In Support of the Google Book Settlement

It isn't unusual to hear from financial analysts here at PND HQ who offer all manner of crazy predictions over (in particular) eBook take-up and how the Amazon Kindle is going to take over the universe, so it was particularly welcoming this morning to read Jeffrey Lindsay's (Analyst, Global Internet at Bernstein) defense of the Google Book Agreement.

From Lindsay:

Google has just done something rather wonderful. It is on the verge of an astonishing achievement that will benefit the U.S. for generations, bridging a major part of the digital divide and giving the country a global lead in a key area – scholarship. Its reward: a lawsuit, public criticism from the hastily reconstituted and Orwellian-named “Open Book Alliance” (Microsoft, Yahoo! and Amazon) and scrutiny by the Justice Department. Imagine what might have happened had they had tried to destroy a competitor’s business model by bundling its product into an operating system or attempted to corner the e-book market by making a proprietary closed system to force users to buy online books only form them.

I like the irony. Lindsay alerts us to the effort by Microsoft (in particular) and their aborted effort to implement their own digitization program - one which in my view never really got off the ground. With a little bit of a dig, he seems to suggest that Microsoft didn't really have the consumers' or publishers' interest in mind when they unceremoniously canceled the Live Search Books program after their late and halfhearted approach last year. So under those circumstances is Microsoft a viable challenger to this agreement when they chose to abandon their effort?

Only Google stayed the course and so now only Google has the world’s largest digital book archive. So what is it going to do that is so terrible now that it has this archive? According to Google it is simply going to let people search it for free and if they want to buy the books direct them to a range of other sellers – hardly cornering much of the value of book digitization.

Lindsay does address three important objections - competition, BRR representation and privacy - and introduces these as follows:

Ignoring the competitively-motivated hyperbole there are some grounds for concern with the Google Book Rights Registry agreement. No legal agreement is perfect and given the way events have picked up speed since Google reached agreement with the Authors Guild, some concerns these do merit some serious consideration. The usual Google refrain "trust us, we do no evil" line may be well intended but the company has already had a couple of near misses on privacy; the Viacom-YouTube lawsuit for example (where Viacom subpoenaed and received full records of all videos seen on YouTube). Moreover Google already caved on censorship in China – clearly as a corporate entity it is susceptible to arm-twisting to a greater degree than the small but well documented number of brave librarians and book sellers in the U.S. who have turned down user reading list requests from the Police and FBI.

Moreover even assuming Google's current management team is well intentioned and trustworthy who can give guarantees about the actions of future generations of management? Considered objections from academics and public watchdog institutions such as the Center for Democracy and Technology fall into three broad categories: (1) lack of competition; (2) limited representativeness of the BRR and its potential for self interested behavior; and (3) Privacy

With respect to pricing he notes critics of the GBS use the pricing models of academic journal publishers as proof that Google will act with similar disregard for universal access and fairness; however, he does note that Google's behavior to date has been more 'altruistic' than the behavior exhibited by those same publishers. Despite this, he concludes that perhaps some type of regulatory oversight might be called for once the agreement is approved.

On the Book Rights Registry he comments,

The BRR in principle has no incentive to drive down the costs of knowledge and given its privileged position could actually act in self-interested ways – analogies to the Olympics venue selection committees have been made. In addition parallels have been drawn with the BRR's unique gatekeeper position relative to the fragmented base of book users prompting comparisons with the cable industry and health insurers.

Again the solution seems to be some sort of oversight of regulation to counter-balance market failure.The EFF position on privacy which I noted a few weeks ago is also referenced as an important issue in not only the debate over the settlement but the wider implications for how Google charts everything we see and do. Books of course hold a particular sacrosanct position in terms of privacy and librarianship and if nothing else many would want Google to act in a similar way to the stand taken by many librarians in the face of subpoena and the FBI.

Lindsey closes with a desire to see the settlement approved by the court noting that the access to knowledge afforded by the agreement exceeds any negative aspects of the deal especially if supervision is also prescribed. His final comments concludes,

With good regulation this repository of human knowledge and ideas could be kept accessible to millions at low or zero cost while ensuring the rights to knowledge and privacy set out in the Bill of Rights could be preserved for generations. What is the alternative? Forcing Google to destroy this database may delight a small number of extremely rich individuals in the Pacific Northwest, but would be one of the greatest acts of Luddite vandalism of modern time. We hope the regulators will be enlightened and bold in the upcoming hearings on October 7th.

Tennis: US Open 1972

Re-posting this on the first day of the US Open and just for fun. Also the NYTimes takes a look at Rod Laver's record in majors. Had he had a full career in majors, Federer would still be chasing him. NYT

In applauding Federer, the commentators ignored Laver’s empty years from 1963 to 1967, when he disappeared into that era’s all but invisible professional tour. In those five years, Laver, a 5-foot-10, 160-pound red-headed Australian left-hander, could have won 10, if not more, of the 20 Grand Slam events, which were open only to amateurs. If Laver had 21 or more major titles, Federer would still be chasing as he awaits the United States Open. Laver would rightfully reign as the best tennis player in history, no arguments.

Originally posted July 6th:

On a day Roger Federer makes some tennis history, I thought it appropriate (or at least thematic) to show some scanned images from the 1972 US Open. I was not in attendance at Forest Hills and all these were taken by PND(OBE). Tennis was on the cusp of radical change; no Borg, McEnroe or Lendl. Connors seeded 15th lost in the first round. The total purse on the men's side was $166,000. Played on grass and you could even reach out and touch the players. (Flickr)

MediaWeek (Vol 2, No 33): Economist Edition - Australia, Ebooks, Reading, Rankin, Ransome & More

This is what happens when I let four Economist issues pile up. Publishing in Australia and a review of the copyright rules under review in Australia. Strangely for the free market Economist they don't advocate elimination of the rules that in the views of some protect the indigenous publishing but which in the minds of others contribute to higher prices. (Economist):

Ultimately the decision rests with Kevin Rudd, Australia’s prime minister, a bookish type who famously penned a 7,000-word essay for a highbrow magazine, the Monthly, warning against “free-market fundamentalism” and “extreme capitalism”. Then again, he also likes to rail against high prices with populist fervour.

Most of the English-speaking world, including America, Britain and Canada, still retains territorial copyright. The main exception is New Zealand, which gave it up in 1998. Different studies have pointed to different effects, from the earlier release of new titles to a flood of cheap foreign children’s books. In 2004 a report found that local publishers were producing a narrower range of titles, with an emphasis on rugby and images of New Zealand’s idyllic countryside. That is exactly the sort of blow predicted by authors and publishers of books like the “The Slap”.

The Economist notes the spiral into bankruptcy of Reader's Digest but also holds some hope for its' future (Economist):

This is wise. There are a lot of people in the heartland, and not just in America. Reader’s Digest’s talent for distilling complex arguments ought to be more valuable in an era of information overload. In the past year Every Day with Rachael Ray and the American edition of Reader’s Digest have lost less than a tenth of their advertising pages, according to Mediaweek—far less than the competition. If it can escape that troublesome debt, the least sexy of publishing companies ought to be around for a while yet.

A review of Outside of a Dog: A Bibliomemoir (Economist):

“I do know some things,” he writes at the end of “Outside of a Dog”. “My books have made me, and through them I know myself and through myself I know them. And nobody can take them away.” At 65, Mr Gekoski’s greatest wish is to have grandchildren to read to so that he can be “connected once again to my parents, as through my children and my children’s children the reading will go on.” This is a book for anyone who has ever wondered how many books there might be time to read: funny, wistful and filled with a longing finally satisfied.

American readers may be unfamiliar with the Swallows and Amazons series of children's (YA) books by Arthur Ransome which charted the adventures of a group of children in England's lake district. Written by Ransome between 1930 and 1947 the were published after a comparatively unconventional personal history for the author (Economist):

It is possible that Ransome was a double agent, also in the Russian service. Certainly, in 1918 he wrote a propaganda pamphlet for the regime entitled “On Behalf of Russia: An Open Letter to America”. In January 1919 he was identified by the Swedish authorities as a Bolshevik and deported with the Russian legation. But this, like so much of Ransome’s Russian adventure, is shrouded in doubt, a mystery caused by lingering official secrecy, a fire in 1923 that destroyed his papers and some deliberate refashioning of history by Ransome himself. One way and another, this was so effective that he eventually became “a national treasure, a sort of grade-one-listed author”.

Finally, The Economist doesn't miss the eBook frenzy but notes the looming presence of Apple (Economist):

Yet there are already signs that consumers may prefer to read e-books on devices that do other things as well. According to some estimates, more people use Apple’s iPhone to read digital texts than use the Kindle. And Apple is hard at work developing a multimedia “tablet” that will probably act as an e-book reader too. Gizmos such as these are the likeliest heroes of the next chapter of electronic bookselling.

In the next few months Thomson Financial will be launching Project Utah which represents a $1bill technology investment to update their systems. At the same time their business is under going significant changes from the market downturn crimping revenue to a new more technically savvy client base (TimesOnline):

The biggest technology bet he will place is Project Utah. Almost two years in the planning, and arriving early next spring, it aims to create a common platform for all of Thomson Reuters’ 200 financial products for the first time, making Reuters’ systems simpler to use.

It is likely to look and feel more like a conventional web portal and all its 500,000 customers will be moved on to it, replacing 3000Xtra as its flagship product. For a company that has previously tailored everything to different customers, it marks a new direction. So does the way that Wenig plans to introduce it.

“It is the first time we are going to properly launch a product,” he said. “We never really launch products. They just emerge. This will have proper marketing and advertising.”

Bloomsbury, proud new owners of Wisden is set to launch an electronic version of the product (TimesOnline): Surely an iPhone app can't be far behind?

One hundred and forty-five years after it was first published, Wisden, the cricket bible, is joining the digital age. Bloomsbury, which bought the publication last November, said yesterday that the 2009 Wisden Cricketers’ Almanack would be available in e-book format by November, with several other Wisden titles.

Nigel Newton, chief executive of Bloomsbury, said that a new edition of Wisden on The Ashes was being rushed to press for the Christmas market after England’s victory over Australia.

An interview with Ian Rankin in the Independent:

Inspector Rebus was said to be a repository for the more sinister side of his creator – yet, as he approaches 50, Scotland's most famous crime writer has had counselling and gone teetotal. But can he really be thinking about jacking it all in 'before the books get bad'? Katy Guest meets Ian Rankin. .... "Crime writers," he explained, "are usually very well-balanced, approachable people, because we channel all our crap on to the page. In the crime-writing community we joke about romantic fiction writers and how they're all evil, backstabbing bitches because they don't have that outlet ..."

Motoko Rich in the NYTimes takes a look at students who are allowed to pick their own reading material for class (NYTimes):

The approach Ms. McNeill uses, in which students choose their own books, discuss them individually with their teacher and one another, and keep detailed journals about their reading, is part of a movement to revolutionize the way literature is taught in America’s schools. While there is no clear consensus among English teachers, variations on the approach, known as reading workshop, are catching on.

In New York City many public and private elementary schools and some middle schools already employ versions of reading workshop. Starting this fall, the school district in Chappaqua, N.Y., is setting aside 40 minutes every other day for all sixth, seventh and eighth graders to read books of their own choosing.

In January 2007 (I only note the date because time flys), I wrote about a similar idea for education (PND):

My answer to the question posed to me was that I envisioned an environment where there were no set textbooks, content or a curriculum for particular courses. Courses would have learning objectives both general and specific and the students would be required to obtain and/or demonstrate their understanding of the core material against these objectives. The student could obtain this knowledge and understanding via any means they wanted. In addition to demonstrating a mastery of the course objectives they would also have to justify the reference material and methodology they used to obtain their knowledge.

Following were posted on the Twitter (@personanondata) this week. Library Journal notes that Elsevier and Springer have lost their arguments before the Texas AG to keep their pricing to Texas libraries a secret. Several economists are looking into price contracting and think that academic journals represent a perfect market to study "price discrimination, bundled sales, and long-term contracting in an imperfectly competitive industry." Numerous other vendors have been asked for their pricing as well (LJ):

The Texas records request is the second to generate an official legal ruling or statement, following a June case before a judge in Washington state concerning a motion from Elsevier to block the release of records from Washington State University. Claims that the contracts contained “proprietary pricing methods and formulae" were similarly rejected, and the documents released.

SONY came out in support of the Google Book Settlement (Bloomberg):

Sony’s position puts it at odds with Amazon.com, which is part of a coalition that includes Microsoft Corp. and Yahoo! Inc. who argue that Google is trying to control the access and distribution of the largest database of books in the world. The settlement also has generated complaints from authors and independent publishers, and prompted investigations by the European Commission and U.S. Justice Department. With Sony taking the side of Mountain View, California- based Google, the debate over the lawsuit in New York could become a proxy war over electronic book readers. In March, Sony gained access to more than 500,000 e-book titles for its readers through an agreement with Google.

England won The Ashes (Week'sBest Cricket)

Google Announce EPub Downloads for Public Domain Titles

You can get lost in the Google books site and the company has just annouced an expansion of the download options that enable ePub downloads. From their blog site:

Google Books will offer free downloads of these and more than one million more public domain books in an additional format, EPUB. By adding support for EPUB downloads, we're hoping to make these books more accessible by helping people around the world to find and read them in more places. More people are turning to new reading devices to access digital books, and many such phones, netbooks, and e-ink readers have smaller screens that don't readily render image-based PDF versions of the books we've scanned. EPUB is a lightweight text-based digital book format that allows the text to automatically conform (or "reflow") to these smaller screens. And because EPUB is a free, open standard supported by a growing ecosystem of digital reading devices, works you download from Google Books as EPUBs won't be tied to or locked into a particular device.

There are some issues with how this announcement has been rolled out but that said there's so much here. For example, librarians will love this from the Bulletin of the American Library Association January -November 1918. (Note: there are some missed OCR's but none that take away from the content). LINK:

THE DAY'S WORK IN HOBOKEN Вт Asa Don Dickinson, A. L. A. Dispatch Agent, Hobolcen, N. J.

Our days at the Hoboken Dispatch Office are full of Interest and Incident. Starting In January with one, we now occupy four of the pleasantest saloons In a town which has ever been famous both for barrooms and Germans. We are but one block back from the water front. The Leviathan docks Just around the corner. Dally an Intermittent stream of very sober looking soldiers passes our door. They are on the long trail which In another moment will bring their feet to the gangplank of a transport.

But we cannot afford to gaze long at the surroundings. The day's work at Hobo- ken means that 6,000 books must be sent overseas and this Involves a good deal of hard work. 6,000 a day means 750 an hour, twelve a minute, one every five seconds. If 6,000 books are to be dispatched dally, 6,000 must be received, acknowledged, unpacked and prepared for shipment dally. They come In lots of all sizes, from a single "Baedeker" up to 20,000 books at once. Ten per cent are purchased books, and these entail ordering and bill checking. They come In all sorts of ways: by quartermaster's freight, by freight prepaid, by freight collect, by express prepaid, by express collect, by parcel post, by moving-van, wagon or limousine, by lighter and by hand. They come with all sorts of addresses, they come In every possible sort of package—nearly 100 packages a day, which should all receive attention on the day of their arrival, for the next day will bring as many more. The books must all be carefully Inspected of course, and a certain number of "unsuit- ables" will have to be disposed of. The very large majority of books which pass inspection must be roughly classified, and each must contain one bookplate, book- pocket, and book card bearing the author's surname and a brief title. (Bless

ings on the librarian who sees that the books he sends us are carefully prepared for shipment. The shelf-list card is not required In our work. Cooperating friends, all please take notice If you would save useless labor.) After the books are made up into carefully proportioned little libraries of about seventy-five volumes each, they are packed In our regulation shipping bookcases. In each box are placed directions to the amateur librarians who are to care for the books overseas. And finally there Is the sealing, stenciling and shipping of the boxes. Some are for use on the transports and later "over there"; some for cargo shipment as part of 50 tons a month asked for by General Pershlng; some are for shipment to one or other of the Naval Bases; or to the Red Cross; or to some particular ship in local waters. About 80 boxes go out each day. Ninety- nine, 7,425 books, is the one-day record so far. Each should bear three pasted labels and on the average five stenclllngs. Our stencil library Is surprisingly large. If a box Is wrongly marked it will surely go astray. In the midst of the hurly-burly over there we cannot but fear It may do so any way.

Suppose we note the events of a busy hour or so at 119 Hudson street: 8:16 a.m.—The dispatch agent arrives, to find a truck waiting to be loaded for the piers. Porters and truckmen are enjoying a cozy social hour. 8:16—The dynamo begins to buzz, galvanizing porters and truckmen Into more or less strenuous action.

8:20—Morning mail arrives: 25 letters and 50 pounds of newspapers and periodicals. 8:25—Truck arrives with load of 50 cases of books received per quartermaster's freight—five lots In the load—two lots are "short" one case apiece.

8:30—Parcel post wagon arrives with 27 parcels: books from publishers, libraries and Individuals, and supplies from headquarters.

8:35—A limousine stops before the door and an early-rising Lady Bountiful enters bearing three Issues of the Saturday Evening Post, and one copy each of Owen Meredith's "Lucile," Irving's "Sketch-book," Mitchell's "Reveries of a bachelor," Drummond's "Natural law In the spiritual world," and "Mr. Brltllng." She naturally wishes to know all about how we send books to soldiers, and holds the dispatch agent in gracious social converse for seven precious minutes, till

8:42—An Irate policeman enters to say traffic on Hudson street Is completely blocked by vehicles standing before our premises.

8:45—Loaded truck departs for the pier, and the traffic begins to trickle through the jam.

8:50—A big express wagon arrives to clog things np again, and at 8:50% comes a giant "seagoing" motor truck nine hours out from Philadelphia with 185 ol our shipping bookcases.

8:51—Three newly hired porters take a good look at this load; then two of them remember that they have been drafted and must leave "for the front" at once; the third candidly states that the work Is too hard for him.

8:52—Telephone bell rings: "One hundred eight boxes of books are lying on Pier 1. They have just come off a lighter from Cheyenne, Wyoming. They weigh about 300 pounds apiece. I suppose they belong to you folks. The major says to tell you they must be taken away before noon, or he will dispose of them as he sees fit."

8:53—Telegram from Washington headquarters: "Congratulations on your last weekly report. Kindly arrange to double your output next week and hereafter."

8:54—Wagon arrives with load of packing

8:56—Another telegram from Washington headquarters: "Use only our standard shipping bookcases. Discontinue at once all use of packing boxes."

8:56 — Telegram from manufacturer of standard shipping bookcases: "Can't get labor or lumber. Don't expect any more boxes for at least a week."

8:58—Distinguished librarian of leisurely habits and a fine conversational talent arrives to Inspect our work.

9:00—Class of Y. M. C. A. transport secretaries arrives to receive instruction in the care and administration of our transport libraries.

9:10—Red Cross chaplain enters with an urgent demand for "Lady Audley's secret." "There is a boy in St. Mary's hospital who must at once have that book and no other."

9:15—Read letter from headquarters: The gist Is as follows: "Don't stick so close to your office. Get out, man, and cultivate diplomatic relations with admirals and major generals."

9:16—Wire from headquarters: "Please release your first assistant." (He had already gone to Boston to establish dispatch office there.)

9:20—Base hospital chaplain enters with a list of 450 titles. He tells us that he has selected them with great care, and hopes there need be no substitutions. They must be on board his ship at 9 a. m. tomorrow. She sails at noon. He doesn't know her name or number or whether she sails from New York, Brooklyn or Hoboken.

9:21—Quartermaster's truck arrives with load of Burleson magazines.

9:23—Three loud explosions In rapid succession on the water front. Many windows are broken by the concussion. All hands rush into the street. German woman from delicatessen shop next door, In hysterics, demands first aid treatment. She gets it—good old-fashioned cold water.

9:25—Moving van arrives with load of 8,000 loose, unsorted books, collected by the New York Public Library.

9:27—Secondhand packing box dealer arrives to take away old boxes, and dealer in old paper arrives for a load of discarded books.

9:28—Military authorities threaten drastic action if we continue to block traffic in Hudson street. A string of 75 quartermaster trucks is being held up.

9:29—Sell two copies of "The Four Million," first editions, to a book dealer for $60.00.

9:30—Long distance telephone from Washington headquarters: "Our representatives abroad report very few books arriving in France. Why is this?"

9:31—Director of Library War Service concludes an unobtrusive visit of Inspection by saying a few kind words as to the progress we are making, and by advising us not to overwork.

9:32—The dispatch agent falls heavily to the floor. He has fainted.

MediaWeek (Vol 2, No 33): Reader's Digest, Jane Friedman, Barnes & Noble

Jane Friedman - exCEO of Harpercollins has launched a new e-Book publishing company named Open Road. Details are few but in a financial filing her company has received $3mm in initial funding (DMW):

OpenRoad Integrated Media, a start-up focused on e-book publishing and marketing, has raised a $3 million round of venture capital financing, led by Bay Area Holdings, PaidContent reported, citing a regulatory filing.

In case you missed the news about Reader's Digest: Reader's Digest restructure their debt as part of prepackaged bankruptcy filing. Emerges with 75% less debt to $550mm! (Link)

Bloomberg publish an overview Tim Collins one of the principal investors in Reader's Digest (Bloom):

Collins bought WRC Media Inc., the publisher of Weekly Reader magazines for school children, in 1999. Five years later he bought Time Warner’s direct-marketing arm, Time Life Inc., which Ripplewood later renamed Direct Holdings U.S. Corp.
Rescue Plan
Attempts to turn the companies around were floundering when Collins bought Pleasantville, New York-based Reader’s Digest and its pocket-sized magazine with a worldwide circulation at the time of 18 million for $2.4 billion including debt. WRC Media had already violated debt agreements and was on the verge of bankruptcy. Direct Holdings had posted two years of net losses.
Ripplewood projected that the transaction, which included merging WRC Media and Direct Holdings with Reader’s Digest, would yield $20 million in savings. The firm used some of the deal financing to pay down $168 million of WRC Media’s and Direct Holdings’ debt. Ripplewood and its co-investors contributed at least $375 million of equity to the deal.

News of Haights Cross as they struggle with their debt load (PW):

In its own press release, Haights said if the exchange offering is not approved, it will be forced to consider alternative options, include filing for Chapter 11. Meanwhile the operating performance of the company’s two main units, fell in the second quarter. Sales at Recorded Books slipped 2.7%, to $20.8 million, and the spokenword audio publisher’s operating income dipped to $6.1 million from $6.4 million.

Barnes and Noble shareholders (amazing there are any other than Len Riggio) are unhappy with he proposed deal to purchase privately held Barnes & Noble College (CHN):

Barnes & Noble's offer to buy the College Booksellers division from company founder, chairman of the board and controlling shareholder Leonard Riggio offers far more than what a third party would pay to buy the floundering branch, the shareholders say. The deal lacks transparency, since Barnes & Noble did not submit history or projections for the division's performance, according to the complaint, which alleges that company directors approved the acquisition because they are indebted to Riggio.

In case you missed the news about Reader's Digest: Reader's Digest restructure their debt as part of prepackaged bankruptcy filing. Emerges with 75% less debt to $550mm! http://bit.ly/jDU6h

The Electronic Frontier Foundation raises questions over Google book search privacy. (EFF):

Given this backdrop, we asked Google to promise that it would fight for those same standards to be applied to its Google Book Search product. We want Google to promise that it will demand more than a subpoena (which is written by a lawyer and not approved by a judge) or some other legal process that a judge has not approved before turning over your book records. In essence, we asked Google to tell whoever came to them demanding reader information: "Come back with a warrant."
Honestly, we thought it would be an easy thing for Google to do.
Unfortunately, Google has refused. It is insisting on keeping broad discretion to decide when and where it will actually stand up for user privacy, and saying that we should just trust the company to do so. So, if Bob looks like a good guy, maybe they'll stand up for him. But if standing up for Alice could make Google look bad, complicate things for the company, or seem ill-advised for some other reason, then Google insists on having the leeway to simply hand over her reading list after a subpoena or some lesser legal process.

Ripplewood Gets Reader's Digestion

In November 1988, when Robert Maxwell's final offer for Macmillan, Inc was accepted, the bid priced the company at 19x earnings - a ridiculous multiple which made Macmillan management, the employee pension plan and shareholders wealthy but ultimately, brought down the successor company Maxwell Communications. Maxwell's financial arrogance didn't stop with the Macmillan, Inc win either as he had bankers and analysts chasing supposed take-over deals for McGraw-Hill and Paramount Communications (Simon & Schuster) into the early 1990s. Once the company came crashing down, Macmillan an expertly run $2.1billion publishing conglomerate, was broken up into innumerable pieces and sold off for far less than the multiple Maxwell originally paid.

Fast forward twenty years and the bankruptcy filing by Reader's Digest nicely bookends a period of media investment that is unlikely to be repeated. Media companies operating - to finance people - in a boring, slow-moving, but stable business segment, offered bankers a friendly place to put their money where they could be safe in the knowledge of stable earnings and small but incremental annual increases. This was true of banks and private equity funds that invested heavily in the publishing business over the past 5-10 years.

In comparing the Maxwell and Reader's Digest experiences, we don't appear to have learned enough. Maxwell was no manager and he surrounded himself with a cadre of sycophants and mediocre managers who effectively contributed to the company's demise. Maxwell was never going to out-skill the executive team that had re-built Macmillan during the 1980s, but no one understood that until it was too late. Similarly, Ripplewood has no background in media and chose to pay a significant premium for Reader's Digest which could only cripple the business if any one of their assumptions failed. At the time of the investment, Ripplewood was not investing in a stable management team that could compensate for their limited knowledge and perhaps provide some continuity; however, they did the next best thing and filled the RD executive suite with industry talent. Naturally, it took the team time to get settled.

As we now know, their timing couldn't have been worse as the global slump resulted in declining advertising revenues and a rate base cut. These macro issues effectively eliminated any time the company may have thought they had to sort out and understand a web-based ad model that could begin to compensate for the anticipated decline of the print magazine.

It is not as though Reader's Digest has stood still and some have wondered why CEO Mary Berner and her team are still in place. The most obvious reason would be that, operationally, Reader's Digest has made improvements and management's future plans and strategies not only make sense but represent a continuation of what has worked over the past two years. The company continues to add to their stable of impressive web properties which pre-date the acquisition, and management has also successfully launched new businesses and aligned themselves with new audiences around Rick Warren and Rachel Ray. It seems likely that more relationships are planned as the company attempts to migrate their audience both to a younger demographic and online.

Someone wanted to bet me a $1 that Reader's Digest would be back to the money trough within a year. I hope that is not the case and I won't take that bet. The company continues to have core strengths around their audience (sure, they are aging but they also continue to buy stuff), a wide array of web properties within which they can build communities and a revenue base that is more diverse than you might think. If they are successful and the group of banks can exit without taking any further write downs (I admit that's a horrible measure), the road will not have been easy to navigate. Here's hoping that Reader's Digest doesn't end up like Macmillan, Inc. and that perhaps private equity grasps some reality.

WSJ: Chapter 11 Is Next Page for Reader's Digest

PaidContent: Presentation to Bankers

MediaWeek (Vol 2, No 32): Google, Australia, Book Rights Registry

The Financial Times took a long look at the Google Book Settlement agreement. Here is a sample (FT):

That makes an effort by Google, to burrow deep into the leading US research libraries to make digital copies of all the works it can lay its hands on, seem both ambitious and quixotic. The project, begun nearly five years ago, has also started scanning out-of-copyright works from libraries in other countries. A digital archive of all extant books – even ones in which few people are these days likely to show much interest – is carrying the internet company’s mission to “organise the world’s information” to the extreme. .... The first concerns the exclusive right that Google would have to distribute digital books whose copyright holders cannot be traced. These so-called “orphan works” may make up a large portion of all out-of-print tomes: Paul Courant, head of the University of Michigan library, estimates that they amount to 1m-2.5m of his collection of 8m volumes. Congress has failed in its own efforts to free up these works so they can be sold without the risk of claims later from the copyright owners. It is a peculiarity of class action law in the US, though, that private legal action can achieve a result that has eluded Congress: since Google and the new books registry would be free to sell works whose owners did not actively opt out of the court-approved settlement, they would assume a right not available to anyone else.

New data released by the IDPF shows accelerating increases in e-Book sales from the top US trade publishers (release). Many people suggest that authors can't do personal appearances so a changed model that depends on 'concerts' and merchandise will never work for authors; however, this article in the NYT shows that authors can do stand-up. (NYT):

Since they began in 1997, storytelling nights hosted by the Moth, a nonprofit, have helped aspiring writers try out new material in a nurturing environment. But lately, storytelling has exploded into a thriving genre all its own, a new avenue to prominence for writers and, increasingly, for actors and comedians. In a sense, storytelling has become the new stand-up — a way to be noticed by the literary agents, actors and directors who increasingly populate the audiences.

Andrew Wilkins discusses what he terms "Australia's most hated book" which is the report by the Productivity commission on Australia's publishing industry (Pub Perspectives)

The Australian book trade has been here before, you see. Rather like the indefatigable mole in that popular arcade game, Whac-a-Mole, the argument that books in Australia are too expensive and hard to get and that abolishing territorial copyright will make them cheaper and more available just keeps on popping up. It was the personal hobbyhorse of former Australian Competition and Consumer Commission Chairman Allan Fels and it was supposed to be addressed by reforms to the Copyright Act way back in 1991.

Those reforms put in place what most still regard as an eminently sensible compromise. Booksellers wanted to get the books from overseas that their customers wanted; publishers wanted to protect the licences under which they published and distributed overseas books in Australia. In a version of the old “use it or lose” principle, the Parallel Importation Restrictions made a publisher release an overseas book within 30 days of its first publication elsewhere or risk losing its territorial rights.

Book Business magazine interviews Michael Healy on the Book Rights Registry and managing very large data (BB):

One of the most important parts of this settlement document … is that it allows rights holders to exercise a very significant degree of control over what parts of their books are displayed, how they want the books priced, and so on. And, of course, rightsholders are entitled to remove their books entirely from the settlement if they wish.

So you can imagine [that] you start with a very large set of metadata about the books that Google has digitized; you then layer on top of that a complex data set about the rights holder; and then you layer on top of that again the ability for each rights holder to express their preferences about their books within the settlement framework. … I think, probably, my background as someone who managed very complex metadata sets for Nielsen was part of the profile that interested those who were looking for someone to head up this registry.



BISG Webcast on the Future of ISBN

Mark Bide of Editeur is hosting a BISG Webcast on the future of ISBN (BISG):

The book industry has had the ISBN for nearly 40 years; there has been little cause for excitement. Now, suddenly the whole subject of "identifiers" has become a hot topic, particularly when it comes to digital books and other online resources. This BISG Webcast will explore why the book industry has standard identifiers, and consider the future of the ISBN (International Standard Book Number), as well as the role of newer identification standards like ISTC (International Standard Text Code) and ISNI (International Standard Name Identifier). What do you need to know to make informed decisions about how -- and whether -- to use them? Register today to find out.

Register here: It is even FREE!

How timely.

Online Learning is Better?

Jonathan Kaplan in the Chronicle of Higher Ed notes a recent study that indicates that online education can be more effective than traditional forms of learning. In fact, the study based on 12 years of educational studies, shows that "online learning has clear advantages over face-to-face instruction."

He then goes on to wonder about the apparent lack of discussion and commentary about this report and suggests that would have been different if the report confirmed educators preconceived notions and bias' about how learning happens (Chron):

But imagine for a moment that the report came to the opposite conclusion. I’m sure that if the U.S. Department of Education had published a report showing that students in online learning environments performed worse, there would have been a major outcry in higher education with calls to shut down distance-learning programs and close virtual campuses.

I believe the reason that the recent study elicited so little commentary is due to the fact that it flies in the face of the biases held by some across the higher education landscape. Yet this study confirms what those of us working in distance education have witnessed for years: Good teaching helps students achieve, and good teaching comes in many forms.

MediaWeek (Vol 2, No 31): Education, Oxfam, e-Readers, Journals

Some of these were on the twitter (@personanondata) this week.

The NYTimes looks at digital content in schools and recognise it is going to come faster to college level than school. (NYT):

Whenever it comes, the online onslaught — and the competition from open-source materials — poses a real threat to traditional textbook publishers.
Most of the digital texts submitted for review in California came from a nonprofit group, CK-12 Foundation, that develops free “flexbooks” that can be customized to meet state standards, and added to by teachers. Its physics flexbook, a Web-based, open-content compilation, was introduced in Virginia in March.
“The good part of our flexbooks is that they can be anything you want,” said Neeru Khosla, a founder of the group. “You can use them online, you can download them onto a disk, you can print them, you can customize them, you can embed video. When people get over the mind-set issue, they’ll see that there’s no reason to pay $100 a pop for a textbook, when you can have the content you want free.”

Publishing sales into the California educational market are way off given the state's budgeting issues (LAT):

California school districts spent at least $633 million on new books in 2007, according to the Assn. of American Publishers. More recent numbers are not available, but a representative of one publishing house who asked not to be named because of proprietary concerns said sales in the state -- the nation's biggest textbook market -- are off by 50% or more.

"We're all seeing a precipitous drop," said John Sipe Jr., vice president of K-12 sales in California for Houghton Mifflin Harcourt.

Fewer than 200 California districts have bought reading/literature texts this year, compared with publishers' typical expectation of 600 to 700, he said.

"This is a staggering difference for our industry," Sipe said.

Long running controversy over high street bookshops run by Oxfam which receive their stock for free. The business also has antiquarian experts on staff who identify the gems that are unknowingly donated to the shops (Telegraph)

It has been estimated that 15 years ago, there were about 3,000 second-hand and antiquarian bookshops in Britain. By 2004, there were only about 1,500 left. Everyone in the trade knows someone who has had to close. In contrast, Oxfam opened its first bookshop in St Giles, Oxford, in 1987. Today, it has 130 outlets in Britain, which make an average of 21 per cent more than the regular Oxfam charity shops.
Working in a second-hand bookshop, it is hard not to be at least a little envious. Last year, Oxfam made £19 million from selling books. Its website boasts that it is the largest retailer of second-hand books in Europe, selling around 11 million books a year. As a charity, it gets an 80 per cent reduction in business rates. It has a slick PR team, it doesn't have to pay for stock and it attracts thousands of volunteers – some of them even celebrities. It can even afford to open shops in prime retail locations: it is common to see bookshops snuggled next to major high street brands, on the Royal Mile in Edinburgh, or in Marylebone in London. The rest of us usually have to make do with less glittering locations.

Video interview with Larry Kirshbaum and Jane Friedman (GalleyCat):

Publishing giants Jane Friedman and Larry Kirshbaum shared a long, candid web video interview with Samantha Ettus--taking a blunt look at the future of publishing.
On the web show, Obsessed with Samantha Ettus, both publishing executives were frank about their leadership. "The truth is I always thought bigger was better. That was one of my mantras. Now what's happened is publishers have a bottom line to protect," explained Friedman, the former CEO of HarperCollins Publishers Worldwide. "And to protect that, they have to publish more and more books just to get that top-line revenue. That is so unhealthy."

Mediapost notes an NPD study on e-Readers:

The study found that 40% of those surveyed were only "somewhat interested" or "not interested at all" in buying an e-reader. How come? Of those who don't want one, 70% said it was because they prefer the feel of an actual book.
Among the 37% who were either "very" or "somewhat" interested in obtaining an e-reader, one of the main factors was the ability to buy and store multiple books, magazines, and newspapers. More than half of consumers were interested in features already offered in current devices like the Kindle's wireless capability and the Sony's Reader's touchscreen.
"Today's e-reader offerings are delivering capabilities that are in demand by consumers," said Ross Rubin, director of industry analysis at NPD, in a statement. "However, some features that could enhance the appeal of more popular content, such as color, remain on the drawing board."

An archived version of a PW hosted discussion on the Google Book Settlement is available (PW):

In a webinar first, the leaders involved with the crafting of the Google Library Project Settlement will share with the publishing industry the benefits of the agreement for publishers and authors. If approved by the Court in October, the agreement will create one of the most far-reaching intellectual, cultural, and commercial platforms for access to digital books for the reading public, while granting publishers unprecedented opportunities and protections. Presented in collaboration with Google, The Association of American Publishers, and Publishers Weekly, the web session is a must-attend event for publishers everywhere.

Ghostwritten scholarly 'research' papers may be a larger issue than first thought. Afterall, its not something you would promote (NYT):

The ghostwritten papers were typically review articles, in which an author weighs a large body of medical research and offers a bottom-line judgment about how to treat a particular ailment. The articles appeared in 18 medical journals, including The American Journal of Obstetrics and Gynecology and The International Journal of Cardiology.
The articles did not disclose Wyeth’s role in initiating and paying for the work.
Elsevier, the publisher of some of the journals, said it was disturbed by the allegations of ghostwriting and would investigate.The documents on ghostwriting were uncovered by lawyers suing Wyeth and were made public after a request in court from PLoS Medicine, a medical journal from the Public Library of Science, and The New York Times.

CrossRef Sees Increase in DOI's For Books

CrossRef.org the membership organization supporting academic publishing content recently reported that DOI's assigned to books has continued to increase year over year:

As of July 2009, more than 1.8 million CrossRef Digital Object Identifiers (DOIs) have been assigned for books. Each CrossRef DOI represents a citable book title, chapter, or reference entry that can be used to link references from scholarly content. Book deposits range from monographs with a single CrossRef DOI to massive reference works with tens of thousands of individual entries.

To encourage publishers to ramp up reference linking for scholarly books, and to explain how CrossRef DOIs for books work, CrossRef has published two documents. The first, Best Practices for Books, was created by CrossRef’s Book Working Group. The second is a Frequently Asked Questions (FAQ) document explaining the relationship between CrossRef DOIs and other DOI applications, such as the ISBN-A.

“We are very encouraged at the growth of books being used in CrossRef reference linking,” said Michael Forster, Chair of CrossRef’s Book Working Group, and Vice President and Associate Publishing Director, Physical Sciences, Scientific, Technical, Medical, and Scholarly Publishing, John Wiley & Sons, Inc. “We solicited feedback from the entire CrossRef membership before finalizing these guidelines. Our goal is to encourage reference linking among books, proceedings, and journal content, and to enhance the discoverability of professional, reference, technical, and scholarly books.”

The best practices document, available at http://www.crossref.org/06members/best_practices_for_books.html, includes suggestions for improving reference matching results. It identifies minimum and recommended book metadata for deposits and queries in the CrossRef system. Ways to handle editions and other types of versions, so important in book publishing, are also addressed.

Catcher in the Rye Sequel has Friends

Four of the countries largest news organizations have filed an Amicus Brief in support of publication of the "Catcher in the Rye sequel". The NYTco, AP, Gannett and Tribune filed the brief earlier this week and it follows one also filed by the ARL, ACRL, Organization for Transformative works and The Write Fund. American Law Daily (Law.com) has all the details:

"Amici publish copyrighted material every day, and depend on the copyright law to protect their writings," the brief states. "Indeed, their need for copyright protection is today more intense than ever as digital technologies make it ever easier for third parties to seize and repurpose the fruits of their costly newsgathering efforts."

All that notwithstanding, the lawyers argued that they "fiercely believe that the availability of a preliminary injunction under the copyright law cannot trump the prerogatives of the First Amendment, and that a book banning of at least arguably transformative work cannot be countenanced."

In their brief, the news organizations argued that Rosenthal's fair use claim has merit.

"While the district court determined that the fair use defense was not decisive, it certainly is the case that the literal reincarnation of Holden as a senior and his interaction with Mr. Salinger, who is trying to kill him, forms tranformative commentary on the book which--as opposed to sheer piracy--brings it into the realm of fair use."

No publication date has been set yet but stay tuned.