3 Things Holding Publishers Back – and 1 Idea

Michael Bhaskar

Publishers are locked into legacy systems and mentalities on too many levels. It’s almost impossible to change this. What to do?

First some background. Last week I was part of the Big Ideas panel at the Futurebook conference. It was therefore a shame that, in true espirit d’escalier fashion, I had a further big idea on the way out. Although I’ve spent a great deal of time over the past couple of years writing a book about the past, present and future of publishing, in doing that research I wanted to steer clear of too many ‘actionable’ points.

The research was really about big picture stuff – more media theory than how-to guide. It was about publishing over the long term; the relationship between publishing and technology, publishing and capital, publishing and culture. So my ideas have become, well, either too big or too irrelevant for most publishers.

One question at the end of our session prompted a more practical response. The question was: why don’t publishers change more? Now, I am the first to puncture the myth publishers don’t innovate.

They do. From industrial processes to intellectual property, early trade union to Christmas presents, open retail to global product standards, ebooks to the earliest uses of desktop publishing, transmedia storytelling to the paperback, publishers have been on the edge of technological, commercial and social innovation for hundreds of years. Few industries have shown themselves as adept at managing constant change in challenging circumstances.

But. But. But there is still more to be done. As I argue in the book, only now, 20 years after the adoption of the web, are we seeing the true contours of the challenge: the fact that a) anyone can be a publisher, that the monopoly we used to enjoy has gone and b) the Internet has created massively asymmetric intermediaries. Exhibit A: Amazon. Complacency is not an option over the long term. So how many publishers have radically restructured, tooled and skilled to meet this challenge? Precious few. Asking why is a good and valid question.

My answer started by saying publishers lack ‘slack’. By slack I mean something specific – the slack suggested by Sendhil Mullainathan and Eldar Shafir: the ability to absorb shocks and disruptions, a general surplus which might appear idle but is actually integral to running a system. This crosses domains. There is financial slack, mental slack, capacity slack. The common factor is that slack is hard to find in publishing. In this thin margin business there is little time for people to stop, reflect and pivot. There is little space or money for doing things beyond simply keeping the show on the road.

Hence change, always hard, is even harder.

Beyond that though, I think publishers are suffering from two related diseases: path dependence and lock in. Path dependence is the phenomenon whereby, because you have done something in the past, so your future actions are conditioned in a certain way, even when that conditioning works against your best interests. Even if there is no necessary connection, because you have done x, you do y. Because that is the way you walk to work, you will walk that way tomorrow.

The weight of momentum for publishers is on the side of doing what they do. In hindsight I think it’s quite clear that ebooks were not a radical disruption but in fact, in most ways, slotted quite neatly into workflows and organisations. After all, they were basically an identical product with an identical business model. Now path dependence is making itself felt. Instead of taking the next steps into the digital environment publishers are carrying on as before. They’re still here and making profit; the ‘old ways’ need modification, not scrapping; everybody return to your seats; carry on publishing.

Coupled with this is system lock in. In the same way that many readers can’t readily shift from a Kindle unless they want to lose their purchased ebooks, so publishing systems and norms lock publishers into certain patterns of behaviour.

Rebecca Smart’s Big Idea on the panel is a perfect example. She argues the publishing schedule exerts a tyrannous influence. It locks us into inflexible practices and, to outsiders, inexplicably sluggish lead times. We are locked into bibliographic systems that prioritise a certain kind of product and release method. We are prisoners of our habits, methods and operations.

Path dependence and lock in aren’t obvious. Yet they saturate businesses. They are the hidden inertial weight dragging along the floor, preventing meaningful, deep change. They are the mental barriers to innovating. They are the little systemic quirks which keep book publishing from becoming something more.

What to do?

The only way the industry as it is presently constituted can realistically innovate is by letting go. It can’t interfere. It can’t watch over its shoulder. And, boy oh boy, it can’t try to manage the change. What it can do is provide seed funding, some expertise and stay well out of the way. Publishing needs more skunkworks.

It’s not an original idea by any means. Plenty of people have proposed similar and there are some great examples out there. Blackwells has opened a team on Silicon Roundabout for just that purpose – removed from the day to day pressures of the retail business and stuffed with devs, it has a wider brief and infinitely more flexibility than a classic in house IT team.

Macmillan have created Digital Science, a brilliant outfit somewhere between an incubator, an R&D unit and a VC; well lead, utterly separate to the usual corporate structures, with a roving mission. To me, this looks like the future of publishing. An equivalent in the education space is something like Pearson Labs.

The truth is everyone is now a tech company. Why else is Nike as much about personal tech as products? Why is Coca Cola launching an accelerator programme? Most major businesses, from Google to Shell, are creating the structures to produce genuinely disruptive innovation, either by protected skunkworks or through some sort of investment structure. And yes, this does even apply to content, that most elusive and difficult of industries, as the consultant Brian O’Leary has recently reported. VCs are beginning to recognise the value of content (which, no, hasn’t gone away). The point is they are looking for new structures around it.

Some publishers and retailers are going with the grain of history. But few of them, and none focused on the trade. Our old friends lack of slack, lock in and path dependence, all cut out of the loop by the incubator/skunkworks model, stay in the mix.

The other angle through which this might happen is through government or university programmes. People like the Technology Strategy Board, projects like the React Hub Books and Print Sandbox or the MIT Centre for Storytelling all show how public and third sector efforts can stimulate innovation. Indeed, there is a very strong argument that the majority of technological innovation comes not from the private sector, far more risk averse and investment light than is supposed, but is really supported by public funds with far sighted return horizons.

It’s all great, interesting and worthwhile. But the issue here is not so much with the underlying technology as with organisational design and consumer behaviour. Both of those are more nebulous and in some ways harder to shift than tech. The point is you don’t just need reactivity and constant experimentation, although you do; you also need market discipline and commercial experience. The need to make money is a powerful incentive to shape products and businesses in ways that will be sustainable and desirable in the long term.

Back to skunkworks. Publishers should do them. They should make teams, trusted and talented teams natch, give them an office in Shoreditch and money. And that’s it. That’s the best shot publishing has of breaking out. It’s the best shot publishing has of creating a business model in that holy of holies, D2C. It’s the best shot of being businesses built around traffic flow, service and curation rather than units sales. Just because something is difficult, expensive and counter intuitive doesn’t mean it’s not worth doing. Publishers are already creatures of risk. And the wolf is at the door.

Is it going to happen? Probably not. The truth is publishers just have other strategic priorities. They are path dependent creatures. There is always a chance. Let’s hope – because I for one think it would make a difference.

Michael Bhaskar is author of The Content Machine and Digital Publishing Director at Profile Books and Serpent’s Tail. He can be found on Twitter as @michaelbhaskar

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