What Business Are You In?
Ivan Hoffman, B.A., J.D.
As we approach Y2K, publishers must realize that we are *already* in a new era. Flipping over the calendar (at least hopefully we will be able to flip over the calendar) is not going to create something new. We are, today, as you read this, in an era of multimedia, cross-marketing and electronic formats and all of the exploitational, promotional and sales opportunities that go along with this new millennium.
Any publisher that does not see this seems destined to fall behind at best and fail completely at worst.
And any publisher that does see this must then ask themselves the fundamental question: "What business am I in?" (And for those who are or wish to be grammatically correct, "In What Business Are You?")
And if the answer to the above question is: "I am in the book publishing business" then I again submit that that publisher runs the risk of not being a publisher for long. It seems to me that the better answer to that question is "I am in the rights exploitation business."
If you see only with the narrow focus of the book publishing business, then I submit that all you see are books. Hard copy, real world books. Books sold in brick and mortar book stores. Books translated into other languages but books nonetheless. Books that come back, often by the carton. This lens restricts your vision since, as publishers, you then seek to acquire rights to market these books. If you are not the creator yourself, then your approach to contracting with authors, artists, illustrators tends to focus on making sure you can get the book out. Even then, many publishers simply either have no contracts or ones that are woefully inadequate even for that narrowly defined market. Additionally, with that small lens, publishers face the same problems that publishers have faced for since Gütenberg: marketing, distribution, sales, returns problems. Lots of return problems.
But let me suggest that if you widen your lens a bit and see your business with vision, then it seems easy to see that in fact you are not in the publishing business but in the rights acquisition business. And if you see that you are in the rights acquisition business, the Y2K and beyond holds incredible opportunities instead of limitations. If you see yourself in the rights exploitation business, new vistas can open to you. Books are merely one adjunct to your business. And what seems then to happen when you see these new opportunities is that you begin to acquire larger rights than merely book publishing rights. You begin to acquire electronic rights, Internet rights, multimedia rights, not only from authors but from cover artists, illustrators, editors and the like. (Read "The Need for Vision")
Let me give an example that perhaps you have heard before but that serves to deliver the reality. In the 19th century, the railroads saw themselves as railroads, carrying passengers and freight. That vision worked for a while. But technology advanced and when the telegraph came along, the railroads failed to widen their business model and see themselves not in the railroad business but in the communication business. Had they seen that coming, had they had that vision, they might have been able to capitalize on the coming revolution in communications. Instead, they remained primarily in the railroad business and fell upon very hard times for a very long time.
Let me bring the example up to date. The telecommunications revolution now ongoing is clearly about revisiting the question "What business am I in?" The traditional telephone companies (MCI, ATT, the baby bells etc.) have been acquiring Internet-related companies, those that own large parts of the Internet backbone, as well as partnering with satellite companies, Internet service providers, cable television companies and so on. They all have seen their business as not merely providing their core services of dial tone telephone access but all the cross-related services they believe are going to be in demand in Y2K and forward.
Another example: 3 ½ years ago, when I got on line, the search engines were... search engines. Now there does not appear to be a search engine in sight. Instead, these businesses began to see that they were high traffic, narrowly targetable demographic web sites and began then to expand their vision. Now everyone is a portal, an entry point into the entire world wide web and in turn, their business models have expanded accordingly. They are well positioned to offer advertisers a range of advertising models designed to expand not only client business but the portal’s business as well. Anyone who has an equity position in Yahoo or such knows the value of this expanded vision.
The Needed Publisher’s Vision
I submit that if you are a book publisher and you do not revise your answer to the pending question to be that you are in the rights acquisition business, then in truth you are not in business at all, or at least won’t be in business for much longer. If you don’t own rights to multimedia, to Internet, to electronic books from *all* your contracting parties, you are soon going to be out of business.
Getting ready for the present era will require publishers to examine their various acquisition agreements with authors, artists, illustrators, editors and the like. It will require an intellectual property examination by a qualified attorney to determine what rights the publisher has or lacks, and whether or not there are trademarks and other forms of intellectual property that may be worth protecting. It is money well spent since it focuses on value and not merely cost.
Expanding this answer has the potential of making decisions about your business model in terms of how you market your product and your business. You tend to look for opportunities that before you might have overlooked. You enter into contracts with this new business model in mind.
You surround yourself with visionaries to advise you.
You ask better questions and accept only better answers.
There is no single version of reality. Everyone looks at an objective event and sees different things in that event. We filter everything that we see through our personal histories and it is those histories that determine what we make out an objective event to be. If your history tells you you are limited, then you see the universe as a limited one and change, for change is what I am speaking about, as scary and dangerous. If, on the other hand, your history tells you you are boundless, then you can see the universe as limitless and change as an incredible opportunity.
Whatever you have believed about yourself in the past, you are no where mandated to continue with that belief system.
You can change.
If you are to survive in the coming, indeed present age, you *must* change.
Copyright © 1999 Ivan Hoffman. All Rights Reserved.
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