The Forthcoming Argentinean E-book Market

In Growth Markets by Octavio Kulesz

• At this time, very few people in Argentina own e-readers, and suppliers have yet to develop a formal electronic market.

• Success in the e-book market is most likely to come from new companies with business models that are distinct from their U.S. and European counterparts.

By Octavio Kulesz

The Argentinean publishing sector experienced an impressive boost in the aftermath of the country’s economic crash in 2001. However, at present the industry seems unable to adequately respond to the challenge posed by the digital era. The audacity that has always characterized the local entrepreneurs is pretty much alive, but has to be unleashed.

Gutenberg in the Pampas

For a huge percentage of Argentinean publishing houses, e-books have represented little more than a remote reality. Indeed, very few people have e-reading devices here: it is actually quite complicated to import a Kindle or a Sony Reader, since the costs involved in clearing customs are higher than the price of the gadget itself! In a way this is a moot point, since Argentina has not yet been able to develop a formal electronic market. For instance, iTunes users cannot download music or films, and in fact, the immense majority of MP3s and movies in circulation have been downloaded from P2P sites; there’s also intense amounts of activity in exchanging PDF files, leading to some notorious cases of legal action against bloggers.

In spite of this sorry situation, publishers have started to realize, mainly because of the news coming from the U.S. and Europe, that e-books will eventually rule their business. That is one of the reasons why in late 2009 the Argentinean Book Chamber commissioned a piece of research with the goal of putting forward solutions for the digitization challenge. Although the final report was very inspiring, to date there has been no further collective initiatives, and the publishing sector has remained pretty much in the same spot where it was last year.

Truth be told, we could say that publishers in Argentina seem to envisage the digital age more with panic than with eagerness, which explains why no traditional company has made any real effort to take advantage of this new era. As a matter of fact, this attitude is not imprudent at all, since, in my view, migration from analog to digital in the Argentinean book market will be far from simple. Let’s first think of the typical family business, run by a senior publisher who is helped by his sons and even by his grandsons. Who will be able to talk the old man into getting rid of the warehouse, hiring programmers, buying software licenses and so on? And who, once again, will persuade him of the importance of digitizing, converting to EPUB and distributing the whole backlist online, when there are other more pressing matters, such as paying the rent, salaries and other expenses?

Apart from small and medium sized companies managed like family businesses, we also find resistance among big publishing houses. So far, their refusal to fully embrace the digital age stems from their fear against piracy: how would they protect their titles if PDFs start to wander around the web with no control whatsoever? On the other hand, big Argentinean publishing companies generally are the local branch of a much bigger corporation whose headquarters are located in the U.S. or in Europe, mainly in Spain. And because of their particular structure, major publishing houses in Argentina willing to experiment with new technologies are forced to wait until the head office abroad allows them to do so, a process that can be slow and thus discouraging. Recently, the main Spanish publishing companies decided to launch their own site together with their branches all over Latin America, a move that has fueled fierce debates and which, in my view, is not going to be successful.

A Digital Emerging Future

If on the supply side of the equation — namely publishers — the general attitude towards e-books is one of suspicion, we should admit that in contrast, from the users’ point of view, things couldn’t be evolving more rapidly. From the two ends of the publishing chain — authors and readers — it is evident that the digital age has already landed: hundreds of young poets and novelists have started to work 100% online, via blogs and web magazines; conversely, thousands of people are enjoying those high quality and (to date) free texts.

Moreover, the large-scale program Conectar Igualdad (Connecting Equality), recently introduced by the national government, aimed at providing students with netbooks, will soon lead massive amounts of youngsters to look for digital content. The public sector has also been very active in promoting new technologies at the town hall level. A case in point is the program Opción Libros, belonging to the Direction of Creative Industries of the city of Buenos Aires: this unit is organizing the third Publishing Conference for next September, which will be fully devoted to the digital revolution.

Therefore, the foundations for the resurrection of the industry have been laid: the users have started to demand online content and the public sector has shown it is ready to meet the industry’s need for new skills and infrastructure. However, as I have tried to point out, traditional publishing houses probably won’t leave their current lethargy — for they cannot do it without jeopardizing the very grounds of their business, which still revolves around paper copies consigned in physical bookstores.

In my opinion, given that the migration of the industry won’t come from analog publishers suddenly becoming digital but from new players joining the game, what we need now is a new generation of digital publishers entering the scene and taking over. This will require a big effort from that cohort, but the attempt will be worth making, since what is at stake is no less than the vitality of the forthcoming Argentinean (e)book industry.

The young digital generation of publishers will have to experiment with new formats and with new business models. From my point of view, there must be a viable and profitable pattern for digital publishing content, because of that unquenchable thirst for online texts that citizens have started to show. Certainly, we cannot expect replicas of the old commercial scheme to work as they used to. And I daresay that even some business models related to digital that may have proved successful in the U.S. or in Europe won’t work at all in our region, so the challenge will be twofold: disenthralling ourselves of old paradigms and also doing away with certain solutions imported from the North that as such may do little to improve the current situation. This is something we permanently discuss with my colleagues from the Digital Minds Network: the digital future of emerging countries won’t have quite the same shape as that of America or Europe.

At Teseo, the academic publishing house I am the director of, we are distributing POD copies on an international network of printing presses we have developed, as well as electronic files that are sold at very low prices; the key is avoiding stock by all means, so that the company can be run remotely. We currently have around 100 titles from the fields of Social Science and Humanities, and last year we launched a new imprint, El fin de la noche, where high quality literature titles can be viewed in their entirety online. Thanks to that, visits to the site have rocketed and sales both for POD and for e-books (since the free online version is not downloadable or printable) have gone up. Press reviews have thrived, as well.

To conclude, Argentina’s current publishing sector amounts to nothing compared to the full-scale makeover that the digital era could bring along to the local market, even if this radical change might shake the very foundations of the book industry as we know it. After all, it was during challenging times, such as after the country’s collapse in 2001 that the Argentinean entrepreneurial spirit showed up, largely accounting for the astonishing recovery of the whole economy — and particularly for the spectacular resurrection of the publishing sector since 2003. It is my hope that the colossal shift the global book industry is undergoing today will ignite that energy that remains dormant in the new generation and thus boost the Argentinean publishing industry once again.

Octavio Kulesz is currently the director of Teseo, a digital publishing house based in Buenos Aires. In 1999, at the age of 22, he founded Libros del Zorzal, his first publishing project, together with his brother Leopoldo. Between 2007 and 2008 he chaired the International Young Publishing Entrepreneur Network, an association of 70 global publishers supported by the British Council and the London Book Fair.

DISCUSS: Is Entrepreneurship the Future of Argentinean Publishing?

About the Author

Octavio Kulesz