Modern style paper-based publishing of books became popular since early 1800s. In 2016, Google used algorithms to come up with a realistic estimate of all unique book titles across all book categories published worldwide. The magic number was about 130 million. It did not include e-books (self-published), which are publishing at about a million a year for last three years. Since then, about 750000 paper books are published annually and after including e-books, there could be roughly 135 million books ever published till date. From this, the annual rate of books published in the last 200 years comes to about 675000 books a year, which is slightly less than the current annual average.
In other words, the average number of books published every year has been constant ever since books have been published commercially. Whereas the world population has increased 7.7 times from 1 billion in 1800 to an estimated 7.7 billion till present. Presuming the percentage of readers would have proportionately increased over the years, the total number of published books should have been in the range of 5 million books a year.
Book as a product
If we consider a book as a product, has there been no innovation in writing? I am referring not to the form, but for the content itself. The answer is probably there have not been enough manufacturers – writers. As per research, 87% of books started by authors have never gone to the publishing stage. But, then an unfinished product is not a product at all. A recent survey showed that around 80% of submissions are rejected by publishers, which means an average 3.3 million books were completed each year till now. This is closer to the need of 5 million we calculated earlier.
We cannot discount every book that a publisher has rejected as worthless. The rejection process itself is very subjective. It is not like there is an algorithm to select good books, which publishers run on the book. This brings us to the point of how a book is chosen.
Publisher as an investor
Current business model used by publishing houses is based on their gut feel of what each book would net them – akin to an investor putting money in a startup. They screen products (books) for pay an advance based on initial idea of a book. Then they print about 5000 books (or somewhere near, depending on whether new or repeat author) to get back their advance. They shell out more than 50% of the book prices to the distribution channels and marketing costs, and about 10% (lesser to new authors) as author royalty. So, they have to get back their advance. Some books don’t break even for them (or the author), and some give them 100x returns. On an average, the publishers would look for a 10x return across all books. So their profit model is also like that of an investor.
They know that all books don’t sell more than the first set of prints. And some of them sell like hotcakes. The problem is they don’t know which ones are the hotcakes for sure.
Demand-supply gap for books as a product
There are about 19000 registered publishers in India, which has a population of roughly 1.1 billion. When prorated to the world population of 7.7 billion (the math is looking easy here), there could be at least a 100 thousand publishers worldwide. So, that means each publisher prints only 7 books on an average each year. But then we have to consider the pareto principle, where 80% of the books may be published by just 20% of the publishers (the big houses). So even this calculation tells us that the big houses printed only about 25 books on an average every year. Whereas they should have been able to print eight times more books on an average.
Isn’t this a beautiful business case for the e-publishing platform? No wonder Amazon Kindle and its kind are having a ball. And the writers are not complaining.
Risk of self-publishing / e-books
It is a huge marketplace. The screening for originality and quality is minimal. Anyone or everyone can publish. The platform will market itself and not each product. There is no feedback mechanism. And the product lies there in that space for as long as the platform allows it. This means new books published in the platform will have lesser chances of being found as time moves on, unless somebody is specifically searching for the book. Of course, there is an advantage that it can be picked up any time and earn money. The chances are minimal though because of the sheer numbers.
Innovation for books
- Innovation of ideas
Each book is capable of adding value to the reader. However, the number of manufacturers for the same product category is significantly higher than a physical product – say a storage device.
There is competition right from the word go. However, there are so many ideas and thoughts that are not shared before, and even if they have been shared, there could be a variation in terms of qualification, method or delivery of that idea which would be appreciated by many.
As long as the book has a central theme, is targeted at a specific audience and the author is able to put across thoughts in a coherent, structured way, then every book can be an innovation in itself. Because the book as a product is so dynamic, the features (ideas) of the book can cater to the different perceptions of audience, which usually varies significantly.
- Innovation of printing and distribution
I am not referring to the online / self-publishing platform here. There can be a better way for publishers to increase the publishing rate per year. Use artificial intelligence to weed ‘in’ good books, instead of rejecting them. Increase the number of books printed in first batch. This has to be aided by reducing the cost of printing – such as eco-friendly alternatives to paper, process automation in printing, etc.
Even alternative distribution channels can be identified – like keeping chocolate and socks brands at cash counters in stores. Increasing initial batch size of printed books can create more visibility in smaller shops (not just book shops) – keep books of related category in outlets of related physical items. Say keeping books on music in all musical instrument shops, books on cooking in restaurants, fiction in cinema halls, etc.
Agreed that this may not sell all the copies of the books printed but using more sophisticated ways of tracking and measuring book sales such as analytics, process mining or even collecting simple feedback from consumers will pave the way for increased publication. And every additional book published, and copy printed and sold increases the use value of the product. And anything that increases use value is an innovation.