Report from the Trenches: Spring Publishing Lectures

By Natanya Housman and Hannah Bennett

In recent weeks, the Pace University Publishing Program has presented two lectures for the benefit of publishing students, faculty, and staff.  The first, presented at the end of March, was the David Pecker Distinguished Visiting Professor Lecture, featuring Michael Healy.  The second, presented in April, was the Eliot DeYoung Schein Lecture, featuring Neil De Young.  Both speakers drew on their multifaceted publishing backgrounds to extend their opinions on this time of dramatic change.

Michael Healy presently serves as the Executive Director of the Copyright Clearance Center.  He assists in expanding market presence and refining business models to accommodate Backlist Rights.  Formerly, Mr. Healy served as the Executive Director of the Book Rights Registry.  For the last three years, Mr. Healy has been the David Pecker Distinguished Visiting Professor of Publishing.

Mr. Healy’s speech on March 29th, entitled Global, Mobile, and Personal: the Future of Publishing in Hazardous Times, was a broad discussion of the challenges and opportunities he sees in the future of the publishing industry.  In his analysis of the industry, Mr. Healy posed a series of questions, each of which highlighted a specific challenge for publishing professionals. What is the future value of publishers?  Does DRM help to reduce piracy?  If consumers only care about content and not brands, where does that leave the publishing industry?  These questions prompted audience members to evaluate their own potential roles in the industry, and the value publishers will have going forward.  Despite this inherent uncertainty, Mr. Healy’s final position was that now is a great time to enter the industry, and especially to start one’s own company.  He believes that the world has opened for new players, innovative and creative thinkers, and a new approach to publishing.

Neil De Young is the Director of Digital Media for Hachette Book Group, USA.  His responsibilities at Hachette include digital business development and strategy, eBook development, and website product management.  Mr. De Young reviews and assesses new business opportunities for Hachette, including contract negotiations and profit and loss assessment.  Prior to his position at Hachette, Mr. De Young held various positions at Scholastic, Inc.

Mr. De Young’s speech on April 11, entitled Disintermediation in the Digital Age: What Publishers Will Need to Do to Stay Relevant, discussed the digital transformation of the industry.  He did so through a series of parables.  In one parable, recounting the tale of a complacent pheasant and an opportunistic fox, Mr. De Young stressed the dangers of a lack of competition.  He later discussed the issue of competition in more detail when, speaking for himself and not Hachette, he answered an audience question regarding the agency model and the current litigation with the Department of Justice.  The government’s lawsuit poses questions about how to maintain healthy competition in the emerging ebook market – questions that professionals, like Neil De Young, must answer.  Other questions that must be answered are ebook pricing, DRM management, piracy, and disintermediation, which will require real innovation from Mr. De Young and his colleagues.  Based on his informative and thoughtful lecture, Mr. De Young is certainly up for the challenge.

These lectures, held every year, are unique opportunities for students to gain firsthand insight from brilliant publishing professionals.  They provide information that students cannot learn from the pages of a textbook.  Both inspiring and thought-provoking, these lectures encourage students to think creatively about the future of publishing and their places within the industry.

Report From the Trenches: A Guest Lecture by Neil De Young

Ever wonder why, really why, an ebook would cost $12.99?  In the end, it’s just a digital file, without a binding and a cover, without the cost of paper and ink and shipping, right?  Many consumers have posed this question, choosing instead the $0.99 ebooks because they are a “good value.”  What they don’t know is that, behind the sudden and exponential rise of the e-readers, there are publishing companies struggling to adapt and redefine the true value of the book.

Luckily, key minds in the publishing industry have risen to the challenge of updating their companies’ infrastructures to meet the new technology.  One such mind is Neil De Young, the Executive Director at Hachette Digital.  Mr. De Young, who is responsible for managing the e-book program at large for Hachette Digital, was gracious enough to speak to Professor Soares’ General Interest Books class last Thursday evening.

Part of Mr. De Young’s job is to assess the impact that new e-reader devices have on the traditional wisdoms of publishing.  For instance, adults ranging in age from 30-44 are buying the most ebooks, a slightly younger demographic than with print books.  Ebooks can also shift a publisher’s optimal release dates. For instance, a marketing team might want to time the release of a book around the release of a new e-reader.  These and other developments have prompted ebook publishers to re-evaluate their traditional publishing plans in the digital age.

Mr. De Young’s lecture was extraordinarily thorough, touching on many of the challenges facing digital publishing, such as hammering out royalties, distribution, piracy issues, and reporting verification.  Hachette is now creating nine different types of digital content, including enhanced ebooks, teaser chapters, and omibuses.  And for each new type of content, readers have the expectation that they can “buy once and read everywhere.”  In other words, publishers must make each type of content available in several different formats, so that buyers may read their books on any e-reader device.

The significance of these challenges, as Mr. De Young explained, is in the Profit and Loss statement. While the paper, printing, and binding costs of book production don’t apply to ebooks, other ebook costs must replace them.  Publishers must pay for digital warehousing, such as servers, rather than traditional warehouses. Likewise, they must pay third parties to protect their files against piracy, and to accurately report ebook sales. Many companies also pay outside parties to create the numerous ebook files for the many tablets, e-readers, and smart phones.  These added costs explain why ebooks must still be priced higher than $0.99 in order to make a profit.  Despite the difficulties facing the industry today, the future of Hachette’s digital industry is in good hands.