Should criminals profit through books?

Readers of this blog will have noticed in recent weeks a pattern has emerged, whereby I post very little for several days, and then when I get days off, post several times a day. I receive several email bulletins with news from around the book world, and read other sites such as The Bookseller on a regular basis, adding comments as I feel necessary, but save the blogging for when I have time to write much more in depth.

Today is one of those days - my first post was about the credit crunch which is affecting EUK and more specifically Bertrams, but my second post for today will detail the various stories that I have found particularly interesting, which have circulated around the book world this week.

Two have particularly caught my eye, the first of which comes from The Guardian. This concerns a Government decision to introduce legislation preventing criminals from profiting from the sale of their stories through books. This has caused a furor within the book world, where publishers pay handsomely for such rights, with many citing this as unworkable and an attack on free speech.

The plan, which is part of the Coroners and Justice Bill announced as part of the Queen's speech, is likely to involve the introduction of a UK-wide civil scheme for the recovery of profits from criminal memoirs. A spokesperson from the Ministry of Justice said it was too early to provide more details, but that the scheme would be unlikely to attempt to retrieve profits retrospectively. The scheme, which is designed to prevent criminals from profiting from their crimes, would not include accounts of prison life such as written by Jeffrey Archer (politicians know how to look after its own), books about other people's crimes, or fictional accounts of crime.

On the surface this sounds all well and good, but (and there is always a but), as Peter Walsh, publisher at true crime specialist Milo Books said "practicality is a different argument from ethics." Walsh went on point out that writing about their experiences is for many criminals part of their rehabilitation, and can often lead to new and successful careers where they make a real contribution to society (which includes paying taxes). In some ways this is no worse than celebrities who write about their struggle with drink and drugs, as many argue that in both cases, these books glorify the writers previous activities and encourage those at the bottom of the pile, who look up to such individuals, to follow their example. I have heard some comment that the admission that one has such a problem seems to be worn as a badge of honour.

The second point that Simon Juden, Chief Executive of the Publishers Association pointed out is that much of the most potentially offensive stuff wouldn't come from people convicted of crimes. For example, Nelson Mandela couldn't publish stuff because he was convicted of a crime, but OJ Simpson could, because he wasn't (that has since changed). This scheme is therefore targetting the wrong people.

The second story which comes from Publishers Weekly, is that Amazon boss Jeff Bezoz has been voted as Publishers Person of the Year. My own views on his company are well known to anyone who has read this blog, but love him or loathe him, he is a force to reckoned with, and one that has changed the face of publishing in the 14 years since Amazon was launched.

Bezoz claims in an interview at the company's Seattle headquarters that those at his company see themselves as explorers. He goes on to say “It’s much more interesting looking at unexplored terrain” and, because of the Internet, “there is boundless unexplored terrain.” This makes him sound like a character from Star Trek, going where no man has gone before.

His strategies of allowing negative reviews and the sale of used and second hand books prompted strong criticism from the book world, yet you have to admire his vision. As he also points out "To succeed in new businesses you have to be willing to experiment and to accept possible failure."

That is the hard part, compared to that, starting a business is easy.

Questions, questions and no answers

With the almost certain demise of Woolworths and wholesale arm EUK in administration, it is difficult to see where this credit crunch will end. Although not personally affected (despite claims by some quarters, my own job is relatively safe), it is distressing to see so many who are.

The situation at EUK does not look good. 700 staff lost their jobs last night, 2 weeks before Christmas, and the administrators are said to be calling in the company's debts. This is not good for the supermarkets either, who owe most of the money, although one cannot help but think that their sitting on this money for so long (figures of up £25 million are being talked about for both Salisbury's and Tesco), then EUK may not have been in this mess.

That though is the name of the game - as George Bush would have put it - the haves and the have mores. It has always been the way that some have to be sacrificed so that others remain profitable. Perhaps it is time to start questioning that ethos, as we are all entitled to earn a living.

The situation with Zavvi, which previously traded as Virgin Megastores, is even worse, as they owe EUK £106 million - how and more to the point, why the accounts department at EUK allowed this happen is beyond me - they should never have allowed things to get to this stage. If Zavvi fails to pay this debt, then they too could be placed into administration, with the loss of yet more jobs. A statement from the company is expected soon.

In the meantime, with no buyer for Bertrams, the book world is getting very nervous. Publishers are also affected by the demise of EUK, with the wholesaler owing them money, which they are unlikely to receive in a hurry. A total figure of £25 million has been suggested as money owed, with Random House the worst hit. Could this also bring publishers down I wonder - I sincerely hope not.

One does wonder what this whole thing is about and what would happen if Bertrams were to go. This would leave just one major wholesaler, in the shape of Gardners, for the whole book trade, and handful of smaller specialists.

MD Michael Neil has been putting a brave face on things, insisting that it is business as usual and the scaling down of EUK, which has still been supplying some stores, would not affect attempts to find a buyer. Talks are continuing with a number of interested parties and there is no set time scale for the sale. But he added: "We have to be realistic. Christmas is in the way but we want to get a deal done as soon as possible."

The wholesaler, which was bought by EUK in January 2007, has separate financing and has not been affected by EUK's administration. The administrators confirmed that Bertrams will continue to trade as normal, but their situation remains precarious.

Big publishers and distributors agreed with Bertrams last week that the wholesaler would pay cash upfront for stock. Neil admitted that these new terms were affecting business (how can they not), as they can only buy what they know will sell. This is seriously bad news for the smaller publishers, although most requests for their stock will be as special orders and therefore firm sale anyway. This decision is though bound to affect availability of slower selling and niche titles.

I hope that they manage to weather the storm, but if the worst does happen, could this mean the end of wholesalers in our country, or will a new contender emerge, in the form of a smaller company keen for expansion? If so, who could that be? Gardners could not buy Bertrams out, as that would create a monopoly, although if Bertrams do go, there will be a monopoly anyway.

If the publishers fail to get back what they are owed, where will it leave them - these costs will have to be recovered from somewhere, and this will inevitably mean several things - pay freezes for the staff, a cut in advances for authors (especially for first timers), and an increase in cover prices. Will they have to re-negotiate terms with the wholesalers that are left, and with book stores that they supply direct to for core stock? Could this lead to a re-opening of the firm sale debate all round and hasten its introduction, and will that hinder or benefit the small presses?

Questions, questions and no answers.

Black Wednesday for the book world

As the future of wholesaler Bertrams as part of EUK, the wholesaler arm of Woolworths hangs in the balance, the book world is holding its breath to see what happens. The most likely contenders are Lingenbrink, Libri and Koch or Neff - all of them German - or Dutch based Centraal Boekhuis. The strong Euro may make the company look attractive, but Germany in particular and the rest of Europe are like Britain, on the brink of recession, and European banks are tighter on lending than their UK counterparts.

Across the Atlantic and encouraged by the strengthening dollar, Ingram may also be a contender - they already have a presence in the UK via Lightning Source, but the recession in the US is if anything worse than here.

Negotiations also continue for a buyer for the troubled chain of Woolworths stores.

Yesterday I read of the redundancy of Telegraph Literary Editor Sam Leith after ten years service. I wish him well in his future career. Yesterday was not a good day for publishing all round Stateside, being tagged as "black Wednesday", following the news of 35 redundancies from Simon and Schuster and that Thomas Nelson are to shed 10 percent of their staff, effective on Friday. This comes on top of planned re-structuring at Random House. I see as well that the Penguin Group have frozen all 2009 pay rises for staff who earn more than $50,000 (£30,000) a year.

Total sales for America's three largest chains fell 6.3 percent for the quarter ended November 1st, with revenue falling to $1.93 billion. All three have blamed the decline in customer footfall, with sales particularly slow in September and October, traditionally the time for new releases in non-fiction. The book sellers are not alone, with other retailers also feeling the pinch. Both footfall and conversion at the store that I work in have tumbled in recent months. reporting Last Wednesday, the Commerce Department in the US reported that consumer spending fell by 1 percent in October, the steepest decline since 911.

Borders saw the highest drop of all the chains, at 9.4 percent. It also suffered the largest decline in like for like conversion on a branch by branch basis. CEO George Jones said the steeper decline at Borders was due to the company’s aggressive inventory reduction program. He stated that Borders are “fine tuning” their inventory program and have a team in place going from store by store to restore any titles that may have mistakenly been removed.

It is timely that BBC2's Money Programme is set to explore the state of the publishing industry in the New Year. The programme will include interviews with Larry Finlay of Transworld, Patrick Janson-Smith of HarperCollins, agent Carole Blake, author Catherine O'Flynn, Luke Brown of Tindal Street, Neill Denny of the Bookseller, and Nicholas Clee of BookBrunch. It will also feature Amanda Ross of Cactus TV, the makers of the Richard and Judy show. I look forward to watching it in due course and seeing what conclusions are reached.

Turning life's crap into compost

The daily Book News update that I receive today featured an article about one Bill Shapiro (editor of Other People's Love Letters) who is asking for authors to send in rejection letters for a new book that he is working on, entitled Other People's Rejection Letters. Letters can be typed or handwritten on paper, by text email or in any format the recipient chooses, and can be either emailed to Bill direct as an attachment or scanned in.

This is an interesting idea that I can see might have a considerable market. Rejection is a necessary evil that every writer has to deal with, and I have had more than my fair share over the years. Perhaps I will send Bill some of mine. The ones I found the most offensive were those addressed to Jane rather than June, showing that the writer had obviously not bothered to read my work. I can imagine how they would have felt if I had spelt their name wrong, but for some reason it was deemed acceptable for them to do this to me.

The post predictably featured several comments from would-be authors, on either side of the pond. One of these contained a link to the website of one Mary Patrick Kavanagh who has found a novel (no pun) way to celebrate the imminent (self) publication of her book. She will be holding a live funeral for it, on December 6th, which can be watched via webcast, hosted by Lifemark Chapel of the Chimes. This will include a viewing of the 'failed' manuscript, rejection letters etc, together with the authors much watched DVD copy of The Secret (I can relate to this one). Viewers are encouraged to bring remnants of their own dead dreams to be buried alongside the authors own dashed hopes. Mary goes on to say that copies of the rejected novel will be sold in the lobby to offset the cost of the appetizers served afterwards. Pity purchases are welcome and encouraged.

I don't why I didn't think of this when I self published my book 2 1/2 years ago - but then again I am not American - and things like this can only happen there. I applaud her sense of humour and enterprise and hope her book is a resounding success. Pity I am working that day, or I would have booked a front row seat !

Known commodities

As furniture chain MFI enters administration, it looks as if Woolworths will follow suit. According to the BBC News site tonight, the troubled retailer has buckled under the strain, after weeks of uncertainty, placing 815 stores, and countless jobs in jeporady. The board of Woolies, one of the UK's oldest chains, have been in talks since 1800 hours to make the formal decision and announcement, which will no doubt come by morning.

Thankfully wholesaler Bertrams is unaffected by this decision, and for them at least, it is business as usual.

In the meantime, and just to underlie how volatile the publishing business it, US publisher Houghton Mifflin Harcourt has closed its doors to any new acquisitions, in a move that has rattled agents throughout the industry. At the other end of the spectrum, it has emerged that the Hachette Group, whose stable encompasses names as Little Brown and Grand Central Publishing, are giving a bonus equivalent to one weeks salary to each of their employees.

If things were already bad for first time authors, struggling to find a deal, they were dealt an ever bigger blow when literary agent Esther Newberg said “It is seriously going to be a time for known commodities,” in case anyone might consider self publishing instead, she went on to say "I would hate to be starting out in the business.”

Even Google is not immune. The company is reducing its 10,000 strong army of contractors, in an effort to cut costs. A spokesman for the company admitted that they had been considering this for some time, since such staff, who make up a third of their workforce, are easier to shed.

A tough Christmas - especially for celebrities

With sales down at almost all major retailers, within and without the book trade, and crisis talks at Woolworths, this will be a bleak Christmas for many. The market in which I work is one of the worst hit, mainly since the products that we sell are seen not only as expensive, but also as non-essential.

The book world is finally being forced to wake up to the reality of the discounting culture that it unwittingly created with the abolition of the Net Book Price Agreement. Echoing what I have been saying for months, The Bookseller reports that according to the Booksellers Association Benchmark Study, the results of which were released on Friday (November 21st), UK booksellers are locked in a damaging "vicious circle" of discounting, and are making fewer profits and seeing less growth than their counterparts overseas.

The report goes on to say that book stores have been hit by a "triple whammy" of declining average prices, stagnating growth and rising costs. Of the countries studied (UK, USA, Ireland, Netherlands, Finland and Sweden), only one (the United States) had a lower average selling price than the UK, with perhaps more worryingly, the number of books sold at discount in the UK rising from 44 percent in 2004 to 51 percent in 2007.

The report estimates that UK bookshops lost around 10 percent of volume sales to other sources, such as supermarkets and online retailers during that same three years. Gross margin for UK booksellers per book is put at around 25 percent (meaning that my book which is sold at 40 percent discount, is a relatively high earner for most), far lower than the average of the countries surveyed.

Echoing my own words, BA president Graham Rand said: "We have to ask ourselves whether the industry has gone too far in creating this -'lowest price' environment for consumers; through this serial discounting are we simply devaluing the worth of the book in consumers' eyes?" I have been saying this for a long time, ever since I first began to learn about publishing in fact and understood how the supply chain works. The lower the prices go, the more books are seen as throw away commodities, of little or no value.

Any fool can surely see that such heavy discounting is not good for business - and not just for book stores. Every sector of publishing is affected by this aggressive strategy, from publishers to book stores to authors. On the surface, it is good for the consumers, since they get lower prices, but it also means less choice, as the money is no longer there to nurture and support up and coming talent, hence the explosion in self publishing. Instead of welcoming this, and seeing it as a good thing that leads to increased choice and competition, the majority working in the industry see this as bane and a dumbing down of quality, to be kept out at all costs. One look at the average celebrity (supposedly) written book will soon tell you where the real dumbing down has come from - the industry itself that pays such obscene amounts to publish these books - not for much longer though.

The BA hopes that this report will be used as a springboard to book sellers to re-think their business strategies, and so do I, for the good of all. Discounting has its place, to encourage sales in slower moving titles perhaps, but to sell brand new books as loss leaders is irresponsible in the extreme. Instead of creating business and instilling brand confidence, this ultimately has the opposite effect. The company I work for, in the electrical sector is undergoing a major re-branding exercise to overcome their public image as a discount retailers; if the book stores do not change their stance, they may be forced to do the same. The conditions may be difficult - they are for all - but there is more than one way to skin a cat - if money is tight, instead of discounting, we need to find ways to cut costs by as the report suggests, closer negotiations with publishers, rethinking of labour costs, increased product ranges and ensuring the supply chain is being used effectively.

Things may be good for Katie Price (her latest book is reported to have outsold Gordon Brown's by 4,446 copies to 193, in just two weeks) but the signs are that the industry is finally catching up with public opinion and cottoning on to the fact that these so-called celebrity memoirs are not worth the money being spent on them. As a genre, celebrity memoirs are losing popularity fast, in favour of self help and books on how to beat the credit crunch.

As well as a more cautious public, who see these books as expensive luxuries, publishers can no longer afford fees reaching into seven figures for such authors. In the first six months of 2008, publishers' lists for non-fiction hardbacks were crammed with books by celebrities, including the aforementioned Katie Price, Katherine Jenkins, Myleene Klass and Craig Charles. Books were also scheduled for older more established stars such as Esther Rantzen, Julie Andrews, Mike Oldfield and William Shatner (now that one might be worth reading). Lists for 2009 reveal only 3 such celebrity books, by comedian Jack Dee, TV host Jeremy Kyle, and comedienne Jo Brand.

The majority of these books are issued as hardbacks, with cover prices (before discount) around the £19 mark, which is a high price to pay. Last December, books had to sell at least 10,000 copies to make it into the Top 20 of the Bookseller magazine's sales charts, this year that has halved to just 5000 copies. While some books have done remarkably well, other have failed to meet expectations. Dawn French is said to have received an advance of up to £2 million for her memoirs, Dear Fatty, yet the book has sold just 30,000 copies. Simply put, celebrities are becoming a de-valued currency. Despite these huge advances with thousands spent on publicity, the majority fail to deliver on sales and do not earn their advances back. Books like this cost publishers money, and lots of it, and the more books that make a loss, the less there is to pay the real writers, who in the meantime, struggle to get any advance at all.

Publishers are beginning to see the light, and are becoming more and more cautious when it comes to these deals. As Stuart Kelly, Scotland on Sunday's literary editor, said: "When even the big names aren't selling, the economics don't add up. Add in the shrinking books market overall, as the credit crunch takes effect, and publishers become no longer willing to take a chance."

Publishing, or for that matter any business venture, is a game of chance, which can go either way. The current economics and experience show, that celebrity books are losing favour with the reading populace. Everything goes in circles, as I knew it would sooner or later. At times of uncertainly the public do not want to know about other peoples glamorous lives, as all this does is create more misery, what they want is believable information and ideas on how to escape from their own. Maybe it is time for me to write that book about Lundy?

A victory for common sense

I have been considering of late whether to publish this blog (omitting the personal and work related stuff) but since it is not likely to be that commercially viable, and on the recommendation of various writing friends, will probably do this via Lulu rather than Authors OnLine, who although very good, are not cheap. At this stage in my life I do not have the funds to publish another book, yet reading through some of the older posts on here, from when I first started this blog (at the beginning of 2006), they are rather good, and have the potential I think, to help a lot of others who may be considering this route. I also considered (and will get around to at some point) writing a more detailed book about print on demand in the UK, and publishing through Lulu may be a useful experience to write about. It will be useful to have tried this route, and have more than one angle to write about (doing it yourself as opposed to through a POD provider who oversee all the formatting and so on for you).

To this end, last weekend I bought one of the those new netbook computers. I have been considering one of these for a while, since my old laptop is rather heavy and bulky for travelling with, especially on the winter helicopter service, where there is a strict weight limit and not much room for hand luggage in the cabin. The one I chose, the Acer Aspire One, has a nine inch screen and 8 GB flash drive, with a Linux operating system. It will be more than adequate for my needs, and a useful and versatile travelling companion.

Not much has been happening in the book world these past few weeks, now that I have got to the bottom of what is going with Amazon and the introduction of their own print on demand service in the UK. The court case with Booklocker must be due quite soon, but there has been no more news. I expect it will appear on the Bookseller in due course, and I will no doubt hear about it from the various writing sites that I post on, as well as from Angela Hoy (the plaintiff) and the Long Riders Guild, whom I am in touch with from time to time.

Now that Oprah Winfrey has endorsed the Kindle, I expect that Amazon shall be selling a few more of these devices. It is not expected to be launched in the UK until the spring, so for the moment we will have to content ourselves with other means, such as the Sony E-Reader, which I expect Waterstones will also sell a few of over the coming festive season.

It will be a tough one this year for all retailers, not just book sellers, with Amazon predicting a sharp downturn in sales. Shares in the company are reported to have plunged by 14 percent in after-hours trading, as Amazon lowered its revenue target for the final three months of the year to between $6 billion (£3.67 billion) and $7 billion, against the $7.2 billion previously forecast. Jeff Bezos is still a lot richer than I am, so I don't think he has anything to worry about quite yet.

I see that Google have also agreed to provisionally (what this means is anyone's guess) pay $125m (£80m) to settle a long-running legal dispute between it and US publishers over its controversial book scanning programme, Google Books.

According to a statement released today, the settlement, which is subject to court approval, will expand online access to millions of in-copyright books, and other documents, in the United States from the collections of participating libraries.

Google Book Search allows users to browse millions of books online and, in the case of out-of-copyright titles (or titles that the author chooses to upload to the site, as I have done), read an extract or sometimes (depending on the permission granted) the entire text. The settlement resolves two lawsuits filed in the United States just over three years ago, one of which involved the Authors’ Guild and the other of which involved McGraw-Hill, Pearson, John Wiley and Simon and Schuster. The lawsuits objected to Google’s plans to digitise, search and display extracts of in-copyright books and share them online without the explicit permission of the copyright holder - I should think so too.

Under the terms of the provisional settlement, users will be able to search and preview millions of additional titles, including out-of-print books, online. Users will also be able to buy titles online via the Book Search site (thank goodness for small mercies). US academic institutions will be able to subscribe to the online collections of libraries from around the world, and students will be able to access millions of out-of-print titles from designated computers in public and university libraries.

In addition to resolving these claims, a portion of the $125 million potential settlement will go towards helping to establish the Books Rights Registry. This will be an independent, non profit organisation will pay the rights holders earnings from institutional subscriptions, book sales, advertising revenue and other potential revenue streams (similar to Public Lending Rights by the sound of it, but online). The registry will also be the method for authors to request inclusion or exclusion from the Google Book Search programme. I must remember to look at this myself then, once it is all set up, since it affects not only US based authors, but anyone whose work is distributed within that territory.

This is a victory not just for common sense, but also for both readers and authors, who will now get paid for the use of their work. I mustn't write too soon though, as how much we will get paid remains to be seen. If it is similar to the public lending rights system, where only a sample of libraries are used each year from which to calculate earnings, then this will not be much good at all, since the libraries that my own books is stocked in have so far not been included in this sample, meaning that even though I know they are being borrowed, I am still not paid. The real winner is then the reader, who will have access to a wealth of knowledge that these books contain.

Further information for authors affected by this decision can be obtained here and here.