The True Cost of Going Digital

In What's the Buzz by Daniel Kalder

By Daniel Kalder

Digital publishing is transforming the book trade. But are publishers really prepared to grasp the challenges — not only technical but also financial — that transitioning to this brave new world involves? Dominique Raccah — founder, publisher and chief executive of Sourcebooks, one of the largest independent book publishers in the USA — thinks not.

“It isn’t as simple as we’re all saying to one another. Everyone thinks e-books are free or cheap . . . but that’s not Sourcebooks’ experience. Publishers are not counting the steps involved.” Confronted with “costs going through the roof,” Raccah hired outside experts to conduct an analysis of the processes of digital production, which she found had added immense layers of complexity and expense to a publisher’s work.

“E-books have added six overall processes to the production of books, and a further seventy steps within those processes. Think about it: When I print a book, I provide the same printed book to every retailer — Borders, Barnes & Noble, Amazon, whoever. But when I provide an e-book, that’s not true because there’s no standardization of formats. What Apple gets, what Amazon gets is different . . . Then every time there’s a change in operating systems, we need to change again. So that’s a lot of added expense. And this is without mentioning things like Apps!”

Raccah continues: “Consider the manufacturing process. In traditional publishing, I hand the files to the printer, who has his own staff to do a whole bunch of stuff. With e-books, publishers have brought all that work in-house. It’s added an enormous amount of costs and processes to our infrastructure.”

Raccah believes that all publishers are experiencing this, but that so far there has been little discussion. “We need to start communicating with each other, to share our experiences. It’s damaging otherwise.” Publishers also need to reach out to authors and agents: “We exist because we are in partnership with authors and agents. We need to talk about what we do — not only e-books, but also enhanced apps, websites and so on. There’s a big infrastructure, so we need to explain it, and showcase it, to make sure authors know we’re doing all of it. They need to understand that the concept of what’s available with a publisher is a lot larger . . . For example, an author can sign a contract directly with Amazon and gain access to, say, 65% of the online market share — but the rest is totally fragmented. Authors need to understand the scale of the complexity and the costs. The more complex it gets the more he’s going to regret turning his back on a publisher.”

Raccah also rejects the idea that publishers relegate the realm of e-books to one digital editor. “We need to make it part of everyone’s job. We need to retrain our whole organizations. If not, there will be more problems, and more costs.”

Sourcebooks has always embraced new technology, says Raccah. “We were the second book publisher to get an Apple developer’s licence. We were developing for the iPad before the iPad was out there. Publishers don’t get to sit these changes out, or stay behind the curtain like the Wizard of Oz. The future is coming whether we like it or not. We need to be transparent. We need a culture of innovation.”

(This story originally appeared in the Publishing Perspectives show daily at the Frankfurt Book Fair on 7 October 2010. Download the complete show daily here or click on the image to view the online version.)

About the Author

Daniel Kalder

Daniel Kalder is an author and journalist originally from Scotland, currently based in Texas after a ten year stint spent living in the former USSR where he (more or less) picked up Russian. He has written two books about Russian life and culture and contributes features, reviews and travel pieces to publications around the world.