Economists are always searching for new laws to explain the structure and behavior of markets e.g. Ronal Coase. When it comes to publishing (or probably any other information / intellectual property intensive) industry, one such rule might be: opacicty creates overhead. What do I mean?
In the traditional publishing model, authors hide their work from the potential audience until publication, agents screen authors from publishers and the marketing is often blind. Authors going through agents may give up a significant part of their earnings for both placement of their work and representation. Because of the inherent unpredictability in this model, authors also surrender potential royalties to publsihers who must account for distribution costs, returns and large production runs with no clear idea of what to expect from sales. Distribution costs are high and terms are onerous because publication decisions are not based on hard data, and much of the production run may go unsold. The high percentage publishers surrender to the channel represent the distributors’ safety cushion. Publishers have to extend their marketing schedules and spend more on pre-publication reviews and other pubicity to try to get titles to sell through when they are released. This results in market delays and publishers risk losing an opportunity window. Opacity leads to overhead.
In the emerging world of open publishing, authors build their audiences by exposing their work while it’s being created; publishers use online technologies to find and assess the salability of an author’s work for themselves; and analytics drive production, marketing and distribution decisions.
Even in the open publishing model, there is some opacity. In previous posts, I’ve explored ways that publishers could improve margins for production, distribution and marketing. But what about the process of discovering and signing new talent? How might this evolve? It’s a lazy summer day, just before a post holiday weekend. Time to wax speculative.
Author title registries and exchanges. Since the writing process is becoming more transparent anyway (e.g. blog to book), why not have a site where authors can register their work, showcase some or all of it during the development process, and let consumers vote on its future popularity (similar to market sites like HSX)? Such systems have demonstrated a remarkable accuracy to predict winners.
Automated pitch cards. Authors working online could automatically make their key audience stats public so that publishers could easily determine the size and makeup of the target market. Most of the software to do this exists already. The registry would allow publishers to establish a profile page and set up alerts so that when an author’s numbers reached a critical threshold, they would be automatically notified.
Book rights auctions. The registry would facilitate book rights auctions between authors and interested publishers – a kind of eBay for authors. Book auctions are nothing new for established authors with potentially hot selling titles – e.g. see Publishers Weekly deal section. However, an electronic version might speed the bidding process for authors that publishers wanted to sign and establish the market for a title. Prices might be more realistic since the bidding would be transparent and there would be data (see above) to ground the bids.
Standardized book deals. The registry might even help expedite negotiation for authors who are inexperienced (and / or unrepresented) using standardized book deals, with some wiggle room on the terms that are usually most in contention – e.g. royalties, subsidiary rights, copyright ownership.