carolynreidyBig Publishing is now over its issues with the digital and is quite on top of the e-book universe, says Carolyn Reidy, the president and CEO of Simon & Schuster.

E-book publishing is now “integrated at every level in publishing.”

Digital books will probably settle at around “25% to 30%” of all book sales, she said in a keynote address to the Book Industry Study Group‘s18th annual meeting, as reported by Publishers Weekly.

Reidy also hailed the “staggering amount of information available” in the form of metadata and social media feedback to drive sales and marketing, and she insisted that “our data says that our pricing is effective” in the context of the Big Five’s push to drive up e-book prices.

Some pundits are already using Reidy’s comments to dismiss Amazon Kindle Unlimited and the subscription model. But what didn’t get discussed is the whole debate over whether the Big Five’s new pricing agreements with Amazon have pushed down e-book sales. Many conclude that they have. Certainly, according to the WSJ, S&S’s e-book numbers are down. Also, those falling sales are based on the publishers’ own receipts, not overall sales volume in the market.

The triumphalist braying of commentators like Alexandra Alter in the NYT, also quoting BISG feedback, likewise missed that point, as has been widely remarked. (And incidentally, doesn’t Reidy’s keynoting at the BISG annual meeting somewhat call into question its independent stance as “a nonprofit research group”? Just asking …)

Still, judging by Reidy’s own comments, the Big Five seem perfectly comfortable with the situation they’ve created. Perhaps they prefer lower e-book sales in a market where they have control over pricing – less upsetting of apple carts that way, after all. Amazon and the self-publishing crowd can continue to grow in the meantime, so long as the giants keep their lock over certain major publishing brands and the revenue from subsidiary rights. All very good for Big Publishing. Let’s face it: the big houses have shown pretty broad indifference to the well-being of the wider book market, authors, literature, and just about everything else they’re supposed to be in business to defend.

Related: A comment to PW from Ed Renehan, marketing director at New Street Communications: “I remember being 1st person ever to show Carolyn Reidy an eBook – made myself using the old VOYAGER toolkit on a Powerbook, at the 1992 ABA convention. She didn’t think the concept would go anywhere. Who called it Carolyn?”

(Image via C-SPAN.)


  1. @Bridget: Thanks for the laugh. I wonder what kinds of retirement plans the very top executives at the B5 publishers have. And how linked are the plans to actual performance? And what’s the executives’ average age? Will they be lazing back on the beach long before the long-term damage is done?

  2. Thanks to the Big Five’s new pricing agreements, my library no longer buys many of their ebooks (and of course, some aren’t available to libraries). At $12.99 and higher for an ebook, and $18 or higher for the print version, I won’t buy them either. I now wait for a used copy of the print book, and never pay more than $4 for the used copies; or I simply never read it. Sad, because my ‘want to read’ list is long and growing daily.

    BTW, Carolyn needs to learn to smile. After all, isn’t she laughing all the way to the bank? (Sorry, couldn’t resist).

  3. Keep in mind that people see and act from their own perspective. Central to the thinking of Big Five executives is preventing Amazon from dominating print book sales to the point where it can dictate terms to them.

    To do that, the Big Five must keep print book distribution through outlets other than Amazon alive and healthy. That means brick-and-mortar bookstores. That’s not as difficult as some might think. If you live where such a bookstore is convenient, you can walk in, buy a Big Five bestseller (perhaps at a discounted price and without paying shipping) and walk out all within five minutes. Amazon will never be able to match that.

    To keep those bookstores healthy, the Big Five are apparently willing to forgo any additional profits they might—and I stress might—make if they sold print and digital at prices that ruthlessly maximize their profits. You might take that 25-30% remark as their target. They intend to price their digital books such that they are no more that 30% of their sales. If that means the gap between the two remains small, that’s fine with them. They need no meet anyone else’s expectations.

    Also, keep in mind that print isn’t as fraught with trouble for large publishers as it is for smaller publishers. The Big Five can print, warehouse and ship in large quantities, so their per-copy cost is less than that of a smaller publisher. Their profit on a $19.95 hardback is likely to be greater than than of a smaller publisher. Their cost difference between print and digital or less.

    That’s particularly true when you take into account that advertising and marketing are probably a larger slice of their total expenses. Why run an expensive advertising campaign to sell a $4.99 ebook when you can use it to sell a $19.95 hardback that earns more profit? And if a publisher can generate enough buzz about their book, many people will buy it at $19.95. The Big Five don’t need the drawing power of cheap, particularly with big name authors.

    If you think of the Big Five as rich and the rest of us as not, then this alleged quote is interesting:

    If you’re a quotation buff, you’ve probably heard of a legendary exchange about “rich people” that supposedly took place between the American novelists F. Scott Fitzgerald (1896-1940) and Ernest Hemingway (1899-1961).

    Fitzgerald is usually quoted as saying either “The rich are different from you and me” or “The rich are different from us.”

    Hemingway is quoted as responding: “Yes, they have more money.”

    In fact, this quote-counterquote repartee never actually occurred. But it is based on things written by Fitzgerald and Hemingway.

    Here’s how it became a legend…

    To read how that legend was born, go here:

    So yes, the Big Five are different from the rest of us. That shapes what they do.

    –Mike Perry, Inkling Books

  4. @Mike Perry, you are right.

    Many people are so quick to criticize the traditional publishers, as if traditional publishers don’t know what they are doing. Yet a lot of the critics are broke and not even close to earning a decent living themselves. Indeed, a large number have no clue what they are talking about. As marketing guru Seth Godin recently stated, “Criticism is difficult to do well.
    Recently, we’ve made it super easy for unpaid, untrained, amateur critics to speak up loudly and often. Just because you can hear them doesn’t mean that they know what they’re talking about. Criticism is easy to do, but rarely worth listening to, mostly because it’s so easy to do.”

    When ebooks and the so called “indie publishing” craze hit, so many of these critics were forecasting the demise of traditional publishers within three or four years. They were also saying that “print is dead.” How wrong these morons were and how wrong they will continue to be. Traditional publishers will continue to do well with both print and ebook editions long after most self-published authors realize they can’t make any money and give up entirely. Many have already.

    Regarding pricing, Seth Godin called the strategy of low ball pricing “Clawing Yourself to the Bottom.”

    Seth stated:

    “Trading in your standards in order to gain short-term attention or profit isn’t as easy as it looks. Once-great media brands that now traffic in cheesecake and quick clicks didn’t get there by mistake. Respected brands that rushed to deliver low price at all costs had to figure out which corners to cut, and fooled themselves into thinking they could get away with it forever. As the bottom gets more and more crowded, it’s harder than ever to be more short-sighted than everyone else. If you’re going to need to work that hard at it, might as well put the effort into racing to the top instead.”

    Indeed, clawing your way to the bottom costs you the chance to make a decent living. It also costs you your reputation. In short, when your book doesn’t measure up, the answer may be to charge a lot less for it and perhaps even give it away (particularly if no one is buying it). If you have a great book, however, the answer is to charge a lot more for it than the substandard competition charges for theirs. You will make a lot more money and feel a lot better about yourself for having written a book that truly makes a difference in other people’s lives.

    Ernie J. Zelinski
    The Prosperity Guy
    “Helping Adventurous Souls Live Prosperous and Free”
    Author of the Bestseller “How to Retire Happy, Wild, and Free”
    (Over 260,000 copies sold and published in 9 languages)
    and the International Bestseller “The Joy of Not Working”
    (Over 280,000 copies sold and published in 17 languages)

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