1. Stay Ahead of the Shift: What Product-Centric Publishers Can Do to Flourish in a Community-Centric Web World BEA, 28 May 2009 Mike Shatzkin

2. The fundamental premises:

3.

• Things will change

The fundamental premises:

4.

• It is necessary to have a view of the future to anticipate change

The fundamental premises:

5.

• The market and how you reach it will shift in some ways between when you sign titles and publish them for the foreseeable future

The fundamental premises:

6.

• You must try new things: it is as important to be nimble and opportunistic as it is to be analytical when you do

The fundamental premises:

7.

• For maximum benefit: new things should be tried within a framework of understanding (your view of the future)

The fundamental premises:

8. A lot happens in 20 years

9.

• TV 1968-1988 :

• Broadcast networks go from totally dominant to highly challenged

In 20 Years

10.

• Music 1980-2000:

• Record companies fat from sales of new formats to a total breakdown of the business model

In 20 Years

11.

• Newspapers 1989-2009:

• From stable cash cows thanks primarily to classified to endangered species

In 20 Years

12.

• Mass-market paperbacks 1975-1995: from multi million dollar bestseller advances to category strugglers

In 20 Years

13.

• Online access 1989-2009:

• From klunky dial-up through a closed online network to the Internet in your hand

In 20 Years

14.

• Books 1989-2009:

• From pre-Internet, pre-POD, pre-long tail, pre-SUPERSTORES to now

In 20 Years

15.

• Books 2009-2029:

• Thats what we need to think about today

In 20 Years

16. A point of view: the world of content in 20 years

17.

• All in the cloud ; piracy and license control no longer a problem (DRM obsolete); almost all file access of any kind is tethered

20 Years from now

18.

• We are all both licensors and licensees

20 Years from now

19.

• Access through multiple devices/screens (synonymous)

20 Years from now

20.

• Nugget (more granular) and niche organization for everything: search, content, social community combined

20 Years from now

21.

• Format- specific publishing gives way to format -agnostic publishing

20 Years from now

22.

• Community gateways, portals, upstream aggregates

20 Years from now

23.

• Crowd-sourced content; crowd-sourced editing and curation

20 Years from now

24.

• Professional and personal super-editing and super-curation

20 Years from now

25.

• Subscription models common; per-item sales relatively rare

20 Years from now

26.

• Mass market (cross-niche) content arising from niches (a new farm system)

20 Years from now

27. 20 Years from now

• The publishing business has a much larger B2B component

28. Perhaps: one general trade publisher

29. c

• Aggregates from across the internet universe

One general trade publisher:

30.

• Delivers books (ebooks, multi-media, group-creations), but mostly POD

One general trade publisher:

31.

• Press runs? If theres someplace to sell them

One general trade publisher:

32. Publishing skills applied within the niches and the nuggets

33.

• Own, manage, administer, or lead a nugget or a niche (or work for somebody who does)

Within the niches and nuggets:

34.

• Generate, curate, aggregate content of any kind from and for the niche

Within the niches and nuggets:

35.

• Employ skills of selection, editing, formatting for presentation, marketing

Within the niches and nuggets:

36.

• For many biggest business: B2B content development for the niche

Within the niches and nuggets:

37. Not particularly relevant, but many here would ask: Books?

38.

• Sure, because of POD, new ones appear all the time

Books?

39.

• More new titles are created by readers than by publishers (might already be true!)

Books?

40.

• Press run titles are the exception, not the rule

Books?

41.

• And reading on paper is definitely retro

Books?

42. The uncomfortable bottom line on this change: from N to X

43.

• Value moves from conte n t to conte x t

From content to context

44.

• Ownership of attention will be more important than ownership of content

From content to context

45.

• Value moves to scarcity

From content to context

46.

• Content creation and distribution no longer require scale

From content to context

47.

• Niche by niche and nugget by nugget: community attention (i.e. marketing) does require scale

From content to context

48.

• If you have capital, where is competitive advantage?

From content to context

49. So todays value creation isnt tomorrows

50.

• You win today by owning valuable content and shelf space to merchandise it

Today vs. Tomorrow

51.

• You win tomorrow by owning valuable eyeballs and mental bandwidth

• You win today by owning valuable content and shelf space to merchandise it

Today vs. Tomorrow

52.

• The historical revenue model was clear

Today vs. Tomorrow

53.

• The next revenue model is not (yet)

• The historical revenue model was clear

Today vs. Tomorrow

54. Transitional decades coming: costs rise, revenue falls

55.

• Supporting multiple models: print books, ebooks, and new forms

The Transition

56.

• Legacy content (yours and everybody elses) all being digitized

The Transition

57.

• Legacy content (yours and everybody elses) all being tagged and organized

The Transition

58.

• Digitizing of rights databases could be more expensive than digitizing content itself!

The Transition

59.

• New screens, platforms, channels proliferate and all create some level of expense

The Transition

60.

• Digital natives inventing a future (social networking, uses of links, redefining roles, determining formats of presentation, feedback, mixing of media)

The Transition

61. Things that happen during this transition

62.

• Lines blur among newspapers, magazines, books, games

Things that happen during the transition

63.

• Content finds markets and pricing models; markets find (and create and promote) content

Things that happen during the transition

64.

• Access to audiences remains the key: NY Times and B&N were ; Google and Amazon are ; Facebook and Twitter to be ? For how long?

Things that happen during the transition

65.

• Darwinian processes (with a boost from technology) create vertical clusters (and do you know Ning?)

Things that happen during the transition

66.

• The old model still works; just for fewer titles (and fewer general trade publishers and fewer bookstores)

Things that happen during the transition

67. Back to the present and near future: change we can feel

68.

• Soon: one bookstore chain exacerbates critical mass issues

Change we can feel

69.

• Soon: five, then four, then X general trade publishers

• Soon: one bookstore chain exacerbates critical mass issues

Change we can feel

70.

• Mass market events: fewer in number, faster to cycle, and shorter in duration (and not just for books)

Change we can feel

71.

• Niche- and self-publishing and blogs as a farm system: will become standard practice

Change we can feel

72.

• More and more paper books short run and POD

Change we can feel

73.

• Ebooks increasingly have content edge: more of it and more timely

Change we can feel

74.

• More difficult to launch new titles

Change we can feel

75.

• Harder to sustain backlist

Change we can feel

76.

• From stable to ever-changing marketing vehicles

Change we can feel

77.

• Indispensability of social networks as word-of-mouth device

Change we can feel

78. What pushes (or nudges) publishers to vertical

79.

• Necessity (horizontal marketing and sales channels diminish)

What pushes publishers

80.

• New marketing opportunities arising on the web

What pushes publishers

81.

• Costs skyrocket marketing outside known niches

What pushes publishers

82.

• Natural development of in-niche relationships

What pushes publishers

83.

• Web sites as a market for content further drive vertical aggregation (across publishers)

What pushes publishers

84. Remembering our own fundamentals: what does a publisher do ?

85.

• Connects content to markets (20 th century)

What does a publisher do?

86.

• Connects databases to networks (21 st century)

What does a publisher do?

87.

• Understands communities of content consumers: what they want and how to reach them

What does a publisher do?

88.

• Recognizes creative possibilities in not-fully-developed ideas

What does a publisher do?

89.

• Coordinates the disparate activities necessary to connect a creator to an audience; sometimes to connect creators to each other

What does a publisher do?

90.

• Manages a massive amount of detail

What does a publisher do?

91. The publishers position today to get to tomorrow: pros and cons

92.

• books are ultimate niche products

• publishers are trained niche marketers

• skilled at content creation, development

• can put a souvenir on the shelf

• can target-distribute URLs

Pros:

93.

• product- and book-centricity

• not continuous

• (most) not vertically focused

• lack resources to experiment

• lack a culture of technology or a culture of experimentation

Cons:

94. What we said when we started:

• Were in an era of rapid change

• We must experiment and re-invent

• Do that within a framework created by a view of the future

95.

• The view of the future presented here: Move toward vertical and community

96. So whats a publishers 21 st century action plan?

97.

• First and foremost:

• understand yourself vertically!

• (BISAC, Special Sales)

The Publishers 21 st Century Plan

98.

• When you know what your verticals are (or might be):

• research your vertical web world

The Publishers 21 st Century Plan

99.

• Construct business metrics and track financials by verticals

The Publishers 21 st Century Plan

100.

• Have a sensible Web strategy: 1 presence for B2B; at least 1 for each vertical

The Publishers 21 st Century Plan

101.

• Create a complete email list strategy: vertical-sensitive and with an author-facing component

The Publishers 21 st Century Plan

102.

• Over time: reshuffle your publishing portfolio

The Publishers 21 st Century Plan

103.

• Over time: maximize cumulative effects of web marketing efforts

The Publishers 21 st Century Plan

104.

• Over time: construct alliances that will enable new businesses and new business models

The Publishers 21 st Century Plan

105.

• And if this doesnt work for you, create another view of the future that does!

• But HAVE ONE !