Literature for sale
Book publishing is different from all other activities in one essential respect. It is the only business where you already know from the beginning that a large number of publications will result in a significant financial loss. Products in other industries can obviously also lose money, but it is never intentional, and may be due to miscalculation, misjudgement of the market, or the like. In the case of book publishing, it is even part of the business idea, that some books will never make money. (This, and the following reasoning, applies to so-called ‘general publishing’, not textbooks, books for special areas, or reference books.)
The reason is that product development – that which in other businesses takes place in laboratories – in the case of books can only be done by publication. It is for the publisher to finance the cost of research and development. There is no way to do market research before you give out a book. No one can say whether a book will sell, before it is published and read. This applies to all types of general literature, novels, biographies, travel books, but also practical guides such as cookbooks and decor books. A book simply does not exist until it has reached the market. In addition, there are books that, regardless of the market, will never be profitable. Among these are almost always poetry, collections of essays, and drama.
The most important investment for a publisher is in authorship. It can often take several years before a writer breaks through. A familiar example is Par Lagerkvist, who debuted in 1912 and managed to publish eighteen books before he broke through with The Executioner more than twenty years later. It took patience and trust from both authors and publishers. It was an investment of several millions, which eventually became highly profitable. A more recent example among many is Sven Delblanc. He debuted with The Hermit Crab in 1962 and became a highly successful author five books later with Åminne in 1970, and other books that followed. Again, this is an investment of millions from the publisher’s side, and persistence and trust from the author’s.
These large investments are balanced by the revenue from the already established writers. A number of bestsellers is required for it to work; to finance both new authors and the books that are not intended to produce a profit. There are no exact figures on how responsibilities are divided between profitable and loss-making books. One can safely argue that profitable books account for the smaller percentage – anywhere from ten to forty percent.
This balancing-act has worked amazingly well since the mid-1800s, when publishing became an increasingly important part of both culture and the market. Several publishers in Europe and in Sweden were successful and survived for generations as family businesses. It is precisely the profitability of long-term investment, which has resulted in stable publishers. Several authors’ works have outlived their authors and have yielded revenues even from the next generation. This in turn led to publishing work being handed down through generations. There was no – and still isn’t – a publishing education, some college for book publishers. It was “on-the-job-training” that mattered.
Although it is quite easy to understand the long-term investment required in writing, there are many who question why publishers insist on publishing ‘unprofitable’ books, like poetry, or so-called ‘slim’ books by foreign authors. The answer is in the work of the French sociologist Pierre Bourdieu, who speaks of “cultural capital”, where cultural goods can be compared with economic capital; this definitely applies in the publishing world. A successful publisher must have this mixture of narrow and popular literature to be credible. This mix creates the publisher’s profile, and it is this that book buyers and critics see as a guarantee of quality and that also attracts young aspiring writers, who may one day fund other aspiring writers.
After World War II, reading exploded in Europe and the United States, and the number of publishers also increased – something that in turn required new administrative solutions. Previously, the publisher had often been synonymous with the owner. The title was publisher and he was in sole control. He – occasionally a she – decided, sometimes with the help of a literary adviser, about publishing, and had the financial considerations more or less in mind. To help them, there was a clerk who did the bookkeeping and sometimes also a cashier – usually a she – who handled the payments.
The publishers were, although substantial companies could be involved, what the Americans call a ‘cottage industry’. That this was so was probably the secret behind the success. A publisher must often make quick decisions based on experience and intuition, not rely on meetings and votes. How could you know for sure that a book entitled Midnight Children, by an unknown Indian writer named Salman Rushdie, would become a worldwide success? Especially since he had earlier published a science fiction novel that was unmarketable and not literarily impressive. Or that an equally unknown Russian writer named Alexander Solzhenitsyn would become a Nobel Prize winner, after his first books in Sweden received lukewarm reviews and hardly sold at all?
This one hundred and fifty-year-old publishing company structure has in recent decades undergone significant changes, not least in Sweden. The major publishers have become even greater, partly through acquisitions of other, often medium-sized publishers and increasingly resemble normal-sized corporations. Today, two major publishing groups dominate the Swedish book market. The management now consists exclusively of economists – the publisher has been replaced by a cluster of directors. The book publisher – which, on the way down, lost the prefix ‘book’ – is replaced by a number of publishers. These are now well down the hierarchy. First comes the president, then the vice president, then a sort of department of directors, then the publishers and under them the editors.
Thus has the important balance between culture and commercialism been upset. It is profit that is dominant. This does not mean that so-called ‘loss books’ will not be published – there will still be poetry collections, essays, etc. – but the space for them is shrinking. And, above all, they are not counted as an important part of the publisher’s profile, but rather as a legacy of necessity. There is a one-sided creep of bottom-line thinking at every level.
Here’s how one way of thinking goes: for this writer, we have published too many unprofitable books, we’ll have to let him or her go; we have too many expensive translation novels, which must be cut; we must reduce the number of releases by several percent, now it is the detective novels and thrillers that take priority, translations from marginal languages may be cut. The same applies to the production of the books. The format of the literature has been reduced to two because it will be more cost-efficient. That different books may require different types of presentation is not on the economic map.
In the case of non-fiction books, they shall preferably be no longer than what is stipulated by contract. The author can be required to cut them down – no matter what the content demands, it is the cost which is absolutely crucial. It can be taken for granted that the economist who demands this usually has not read the manuscript.
The mixture of different types of books, which is the hallmark of every larger publishing company, and which is so fruitful, is becoming increasingly homogeneous. That which is considered uneconomic is cast aside in favour of what is for the moment able to bring in the highest income.
This development, which I have observed for years, is confirmed by the economist and researcher at the Stockholm School of Economics, Jenny Lantz, in her dissertation Taste at Work – Taste and Organisation in the Field of Cultural Production. She writes about the existence of an “economic pole” and a “cultural pole” in so-called ‘culture-producing’ companies. She points out the obvious fact that the cultural component is a necessary part of culture-producing companies, but that these two poles are often seen as opposites, rather than complementing each other. In most cases, the cultural part is seen as a problem, and as something that needs to be taken care of – “it has to be managed” – so as not to be disruptive, that is, it must adapt to the economic part. She believes that in such companies there is an “ongoing repositioning to the economic pole”. This is a conflict that is detrimental to the company. To solve it, it is above all necessary that one becomes aware that it exists and that one discusses and solves these problems within the company.
In an interview, she says that more and more companies in the cultural sphere are run as if “one is dealing with toothpaste and shampoo”. Her thesis is about film- and music companies, but she says that she has heard from several employees within publishing who have read her work, and that they recognised themselves: “It / is / rather the business degree that is rewarded in a career than going down the path of cultural knowledge.” Jenny Lantz also notes that marketing departments have a very large space in the big publishers.
As shown earlier, long-term investment is a publisher’s spine. The economists in charge are, by definition, more interested in quick profits. They are not restricted to publishers, which the older generation built up to be a business for the future, but they can use their knowledge in any business. The long-term approach is therefore against their own interests. It is the annual financial statements – or even quarterly financial statements – which are crucial. And they show good results, just because of investment reduction. In addition, the ‘barns’ are being emptied, as earlier generations of book publishers are often filled to the brim with very profitable authorship. It interrupts long-term writing relationships because the author’s books are now being sold in smaller editions; books such as cookbooks, plant- and bird books, that might have had a long but slower life are being sold off – that is, they would rather take quick profits and destroy the book’s future sales.
The often very profitable publishing company that is taken over is then broken apart in a far-reaching centralisation. It blurs their profile that took many years to build, and refines them into niche publishers who only publish one sort of books, health books in one place, travel books in a different place, and purely fiction in a third. The result is that these satellite publishers become extremely sensitive to the business cycle and finally end up making a loss, although when they were sold they were highly profitable.
When the ‘barns’ are empty, the economists move on to exciting new tasks in completely different industries. But, as Jenny Lantz also points out, this purely economic thinking in culture-producing companies is not even good for the economy: “It’s not that the economic pole automatically gives more money.” The commercialisation of the major Swedish publishing houses has not brought the economic effects expected. As Sweden, compared with the other Nordic countries, led the way in this economic reorganisation of the big publishers, a comparison of them is interesting.
In our neighbouring countries, the structure of publishing has changed partly in the same way. The big publishers in Denmark, Norway and Finland have become larger through their own growth, not least through the acquisition of smaller publishers. But they have generally retained the old structure, with a book publisher in the management of the publishing company, with daughter-publishers retaining their individual publishing management and their own profile. Ten or fifteen years ago, the Swedish book-market was the leader in the Nordic countries – in terms of number of published books per capita, Sweden is now in last place, with Finland and Norway a good bit higher. The same applies to the sale of books per capita.
These figures are from 2009, since then, the Swedish book market has shrunk further. In 2010, sales decreased by two percent, and the first four months of this year have led to a reduction of an additional ten percent. That publication has also decreased by five percent is hardly surprising. This compares with the Norwegian book market, where sales rose 19 percent in the first nine months of 2010. (All statistics are based on the Swedish Publishing Association’s members.)
It appears in particular that the publication of literary books has fallen. The Swedish Publishing Association notes that “books on nutrition, health and personal development were specifically affected in 2010 – a trend that extends several years into the past. Other notable trends were books about the environment and ‘going green’, and on knitting and crochet. “This is comparable to Norway, where sales of fiction during the same period have increased by 33 percent. (Part of the increase is due to Karl Ove Knausgard’s books – we have also had Stieg Larsson’s books.) It is short-term economic thinking that leaves such marks.
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That the downturn in the Swedish book market has not been bigger is due to the fact that, in the large publishers’ shadow, a large number of ‘small publishers’ has grown up. These are individually driven publishers, often specialising in a particular country’s or continent’s fiction, reference books of a certain genre, children’s books and more. Another sign of the big publishing houses’ downsizing of literarily precious books is where the Nobel Prize for Literature has gone for the last fifteen years. Previously, the big publishers were completely dominant, now the opposite is true. Of these, only four Nobel Prize winners were published by the big companies, compared to eleven by the smaller publishers. (I have counted even those publishers bought by a major publisher, but the respective Nobel writers were published before purchase.)
These small publishers cannot, however, outweigh the increasing imbalance of the big publishers. They cannot replace the cultural capital that is steadily decreasing. The result is that the readers of books instead will number fewer; they are attracted to other activities when they want to relax. This imbalance is draining the world of publishing of its vitality and creativity.
It has not always been so. Sweden has, since the Second World War, been the leading nation in the Nordic countries in terms of book publishing. The market has been constantly updated through the initiative of the astute publisher. First launched were the so-called ‘people’s books’ that spread millions of books in workplaces and libraries, then the book clubs that actively sought out even inexperienced readers. In the 1960s came the first wave of pocket books that made books available to young people in particular, and since the 1980s the second wave of quality pocket books that has made books available in tens of thousands of outlets across the country. Such initiatives have not occurred since the economists took over the management of publishers. The last revitalising of the book market was the reduction of VAT on books in 2002, from 25 to 6 per cent. It was a political measure, which produced a sharp increase in sales, which has now abated.
The lack of creativity becomes clear when we currently find ourselves in one of the most technologically exciting periods in book publishing’s history. The huge opportunity that the internet provides has only been applied in the form of the online bookshop. However, little has been done to sell texts online – creating opportunities to download both non-fiction and fiction books in whole or in part from the internet. The e-book reading devices, for so long leading a fading life in Sweden – this gadget-mad country. Similarly, the new challenging opportunities created by POD (print on demand) or e-books have not been seized. The big publishers seem to be waiting for a more or less passive evolution, instead of making it happen.
The book market has become increasingly depleted with respect to various literature-stimulating initiatives. The variety of literary magazines and calendars are all gone, except the few that are not owned by publishing companies. Literary prize competitions that were common in the past have disappeared. The August Prize, which is the most important sales stimulant in the industry – a publishing company initiative predating the economists’ dominance – is now more than twenty years old.
It is not economists, but professional book publishers, who have constantly renewed the book market. The less influence they have, the more impoverished is the world of publishing. If the current trends in the book market are allowed to continue, it will inexorably decline. Not only will many prospective readers be attracted to other parts of the cultural and entertainment world, but even young literary talents will seek sanctuary from the world of books to other creative activities.
Of course, economists are needed in all major companies, including book publishers, but it is the upset balance between culture and capital that is causing stagnation. It’s time for a dialogue between the two ‘poles’ of the big publishers. A dialogue in which economists give more space to the publishers’ role and status in the hierarchy, while the economist is clear about what influence he / she has on the book publishing. Where one makes a budget that takes account of the books’ – and the authors’! – irrational natures and does not rationalise away individualism and individuality. The great historian and writer, Thomas Carlyle, wrote that a publisher must consist of both market and cathedral. It still applies today. The balance must be restored if we are to have a book market in Sweden with a future.