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Wednesday, September 22, 2010

Is the Print Party Ending?


I personally don't feel print media will ever disappear completely and I have said as much previously on this blog...In fact, I believe print will have a rebound attributable, again, to technology. But, more deeply, because there are some things people just want in a more preservable, 3-dimensional format...You know, one you can read when the digital "gadgets" fail for whatever reason.

Marion Maneker, in an article for BNET (The CBS Interactive Business Network), has this take on print media's demise that he has deduced from three recent occurances in the publishing industry:

Will the Last Book Publisher Please Turn Out the Lights?

We’re reaching the end of the party for print – it’s going to go out with a whimper. We might just have even seen the last flickers of fun go out in three relatively small stories in the New York Times late last week and today. Here’s the list: the announcement that Newsweek’s Howard Fineman is moving to the Huffington Post; a brief profile of a near outsider’s hiring for a plum job in the book business; and the ever-sillier spectacle of the Barnes & Noble (BKS) proxy fight. Taken together, they suggest there’s no turning back.

The most important of the three stories is actually the Barnes & Noble takeover fight. Chairman Len Riggio’s intransigence in the face of forces that want to reform and re-energize the company — even as physical book sales continue to evaporate — make it clear that he is incapable of put the best interest of the company ahead of his own and his family’s interests. Here’s Riggio complaining to the New York Times as his company’s stock has dropped nearly 30%:

“I find it almost repulsive I have to be put in a position to defend myself,” Mr. Riggio said last week in Barnes & Noble’s corporate offices, leaning forward to press his point. [...] Barnes & Noble’s new chief executive, William Lynch, is paid $900,000 in salary, while his predecessor, Stephen Riggio, who was also vice chairman, was paid $800,000. Stephen, Mr. Riggio’s younger brother, remains vice chairman and now earns $400,000.

Mr. Riggio — who reduced his salary this year to $100,000 from $300,000 — made no apologies for what he said were necessary costs for hiring good executives. “I’m significantly undercompensated,” he said. “Steve is undercompensated.”

When a controlling shareholder in a company suggests he has to be paid a lot to stay with the firm, you know there’s conceptual disconnect. Riggio’s tortured logic, however, is the least of Barnes & Noble’s problems as a company.

B&N has an interesting history. It transformed the marketplace for books in the era of big box retailing. In the process, B&N added scale and efficiency to the modern publishing industry which in turn allowed publishers to achieve bigger and bigger sales. From the early 1990s, when B&N took the Superstore concept wide — other stores had invented it — until just recently, the sales of the top hardcover titles have increased geometrically.

Where books selling millions of copies was once a generational phenomenon, today it is the norm. Success breeds transformation and the rise of the mega-book attracted new retail outlets like Walmart (WMT), Costco (COST) and Amazon (AMZN) to the book business. These sales channels proved even more efficient — and offered greater discounts — than B&N. They did to the book chains exactly what the chains did to independent stores. Already weakened on that front, and further imperiled by the financial crisis and the damage it has done to all retailing, B&N faced a second front fighting off digital distribution of books.

Read more http://alturl.com/6b2rn

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