Writers Magazine 2008

The current situation in the book trade is one of rapid change. It’s important for writers to understand what is happening as it will impact on their own chances of getting their work published and how it will be published. This new series will look at the changes in the book trade, with a different focus each week. The first article dealt with  where books are heading and what changes are taking place at the sharp end of the book trade - the bookselling world.

This second article will look at publishing

In the last few years publishing has seen an inexorable move towards conglomeratisation, in fact rather more so than in bookselling. In the UK Random House UK’s pre-eminence in terms of size has been successfully challenged by Hachette, which acquired Hodder Headline and then Time-Warner Publishing in quick succession, to achieve 15.3% market share in 2007. The percentages were: Random House 14.7%, Penguin 10.5% and HarperCollins 8.3%, meaning that the four biggest publishers have nearly 50% of the UK market. In fact these percentages are already out of date, as Hachette has more recently consolidated its lead by acquiring Piatkus Books.

A look at the US publishing scene shows the same dominance by the big publishers, with Random House leading the pack but HarperCollins, Penguin USA and Simon & Schuster also major players in the trade (general) publishing area.

These big publishers are very focused on growing their market share, and seem more interested in this than they are in profitability. For their owners the latter is key to their long-term future, since they are above all commercial ventures - and are expected to turn in growth and a profit every year. The corporations of which they are a part – Bertelsmann (Random House), Lagardere (Hachette), News International (HarperCollins) and Pearson (Penguin) have many other interests and are not necessarily focused on the book trade. They are the publishing divisions of large corporations and may act more like big companies than like publishers used to be.

Above all these big publishers are very focused on market share and highly competitive. They are naturally interested in bestsellers, as these deliver the big numbers, the shelf space in the bookshops and the high visibility they are looking for. Anthony Cheetham, CEO of new UK publisher Quercus, had this to say about blockbusters in the Bookseller:

These comments relate to the acquisition of celebrity biographies, but large publishers compete even more aggressively for the bestselling fiction authors who will deliver the big sales. Many observers thought that Headline were doing a good job with James Patterson, but there was still room for Random House UK to come along with a huge deal which contracts the author to deliver eight books a year. The value of the mega-selling author is almost beyond price to a growth-hungry publisher when you consider the shelf-space their books can command, the value of their backlists and the wonderfully consistent torrent of money they will generate.

Whilst all this corporate in-fighting is going on, it is good to be able to report that some independent publishers have been doing quite well. In the UK the indies in the Independent Alliance, led by Faber, have pooled resources to run their own sales operation, with impressive results. Recent figures show an increase in the UK’s Independent Publishers Guild members of 515, up from 440 three years ago. But the gap between the corporate publishers and the indies has widened. A favourite tactic of the former has been to grow by acquisition, and they have taken over many of the mid-sized independent publishers.

Publishers may not have made much use of it for new books yet, but print on demand does lower the bar for starting a publishing company, in that less capital is required for the start-up. More new independent publishers should be the result, but also in the UK the success of Quercus has shown that quite a small company can seize the initiative by making bold acquisition decisions and giving strong promotional support for its titles. The founders of Quercus would also be the first to admit that luck has also played its part, with successes such as Steff Penney’s win of the Costa Prize with The Tenderness of Wolves.

But publishing is hugely affected by what is going on in bookselling and the increasing focus on selling bestsellers makes it hard to promote and sell niche books through bookshops. Many slightly marginal genres, such as literary novels and poetry, are affected by this. It’s hard for new authors to find a publisher when the structure of the book trade dictates that publishers are really only looking for new authors who have a real chance of becoming instant bestsellers.

Chris Holifield

© Chris Holifield 2008