscal 2007. Full year EPS were $2.83 versus $3.31. While the company adjusted these numbers for their 'special charge' associated with business realignment the investment community hit the company hard with their stock price down 6%.

From thier press release:

Meredith recorded an after-tax special charge of $16 million in the fourth fiscal quarter, related primarily to the further repositioning of its book publishing business and selected reductions in force. The special charge included adjusting certain book royalties, art and editorial, and inventory accounts, as well as severance for eliminated positions in book and elsewhere in the Company.

In particular the following line items were noted: Increase in book sales return allowance, a write-down of book inventory and editorial prepaid expenses and severance expense, write-down of book royalty, and bad debt reserve for Home Interiors Group receivable.

Simon & Schuster Reports

CBS released their half year results with top line revenues and operating income up 1%. The company is re-evaluating their assets portfolio given the general economic environment and has announced the sale of 50 mid-sized radio stations. They are also aggressively managing expenses. How all this impacts Simon & Schuster if at all was not mentioned. Here is the relevant section from the press release on S&S:

Publishing (Simon & Schuster) Publishing revenues for the second quarter of 2008 declined 7% to$186.0 million from $200.3 million for the same prior-year period, as best-selling titles in the second quarter of 2008, including The Broken Window by Jeffery Deaver and Chasing Harry Winston by Lauren Weisberger,did not match contributions from prior year titles which included Blaze by Stephen King writing as Richard Bachman, and The Secret by Rhonda Byrne. Publishing OIBDA and operating income decreased 15% to $17.0 million and 19% to $14.6 million, respectively, with lower revenues partially offset by lower royalty expenses. Publishing results included stock-based compensation expense of $1.2 million and $.9 million for the second quarter of 2008 and 2007, respectively.

Wolters Kluwer Reports

Half yearly results at Wolters Kluwer were mixed with organic revenue growth up 1% and revenues at constant currency rates up 4%. Overall reported revenues were down 4%. Operating expenses held constant with the prior period resulting in a slight reduction in operating margin.

Total half year revenues were $1,608mm versus 1,677mm and EBITA was $288mm versus $304mm.

Highlights from the company's press release are as follows:

Double-digit earnings growth, stable profit margin, and solid cash flow performance give confidence for achieving the full-year targets. With its diversified and defensive portfolio, Wolters Kluwer has the foundation in place for sustained profitability and long-term growth.

• 20% diluted ordinary earnings per share growth in constant currencies
• 4% revenue growth in constant currencies (1% organic revenue growth)
• 8% growth in higher margin electronic products in constant currencies
• Resilient profit margins despite weaker market conditions
• Solid free cash flow underpins strong balance sheet and liquidity
• Reiterate progressive dividend policy

Under the hood: The company has to be worried about the results in its Health segment which industry wide has been one of information publishing's more vibrant sectors. For the half year revenues are down 14% (2% CC) and EBITA down 51% (49% CC). On $305mm in revenue the Health segment is almost a breakeven business which must be a concern. The company's Tax and Regulatory business was a highlight and helped mitigate some of the reduction in Health. Overall, the company remains confident of hitting its full-year growth targets between 3-4% despite the retraction in Health and their other slow segment Corportate & Financial Services.

Pearson Reports

From their press release:

• Sales up 14%* to £1.965bn;
• Adjusted operating profit up 38% to £124m;
• Adjusted EPS up to 5.6p (from 3.1p in H107);
• Interim dividend raised 6.3% to 11.8p.
• Long-term investment strategy paying off
• Education sales up 17% and first-half profit of £14m with rapid growth in digital learning services and continued international expansion;
• FT Group sales up 11% and profits up 21%, benefiting from shift towards subscription and digital revenues and focus on global businesses;
• Penguin sales up 9% and profits up 22%, with strong publishing and innovation in all markets.
• Healthy outlook: Full-year guidance confirmed; on track for further progress in all businesses.

Marjorie Scardino, chief executive, said: "Our momentum is strong, even in these tough economic conditions. We have leadership positions in good markets and an effective growth strategy based on quality content, digital innovation and international expansion. That strategy makes us confident that 2008 will be another record year, and that we will continue to grow."

For the year:
The company expects Eduction to be up 10% in constant terms for the year. The company is also reorganizing education into three groups: US Domestic, International, and Professional. Margins will be constant despite 'harcourt integration expenses' and will grow by 1pp per year beginning in 2009.

Penguin has made 'an excellent start to the year' and Pearson expects them to achieve double digit operating margins for the year.

FT is showing growth in subscription, circulation and advertising revenues (up 2%) in the first half. Pearson expects to increase profit at FT Publishing even without any growth in advertising revenue. Guardian reports FT added 350,000 new subscribers in six months.

Brand Presence

Most people in our industry recognise the irony inherent in discussing brand management in the publishing industry. Every aspiring author and agent seeks the validation that being published by a major publisher brings, yet most consumers have only a passing awareness of the publishers' brand. There are exceptions--Harlequin, Hungry Minds, O'Reilly- but across the panoply of publishers, brand strength is only partially monetised.

This recognised fact has not stopped publishers from investing heavily in branded web sites that cocoon their authors in an experience that generally is not relevant to the consumers they are attempting to attract. That is not to say that the content and applications available on the websites of most large publishers are inadequate or unsophisticated, but they are misappropriated. I especially like the websites of Harpercollins and Penguin, who have both taken up the challenge of community building, widgets and e-Content. And it is difficult to be critical of these attempts, given the aggressive level of experimentation undertaken.

What seems to be lacking in all publisher websites, though, is a strong sense of engagement. And engagement that is resilient. Just as consumers return to their favorite booksellers, publishers need to believe they can engage their consumer base to such an extent that they return each time they are interested in purchasing a book. And that's any book.

Publishers are best placed to build author-centric and subject/theme-oriented websites--not sites oriented around a "brand" that isn't relevant, but those that focus attention on segments of the business that remain relevant to consumers. Envision the Spiritual segment at a site supported by Harpercollins which has a unique, appropriate and relevant focus far apart from the current 'corporate' approach. All segments are valid candidates for more of a silo approach to marketing publishers' products. And I would go further in recommending that publishers consider marketing within these silos all titles available, rather than just those produced by the publisher. What better way to condense a market segment and become a destination site for Self-Help, Spirituality, Mysteries, Computer and any number of other book-publishing segments. Consumers aren't dumb. Amazon's main attraction is that all the titles in any one segment are available in one place. As long as publishers continue to ignore this fact, they will under-serve the market and under-perform given the investment in their sites.

So, which publisher will be the first to license a "Books in Print" database (as B&N, Google, Borders and many others have already done)? That would be an excellent start; moreover, the publisher is best placed to augment this data with more details, content and community- building applications that will draw in consumers. A quick search for Doris Lessing and George Pelecanos shows that Books.Google.com and Wikipedia are more likely to be the initial reference points for consumers. On their respective publisher's sites, these authors retain a significant presence, but that presence does not appear to be adequately monetized. Many publishers will argue that they are there to support the retail sale and as long as a book gets sold-- based on their effort-- they have done their job. There is something to this argument but the age-old paradigm on which it is based--multiple retail channels, limited retailer power--is long behind us and getting worse for the publisher.

Web presence for many companies (including publishers) remains a fluid engagement. The inherent benefit of the web is that you can try and fail repeatedly, with limited downside, assuming you monitor closely. In the publishers' case, it is important they not attempt use the web to build brand awareness around their trade-marks which continue to be removed from consumers' experience, Internet or not. What their focus should be is building a discernable alternative to the predominant web retailers by segmenting their offerings around logical categories and building their brand around those segments as they use their content knowledge, author relationships and technical expertise to build something powerful for the future.

Pearson Post Strong H1 Results

Pearson reported strong revenue increases (up 14% to £1.965bn) and adjusted operating profit up 38% to £124m versus the same period last year. Additionally, their adjusted EPS is up to 5.6p (from 3.1p in H107) and the company's interim dividend has been raised 6.3% to 11.8p. (Press Release).

According to the company this is evidence that their long-term investment strategy is paying off as evidenced by,

• Education sales up 17% and first-half profit of £14m with rapid growth in digital learning services and continued international expansion;
• FT Group sales up 11% and profits up 21%, benefiting from shift towards subscription and digital revenues and focus on global businesses;
• Penguin sales up 9% and profits up 22%, with strong publishing and innovation in all markets.

Marjorie Scardino, chief executive, said: "Our momentum is strong, even in these tough economic conditions. We have leadership positions in good markets and an effective growth strategy based on quality content, digital innovation and international expansion. That strategy makes us confident that 2008 will be another record year, and that we will continue to grow."

By segment the company notes its full year 2008 prospects:

Pearson Education (63% of 2007 sales and operating profit). Our education business is trading in line with expectations. As previously announced, we have begun a reorganisation of our education company, which we are now managing and reporting as three segments: North America, International and Professional. Our expectations provided at the full-year results under the previous segmental analysis (worldwide School, Higher Education and Professional) are unchanged.

In North American Education, we have a strong market leadership position and demand for our products remains healthy. We expect our North American Education business to increase sales by around 10% at constant exchange rates (or by 2-4% in underlying terms).
In International Education, we are well placed to benefit from the growing demand for materials, assessment, technology and related services at all stages of learning. We expect our International Education business to grow sales by around 10% at constant exchange rates (or in the low single digits in underlying terms). These growth rates include the impact of the completion of the UK key stage testing contract in 2007.

In Professional Education we continue to expect sales to increase in the low single digits at constant exchange rates.

For Education as a whole, we expect 2008 margins to be similar to the 2007 level of approximately 15%, in spite of significant integration costs relating to the Harcourt businesses (which we include in our operating results). In 2009, we expect to increase Education margins by around one percentage point as we begin to realise the financial benefit of the acquisitions. Beyond 2009, we see further opportunities to increase margins in Education as we continue to consolidate our businesses.

Penguin (20% of 2007 sales, 12% of operating profit). Penguin has made an excellent start to the year, with a particularly strong first-half publishing schedule. It is on track to reach its goal of double digit margins for the full year.

Financial Times Group (17% of 2007 sales, 25% of operating profit). The FT Group is on track to achieve continued profit growth this year. FT Publishing has shown sustained growth in subscription, circulation and advertising revenues (up 2%) in the first half. Future advertising revenues remain difficult to predict, but we continue to expect to increase profit at FT Publishing even without any growth in advertising revenue. Interactive Data has raised its guidance and now expects to achieve full-year revenue growth in the 8-10% range and operating profit growth within the 11-13% range (headline growth under US GAAP).

MediaWeek (Vol 1 No 30):

NY Times looks at textbook piracy:

The transition has already begun, even while publishers continue to sell print editions. They are pitching ancillary services that instructors can require students to purchase, just like textbooks, but which are available only online on a subscription basis. Cengage Learning, the publisher of Professor McMurry’s “Organic Chemistry,” packages the new book with a two-semester “access card” to a Cengage site that provides instructors with canned quizzes and students with interactive tutorials.

A lengthy article in The NY Times showing the battle to win over younger readers to books.

Books are not Nadia Konyk’s thing. Her mother, hoping to entice her, brings them home from the library, but Nadia rarely shows an interest.

Reuters suggests that a deal for Informa could be imminent. The Observer writes about the biggest website you have probably never heard of:

The invisible hand behind many memes, apparently including the googled swastika, is a website called 4chan. From semi-literate cats to the 'ironic' comeback of singer Rick Astley, this online community is building a reputation as a nursery of all that is weird and wacky and likely to be landing in your inbox tomorrow.

NYTimes on the growing instance of product placement in broadcast news.

In recent weeks, anchors on the Fox affiliate in Las Vegas, KVVU, sit with cups of McDonald’s iced coffee on their desks during the news-and-lifestyle portion of their morning show. The anchors rarely touch the cups. Executives at the station, one of 12 owned by Meredith Corporation, say the six-month promotion is meant to shore up advertising revenue and, as they told the news staff, will not influence content.

S&P (Yes,the same folks that missed the credit crisis) have placed the NYTimes on negative credit watch.

The CreditWatch listing reflects an accelerating pace of total revenue decline and a rate of decline in EBITDA in the first half of 2008 that indicates the company may have difficulty achieving our expectations for the current rating.

The Telegraph notes that Thomson Reuters will launch news channel to compete with Bloomberg, Fox and CNBC.

The Daily Telegraph understands that the plan is for the channel to appear on both the internet and some form of cable or digital platform. The launch could be as early as January but may be pushed back as the company is conscious of Reuters' earlier unsuccessful foray into television.

MediaPost has a round-up of a very bad 10days for newspapers and magazines.

While all three mainstays of the traditional media have scrambled to adapt to the digital age with more online features and services, their Internet businesses still contribute just a small fraction of total revenues. Even more ominous, the rate of growth in online revenues is slowing, making it unlikely that they will ever be able to offset losses in the core business.

On the other-hand, MediaPost also reports on the rise of newspaper-distributed magazines.

It's one of the weird paradoxes in current media trends: While newspapers and consumer magazines are both taking it on the chin in 2008, some magazines distributed via newspapers are doing quite well. Among the leaders are American Profile and Relish, from the Publishing Group of America--which have seen year-to-date ad pages increase 12.58% and 19.69%, respectively, according to MIN Online.

The Independent looks at E-books as retail items and assesses whether they are threats or favors.

The long-term danger for publishers is if they don't invest in digital technology for their content. They could also lose out if they just make classics available for e-book readers and not the most recent popular titles. Henry Volans, head of digital publishing at Faber, said: "There is no reason whey people who have e-books should suddenly only be interested in Dickens. They will want the big new titles as well."

Giles Coren on Editing

Spoiler alert: There is some very colorful language in the attached article written by food critic and writer Giles Coren. Giles has taken exception to what might appear to a disinterested party as a fairly minor editorial change to one of his recent restaurant reviews. As Mrs PND notes he is quite elegant in the manner in which he abuses the parties responsible. Giles and Gordon Ramsey are said to be good mates and it is clear after reading this where the common affection resides.

Consider yourself forewarned. There is no way anything like this would ever be published in a major US newspaper.

The Guardian.

SCHOLASTIC ANNOUNCES FISCAL 2008 RESULTS AND FISCAL 2009 OUTLOOK

From the company's press release:

New York, NY (July 24, 2008) -- Scholastic Corporation (NASDAQ: SCHL), the global children’s publishing, education and media company, today reported its results for the fiscal 2008 fourth quarter and full year and its outlook for fiscal 2009. It also announced that its Board of Directors has declared a quarterly dividend of $0.075 per share to be paid on September 15, 2008 to shareholders of record on August 4, 2008.

“Given our track record of strong free cash flow, generating $188 million in fiscal 2008, and low debt levels, we repurchased $220 million in stock last year while continuing to invest in strategic growth opportunities,” stated Richard Robinson, Chairman, CEO and President. “Initiating a regular dividend allows us to return additional cash to Scholastic shareholders.”

For the fiscal year ended May 31, 2008, the Company had revenue from continuing operations of $2,205.6 million, up 15% from the prior year. Earnings from continuing operations rose to $2.82 per diluted share from $1.70 per diluted share in fiscal 2007. Fiscal 2008 results benefited significantly from the publication of the seventh and final book in the Harry Potter® series.

Revenue from continuing operations in the fourth quarter of fiscal 2008 declined 2% to $536.1 million. Earnings from continuing operations were $0.75 per diluted share compared to $1.04 per diluted share in the fourth quarter of fiscal 2007, primarily reflecting continued investment in the Company’s growth initiatives.

The Company reported that negotiations for the sale of its direct-to-home continuities business, which it previously announced it would exit, moved forward during the quarter, and that it expected to finalize terms in the first quarter of fiscal 2009. Scholastic also announced that it shut down its school-based continuities business effective May 31, 2008. As a result, both businesses have been classified for accounting purposes as discontinued operations in current and prior periods.

In fiscal 2008 the loss from discontinued operations, net of tax, was $3.39 per diluted share, compared to a net loss of $0.29 per diluted share in fiscal 2007. In the fourth quarter the loss from discontinued operations, net of tax, was $1.09 per diluted share compared to a net loss of $0.11 per diluted share in the prior year period. The greater loss in the current year and quarter primarily reflects non-cash asset write-downs, net of tax, of $2.62 and $0.79 per diluted share, respectively, recorded following the decisions to exit these businesses. In the current year and quarter, the net loss associated with direct-to-home continuities was $0.61 and $0.21 per diluted share, respectively, and with school-based continuities the net loss was $0.16 and $0.09 per diluted share, respectively.

Including continuing and discontinued operations, the fiscal 2008 net loss was $0.57 per diluted share compared to net earnings of $1.42 per diluted share in fiscal 2007. In the fiscal 2008 fourth quarter, the net loss was $0.34 per diluted share compared to net earnings of $0.93 per diluted share in the prior year period.

“Scholastic made important investments in fiscal 2008 to achieve ongoing revenue and profit growth and to reach 9 to 10% operating margins in 2010,” Mr. Robinson added. “These initiatives include:
1. Building and testing a second generation, online selling platform for School Book Clubs to launch in fiscal 2009, which improves on our online system that already handles 60% of Club orders;
2. Expanding the use of point-of-sale equipment and online tools in School Book Fairs, to improve merchandising and the book fair experience;
3. Developing new publishing and online properties, like the innovative multi-platform adventure series The 39 Clues™, which combines books, collectible cards, online games and an interactive website;
4. Investing in a stronger sales and service organization for Scholastic Education and in new technology products like System 44™, a prequel to our top-selling reading-intervention program READ 180®;
5. Accelerating investment in China and Southeast Asia to serve the growing market for English-language books and learning, where Scholastic’s business expanded by more than 20% in fiscal 2008.

In fiscal 2009 we also have plans to reduce costs by $25 to $35 million, through reductions in headcount and other spending areas. Based on these elements, this year’s plan delivers profit and margin growth (excluding Harry Potter) and moves us toward our goal of 9 to 10% operating margins in fiscal 2010.”

Fiscal 2009 Outlook

The Company expects total revenue from continuing operations in fiscal 2009 of approximately $2.0 to $2.1 billion, and earnings per diluted share from continuing operations in the range of $1.75 to $2.10. This guidance reflects growth in revenue of approximately 3 to 5%, and in earnings per diluted share of approximately 10 to 25%, excluding the benefit of Harry Potter in fiscal 2008. Free cash flow is expected to be approximately $90 to $100 million.

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Kindle Sex

Sillicon Alley Insider (via Booktwo)notes that Amazon is being characteristically coy about the level of porn on sale via the kindle. They note that Amazon is prepared to offer sales rank for most titles but similar ranks are suspiciously lacking for erotic titles. They don't explain how they came about this research but a review of this series of pages on Amazons web site shows no erotica. And this is what you get if you try one of the sales tracking services linked to Amazon services. What are they afraid of?

I may have mentioned that a "sex books in print" is a noted but under served market segment but this list throws up a few more interesting items. Subscriptions to NYTimes and WSJ are in the top 20 (and probably run at a more sustained level than the other titles). With respect to the NYTimes this and the iPhone must spell the death knell for the Times Reader, that mediocre electronic newspaper reader the Times brought out a few years ago. Also of note, is that the title mix includes both adult and young adult titles.

Readers should be aware that battery life is limited.

Tivo And Amazon

The NYTimes is reporting this morning that Amazon and TiVo has signed an agreement that will allow TiVo users to purchase via an on-screen menu some of the products mentioned in shows like The Daily Show, Letterman and Tonight. From the article:

In the months ahead, TiVo plans to begin offering this feature to advertisers and programmers, so that the chance to buy products and have them delivered will be presented to viewers during commercials and even alongside product placements during live shows. The move highlights TiVo’s attempt to shift from being a creator of set-top boxes, competing with copycat devices, to being an advertising innovator that is trying to develop advertising technologies for the television industry.

I have two TiVo's neither of which I can use in satellite-less PND Towers. And we are not happy about it.

McGraw Hill Plotting to Buy RBI

The Telegraph handicaps some of the interest in the sale of Reed Business information and offers the intreging notion that MGH would purchase the Reed titles. What they don't discuss is what would happen afterwards. As I have speculated, some assets are likely to be sold after a sales of RBI and this article compares the 'overlap' between the RBI titles and those currently owned by MGH.

The McGraw Hill Companies, owner of Standard & Poor's credit rating agency, has titles which overlap with RBI in aviation and construction. McGraw publishes aviation Week and a collection of architectural and engineering titles, while RBI has a large portfolio of construction titles including Construction News and Professional Builder.

And:

The sale of Reed Business Information (RBI), whose titles include film industry bible Variety, Flight International and New Scientist, began last week when information was sent to prospective bidders. If RBI fetches the asking price, it would be the biggest media takeover since the sale of Emap at the end of last year.