Re: ebook acquisition collectives

[Joseph Esposito <espositoj@gmail.com>]

Sandy and I are not in agreement here, though some of the
difference may be matters of definition.

First, though, let's be clear that even university press assets
may sometimes be offered for sale.  When I was working as a
consultant, I was asked to advise on such matters.

But as to the numbers, my comment was for books from U. presses.
Sandy introduces an important distinction:  monographs vs. trade
books.  Of course, if you can tell me what is a monograph and
what is a trade book (besides the discount schedule it is offered
under), we might be able to resolve this.

Two years ago I worked on a project, funded by the Mellon
Foundation, that involved my surveying U. presses.  I conducted
50 interviews, covering 30 presses.  The public version of that
report can be found here:  http://j.mp/8TWlC8; see in particular
Section II, Statistical Snapshot.  What the survey revealed,
among other things, was the extent of the erosion of library
sales.  I would say that it is a stretch to think that libraries
comprise more than 25% of U. press sales.  No two presses are
identical, of course, but my notes are pretty clear about this
the market percentages.

Of course, if you are able to separate monographs from trade
books, you might get a different answer.  On the other hand, this
still wouldn't change the thrust of the argument, because trade
books are part of the revenue picture for many presses.  I would
add that making these kinds of distinctions introduces bizarre
exceptions.  For example, one of the most important titles from
an economic point of view for the entire press community is the
Chicago Manual of Style. Monograph?  No.  Trade book?  No.

No matter how you slice it, if publishers switch from selling
copies to selling copyrights, as Eric's proposal suggested, the
economic ramifications are very large and entirely negative from
the point of view of the publishers, who are required to earn the
bulk of their income from revenue.

Joe Esposito

On Fri, Aug 13, 2010 at 12:33 PM, Sandy Thatcher

<sandy.thatcher@alumni.princeton.edu> wrote:

> I would question Joe's figure of 75% sales to individuals. That
> may be the case for trade books published by some of the larger
> presses like Harvard, Princeton, and Yale, and it no doubt is
> even at the low end for sales of regional titles. But I very
> much doubt that it is anywhere close to being accurate for
> sales of scholarly monographs, even those published by the
> largest presses. It is no accident that Baker & Taylor remains
> the largest customer for most university presses, and even
> though Amazon is in a strong second place for many presses, we
> know from an AAUP marketing survey that libraries also purchase
> through Amazon. If I were to hazard a guess based on my
> experience at Penn State, I would say that 75% represents the
> proportion of sales that go to institutions, and for many
> titles it would even be closer to 90% (especially those that
> never make it into paperback).
>
> In the scenario I depicted, the originating publisher would not
> give up the right to provide POD editions even though the
> monographs would be made available as OA ebooks. That is still
> a service the publisher could provide and derive income from.
> The publisher could also use a Creative Commons
> "non-commercial" license to preserve rights for commercial
> re-use (though I have my doubts about the conceptual basis for
> the distinction between "commercial" and "noncommercial").
>
> In talking about "sale of a piece of the publisher's company,"
> Joe obviously has commercial academic publishers in mind.
> University presses are not in this sense "for sale." And those
> who "own" university presses are not driven by profit motives
> and do not generally think in terms of ROI. So there is no
> "asset" involved if the books are being purchased from
> university presses.
>
> Sandy Thatcher
>
>
> At 5:28 PM -0400 8/12/10, Joseph Esposito wrote:
>>
>> With scenarios like this, it's often useful to put oneself
>> into the position of people on the other side of the
>> arrangement.
>>
>> The primary side in this example is that of the librarian.
>> The librarian is asked to contemplate an *outright* purchase
>> of a book or books. We will have to think about what an
>> outright purchase means, but the benefits to the library are
>> clear, if the price could be met.
>>
>> On the other side of the arrangement is the publisher. This
>> publisher sells books that have little or no market outside of
>> libraries. (There are fewer such publishers than many people
>> believe. Books are not humanities journals. Even
>> university presses sell 75% of their books to individuals.)
>>
>> From the publisher's point of view, the proposal is not to
>> sell copies but the right to make copies. This is
>> effectively the sale of an asset; it is a liquidation
>> strategy. After the sale of the asset, what is left?
>>
>> Thus from the publisher's point of view, the outright sale is
>> tantamount to the sale of a piece of the publisher's company.
>> This may not be how it looks to the librarian, but it is how it
>> looks to the publisher.
>>
>> I doubt many publishers would participate in such a program.
>> Books are for sale, companies mostly are not. On the other
>> hand, a financial owner--that is, an owner who is not an
>> operating executive but who views the publishing company
>> simply as an investment--may take a different view (and demand
>> for the sale of the asset a huge multiple, perhaps 8-10 times
>> the projected lifetime cashflow of the asset).
>>
>> And that's the key: to buy an asset, you have to pay asset
>> prices, not the sum of all the book prices.
>>
>> Let's go back to publishing good books, buying them, and,
>> hey!, maybe reading them as well.
>>
>> Joe Esposito