The Insanity of Book Publishers

February 4, 2011

Einstein’s definition of insanity is “Doing the same thing again and again, but expecting different results”

I read this morning on the National Post that Canada’s largest book distributor (HB Fenn and company) has declared bankruptcy proceedings.

In the statement, H.B. Fenn blamed “the loss of distribution lines, shrinking margins and the significant shift to e-books” for their financial difficulties. The company lost a major source of revenue last year, after Hachette Book Group moved control of Canadian sales and distribution of its titles to their U.S. offices. “I think this situation was enormously affected by the departure of one very large client,” said Carolyn Wood, executive director of the Association of Canadian Publishers.

It’s incredulous that they blame a rise in eBooks as a factor in their demise? They’re distributors, they’re experts at it, so why didn’t they move their operation into eBook distribution? As they say, they saw it as a growing market… they have all the contacts in place with the authors and publishing houses, they understand the complexities of the publishing business, they were in an incredible position, so why didn’t they leverage that knowledge base?

The real difference for them between eBooks and paper books was the distribution network, all they had to do was get cosy with a technology company that could handle the eBooks and the technology, while they maintained those all important and very valuable relationships (now all going to waste).

But that doesn’t seem to be the case, they appear to have continued with the business model that allowed them to become the largest distributor in Canada, but when demand and the distribution network changed, they didn’t, that’s insane!

Original article

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