Australian Open 1976 & John Newcombe

Newk has just finished a quarter final match against Ross Case which he won 6-4, 6-4, 6-1.  Somehow, I was sitting in a box seat at court side and a family friend lent me his 35mm camera which was the first time I had used one.  From then on I was hooked.  In those years, the Australian Open was held at Kooyong Tennis Club on grass and it was a little like the old US open set up at Forrest Hills.  Just like Forrest Hills the club is still there.  In the years I lived in Melbourne I went to Kooyong many times to watch the Open since the tournament also coincided with the long summer school break. 

Newcombe made it to the final where he was beaten by fellow Aussie Mark Edmondson which must have been a disappointment because it was Edmondson's only major win.

The Death of the Copyright Agency

The combined impacts of technology, legislation and judicial decisions on copyright licensing are beginning to show how rights licensing agencies are likely to face a difficult time extending their current business models in the future. In Canada, Access Copyright (AC) has struggled to impose a new pricing model on universities which accords a high per student fee for unlimited access for publisher content covered by an Access Copyright agreement. Since AC imposed their new model about two years ago, the agency has lost out in court over the concept of ‘fair dealing’, with the practical impact being, that universities are now requesting significant revision to their AC agreements. Led by the University of Toronto which has refused to renew their current agreement, academic libraries in Canada believe that their content rights under the court’s interpretation of ‘fair dealing’ are already broad based and that the universities do not require a license anywhere as expensive (and potentially limiting) as the license imposed by CA. As a result of these interpretations it is a widely held belief that CA faces a very difficult future given their main revenue model has been significantly undercut by the courts.

For an interesting review of the legal situation in Canada here is a quote from an interview with Prof Ariel Katz, Associate Professor at the Faculty of Law, University of Toronto:

So does Access Copyright still have a role to play with universities?

It’s not clear at all. For one thing, it’s not that Access Copyright offers a very generous license. Even though it’s now well established that fair dealing could have a generous application in education, fair dealing doesn’t cover everything, it’s not a carte blanche that allows the free copying of everything. Therefore, educational institutions may still need licenses for activities that go beyond the scope of fair dealing, and they have always been willing to pay a lot of money for such licenses. The problem is that Access Copyright’s licenses do not offer a generous license at all. In fact, the licenses they offer are very restrictive – you can copy no more than 10% of a work or a chapter from a book, and this permission comes not only with payments but also with many strings attached. In fact, many believe that what AC offers for a fee would very likely be considered fair dealing anyway.

Are there any universities still subscribing now?

Yes. About half of Canadian universities (outside Quebec, which has its own collective) are still licensees of AC. U of T and Western were the first to sign new licenses outside of the Copyright Board proceeding tariff, but to their credit they signed a short term license, which expires by the end of this year. Both of them announced that they would not renew it, but invited AC to negotiate a new license on more favorable terms. It’s still unknown whether AC can or will be willing to offer something that would be worth paying for.

Technology is also enabling a shift away from permissions based commerce as more and more content is made available via publisher’s electronic platforms. As these platforms become more sophisticated and comprehensive (as well as easy to use), libraries are able to provide immediate access to content for their academic patrons as part of their base subscriptions. Content on these platforms is then integrated into course management systems and other similar distribution vehicles directly to students. Where in the past fees for this use needed to be negotiated (and the content retrieved), we are increasingly seeing ‘all you can eat models’ which include course pack use, researcher access and on/off campus access to name only a few of the options. Where publishers include these additional rights in their platform agreements, they enable a more functional site for users and will potentially begin to reduce the amount of content fees generated by collecting agencies such as copyright clearance center (CCC) and others.

In the US, CCC is a more-broad based collecting agency with less reliance on the educational segment and the blanket license approach followed by the UK, Canada and elsewhere has not been widely adopted by US academic institutions. In the US, the impact of technology as described above is likely to eat away progressively at their model as publishers place more of their content in easily accessible locations. That said, CCC is unlikely to face the issues that AC and the UK and Australian agencies are currently facing.

In Australia, as documented by fellow traveler Peter Donoughue, similar issues surround the interpretation of ‘fair dealing’ and the elimination in Australia of the so-called statutory license governing academic use of publisher content. As Peter states:

The next five or so years will see most educational publishers sign tailored subscription-based licenses with tertiary institutions and premium school customers. They will have the option of using newly developed Copyright Agency voluntary licenses for the rest if that makes sense.

Under these emerging business models publishers will have the freedom to offer comprehensive content offerings - primarily digital but inclusive of print. And the schools will demand liberal free use provisions as part of the deal, particularly involving content distribution in the classroom. Remunerable 'multiple copying' will be a thing of the past and the concept itself deemed quaint.

Such arrangements are the mainstream future. As content goes digital, primary exploitations (formerly sales of books) and subsidiary 'bits and pieces' (eg photocopying) will collapse into comprehensive content offerings via licenses.

Peter does believe the Australia copyright agency (CAL) will be able to support a business in this new environment; however, he does note that pending legislation in Australia may halve the amounts collected under the current permissions based program. With much less money to go around it will create a challenging environment for any agency like CAL.

Earlier this month I attended a user group meeting for the library permissions tool “Heron” which is one of my Publishing Technology business units. Heron helps libraries manage their permissions reporting obligations to Copyright Licensing Agency (CLA) using PubTracker. Pubtracker is a simple tool which saves libraries days’ worth of time each month to compile content usage. At this meeting, there was a lot of discussion about the new CLA universal license which had recently been negotiated and agreed between CLA and academic libraries. Here the issue was less with the model and more about what was ultimately covered by this agreement. The view of most of the librarians in attendance was that CLA had misled the group with respect to the extent of content covered by the agreement. Indeed, most librarians believe the content covered was significantly less than the prior agreement with specific reductions in access to US based content. Some librarians were contemplating not signing this new agreement.

The UK Librarians were most angry about the impact the new limitations would have on their roles on campus. One librarian stated that they’ve been focused on educating lecturers about the appropriate use of content and to seek the right authorizations however; with the new CLA license they would be stuck trying to explain to a lecturer why last year authorization was available but this year it wasn’t (or was much harder to gain). They felt this would lead to more disobedience by lecturers. The crux of the issue is that US content may not be covered by the new CLA license and UK librarians will be forced to go directly to US publishers which almost by definition is a more cumbersome and frustrating process.

By far the most difficult situation is being faced by the Canadian Access Copyright office which has already downsized and faces stiff opposition from it’s’ user community. Other licensing agencies also face challenges related to technology advancement, legislation and judicial challenges, and as more and more content becomes digitally available, all these agencies will need to undergo comprehensive change in order to maintain their role and relevance.  Whether the experience of AC is a trend setter is an open question but there is certain to be much more on this subject over the coming years.

MediaWeek (Vol 6, No 34): Georgia Tech MOOC'd, Renting from Amazon, City Hall Library, + More

NYTimes on Georgia Tech's approach to MOOCs

Although it is just one degree at one university, the prospect of a prestigious low-cost degree program has generated great interest. Some educators think the leap from individual noncredit courses to full degree programs could signal the next phase in the evolution of MOOCs — and bring real change to higher education.

“Perhaps Zvi Galil and Sebastian Thrun will prove to be the Wright brothers of MOOCs,” said S. James Gates Jr., a University of Maryland physicist who serves on President Obama’s Council of Advisors on Science and Technology. “This is the first deliberate and thoughtful attempt to apply education technology to bringing instruction to scale. It could be epoch-making. If it really works, it could begin the process of lowering the cost of education, and lowering barriers for millions of Americans.”

The plan is for Georgia Tech to provide the content and professors and to get 60 percent of the revenue, and for Udacity to offer the computer platform, provide course assistants and receive the other 40 percent. The projected budget for the test run starting in January is $3.1 million — including $2 million donated by AT&T, which will use the program to train employees and find potential hires — with $240,000 in profits. By the third year, the projection is for $14.3 million in costs and $4.7 million in profits.

The Economist reports on education standards and teaching students to think (Economist):

Though America’s grim education results come in for special drubbing in this book, the country is not alone in failing to teach its children how to think critically. This, at least, is the view of Andreas Schleicher, the “educational scientist” behind what is known as the Program for International Student Assessment, or the PISA test. If most exams quantify students’ ability to memorise material, this one aims to assess their effectiveness at problem-solving. Since 2000 it has been administered to millions of teenagers in more than 40 countries, with surprising results. Pupils in Finland, Korea, Japan and Canada consistently score much higher than their peers in Germany, Britain, America and France. The usual explanations for these achievements, such as wealth, privilege and race, do not apply.

Inside Higher Ed looks at Amazon's limitation on usage of your rented textbook

According to the Textbook Rental Terms and Conditions page on Amazon.com, when renting through Warehouse Deals, which is an Amazon subsidiary, “You may not move the textbook out of the state to which it was originally shipped. If you wish to move the textbook out of that state, you must first purchase the textbook.”
If Amazon does determine that a renter has moved his or her book to a different state “at any time during the rental period,” the company at its “sole discretion” can charge the consumer the buyout price of the textbook.
Some experts believe the policy is another reflection of the extreme lengths to which the company continues to go in order to avoid collecting state sales taxes. But could Amazon’s use restriction and other complicated rental conditions cause problems for students or lead potential textbook renters to take their business elsewhere?

Interesting video article on City Hall's hidden library of special collections.



From Twitter this week:

Muscle Shoals: watch an exclusive trailer for a documentary about the music born in the Alabama town Guardian
News International could face corporate charges over phone hacking Guardian 
E Ink Reports 46% Sales Drop, Expects E-Reader Shipments To Be Flat This Year Techcrunch 
BBC News - British Library's wi-fi service blocks 'violent' Hamlet BBC 

American Accessories in Kings Cross

There's still a sordid underbelly to London's Kings Cross area.  I wasn't interested in going inside and neither was she although I think she had other things in mind.

Ten (+One) Newish Publishing Technology Start-ups

Sellfy is an e-commerce platform that enables anyone to sell digital products directly to their fans and followers using just a link. Whether it's an e-book, music, video, photos, software, or any other type of digital content, just upload your product, enter the price and start selling on Twitter, Facebook or your own website. Sellfy takes care of file storage, payment processing and product delivery to the end customer.



24symbols is a service to read digital books on the Internet based on a subscription model. It's like a Spotify for book.

Marquee is a flexible publishing platform that helps you craft great content for your audience. It operates as a fully hosted service, or can integrate into your existing workflow.

Livrada creates and distributes e-book cards at retail. Each Livrada gift card represents a specific title, and can be redeemed wirelessly on Kindle, NOOK and Kobo platforms (more to follow). Livrada makes the browsing, discovery, and gift giving of digital content tangible, and gives digital content a presence in stores. Livrada also works with authors to sell, promote, and give away their digital works at live events. Finally, we work with organizations to distribute e-books in bulk.


Medium is a new place on the Internet where people share ideas and stories that are longer than 140 characters and not just for friends. It’s designed for little stories that make your day better and manifestos that change the world. It’s used by everyone from professional journalists to amateur cooks. It’s simple, beautiful, collaborative, and it helps you find the right audience for whatever you have to say.


GENWI is a cloud-based smartphone and tablet app publishing platform continues to push forward in the mobile app development space, today launching an iPad app publishing solution and mobile content management system (CMS). As the company’s evolution has led it to a focus on providing media publishers with tools to create and manage newspaper, magazine, and catalog apps for iOS and Android, the iPad app solution is a logical extension to prior platform iterations — especially with the escalating adoption of tablets, specifically the iPad, as a content production tool and a source for some of the best (and most well designed) media apps. (Techcrunch)




Draft, a streamlined online word processor with version control, is getting deeper into the new professional publishing ecosystem.  The one-man team of Nathan Kontny has just introduced a new REST API that’ll let any news outfit or other publishing organization connect Draft to the other software it uses. If you’re BuzzFeed or The Huffington Post* or another media company with a big mix of full- and part-time writers, you could use the API to let writers and editors work through versions together in Draft then publish straight to your custom content management system. (Techcrunch)


7write wants to provide better writing software for wannabe authors, help them market their work in better ways and help them sell across multiple markets including digital and print.  (Techcrunch)




Pressly mobile publishing platform is designed to help brands, marketers and traditional publishers succeed in the growing world of tablet and smartphone reading. A flexible, turn key solution, there are a number of creative ways you can use it to drive results and engage your audience.


Open Air Publishing is a leading digital-first nonfiction publisher. Our team is redefining what a “book” can be by creating reading experiences tailored for touchscreen devices.  Examples of the platform technology are found here: BetterBooks Library

Master Your DSLR Camera: A Better Way to Learn Digital Photography from Open Air Publishing on Vimeo.


Graphicly provides authors and publishers the simplest and most cost-effective access to digital content conversion and distribution, across every marketplace imaginable, with comprehensive actionable insights on reader behavior.

MediaWeek (Vol 6, No 33) Belle de Jour and "Boy", Thoughts on Pricing, DA Information Administration + More

Girl: I am a prostitute! Man: I never knew. Now I look stupid! Indeed. (Daily Mail)

At first Owen was unaware that he was in a relationship with the anonymous blogger, who was gathering thousands of readers with apparently true tales of prostitution.
He says: ‘I knew she was writing a blog as she was often typing away but she said it was science fiction and I believed her. I didn’t read it and I had no idea what it actually was.
‘But in spring 2004, I thought she’d been writing down things I said so I put one of my exact phrases into Google – something extremely unique – and the blog popped up. I was absolutely horrified.  'I remember sitting on a bench feeling numb and shocked with that silly [J Geils Band] song going round in my head – “My girlfriend is a centrefold”.
'But I didn’t actually realise I was in it as all my quotes were as clients, and I didn’t think she was actually a prostitute.’

Not that there's anything wrong with that.

Interesting article on pricing theories from The Economist:

WHEN bosses promise to make their companies more profitable they usually say they will do so by increasing sales or cutting costs. But a third road to profits is rarely mentioned: putting prices up. Managers often fail to ask how they might do better at plucking the goose to obtain the most feathers with the least hissing. The spiel from the management consultants who advise companies on pricing—whether specialists like Simon-Kucher or giant generalists like PWC—is that it is now more vital than ever to be smart at it. In today’s austere age many businesses cannot depend on rising sales volumes to lift their profits. As for cutting costs, most have already pared them to the bone. Prices are all that is left. And a business can do a lot with clever pricing, to boost its share of the limited spending-power that is out there.  

Makers of high-tech products such as smartphones can opt to add whizzy new features and push up prices. In the case of luxury goods, their exclusivity is a large part of their appeal, and this in turn is a function of their price, so firms usually have scope for limiting supply and charging more: Ferrari, a sports-car maker, and Mulberry, a purveyor of posh bags, have both recently signalled that they plan to do just that. But raising prices by making products better or more exclusive is a strategic decision, open to only a few types of business. For all sorts of mundane goods and services there is much that can be done tactically, the consultants say, to charge more for the same thing.

By the time this eBook case gets done it won't matter. Here's the publisher's filing opposing the penalties imposed on Apple for contesting the DOJ case against the publishers. (Apple Insider)

DA Information Services in Australia has gone into administration (SmartCompany)

An academic book publishing company with $40 million in turnover has now collapsed in administration, yet another sign the print and publishing industries are continuing to face severe transition pains.  The news comes after discount book group allbooks4less also fell into administration last week, following an aggressive expansion plan.
Publishers have commented bookstores and booksellers have struggled to prop up book prices in the face of dynamic online competition.  DA Information Services Group, which contains the businesses Information Specialists, DA Information Services Pty and Central Book Services, has been placed into administration.  The company claims to be Australia’s largest locally based full service academic library supplier, providing books, journals, eBooks and other media products for professional purposes across Australia and New Zealand.  The business was founded 60 years ago. Customers include academic libraries, research facilities, medical centres, government departments, universities and TAFEs, along with law libraries.

From the TwitterFeed this week:
Digital libraries are developing from the old model. WAPO
Bauer under renewed fire over magazines that glorify Nazi regime Guardian
Philip Hensher: There’s nothing out of date about duty (and other words). Telegraph
Google results will now show 3 in-depth articles - topics include censorship and Legos GigOm  

MediaWeek (Vol 6, No 32): Detective Fiction, Barnes & Noble + More

Why detective fiction works from New Statesman:
This may or may not be a good thing. These days, you can comfortably inhabit the world of eccentric amateur detectives and embittered private eyes all year round, in the company of learned fellow travellers, on television, at the cinema, in books and online. There are murder mystery weekends and endless box sets; in classrooms, at conferences and on college campuses, it is now de rigueur for undergrads to study crime fiction and its relationship to feminism, post-colonialism and critical theory, just as I once had to sweat my way through Troilus and Criseyde and the meaning of courtly love. At City University in London, you can now study for an MA in crime thriller novels. Doubtless at a certain point, even Michael Gove will capitulate and make Elmore Leonard his grammar tsar. The underground has become the mainstream.
Just to recap, for those few who haven’t been paying attention or who haven’t had the chance to study, say, module EAS3217 (“Crime and Punishment: Detective Fiction from the Rue Morgue to the Millennium”) at the University of Exeter or EN658 (“American Crime Fiction”) at the University of Kent: Edgar Allan Poe invented detective fiction in 1841 with his short story “The Murders in the Rue Morgue”, then Wilkie Collins wrote The Moonstone (1868), then along came Sherlock Holmes and Agatha Christie; America went hard-boiled; and now there’s everything else, including a lot from Scandinavia.

Boris Kachka with some needed perspective on the news about Barnes & Noble (New York):
The industry that looked on Barnes & Noble as a virus now treats Amazon like a pandemic. Just last week, in advance of Obama’s visit to an Amazon warehouse, a letter from the ABA (now down to roughly 1,500 members) called Obama’s praise of the company “woefully misguided.” Publishers, meanwhile, are a lot more open in their disdain for Bezos than they ever were for ­Riggio—especially after Amazon came out on top in a recent antitrust suit over e-book prices. Now they’re on the side of Barnes & Noble, the last bastion of bricks and mortar. When Microsoft invested in the Nook last year, publishing CEOs wrote in to congratulate Lynch.
But that cooing sound you hear from publishers isn’t love for Barnes & Noble; it’s fear of its disappearance. Last year, one executive compared a B&N-free landscape to The Road: “The postapocalyptic world of publishing, with publishers pushing shopping carts down Broadway.” For all the anti-chain agitation, publishers long ago adapted to a world in which one business controls 25 percent of the market. And while it may have hastened publishing’s own rapid consolidation—culminating in this year’s Penguin–Random House merger—Barnes & Noble never seriously jeopardized the publisher’s role as the supplier. Amazon, though, is now a growing publisher in its own right, threatening to make not just bookstores but traditional publishers obsolete.

In sports this week from Twitter feed:

James Anderson of England poses with Bob Willis ,Ian Botham and Michael Cairns, the Lancashire Chairman after after becoming the highest Test wicket taker whilst playing for Lancashire during Day one of the 3rd Investec Ashes Test match between England and Australia at Old Trafford http://fb.me/2eSG3vKbi

Hong Kong Housing 1969: Kai Tak Approach

When I first saw this photo I assumed it had been taken from a building across the street from this particular slum (and, what someone was doing in this neighborhood would have been a different story);  however, this is actually taken out of the window a a plane - probably a 707 - coming in to land at what was Hong Kong's only major airport.   KaiTak has been closed for about 10 years now and looking at the density of Hong Kong it's hard to imagine there was ever any space to land Jumbo jets once every two or three minutes.  I suspect these people in the slums got pretty fed up with the jet noise as well.

Here is the image take immediately before this one. PND

A weekly image from my archive. Click on the image to make it larger.

White House Sponsored DataJam Promotes Open Data Initiatives

There is a lot of machine-readable data coming from the federal government, as a result of the Obama Administration’s open-data initiatives. Open data was a platform initiative of the President’s first presidential campaign and, in his second term, he has reinvigorated this policy with a new spate of policy initiatives, executive orders and community outreach.

The result of the outreach program was on display at a recent Datajam event I attended at the White House Conference Center (near, not at, the White House). Sponsored by the White House Office of Science and Technology and CENDI, the event invited technologists, researchers, publishers and data owners to weigh up ways of using the data and content rapidly being made accessible by almost every federal agency. As a group, we were challenged by White House Chief Technology Officer Todd Park to engage our inner entrepreneurial spirits and think up new and innovative uses for government data. In a lively opening speech, Park promised the datajam audience member who came up with a viable idea or product within 60 days that he would “make [him or her] famous.” He pointed to several examples of health data related products which had come out of similar meetings recently, and was enthusiastic about this group’s ability to produce some interesting ideas.

Government information and data is a by-product of the taxes we pay to maintain the federal agencies, and, Park confirmed “the administration is looking to maximize tax payer return of government produced data by opening it up to so many people can access and use it.” Citing as a guiding principle ‘Joy’s law’--that the smartest people in the world will always be working for someone else and that collaboration is an imperative if real progress needs to be made--Park suggested that bringing people together in groups like ours is important for both promotion of open data and for actually devising worthwhile uses for it. Furthermore, he made the point that “open data by itself is useless and only useful if it gets applied to something and produces value.” He encouraged us to “use ‘our data’ to produce awesomeness - where stuff can actually happen.”

Earlier this year, President Obama signed an executive order requiring all federal agencies to open access to all government-sponsored published content by the end of 2013. This has produced a frenzy of activity at some agencies to determine what they have and how to make the materials accessible. Some agencies are more mature in this respect than others but, CTO Park confirmed, the President is passionate about open data and has made specific commitments to fulfilling this policy.

In a speech in Austin, TX, in May, the President cited several examples of start-up companies working with open data: “StormPulse uses government-produced weather data to help businesses anticipate disruptions in service. Another company based in Virginia called OPower uses government trend data to save consumers $200m on their energy bills.” Obama also mentioned an app called iTriage, founded by a pair of doctors, that uses data from the Department of Health and Human Services to help define symptoms and find appropriate health care for the patient. In the same speech, the President announced that his administration is making even more government data available and he expected that this and his other open-data initiatives would help launch even more start-ups similar to the ones he mentioned. 



The data available would help “more entrepreneurs come up with products and services that we haven’t even imagined yet”.

More recently, in a speech just two weeks ago, President Obama suggested that we are part of a process to build a better, more open-data America. Hyperbole aside, there will be no coming back once these policies are in place and this policy by the executive and agencies of the Federal government is likely to have profound changes on how we, as citizens, interact with the government. Frequent examples of open data initiatives cite the use of satellite imagery and data from the National Oceanic and Atmospheric Administration (NOAA) which have produced the now ubiquitous mapping and weather apps; however, given the “fire hose” nature of the data and information on offer, these early examples are likely to represent only isolated examples of the opportunities represented by the government’s open data initiatives.

Commercial publishers of government-funded and/or -produced content and data are spooked by some of these moves by the government. During our meeting it was mentioned that one only needs to search for “aspirin” on Google to see how accessing government-produced content via API can produce content that looks very much like a drug handbook entry from Elsevier, Wolters Kluwer or some other commercial medical publisher. The government often makes reference-like content a requirement of various approval processes, and thus, we may be about to see professional reference content undergo some profound changes. And that is just one small example of what could happen to commercial publishing.

As a direct result of the open-data initiatives both in the US and Europe, the Association of American Publishers and Society of Scholarly Publishers (in collaboration with partner CrossRef) have established an initiative named CHORUS. (The EU is said to be about to press for greater open-data requirements than we have in the US.) Through CHORUS, publishers aim to avoid a PubMed situation and manage the open data and open access content requirements themselves; publishers who publish content which is also available on PubMed see significant decreases in traffic once PubMed opens access to the same content. Publishers believe that, by setting up their own open-access service, they will be able to fulfill the government’s open-access requirement and mitigate the impact(s) on their own business models.

Regardless of the risks to current publishers and their business models, it appears that the government produces a lot more content and data than is currently being commercialized by publishers. The sheer amount of data is overwhelming and, as long as the President continues to promote open data, we’ll see hundreds of new products and services develop in the short term as entrepreneurs take CTO Park up on his promise to make them famous.

My Big Book of Posts & Predictions

I have compiled all my annual predictions posts and a selection of more thoughtful posts that have appeared here since 2006 when I started PND. Here is the slideshare link to the book.

If you would like a pdf file of the book directly from me just send me a note.  Here is a link to all the other presentations I have placed on slideshare.net which have been viewed 35,000 times!

 
Personanondata Predications and Posts: 2006 - 2012 from Michael Cairns

MediaWeek (Vol 6, No 30): Colbert Mocks MOOCs, Private Eye, Barnes & Noble + More

Steven Colbert interviewed Anant Agarwal the President of edX, who explains the reason for offering free university courses online. Steven proclaimed ignorance of the free MOOC model and compared the model to a shoe store.



And at the Chronicle of Higher Education a more serious opinion piece about who's driving the MOOC locomotive:

I understand that politicians have a duty to be good stewards of public money, as do college administrators; and I certainly don't have any objection to cutting costs where we can. But when our primary objective becomes making degrees as cheap as possible, rather than providing the best education possible, we're missing the mark as educators and doing no good for the future of our students or our nation.

That's why it's so important for us as faculty members to realize who's driving the online locomotive. It's not students, only about a third of whom take any online classes. It's not our colleagues, the vast majority of whom still aren't fully on board with online learning in general, much less with MOOCs. And it's certainly not employers, who over all seem to prefer that students take most of their coursework in traditional classrooms. It's the administrators and the politicians, whose priorities—let's be honest—are not the same as ours.

I sometimes wonder if the train is so big, and moving so fast, that it's just going to derail itself due to basic physics. But unless that happens, and until it does, the only way to slow it down is for enough of us to refuse to get on board and instead line the tracks, signaling "proceed with caution" with all our might.

From BusinessWeek; Barnes & Noble, the obituary.

Barnes & Noble is a $6.8 billion company with 675 carefully selected locations in every state in the country. It also operates 686 college bookstores, which with the e-reader operations make up the company’s Nook Media unit. Sales at its regular stores declined almost 6 percent in the company’s 2013 fiscal year, to $4.6 billion. But because their margins are getting higher and their expenses lower, the bookstores still make money: Ninety-five percent are profitable. Lynch may not have been reading real books, but Barnes & Noble’s customers still do.

The company hasn’t announced its plans yet, but it will probably sell the e-reader business or shut it down. Barnes & Noble’s Nook misadventure may look like one of those inexplicable unforced errors businesses make from time to time, like New Coke or the Edsel. But it’s hard to blame Lynch for trying to transform the company. The digital revolution is changing the dynamics of the business. The company had to respond, and it still does. The problem was that Lynch tried to transform the wrong thing.

Barnes & Noble has a history of ill-timed technological decisions. In the 1990s it was focused on beating Borders and didn’t set up its website until 1997, a full two years after Amazon.com went live. It introduced a primitive e-reader too early, in 2001 (on Sept. 11, to make things worse). After Amazon introduced the Kindle in 2007, Barnes & Noble needed someone to take control of its destiny and hired Lynch to do just that.

Eye Full: Ian Hislop explains why Private Eye’s blend of humor and investigative journalism wouldn’t work in the US (CJR)

Britain’s bestselling current-affairs magazine, Private Eye, has been producing its biweekly and decidedly English mix of satire, industry gossip, cartoons, and investigative journalism since 1961. Despite its print-focused operation (there is no digital version, and its website offers just tidbits of what’s available in the print edition), the magazine’s 200,000-plus circulation is the highest it’s been in recent years, buoyed by its recent 50th-anniversary issue and various government and media scandals. Much of the success is due to editor Ian Hislop, 52, who’s been at the helm since 1986. A self-professed workaholic, Hislop also writes for and appears on television, most famously as a panelist on the BBC’s long-running comedic news panel show, Have I Got News For You. As his profile has risen over the years, Hislop has become a regular on various power and influence lists, from The Guardian to GQ, and has been called “the king of British satire” and even a “national treasure.” CJR’s Sara Morrison spoke to Hislop about mixing satire and seriousness, and why American publications and TV shows either don’t or can’t.

Remember Suzi Quatro? (Telegraph):

And she made a pretty big impression on us teenage boys too. I tell her, slightly guiltily, about a rumour that spread around the school that if Devil Gate Drive hit No 1 in 1974, she would strip off on Top of the Pops. She’s laughing so much she can hardly speak. “Rock ’n’ roll! It’s the music of puberty,” she splutters. “I’ve always maintained that you can be sexy with your clothes on. Sexier maybe.” In 2007, Quatro published a candid and entertaining autobiography, Unzipped, in which she told stories about throwing a drunken Iggy Pop offstage, shooting an amorous Alice Cooper with an arrow, and turning down advances from Elvis Presley. Last year, she developed it into a one-woman, multi-media show for a brief run at London’s Hippodrome. This September, she brings a revised version to the Play Misty Club in Hackney for six nights.

From Twitter:
What is a publisher now? New interview with Victor Henning on scholarly PublishingTechnology
Springer Science buyout loan revised to attract investors IFR Asia
Here’s how Amazon self-destructs Salon
Previously unseen Joseph Heller story out this week Guardian 

Tokyo Skyline 1972

I've never been to Tokyo.  I've not had an interest.  It's never been in my plans.  

In an odd way this is a mesmerizing view of a damp Tokyo skyline taken from high up the Keio Plaza Intercontinental.  The damp surfaces add a lot of depth to the image and the mist confines the view so it feels almost intimate.  It's a shame we have as much of the roof and air conditioning unit in the foreground but if it were tighter then we would miss all the intricate pedestrian walkways in the bottom left.

This is a full page spread in my blurb book and works really well.

A Funny Thing Happened on the way to History

It is hard not to find the humor in this announcement from the American Historical Association which in a recent policy statement suggests that universities seek up to a six year embargo on publishing digital dissertations.  Windowing hasn't proven effective in trade publishing and it is just as less likely to work here.  The nub of their argument is that digital content can be so widely distributed in contrast to those pesky paper dissertations or UMI versions, that academics risk harming their opportunities for tenure if they can't get their work published.  There is some logic to the policy in that the society wants to protect scholarship by providing a financial incentive for both the author and publisher but for all practical purposes this is wrong headed.  Having a dissertation widely available in advance of a proposed book, it is argued, would torpedo a potential book deal.

The policy runs counter to the growing calls for more open access which often comes from researchers and academics but not publishers.   It would seem that rather than think of a potential solution that looks forward taking full advantage of current media culture and technology the AHA has chosen the historical approach.  In the process, they have attempted to, at a very late date, turn back the clock on scholarly publishing.

That would then lead me to conclude that any young researcher and/or PhD student would view the association as not one which they would want to actively participate in.  Ever.  And that's history for you.

In their announcement they cut straight to the chase:

The American Historical Association strongly encourages graduate programs and university libraries to adopt a policy that allows the embargoing of completed history PhD dissertations in digital form for as many as six years. Because many universities no longer keep hard copies of dissertations deposited in their libraries, more and more institutions are requiring that all successfully defended dissertations be posted online, so that they are free and accessible to anyone who wants to read them. At the same time, however, an increasing number of university presses are reluctant to offer a publishing contract to newly minted PhDs whose dissertations have been freely available via online sources. Presumably, online readers will become familiar with an author’s particular argument, methodology, and archival sources, and will feel no need to buy the book once it is available. As a result, students who must post their dissertations online immediately after they receive their degree can find themselves at a serious disadvantage in their effort to get their first book published; it is not unusual for an early-career historian to spend five or six years revising a dissertation and preparing the manuscript for submission to a press for consideration. During that period, the scholar typically builds on the raw material presented in the dissertation, refines the argument, and improves the presentation itself. Thus, although there is so close a relationship between the dissertation and the book that presses often consider them competitors, the book is the measure of scholarly competence used by tenure committees.

MediaWeek (Vol 6, No 29): MOOCs again, Dr. Who, Fiction in Business, 1970s NYC, Flipping the class.

The Economist on MOOC's

The industry has similar network economics to Amazon, eBay and Google, says Ms Koller, in that “content producers go to where most consumers are, and consumers go to where the most content is.” Simon Nelson, the chief executive of FutureLearn, disagrees. “Anyone who thinks the rules of engagement have already been written by the existing players is massively underestimating the potential of the technology,” he says.
Certainly, there is plenty of experimentation with business models taking place. The MOOCs themselves may be free, but those behind them think there will be plenty of revenue opportunities. Coursera has started charging to provide certificates for those who complete its courses and want proof, perhaps for a future employer. It is also starting to license course materials to universities that want to beef up their existing offering. However, it has abandoned for now attempts to help firms recruit employees from among Coursera’s students, because catering to the different needs of each employer was “not a scalable model”, says Ms Koller.

That big MOOC initiative announced by San Jose State six months ago is on-hold (IHeD)

San Jose State Provost Ellen Junn said disappointing student performance will prompt the university to stop offering online classes with Udacity this fall as part of a "short breather."  Junn wants to spend the fall going over the results and talking with faculty members about the university’s online experimentation, which extends beyond the Udacity partnership and has proved somewhat controversial. She said the plan is to start working with Udacity again in spring 2014.  “I think the commitment is to look at the data carefully and make adjustments,” Junn said in a telephone interview Wednesday.  Preliminary findings from the spring semester suggest students in the online Udacity courses, which were developed jointly with San Jose State faculty, do not fare as well as students who attended normal classes -- though Junn cautioned against reading too much into the comparison, given the significant differences in the student populations.

The Daleks and Dr. Who make a show at Comic-Com (Guardian)

The big news outside the Comic-Con panel was confirmation that the Daleks are coming back for the 50th anniversary. Said Moffat: "The Doctor once said that you can judge a man by the quality of his enemies, so it's fitting that for this very special episode, he should be facing the greatest enemies of all." (A biscuit for anyone who got that reference to Remembrance of the Daleks.) But from the publicity stills we've already seen, the Daleks in question are the ones from the Russell T Davies era.

Photos of 1970s NYC (Atlantic)

And so closes Maxwells in Hoboken (New York)

“Maxwell’s felt like a Portkey in Harry Potter,” says ex–Hoboken resident Chris Stamey, one of the many musicians  mourning the great venue’s passing. In the pantheon of important New York City rock clubs—Max’s Kansas City, CBGB, the Bottom Line—Maxwell’s ranks as high as any, even though its legal address is New Jersey. Hoboken was still known mostly as Frank Sinatra’s birthplace when Steve Fallon began booking unknown bands in his tiny, plain bar 35 years ago. On July 31, after countless nights of weird music from acts that went on to fame (Nirvana, R.E.M.) or didn’t (the New Marines drew only one paying customer), the first couple of bands to perform at Maxwell’s—the Bongos and a—will play a final show, and the club will close.

Flipping the class room for ancient Rome (Chronicle)

For me it all started last August, when I naïvely assumed that the students would be delighted to listen to short lectures at their own pace and away from an uncomfortable and noisy auditorium.  The problem, I soon discovered, was that nobody told the students they were supposed to hate lectures. They were genuinely disoriented when I didn't spend class time lecturing. Only about 25 percent of them watched the prerecorded lectures before class. As a result, class discussion of content became an exercise in futility. Their comments at the end of the semester made it clear that about two-thirds of them preferred a typical lecture class.  I'm pretty sure my students would have been no more interested in watching a Superprofessor lecture on Ancient Rome than they were in watching me—it wasn't me or my style (as they clearly said in the surveys); it was the extra work required of them.

Assigning fiction reading in business school (HBR)

My view of what makes literature so valuable in the classroom is that it helps students really get inside individuals who are making decisions. It helps them see things as these people in the stories actually see them. And that's because the inner life of the characters is imagined and described, in many cases, by brilliant writers whose sense of how people really think and how they really work have been tested by time over decades or even centuries.  We have students, as you know, from a wide variety of backgrounds. And many of them take this course because they've got their own sort of personal interests and concerns-- things they're really trying to think through. And what they often really learn is not sort of what the author put in there, but they learn what other students see and understand and are troubled by or like in these stories.  So it's a very complex form of learning, but it's very different from the old instructional model. In many ways, it's like the case method approach to learning.

Jefferson Memorial

From this morning.  We hold these truths, etc, etc.

MediaWeek (Vol 6, No 28): Turow and Authors, Library Incinerator, Open Access, Apple Decision, Responsive FT, Linguistic Rowling + More

Gene Schwartz writing in Book Business magazine about Scott Turow's advocacy for the lowly author (Book Business):

Copyright protection has now become a two edged sword. Not requiring registration, ownership is vested from the moment of the first scribble. Large corporate copyright holders who can afford policing these provisions, are now benefiting a few authors at the expense of the many, by constraining the ability of journeymen and aspiring creators to excerpt and cite from other works without going through daunting procedural barriers, at the risk otherwise of what could be draconian punitive penalties (the threat of up to $150,000 in statutory damages) and outsized processing and permissions costs.

So, Turow’s main point has traction with me, that our institutions work against the author’s interests: legal decisions such as the first sale doctrine applied by the Supreme Court to the recent Wiley case – albeit confirming what has been going on for over fifty years; regulatory interventions such as that of the Justice department upsetting a settlement supervised by the courts, and agreed to by the Authors Guild, major publishers and Google.

Turow also made a point that with Amazon’s patent for the resale of e-Books, non-drm protected works would need very few original sales in order to create an unlimited copyable inventory for the resale market. This forecast may seem a bit extreme, but I think it suggests is that Scott Turow’s lament is not without foundation. Unless the industry and the legal system is prepared to re-visit how creators can extract a legally and technologically enforced portion of the economic value of their intellectual output, very little economic value will remain after first publication.

That big train crash in Canada destroyed a library (Metro)

The fatal train disaster that obliterated much of Lac-Megantic also destroyed the local library, including irreplaceable items outlining the history of the town and the surrounding area. Nothing is left of the building — which bordered the railway tracks — except ash. Including books, some 60,000 items are gone. The library was next door to the Musi-Cafe, where dozens of patrons and employees died after the July 6 tragedy. The archives were personal — more than two dozen families had donated various documents, items and heirlooms since the library opened in 1991. Diane Roy, chairwoman of the library’s board of directors, said the archives included letters penned by her uncle dating back to the Second World War. Other items included some of the oldest photos in existence of Lac-Megantic as well as the negatives. Also gone forever are a few hundred works of art — reproductions, originals and some that were being housed on loan.

Michael Clark writing in Scholarly Kitchen on the Apple court decision (ScholarKitchen):

What this means is that anyone wishing to enter the ebook distribution space will face an ebook pricing war against an entrenched competitor that is willing to sell at a loss, propped up by a seemingly limitless supply of cash from investors who do not seem to care about margins so long as market share is growing.

The result is likely to be an ebook market (at least in trade publishing – professional and scholarly publishing is a different matter) with little innovation – why would anyone bother? Not only must a new entrant invest in new technology, negotiate complex, multi-national rights agreements with publishers, and market their new product to consumers, they must then slog it out in a price war. And while a very few entrants such as Kobo are trying, one of the few companies with the cash hoard to withstand Amazon is Apple (Google is another and Microsoft, reported to be flirting with the idea of purchasing Barnes & Noble’s Nook business, is a third), though a price war goes against their DNA and it is not clear that ebooks are important enough to them to be worth the cost.

In case anyone thinks that this is overstating the bleakness of the situation, I direct you to the recent departure of Barnes & Noble’s CEO, William Lynch, a former Palm executive who was brought into the company to grow their reader business, in what Reuters called “an acknowledgement that its digital division Nook has failed to compete successfully in the e-reader and tablet markets“. Furthermore, after reporting that Nook sales dropped 34% last quarter, the company announced it was pulling the plug on its hardware division.

Interesting business case review of the Financial Times responsive design approach (SmashingMag):

In order to stay competitive, a digital product needs to evolve, and as developers, we need to be prepared for this. When the request for a redesign landed at the Financial Times, we already had a fast, popular, feature-rich application, but it wasn’t built for change. At the time, we were able to implement small changes to features, but implementing anything big became a slow process and often introduced a lot of unrelated regressions.

Our application was drastically reworked to make the new requirements possible, and this took a lot of time. Having made this investment, we hope the new application not only meets (and even exceeds) the standard of the first product, but gives us a platform on which we can develop faster and more flexibly in the future.

Why Open Access makes no sense (Guardian):

There can be no such thing as free access to academic research. Academic research is not something to which free access is possible. Academic research is a process – a process which universities teach (at a fee). Like it or not, the primary beneficiary of research funding is the researcher, who has managed to deepen their understanding by working on a particular dataset. The publications that result from the research project are only trivially a result of the research funding, they come out of a whole history of human interactions that are not for sale. Not even in a slave society.

For those who wish to have access, there is an admission cost: they must invest in the education prerequisite to enable them to understand the language used. Current publication practices work to ensure that the entry threshold for understanding my language is as low as possible. Open access will raise that entry threshold. Much more will be downloaded; much less will be understood.

Nerd Alert: Heard on the Radio The linguistics professor who unmasked Rowling (BBC):

Prof Peter Millican of Hertford College, University of Oxford, helped unmask JK Rowling as debut crime writer Robert Galbraith. An expert in computer linguistics, the professor developed software to analyse and compare texts. He analysed The Cuckoo's Calling against Rowling's other novels, The Casual Vacancy and Harry Potter and the Deathly Hallows. He spoke to BBC News about how he arrived at his conclusions. "I was given some text by The Sunday Times - I had two known texts by JK Rowling, two by Ruth Rendell, two by PD James and two by Val McDermid. "What I did was clean up the texts, put them into my software and do a battery of tests to see what similarities there were.

From twitter:
Amazon shares hit another record on strong sales data Reuters
Blackboard Announces New MOOC Platform,By Jeffrey R. Young /The Chronicle Chronicle
Vital Source Launches E-Textbook Building Block for Blackboard Learn Platform PRWeb
Copyright actually keeps many books off the market, study says Fortune

Bali Wood Carving Craftsman 1971

These guys could whip up a nice piece of wood carving in less than a day and here, he's finishing up something that's been sitting in PND Abbey for forty years now.   It's days may be numbered as the PND aristocracy is forced to downsize due to events entirely within their control and it could get tossed in the skip.

Justice Department declares emphatic victory in price fixing case against Apple eBookstore

In a decision which will undoubtedly be appealed but which opens the possibility of hundreds of millions of dollars in penalties and restitution, Apple was found guilty of conspiring with publishers to raise eBook prices.  Personnally, I thought Apple had a good case but Judge Denise Cote noted that Apple facilitated the conspiracy, took advantage of the publishers paranoia regarding Amazon and also leveraged the impending launch of the iPad that caused higher pricing for eBook consumers.

For the Department of Justice - them of the spider-web of telephone conversations - this was an opportunity for a victory lap and some degree of hyperbole (DoJ)

“This result is a victory for millions of consumers who choose to read books electronically.  After carefully weighing the evidence, the court agreed with the Justice Department and 33 state attorneys general that executives at the highest levels of Apple orchestrated a conspiracy with five major publishers – Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster – to raise e-book prices.  Through today’s court decision and previous settlements with five major publishers, consumers are again benefitting from retail price competition and paying less for their e-books.

 

“As the department’s litigation team established at trial, Apple executives hoped to ensure that its e-book business would be free from retail price competition, causing consumers throughout the country to pay higher prices for many e-books.  The evidence showed that the prices of the conspiring publishers’ e-books increased by an average of 18 percent as a result of the collusive effort led by Apple.

  “Companies cannot ignore the antitrust laws when they believe it is in their economic self-interest to do so. This decision by the court is a critical step in undoing the harm caused by Apple’s illegal actions. 

“I am proud of the outstanding work done by the trial team.  The Antitrust Division will continue to vigorously protect competition and enforce the antitrust laws in this important business, and in other industries that affect the everyday lives of consumers.”

Other reports:

Reuters
Telegraph
WSJ - No comment from Amazon.

MediaWeek (Vol 6, No 27): Childrens Books, Kodak Moment, Education Technology, Cengage Pricing +More

The Atlantic magazine goes along to the New York Public library to review an exhibit there on Children's books (Atlantic):

The exhibit also reveals that the books that matter to children are not always the same as the ones adults think should matter. Marcus cites Edward Stratemeyer, the turn-of-the-century author and entrepreneur who launched The Bobbsey Twins, The Hardy Boys, Nancy Drew, and other commercial favorites. An adulatory 1934 profile in Fortune magazine said that children's book publishing had been a sleepy backwater until Stratemeyer proved it could be big business, "and he did so by publishing book after book that the critics of the day thought mediocre but that children loved," Marcus says. Likewise, The Poky Little Puppy, which is on view, was one of the original 1942 Little Golden Books that the librarians of the day thought were not artistic enough to be worthy of children—but that kids loved anyway.

The genre has come a long way over four centuries. "Early children's books tended to be solemn and purposeful," Marcus says. "They were created to teach a moral lesson of some kind and they spoke to the child from on high. This approach worked well enough for groups with a fundamentalist view of life—the Puritans for instance—and with certain basic lessons that needed to be communicated as early as possible. But other kinds of books for children began to appear by the mid-1700s. Under the influence of John Locke and his observations about how children learn and grow, this new kind of children's book showed a greater awareness of children's interests and capabilities."

Another look at the fall of Kodak from Kenny Suleimanagich reporting in Medium:

Analysts have pointed to a number of factors in Kodak’s fall, from general mismanagement to poor financial decisions. Its divestiture of Eastman Chemical stripped billions in cash flow that might have propped it up as it struggled to make the transition to digital. Others point to antitrust suits that hampered the company for decades and opened the door to rivals. Some of those, notably Fuji, were able to manage the analog-to-digital conversion successfully.

To the people in the trenches, like DeMoulin, the failure always comes back to the same key error: Kodak, they say, suffered from a fundamental breakdown between, on one side the engineers and tinkerers — many of whom saw the digital future clearly and fought to bring it forth — and on the other the top management, whose interest remained fixed on molecules and the miracle of near-monopoly profits.

DeMoulin told me about watching a team in 1980 demonstrate a scanner-printer that converted film images to digital. “That’s when I thought: This digital thing is going to happen,” he recalls. His place at the helm of the professional-imaging division allowed him to autonomously invest in developing a digital still camera, and he says he pursued that vision, despite lukewarm support from the company.

The Economist takes a look at how technology is disrupting education (Economist):

The main reason for optimism, though, is the evidence coming in from classrooms. Adoption of education technology in America’s state-funded schools was given a boost by a requirement to measure pupil performance in the No Child Left Behind Act, signed by George W. Bush. Online learning was first picked up in some surprising places, including rural Idaho, where schools were looking for ways to expand the limited curriculums they were able to offer. Barack Obama’s Race to the Top initiative gave a further shove, making billions of dollars available to states willing to innovate. At the beginning of June his administration announced a plan to give 99% of America’s students access to high-speed internet within five years.

Those schools that have pressed on have done rather well. Rocketship, a chain of seven charter schools in San Jose, California, blends traditional teaching with at least an hour a day of individualised online instruction in mathematics, literacy and comprehension. Its low-income pupils outperform those living in the wealthiest districts in the state. Over on the east coast Mark Edwards, superintendent of the Mooresville graded school district in North Carolina, introduced personalised learning on laptops for all pupils aged ten and over in 2009. His district is now one of the state’s leading performers, despite being close to the bottom in funding per pupil. Between 2009 and 2012 the share of its pupils considered proficient in maths, science and reading rose from 73% to 88%.

The Chronicle of Higher Education covers the Cengage bankruptcy but in the comments was this from "Fyzprof" on textbook pricing (Chron):

See the article by Peter Roll, "Introductory Physics Textbooks", Physics Today, Jan. 1968, p. 63. The article lists 50 texts, ranging in price from $5.50 to $14.75 in 1968. This translates to roughly $36 - $100 in 2013 dollars, according to an online calculator that uses the Consumer Price Index. Since this is the high end of the "trade book" range, I would consider it reasonable for textbooks.

In the 1960's, science and math books tended to be more expensive than texts in other fields due to the complex manual typesetting of equations and diagrams. Everything is electronic today, so I don't know why the prices are still so high. A Cengage text for a one-semester advanced course (3rd ed.) that I thought was expensive at $16.50 in the 1970's now retails for $347.95 (7th ed.). Yes, three hundred(!) and fifty bucks. The publisher's rental fee for the fall 2013 semester is $120. A Wiley text that cost $13.50 in 1968 (1st ed.) now costs $247.99 (10th ed.) for the regular version and $257.99 for the extended version. The electronic version is $89 and requires that the student download and install proprietary software. The electronic version may or may not stay active throughout the entire multi-semester course sequence. It is frustrating to have proper texts available, but not be able to use them.

The publisher and bookstore reps are always extremely helpful and have been very good to me through the years. I appreciate that very much. Unfortunately, the astronomical prices effectively sabotage my courses. I recently had a class revolt on the first day of the term because of a $180 paperback for the one-semester course. I used that book for over ten years, but I can't use it any more. Its current list price is $271.95, and even the previous edition, used, is well north of $150. Students generally prefer paper books, which are easier to use and sell. Many electronic versions are non-transferable and expire within a year. Students who might otherwise keep their books for future reference cannot do so. They find it necessary to sell their books from one semester in order to raise the money for next semester's books. To save money, students order their books online. The term is half over by the time the books arrive. In the meantime, the students fall behind and make excuses for not completing their assignments. Even if students don't revolt openly, the resentment is there and that makes it difficult to establish a good rapport with the class. This whole textbook situation just doesn't make for a good learning experience.

From twitter this week:
'Publishing has gone mad': literary world rocked by moves at HarperCollins and Penguin Standard
The Guardian Literary clock - add a quote Guardian
Newsstand in Brooklyn subway station becomes pop-up shop for books and zines PW
Russell Brand: what I made of Morning Joe and Question Time Guardian

And in sports, how great was Andy Murray? (Guardian)

Cengage Declares Bankruptcy as Expected

Cengage has submitted a per-arranged bankruptcy filing which will wipe $4Billion in debt off its balance sheet and in the process enable them to "better position the company for long term growth" according to their press release.  The wipe-out leaves the company with approximately $1.8Billion in debt but it will be the crippling debt payments, loan requirements and covenants that will do most to free up the company to do what the private equity investors said they would do in the first place which is to push the company into producing more digital and on-line products.

The company has been aggressively re-populating its' executive suite and under Michael Hansen who joined as CEO from Elsevier last year, the company now has an almost entirely new executive management team.  It would be expected that this new team will have more flexibility in developing new products and expanding their Cengage MindTap (which still sounds like a medical procedure) products.  When the original Apax led private equity deal was done, there were promises made that Cengage would begin to haul back the advantages that Pearson and McGrawHill had built up in their respective investments in digital learning; however, reality bites, and the debt coupled with a fast slow down in the education market conspired against them.  It is likely that insiders at the company knew this day was inevitable at least two or three years ago as the market slowed and their cash flow became less buoyant.  That's only to imply that the market did not grow sufficiently to match their projections and allow them space to grow the business.

Perhaps this is finally the end of stupid publisher ticks with debt.

Here is the Cengage press release and the text is below:

Stamford, CT – July 2, 2013 – Cengage Learning, Inc., a leading educational content, software and services company for the academic, professional and library markets worldwide, announced today an agreement with certain of its lenders to restructure its balance sheet and significantly reduce its approximately $5.8 billion of outstanding debt to better position the Company for long‐term growth and profitability. In order to implement the financial restructuring, Cengage Learning and all of its domestic wholly‐owned subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the Eastern District of New York.

In conjunction with the Chapter 11 filing, Cengage Learning entered into a restructuring support agreement with an ad hoc committee of first lien lenders who hold approximately $2 billion of the Company’s first lien debt. In this agreement, the lenders committed to support a restructuring transaction that will eliminate more than $4 billion in debt from Cengage Learning’s balance sheet and position the Company to implement management’s strategic business plan.

Cengage Learning maintains substantial cash balances and expects to generate positive cash flow, and therefore does not need nor intend to obtain debtor‐in‐possession (DIP) financing. In addition, the Company has reached an agreement with its secured lenders that permits it to continue to use cash flow from operations to continue to fund the business and meet obligations in the normal course during the restructuring process.

Michael Hansen, Chief Executive Officer of Cengage Learning, said, “The decisive actions we are taking today will reduce our debt and improve our capital structure to support our long‐term business strategy of transitioning from traditional print models to digital educational and research materials. Cengage Learning began an operational transformation six months ago under the leadership of our new senior management team, which is executing bold plans to enhance our customer relationships and introduce innovative digital and print products and solutions to meet our customers’ evolving needs.

“A more appropriately‐sized capital structure, along with our established product lines, leading market positions and strong customer relationships, will position us well to accelerate our growth and take advantage of business opportunities in the education and research space. We are grateful for the support of our key financial stakeholders for our business plan and restructuring. We will continue normal business operations, with no expected disruptions to our relationships with our employees, customers, business partners, or vendors. Our customers can be confident that they will continue to receive the same high quality content, products and industry leading services and support they are accustomed to without interruption,” concluded Mr. Hansen.

Cengage Learning plans to make timely payment to vendors for goods and services provided to the Company during its restructuring in the normal course of business. It is anticipated that employees will continue to receive their usual pay and health and welfare benefits.

Cengage Learning has filed customary “First Day Motions” with the Bankruptcy Court, which, if granted, will help ensure a smooth transition to Chapter 11 without business disruption and will minimize impact on its employees, customers, authors, content providers, business partners, vendors and suppliers. The motions are expected to be addressed promptly by the Court. Cengage Learning plans to make timely payment to vendors for goods and services provided to the Company during its restructuring in the normal course of business. The Company fully anticipates that employees will continue to receive their usual pay and health and welfare benefits and is confident that the Court will approve its request to do so.