Publishing's digital disruption hasn't started.

Imperceptible, invisible almost, but it was there at the London Book Fair this year—publishers quietly clapping each other on the back and breathing a collective sigh of relief:Phew, thank goodness that ebook thing is over. Now let’s get back to real publishing.

I’m being a little facetious, of course. But this year’s trade show did see a genuine departure from the maelstrom of anxiety and excitement over the rapidly developing digital market that has dominated the last few fairs.

Most publishers seem to believe the worst is now over, that the industry has survived an inconvenient tsunami warning that turned out to be nothing but an unseasonably high tide.

But is the industry blind to the coming tempest? I certainly believe so.

The music industry thought that disruption was over by 2011 when their sales began to recover somewhat. Despite digital units accounting for 64% of music sales, the consensus was that the market had stabilized and was back to business as usual. Then in 2011 a Swedish start-up called Spotify launched in the U.S. After only four years in the mainstream, it now has over 15 million subscribers  and 60 million active users. The Spotify business model has truly disrupted the music industry, with artists now looking at nontraditional ways of generating sales other than records as their staple income.

Any parallels for authors and books here?

That’s admittedly a question publishers are as tired of asking as trying to answer. But the important thing to note is that while a change in format initially affected business models, the streaming element brought about disruption in the music industry that has stubbornly staid put.

Likewise, for anyone to think that the digital disruption book publishing has experienced in the last few years is over or receding would be foolish in the extreme. In almost every other industry that has experienced disruption in recent times it has followed a very distinct pattern.

Perhaps the best example of a disruption process is one put forward by Steven Sinofsky, a former Microsoft President and Andreeson Horowitz board partner and investor. While Sinofsky writes primarily about the disruptive effects of technology on established industries and their incumbents, I think the framework he proposes is instructive for book publishing.

Steven Sinofsky’s Four Stages of Disruption

Here’s how this looks as applied to the book industry:

Phase 1: Disruption of Incumbent is defined as the introduction of “a limited, but different, replacement for some existing, widely used and satisfactory solution.” At this stage, incumbents regard innovations as toys or nice-to-haves but not fundamental to their core business. If you look at both the explosive early growth in ebook and e-reader sales as well as the effective liberation of the self-publishing space, this makes plenty of sense. Publishers were hitherto no longer the gatekeepers.

In our industry publishers either denied or downplayed the impact ebooks would have. This sounds a lot like 2007–2009 to me.

Phase 2: Rapid Linear Evolution describes how after the initial disruption the industry begins to relax and allow the disruptors to develop their ideas. Writes Sinofsky, “The traction in the disruptor camp becomes undeniable.” The incumbent continues as normal but tolerates and begins to incorporate changes into its own business.

The early growth of ebooks certainly piqued publishers’ interest, and they adopted many of the key elements of ebooks without innovating especially boldly themselves. Even today, how many publishers have dedicated budgets or teams dedicated exclusively to digital content? In my experience, surprisingly very few. Digital is still largely seen as an add-on to print, not a separate and very different business.

2010–2013 was the period when publishers adopted this new delivery method of what effectively was the same content, albeit in a digital format.

Phase 3: Appealing Convergence is when the disruptive and incumbent parties come to work together, as according to Sinofsky, “even when technologies are disrupted, the older technologies evolved for a reason, and those reasons are often still valid.” The market begins to stabilize. There is widespread acceptance of the new technology and early adopters mature, allowing the industry to settle in with a harmonious blend of, in our case, print and digital.

This is where I believe publishing sits today in 2015.

For further evidence, look no further than the reported plateauing of ebook sales, the resurgence of print titles in 2014, and the talk of ebooks going “out of fashion.”  Some more reasoned commentators have highlighted that print vs. digital is also not a battle to the death.

The danger here is that complacency sets in, and publishers revert to print cycle–thinking and fail to plan for the future.

Phase 4: Complete Re-imagination is in Sinofsky’s view the “last stage of technology disruption…when a category or technology is re-imagined from the ground up.”

Think of how other industries are being disrupted. Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate.

As Sinofsky writes, “Re-imagining a technology or product is a return to first principles. It is about looking at the underlying assumptions and essentially rethinking all of them at once.”

So what is a book? What is reading? How will the millennials and children of the future consume stories? Will they even want to? I don’t think any of us know.

So the publishing industry’s timeline could look something like this:


Whatever emerges from this next phase will surely be a complete departure from what we understand today as an industry. As start-ups and interlopers begin to grasp both the values and deficiencies of contemporary publishing they will engineer radical change.

Will it be too late in 2016 to respond? Will back-slapping turn to hair-pulling?

Sinofsky signs off by noting that “timing is everything.” How are you spending your time? Are you thinking to the future? As I mentioned, very few publishers I know have devoted any significant research and development resources to digital and the real, fundamental analysis of what it will be to be a storyteller or content curator in 2020.

Ironically, one of publishing’s Achilles’ heels—its supposed inaccessibility or naturally poor fit with innovation—may in fact help slow the impact of disruption. However, it will not stop it.

Change is the law of life. And those who look only to the past or present are certain to miss the future.

—John F. Kennedy

 

This article first appeared on the Digital Book World Expert Blog in April 2015.