Croudsourcing Investments in Books: It will happen.

Eric Hellman over at the eponymously named Go To Hellman has an interesting idea that chips away at one of the last foundations of big publishing; the 'investment banking' attribute that big publishing brings to the industry.  Here's a snip from his blog post this week:

There's nothing intrinsic about crowd-funding that restricts this sort of fund-raising to unknown authors looking for a first advance. The JOBS act restricts the amount raised from "unqualified investors" to $1,000,000, so the really big name authors would have to tap the "qualified investor" funding market. (An individual with more than a million dollars in assets excluding home and vehicles is considered "qualified")

Once equity crowd-funding becomes established for books (and it WILL happen!), incumbent publishing houses will have lost, at a stroke, their oligopoly on books as investment vehicles. Already, publishers are outsourcing their design, editorial, production, distribution and sales functions; providing capital is their last bastion of essential function. They will have to participate in the new markets or they will dissipate into irrelevancy.

Read the whole thing.

OCLC's MOOC and Libraries Event Videos

From OCLC a selection of links to some of the sessions at last months Washington meeting on MOOCs and libraries:

MOOCs and Libraries event videos now available

The “MOOCs and Libraries: Massive Opportunity or Overwhelming Challenge?” event took place 18–19 March at the University of Pennsylvania and was broadcast live online. Hosted by OCLC Research and University of Pennsylvania Libraries, the event featured thoughtful and provocative presentations about how libraries are already getting involved with MOOCs, and engaged attendees in discussions about strategic opportunities and challenges going forward. More than 500 people participated in this event: 125 attended in person and more than 400 attended remotely online.

Links to the 11 individual videos and a MOOCs and Libraries video playlist that comprises all of these videos are available on the MOOCs and Libraries event page and on the OCLC Research YouTube Channel. Links to the presenters’ slides, the next steps document and the #mooclib archived tweets from this event also are available on the MOOCs and Libraries event page. Look to the OCLC Research blog, HangingTogether, for a short series of postings that recap presentation highlights and summarize outcomes from this event.

View announcement »

MediaWeek (Vol 6, No 14): Window Cleaners, Museum Stores, Goodreads, Media News + More

Confessions of a window cleaner now back in print and coming from Harpercollins. (Independent):

While the films quickly ran out of steam, the books that inspired them didn't. Written by a former advertising executive called Christopher Wood under the pseudonym Timothy Lea, they ran to 19 titles, and Wood penned a further eight under the name of Rosie Dixon. They were overwhelmingly of their time (and there can be no better excuse), but it seems they are about to have their time again. Over the next 18 months, HarperCollins imprint The Friday Project will reissue all of them as e-books.
Good god, but why?
...
The cast of that film might well wish to quickly forget their involvement in it, much as many associated with the Confessions… films do today. Tony Booth, who played Timothy Lea's brother-in-law, declined an interview (much, you suspect, to his daughter Cherie Blair's relief); likewise Lynda Bellingham and Jill Gascoine, both presumably reluctant to revisit their early, naked screen appearances. Robin Askwith, for whom Confessions… proved a career high point, was prepared to give us an interview, but offered us just 20 minutes of his time in exchange for £500 – a figure greater than he would ever have received for cleaning windows.
There is, however, somebody happy to talk, for free – and that is the author himself. I meet Christopher Wood on a cold Thursday morning in a chic London restaurant. Now 77, Wood, elegant in his tweed jacket and wispy white beard, is terribly well spoken (he pronounces "off" as "orf"), and emits the kind of carefree air so common in older people and so envied by younger ones.

In the not really news category - The Observer notes the success of Museum stores that are popping up everywhere selling all kinds of things. (Observer):

Some of the more creative items appear to have been thought up in several eureka moments. St Paul's Cathedral harvested some of the rubble from recent refurbishments and set it into cufflinks. For £210 owners can now decorate their shirt cuffs with marble from the starburst under its famous dome.

Over at the National Theatre shop, the success of Warhorse – turned into a film directed by Steven Spielberg – led to the offer of a £2,500 half-size replica of the geese puppets used in the stage show, created by the puppeteers who made the originals.

At the Science Museum, shoppers can buy vases shaped as Thomas Edison's iconic light bulb, made from recycled incandescent bulbs. The museum has asked its inventor in residence, Mark Champkins, to create more unique items for it to sell.

However, perhaps leading the way in terms of creativity is the London Transport Museum in Covent Garden. To celebrate London Underground's 150th anniversary, the creative heads there have salvaged luggage racks from old Metropolitan line trains – selling them for £250.

At The Atlantic Jordan Weissmann opines why he thinks Goodreads is so valuable to Amazon.

So Amazon has just bought the ecosystem where many of America's most influential readers choose their books. How exactly they'll use it isn't entirely clear yet. Some have suggested they'll integrate Goodreads into the Kindle experience. Others think that, given the problems Amazon has had with writers buying friendly reviews, they might use the site as an a big cache of trustworthy opinions. As David Vinjamuri put it at Forbes, "Goodreads offers Amazon the ability to transmit the recommendations of prolific readers to the average reader." In any event, there's plenty of value for Amazon to unlock. Assuming, of course, they don't do anything to muck up their new purchase.

The Economist as a quick look at news organizations and concludes:

Where is the good news? Last year local TV stations, especially those in swing states like Florida and Ohio, got a welcome boost from the $3 billion spent on TV advertising during the election. And newspapers are now starting in large numbers to demand payment for their digital content. Pew reckons that around a third of America’s 1,380 dailies have started (or will soon launch) paywalls, inspired by the success of the New York Times, where 640,000 subscribers get the digital edition and circulation now accounts for a larger portion of revenues than advertising.

Boosting circulation revenue will help stem losses from print advertising, since it has become clear that digital advertising will not be enough. For every $16 lost in print advertising last year, newspapers made only around $1 from digital ads. The bulk of the $37.3 billion spent on digital advertising in 2012 went to five firms: Google, Yahoo, Facebook, Microsoft and AOL. Not much Gandhian equality there.

From my Twitter Feed this week.

Scholarly Publishing: Project Muse and Highwire Press Announce Partnership PressRelease
In digital age, library finds difficulty attaching numbers to its value. Topeka CapitalJournal (They buried the lead).
CourseSmart Analytics Is a Bad idea | Inside Higher Ed InsideHigherEd
Amazon Takes on Dropbox With New Desktop File Syncing Wired
Rosetta Stone acquires Livemocha for $8.5m (Nick Summers/The Next Web) TNW
BBC News - Judge rules digital music cannot be sold 'second hand' BBC

Roof Top Gardens Midtown 1968

In the old days you used to be able to walk out onto these roof gardens as part of the tour of Rock Center - at least I assume so since I have a photo from this set of Mrs PND senior standing on the grass down there. Now you can get something of a view of them if you go to the top floor of SAKs which I did a few years ago but I would like to go out to one of these gardens just once.  I've guessed that this image was taken mid morning on a weekday and, assuming that, it is interesting to see how much less traffic there is both on the roads and on the sidewalks.

Check out my book on Blurb in print and iPad versions.

 If you want to make your own here's a link for $20 off your first book.

Content Cashier

Buying content is way too cumbersome.  I don't mean the Amazon 1click buy but rather the individual article or chapter you might want to read.  We are seeing how video and audio (Netflix On Demand and iTunes for example) are morphing into single transaction type activities and this should happen for print.  Eliminating all impediments to the efficient sale or transaction of content should be the objective of any content owner yet with all the investment in online retail, publishing processes and efficient supply chains, the media industry has simply transferred the old models to the online world.  Outside of complete books, content is still very hard to transact on.

But there is a simple fix: I've long thought that content should carry with it a 'cash register' which would allow immediate purchase, rent or access (based on user rights).   I'll admit that metadata is not the industry's strong point but part of the reason metadata in media is generally so abysmal is that there is too much distance between the metadata owner and the transaction.  Tighten that space to where there's no difference and you'll see metadata improve fast.

Let's say a publisher wants to make a book chapter salable.  "Content Cashier" (TM pending) will provide the prospective buyer with a price for the type of transaction they want such as buy, rent, etc.  If they have a profile with "Content Cashier" this transaction will occur in the background with a simple acknowledgement (yes/no) that the customer wants to continue.  If not, the user will be able to pay via some other method (Paypal, Amazon) in less than 60seconds.

Publishers would attach their terms of use and pricing within a very simple framework - little different than if you were in a physical bookstore.  The bookstore experience assumes many things notably if you buy a book you are going to transact at the register and walk out with it.  "Content Cashier" will also take certain assumptions for granted about the transaction and the customer to simplify the pricing and the transaction itself.  In our model the publisher will pick up more than 95% of the value of the transaction (we haven't decided yet), but there is no reason why standard retailer discounts, commissions and other fees should apply when we've eliminated all the inefficiencies in the supply chain to shorten the gap between content and the buyer.

Other tools will allow a publisher to create collections and retail 'pop-up' storefronts that maximize their opportunities to reach out directly to customers.  The real benefit however will be that "Content Cashier" travels with the content so that at any time - meaning when the content is out of the control of the publisher - a transaction can be executed.  Pass a link via email, find the article in a database, or list the item on a course outline or LMS, no problem; "Content Cashier" will let the user pay for that content instantly.  When this type of instant transaction can be facilitated at the point of need publishers will begin to improve their metadata, simplify their pricing and engage in experiments with their customers to maximize their revenues.

Providing "Content Cashier" information on your content is likely to enable new business opportunities for new market entrants who want to use content as a component of a product with many more unique additional features and services they have developed.  Enabling these new models becomes far easier when a set of simple terms and conditions travels along with the content.  There are any number of new platforms, store ideas, collaborations, services and tools and these increase by the day.  Many are spurious, some are stupid but occasionally a really new idea will come along.  Since many of these new ideas fight for your attention and time why not make it easy for them, stop the guessing game and start to manage your retail opportunities in at proactive way.   That's what "Content Cashier" is all about.

MediaWeek (Vol 6, No 13): London Town, Kirtsaeng Copyright, Bacon, Today Show + more

An homage to Uncle Monty who died this week. Also known as Henry from Pie in the Sky. New Statesman.

A long The Nation article discussing several books about London. How distinct, original and independent is London or has it all just been "Made in America"?

The arrival of new sensibilities in pop, couture and conceptual art coincided with the arrival of youngish, self-consciously forward-looking, extravagantly promise-making politicians who sought to persuade American journalists and not a few other people that London was the home of a distinct contemporary set of ideals. (Though in a way, this was nothing new: in 1966, Time magazine had identified London as “the swinging city”—with people saying ever since that London swung for about thirty people for maybe half an hour—while in the mid-1990s, the “Cool Britannia” moment was announced by Newsweek and duly covered in Vanity Fair.) It was a time of jubilation, partly about what was happening, but mostly about what was going to emerge: a post-Thatcher, post-Major utopia populated by politicized guitarists and guitar-playing politicians. It lasted until late 1997, with—depending on where you were standing—the release of Oasis’s bloated album Be Here Now or the revelation that the new prime minister, Tony Blair, part of the generation pledging to end political “sleaze” (the word appeared in national newspapers 3,479 times in 1994–95), had exempted the Formula One racing empire, run by the Labour donor Bernie Ecclestone, from the government ban on tobacco sponsorship. It turned out that, despite what people believed, Oasis wasn’t infallible and, as many people suspected, Blair was a cynic. Blair’s friend Peter Mandelson later assured a Silicon Valley audience that New Labour was “intensely relaxed about people getting filthy rich” (“intensely relaxed” doubling as an uncannily accurate description of Blair’s persona).

James Grimmelmann writing in Publisher's Weekly about the Kirtsaeng copyright case the Wiley lost last week.

Justice Breyer, writing for himself and five colleauges, disagreed. "Lawfully made," he explained, refers only to infringing versus noninfringing copies; it does not make geographic distinctions. First sale applies to copies made anywhere in the world "as long as their manufacture met the requirements of American copyright law." Since the textbooks Kirtsaeng was importing were printed with the permission of the copyright holders, they were legal, and so were his imports. Game, set, match.

Breyer's opinion gives particular weight to concerns suggested by the American Library Association and other groups who submitted amicus briefs. If copies made abroad aren't subject to first sale, there goes the lending right for imported books; art galleries couldn't safely display foreign paintings; and don't even think about trying to sell your imported car, which contains copyrighted software. Indeed, one might ask, why wouldn't publishers shift all their priting overseas, to be rid of first sale once and for all? Breyer's opinion for the Court denies this parade of horribles a permit.

Justice Ginsburg's forceful dissent, however, points out the serious consequences the decision will have for publishers. If Kirtsaeng can import international editions, so can Amazon, or anyone. The price differential between the two will collapse. Publishers will be reluctant to create inexpensive editions for those in less affluent countries who can't afford the eye-watering prices (some) Americans can. That's bad for readers around the world, and could make it infeasible to publish some books at all.

The Kirtsaeng opinion seriously undermines the viability of English-language territorial rights in this age of global e-commerce and cheap shipping. All English-language editions will be competing against each other, which means licensing a U.S. edition and a Canadian edition and an Indian edition is inviting the three publishers to compete against each other on price.

Columbia Journalism Review is one of the best media industry journals going and I've linked to their articles many times. Here in brief they jump on some link bait set by BusinessWeek about the Amazon Goodreads deal:

Bloomberg BusinessWeek makes itself look silly today, running a speculative piece on how much Amazon paid for its latest acquisition, Goodreads.

Here’s the headline: Amazon likely paid $1 billion for Goodreads

Philip Pullman on bacon (More Intelligent Life):

Frying bacon: is there any smell that prompts the saliva glands to gush more freely? Roasting coffee is almost as good, perhaps, but bacon is the king. And it has to be fried. Grilling the stuff makes it self-conscious and prim. Grilled bacon is for people who are too polite for sensuousness, let alone sensuality. The rashers have to wallow in a blackened frying pan, curling up with delight, spitting with glee, letting the fat molecules, as they rise in excitement from the stove, carry the news of the ongoing savoury-umami-salty-Maillard orgy to every corner of the house. And what sort of fat? The bacon will generously supply some of its own, but if it needs supplementing, the best of all is lard. No olive oil here, thank you.

In a way you have to feel sorry for Matt Lauer over at the Today show although the irony is lost on everyone at this point. (NY Mag)

The irony of the current situation is that almost no one with an eye for live television thought that Curry, all things being equal, was a natural for Today’s couch. Curry was a television pro—her emotionally charged reporting on Darfur and Haiti won awards and performed well in the ratings—but that’s a very different skill than making small talk about salad dressing and bantering with Matt Lauer. Wide-eyed and breathless with empathy while interviewing people touched by tragedy, Curry could be awkward and mercurial in the morning happy-talk milieu, her real feelings bursting forth at odd moments. She was considered intensely earnest and somewhat fragile, despite her hard-news chops. In the past, Couric would sometimes tease her about her clothes, remarks that Curry took badly. When Lauer and Today producers tried to “punk” the rest of the cast one morning in 2011—sending them to a fake magazine photo shoot where the photographer had a meltdown and started firing all his assistants—Curry was infuriated with Lauer and retreated to her dressing room. Roker, her longtime friend, was sent to comfort her.

From my twitter feed:

BBC News - Your Week in Pictures BBC Check out the seventh photo!
Launch Pad Finalists Announced for SLOAN-C Conference on Emerging Technologies. Edsurge 

Beirut International Airport 1972

In many of the countries we visited once the plane had settled into its' parking space somewhere out on the tarmac they would roll over the stairs to the plane and everyone would descend to be transported to the terminal in a bus.   At some airports - Karachi, Tehran, Beirut - before the cabin doors where opened they would send out guards to watch over the plane.  At one airport I remember a ring of soldiers facing outwards and spaced a few feet apart entirely circling the plane.  For a kid, that seems exciting but I am sure to some of the adults coming down the stairs from one of these Jumbos seeing that type of welcome was possibly unsettling. This guy seems a little more relaxed and isn't typical of what I recall about some of the guards I saw in other locations.  I think PND Senior probably took this image because officers with guns mingling with civies was for us still unusual.  Times have changed.

This is a great full page spread in the Blurb book I am always mentioning.

A Student Vision for Digital Learning

A presentation from Project Tomorrow on the uses of and implications for technology in education. More information about the Project Tomorrow is located here:

The vision of Project Tomorrow is ensure that today’s students are well prepared to be tomorrow’s innovators, leaders and engaged citizens of the world. We believe that by supporting the innovative uses of science, math and technology resources in our K-12 schools and communities, students will develop the critical thinking, problem solving and creativity skills needed to compete and thrive in the 21st century. We approach our mission through national research projects, the replication of model excellence projects in schools and communities, online tools and resources for students, teachers and parents, and national and regional advocacy efforts. In September 2005, NetDay, a national education technology nonprofit group, merged with a regional science education nonprofit to create the new Project Tomorrow.

Enabled, Engaged, Empowered: The New Student Vision for Digital Learning from Julie Evans

What can the "Speak Up" findings tell us about the future of technology in education:

• Students serve as a 'digital advance team' 
• Students regularly adopt and adapt technology for education
• Students frustrations focus on the unsophisticated use of technology in education
• Persistent digital disconnect between students and adults
• Exacerbation of lack of relevance in current education
• Students want a more personalized learning environment

Cambium Learning (Voyager) Makes Executive Changes

The fun never stops in education publishing these days. The Dallas based education content and technology company Cambium Learning Group announced senior level executive changes last week with their CEO and CFO leaving the company. Cambium comprises three businesses: Voyager, a comprehensive intervention business; Sopris, a supplemental solutions business; and Cambium Learning Technologies, which includes ExploreLearning, IntelliTools, Kurzweil and Learning A-Z. Cambium will have been negatively impacted by the general slow down (some say collapse) of the US K-12 market over the past three years.

Last week the company announced the resignations of CEO Ron Klausner and CFO Brad Almond. In both cases internal candidates were designated as replacements and both resigned their board positions as did board member Vernon Johnson. John Campbell who had been SVP and President of the Cambium Learning Technologies unit was named CEO.  Barbara Benson, currently the Controller and Principal Accounting Officer of the Company was named CFO. Johnson's position on the board was taken by Joe Walsh who was also named Chairman of the Board. Walsh has clearly been brought in as an executive chairman and in a change management role. There is more on the changes in the following 8K: SEC.GOV (8K Statement)

Over the past several years revenues have been up and down at Cambium but 2012 was clearly a painful year for the company as this summary indicates:

Cambium Learning Group, Inc 10K

Voyager was purchased by Veronis in 2009

Library patron borrows an eBook. Library can't cope.

From the Orlando Sentinel:

"The library's e-book service is great because I don't have to park, walk to the library, find the book and check it out," said the accountant [Krantz]. "The only complaint I have is that I have to wait longer than usual for an e-book because the library seems to stock few digital copies of the titles I want."

Krantz represents a growing number of Central Florida readers depending on their public libraries to fuel their consumption of e-books, downloadable audiobooks and other digital media. At the same time, librarians across the Orlando area are scrambling to meet that increasing demand while facing rising e-book costs and budget cuts.

"The growing expense of e-books is something we're up against as a profession," Pepo said.  Tate explains that the library's two e-book copies of "Guilt," a bestselling thriller by Jonathan Kellerman, cost the Seminole County PublicLibrary about $84 each. But each of the 20 copies of the same title in print cost $28.

"That really chips into your budget as you try to provide patrons e-books," Tate said.
Publishing houses say e-book prices are high because they don't ever wear out, are borrowed more frequently than print books and are convenient: Users don't have to go to a library to check them out.

MediaWeek (Vol 6, No 12); Nash on Publishing, Retailing, Libraries, Copyright + more

A long treatise on publishing from Richard Nash and here is a sample (Virginia Quarterly);

Selling a book, print or digital, turns out to be far from the only way to generate revenue from all the remarkable cultural activity that goes into the creation and dissemination of literature and ideas. Recall again all the schmoozing, learning, practice, hustling, reading upon reading upon reading that goes into the various editorial components of publishing; the pattern recognition; the storytelling that editors do, that sales reps do, that publicists do, that the bookstore staff does. Recall the average feted poet who makes more money at a weekend visiting-writer gig than her royalties are likely to earn her in an entire year. You begin to realize that the business of literature is the business of making culture, not just the business of manufacturing bound books. This, in turn, means that the increased difficulty of selling bound books in a traditional manner (and the lower price point in selling digital books) is not going to be a significant challenge over the long run, except to free the business of literature from the limitations imposed when one is producing things rather than ideas and stories. Book culture is not print fetishism; it is the swirl and gurgle of idea and style in the expression of stories and concepts—the conversation, polemic, narrative force that goes on within and between texts, within and between people as they write, revise, discover, and respond to those texts. That swirl and gurgle does happen to have a home for print fetishism, as it has a home for digital fetishism. This is what literature has always been. Being yoked to the Industrial Revolution’s machines for analog reproduction, accompanied by an arbitrary process for selecting what should be reproduced, will prove to be an anomaly in the history of literature, useful as that phase was for the democratization of access to reading. The publisher is an orchestrator in the world of book culture, not a machine for sorting manuscripts and supplying a small number of those manuscripts in improved and bound form to a large number of people via a retailer-based supply chain best suited for the distribution of cornflakes, not ideas.

As for as the rest, this week's maybe The Economist edition... 

The idea that Amazon could open retail stores may not be so crazy as The Economist reports on other examples of web retailers getting physical:

Pure online retailers do not pay rent but their variable costs eat up much of that advantage, says Sophie Albizua of eNova Partnership, a consultancy. Without storefronts to lure in customers they shell out to buy ads linked to Google search results. Delivery, especially of bulky goods, is a headache. Couriers show up at empty houses, and fees often fail to cover the full cost. Shoppers return a quarter or more of clothing they buy, another big expense.

All this looks easier if you have real shops. With “click and collect” customers can order with, say, a smartphone but pick up the item at a convenient outlet. Often, they linger to shop more. Britons pick up something extra about 40% of the time, says Ms Albizua.

Happily hybrid John Lewis, an upmarket department-store chain, says that on- and offline shopping spur each other on. When a new shop opens, online sales in the vicinity can jump by 20-40% “overnight”, says Noel Saunders, the manager of the branch near London’s Olympic Stadium. New products can be tested online and stocked in store if they do well. Nearly a third of customers who order online pick up their wares in stores. Britons are among the world’s most avid online shoppers, but 65% still prefer buying in-store, according to a survey by Hitachi Consulting.

Taking a look at the right of first sale ruling by SCOTUS last week (Economist):

Publishers, record labels, film studios and other content-owners are shocked. They have often sold the same product in poorer countries for less, knowing that it would not hurt their pricing power at home. Now it will. Big online retailers such as Amazon and eBay could start exploiting these pricing differences on a large scale. Ian Whittaker of Liberum Capital, a broker, thinks this ruling will really hurt academic publishers, such as Pearson (a part-owner of The Economist). They tend to sell identical books for eye-watering prices in America and much less in countries where people cannot afford those prices.Publishers have already warned that they may have to turn the page on the old system of letting students in poor countries buy textbooks cheaply. “Some people are predicting a world where price discrimination will no longer be possible,” says Arti Rae, a professor of law at Duke University. Media companies could choose to stagger the release of films or books across countries, delaying the launch of titles in countries where they cannot fetch high prices. However, that may simply encourage piracy. Congress could intervene and rejig the Copyright Act of 1976, which established the first-sale doctrine. But that would require Washington to get its act together—a plotline so implausible that it would make J.K. Rowling blush.

No one likes to be belittled or disrespected (especially in public) but that may be how libraries perceive publisher behavior towards them.  On eBook lending (Economist):

E-lending may reduce publishers’ control of their books, but it also takes power away from libraries. Relying on outsiders’ servers to host e-collections can mean legal hassles (it can be hard or impossible to switch providers) and worries about privacy. Alan Inouye of the American Library Association notes that libraries jealously guard data about users’ borrowing habits. But e-lending leaves new, digital traces that publishers could exploit.

An even bigger worry for both libraries and publishers is competition. In 2011 Amazon launched an e-lending programme in America. It has since expanded it to Britain, France and Germany. Customers who sign up for Amazon’s “prime” bundle of services, which offers free delivery and streamed movies for an annual fee, can also borrow a book each month on their Kindles, Amazon’s e-reading device. So far no works from big publishers are available. Librarians are irked by this, but not yet anxious. Laura Lent, the chief of collections at the San Francisco Public Library, notes that lending from her shelves, unlike Amazon’s, is free of charge.

Librarians and the book industry have different interests. But without getting future generations into the book-reading habit, both will perish, says Stuart Hamilton of the International Federation of Library Associations and Institutions. Library lending plays a big if unquantifiable role in nurturing a love of reading.

From my twitter feed:

Dennis Wheatley to ride again, via Bloomsbury Reader The Bookseller
The ROI on Metadata for Books Swets
BBC News - Music sales are not affected by web piracy, study finds BBC
Bergdorf Goodman’s Literary Windows Bookriot

FT Confirms Cengage Roster of Helpers

I was just talking to someone about how the timing of their annual accounts will not favor Cengage when PWC has to pass judgement on the company's accounts. As noted this evening in the FT, Cengage has confirmed it now has all the advisory pieces in place to take the anticipated steps in fixing its' balance sheet.

The company said Friday that it had appointed Alvarez & Marsal for restructuring advice; Lazard to serve as financial adviser and Kirkland & Ellis for legal counsel “as part of ongoing efforts to assess its capital structure”.

It also announced that it had borrowed $430m, almost all the remaining available amount under its revolving credit facilities, to ensure it had sufficient liquidity to fund its working capital needs.

Cengage must repay $2.42bn of debt between June 2014 and June 2015 unless it can renegotiate the terms of its borrowings. Interest payments are due this June, when PwC, its auditor, must decide whether to qualify Cengage’s accounts.