Tuesday, March 20, 2012

Poisoning the Well – The Publishers and the Libraries

April 7, 2010

“Once upon a time,” two tribes fought over which one had rightful access to the crops growing in a local field. One of the angry tribesmen took matters into his own hands, dropping a powerful poison into the well of the opposing tribe. Soon, the opposing tribe’s populace began dying. The poisoner announced his act to the leaders of his own tribe. They rewarded him. But, then the poisoner’s tribesmen started dying, since they were downstream from the opposing tribe. In the end, no one survived.

The story illustrates a principle that publishers have forgotten. Publishing is a vertically integrated business, but it is also horizontally organized. There is a food chain, with the publishers selling to distributors and libraries, who are one step closer to the retail public. But publishers also have competing product lines in hardcover, paperback and eBook lines, and to keep their hardcover business alive they have artificially priced their eBook price much higher than it should be, IMHO. I believe (and have said here before) that, as the $2.99 price Amazon permits as a basic eBook unit price becomes the de facto price, this may eventually maim most traditional publishers and could kill many of them.

Apparently, the suicidal tendency of some of the publishers goes beyond what I saw as merely irrational. On my way back to Northern California from Seattle, I read in a newspaper that some publishers have tried to limit the number of times a library may loan an eBook before having to repurchase the title. The unintended consequences of this path are the deaths of both the libraries, who can’t afford to continually reacquire eBook titles, and the publishers, who will lose the library market and the young readers who use libraries. There is an even more insidious consequence: Given the current budget problems that trickle down from the Federal government to our local governments, libraries are already being tightly squeezed, and so are public schools. Forcing libraries to spend cash they don’t have simply means they won’t have many eBooks available at all. Children who used libraries because they can’t afford to buy books will lose their access and may stop reading. Fewer eBooks means fewer readers. Fewer readers means dumber adults. Dumber adults means a less competitive country, with us all suffering as a result. Here’s a case where poisoning the well is a national security issue.

Anyone have a different opinion? Please, express it here!

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