Dohle told the Court that if subscription got its wicked way there would be no bricks & mortar retail left within three years, and that publishers would be “dependent on a few Silicon Valley or Swedish companies”. That of course is totally unacceptable. Imagine if two German companies dominated the US publishing sector. No, wait…
Pretty much since the first US subscription ebooks platforms launched back in 2013 with Scribd and Oyster leading the race, Penguin Random House has been insisting readers will want nothing to do with subscription.
This from PRH UK CEO Tom Weldon, in full gatekeeper costume, back in 2014.
We have two problems with subscription. We are not convinced it is what readers want. ‘Eat everything you can’ isn’t a reader’s mindset. In music or film you might want 10,000 songs or films, but I don’t think you want 10,000 books.
Well, there’s no arguing with that. 10,000 films? Gimme, gimme, gimme. 10,000 books? Do be serious. It’s not in my mindset.
The arrogance defies belief. But remarkably Weldon was deadly serious. He really had convinced himself that, as appointed gatekeeper of all things culture, he knows best what the consumer wants.
Yes, for sure, Tom Weldon was a great businessman who captained PRH UK and made it a major player in the industry, and we all loved him for that. But the moment the notion of subscription came up, giving consumers real choice and empowering digital reading at the expense of print, the poor guy just lost the plot.
Yes, the unwashed masses may fall for the faux allure of 10,000 films, or 10,000 songs, but books? You can’t go giving people a choice of books beyond what PRH publishes for them. These things have to be curated by higher beings in plush offices in London and New York, who know what’s best for these poor souls, otherwise you end up with self-publishers stealing market share, and that would never do (and certainly never be admitted to).
And much the same can be said for Markus Dohle, current CEO of PRH, unquestionably one of the industry greats, a legend in his own lunchtime, and so often someone with his pulse on the consumer-publisher relationship.
But not when it comes to ebooks. Most definitely not when it comes to subscription. And for God’s sake don’t mention the Swedes!
Let us cast our mind back to Frankfurt 2017, where Dohle as usual was giving a keynote speech, as befits an industry giant. The speech was in German but Dohle shared the gist in English with Publishers Weekly, whence these quotes come:
We have achieved a healthy coexistence between print and digital books. Who would have imagined that, in 2017, we would be observing an 80:20 split among those formats globally? You might say that many so called “experts” predicted the split five years ago. But the split that experts and other observers were predicting was that 80% of all books sold today would be digital. Many were even predicting the death of print books.
Yes, selective history is a wonderful thing. So are selective statistics. In 2022 Dohle is still telling us the print-ebook split is 80-20, as if somehow PRH can defy the normal laws of consumer economics and this ratio is fixed in stone.
Let’s first acknowledge, then set aside the speak-first-think-later doom-mongers of the early 2010s who revelled in the idea of the death of print and the demise of Barnes & Noble and relished Amazon ruling the world. In fact not just the early 2010s. Some were still asserting B&N was at death’s door as recently as 2019.
Of course the sky is always falling in the publishing industry, and there’s always a bogeyman. Amazon fulfilled that role for many years, but as the Kindle programme became a sideshow for Uncle Jeff the substitute bogeyman, subscription, was gradually slipped into the industry conversation, with PRH among the cheerleaders.
As an industry we collectively thrive on the rollercoaster of doom-and-gloom followed by euphoria as we ride out the latest publishing storm, before looking for another sky-is-falling cry to latch onto as we hurtle into the abyss once more.
Take the Pandemic – lethal to so many people, so let’s not for one second make light of it – but breathing new life into the publishing industry it was supposed to level. And having emerged stronger for it we’re in the not-quite-post-pandemic doom-and-gloom phase again, on the roller-coaster as it hurtles once more into the abyss, revelling in supply chain disruption and paper shortages and anything else that give us a victim-of-a-cruel-world thrill before we coast up the other side as the industry once again rises phoenix-like from the ashes.
From Amazon to pandemic and now subscription, Dohle is making sure the world knows the Swedes and their confounded subscription model are today the biggest threat to civilisation.
In reality Dohle no doubt still thinks Amazon is the real bogeyman, but he could hardly rage against Amazon’s dominance of the market while telling a Court that PRH gaining even more dominance of the publishing industry was a good thing.
So he slipped in a completely irrelevant, not to mention ridiculous, tirade against subscription to try derail the DoJ team, not for one second taking time to consider the way he was contradicting his own position, that the public just don’t want ebooks. Why else would the ebook market be at, according to PRH, 20%?
To understand that, let’s first resume our visit to Dohle’s Frankfurt 2017 speech.
Opined Dohle:
Sales of the most popular ebooks by traditional publishers have declined in the last three years in the major Anglo-American markets.
That of course had nothing to do with PRH and other mainstream publishers jacking up the price of the “most popular ebooks”, thereby making the print version much more appealing.
After all, why would any consumer be thinking, “Now shall I pay $20 for the hard cover book that will look good on my shelf, that I can share with friends, and that I can sell on or donate to a thrift store when I tire of it, or shall I pay $20 for the ebook I shall never own, cannot share with anyone, and cannot donate or sell on to recoup some of the costs?”
Dohle went on:
Opportunities for self-publishing and streaming books are growing. Traditional publishing houses and bookshops are not participating in either phenomenon in a scalable manner.
Today, 50 million book titles–including all formats and used books–are available from Amazon. Yes, you heard correctly: 50 million. We are drowning in titles.
Drowning, I say! Absolutely drowning!
So maybe Tom Weldon had a point after all. 10,000 books is indeed too much for the poor consumer to bear. And the reading public is now drowning in 50 million books!
Just like the first railway passengers, expected to explode if the train exceeded thirty miles per hour, consumers just cannot cope with so many books on offer. It’s just not natural to have so much choice.
Dohle invoked Malcolm Gladwell’s famous 2012 quote, oft used to argue against self-publishers:
In a world of infinite choice, it is the editor who is the king. Don’t give me more, give me less and make it good–and you will be in business forever.
Who could possibly argue with that? Give me less. Now! And that of course is why Markus Dohle has taken the noble decision that PRH should stop publishing new titles, and he has withdrawn his bid to acquire Simon & Schuster.
No, hold on, that would involve consistent, rational thought. Let’s stick with the reality of PRH-think in the 2020s.
Now we can all understand why PRH and other mainstream publishers are extremely wary of Amazon’s Kindle Unlimited ebook subscription service. Handing even more of the ebook market to Amazon would obviously not be in the publishers’ best interests.
So publishers can learn from their mistakes!
Not of course that that has stopped those same publishers handing Amazon pretty much total control of the audiobook market.
Okay, so maybe they can’t learn from their mistakes after all.
But PRH has gone to the opposite extreme, per its 2020 decision to pull all its titles from all unlimited subscription services. Again, we can all understand the concerns about Amazon’s dominance, but in what conceivable way were English-language PRH titles sold on Nextory, BookBeat, Scribd, Storytel and a host of other subscription platforms undermining the industry or hurting author incomes in these countries?
Kobo+ (in the Netherlands, Belgium, Canada and beyond) has shown how subscription actually boosts à la carte sales, and likely print books too.
But PRH isn’t open to rational argument when it comes to subscription. Rational thought, after all, would conclude an author getting a small share of a subscription pot for a download in a minor market is better than getting a large share of nothing from that book not being available on that platform. PRH, it seems, thinks 100% of nothing is infinitely preferable to x% of something.
But there is at least consistency from Markus Dohle when it comes to making a stand against subscription. Book subscription, that is. Films? Bring it on! We want those lovely knock-on book sales!
Every good film and every good television series is based on a good story, and in most cases, those stories begin with a great book. Hollywood’s thirst for stories, from established studios as well as new players in the business—among them Netflix, Amazon and Apple, Hulu, Facebook and Google—has never been greater than it is today. And each iteration of a story as a film or a TV series increases sales of the original story, namely, in the form of the book.
Yay! Subscription rules! I often wonder if Markus Dohle and the other industry bigwigs happily subscribe to video and music subscription channels while ranting against the evils of subscription…
Ranting? Markus Dohle? Believe it.
The matter came to a head as it was announced Findaway was being acquired by Daniel Ek’s Spotify and Audiobooks.com by (at the time) Jonas Tellander’s Storytel, both of course based in Sweden, something Dohle does not want us to forget.
In a super-soft interrogation by The Bookseller’s Philip Jones in late 2021 Dohle solemnly explained:
When it comes to subscription, I am convinced that in the long run it is not good for author income, it is not good for retail.
Look at these investments this week: big bucks flowing into the United States publishing industry, Storytel and Spotify entering the scene. We have a very clear view on this: it’s not good for authors, it’s not good for retail, it’s not good at creating the future of books and long-form reading for generations to come, and we continue to apply that to our strategy. We are talking to agents and authors about this and more and more people agree with us. We will see how this unfolds, whether readers at large will adopt those kinds of models. The future will show [the verdict], ultimately the reader will decide.
Big bucks flowing into the US publishing industry?
For the record, Daniel Ek’s Spotify paid just $123 million for Findaway –
and Storytel paid $135 million for Audiobooks.com. That’s a total of $257 million from the Swedes. If that’s “big bucks” I can only imagine what superlative Dohle would invoke to describe the $2.175 billion a certain German company that pays Dohle’s salary is attempting to pay for Simon & Schuster.
The reader will decide the future of subscription?
Do be serious, Markus. By deliberating keeping top content – all content in the case of PRH – out of the streaming services you are ensuring readers are not being given meaningful choice. What next, the PRH Model-T ebook? Any colour as long as its digital black?
But let’s spear the poignant parts of The Bookseller essay for this current debate.
Sophia MacAskill, podcasts and audio associate agent at Curtis Brown, was brought in to ram home the threat of subscription.
There is always the question of monopolisation within the industry.
Not, Markus, perhaps the best point to bring up when preparing to argue in Court that your own company should be allowed a big step closer to monopolisation within the industry.
In the same The Bookseller post, Society of Authors CEO Nicola Solomon said she remained:
Concerned at the very low returns authors get from any form of subscription model, including Audible, and the lack of transparency in calculating royalties on many systems.
Oops! Here we have Dohle explaining how the unlimited subscription model is the devil incarnate while Solomon is saying the Audible credit model – the model PRH happily uses in the full knowledge Amazon owns the market – is just as bad.
But Dohle just keeps on reeling out the subscription bogeyman at every opportunity, and that included while giving evidence in the trial to decide the future of the PRH buy-out of Simon & Schuster.
And he doesn’t seem to care how daft he sounds. A sign either of desperation or arrogance. Or perhaps a mixture of the two.
In Judge Florence Pan’s court in Washington Dohle is trying to explain why PRH should be allowed to acquire a huge additional segment of the US publishing industry, and stoops to such nonsensical assertions as that PRH and Simon & Schuster editors would bid against one another to acquire new titles. It begs the question why Judge Florence didn’t invite one of the PRH lawyers to argue the DoJ case against PRH, to show such objectivity was even possible.
Dohle certainly had no problems with objectivity. He just casts it out of the window and forgets all about it, instead dragging in subscription – not at all on the Court agenda – as the big bad wolf the DoJ should really be worried about.
Today, the biggest threat is all-access models for books.
And just in case that wasn’t clear, Dohle talked of the “tectonic influence” of these subscription companies.
Tectonic? Since when did sombre publishing CEOs talk in such terms? Do you think maybe Dohle is a secret TNPS reader?
Dohle further told the Court that if subscription got its wicked way there would be no bricks & mortar retail left within three years, and that publishers would be:
Dependent on a few Silicon Valley or Swedish companies.
That of course would be totally unacceptable. Imagine if two German companies were major players in the US publishing sector. No, wait. Aren’t both PRH and Macmillan owned by German corporations?
Or is there something special about Sweden that Dohle has a problem with? Would Dohle feel so down on subscription if they were not mostly run by Swedes?
But let’s end this fisking of Markus Dohle with his revelatory statement that if subscription were allowed free reign there would be no bricks & mortar stores left standing.
Revelatory in that this so starkly contradicts everything Dohle has argued these past years about consumers preferring print to ebooks.
And let’s be absolutely clear this is about print vs ebooks, because audiobook sales in physical format sold online or in physical retail simply do not move the needle. There is no physical retail audiobook sector to disappear in two to three years per Dohle’s hilarious prediction. And in any case we all know audio does not cannibalise print and audiobooks and print can coexist peacefully. Not least because only a tiny, tiny fraction of those 50 million books we are drowning in are are even available in audio format.
So when Dohle tells a US Court that subscription will destroy physical retail in the space of a couple of years he can only mean ebooks, the exact same format he has year after year after year delighted in telling us 80% of consumers don’t care for because they are soooo in love with print.
So how, Markus, did you keep a straight face in Court when you told the Judge subscription, were consumers allowed the option without the PRH gatekeepers’ to keep the barbarians at bay, would wipe out bricks & mortar print retail in just two to three years?
Oh, and that 80%-20% split… The reality is somewhat different.
No, the market is not split 80-20, just PRH sales.
And for PRH it will remain 20% so just as long as Dohle is CEO and can keep ebook prices high to depress à la carte retail and keep titles out of subscription services to thwart those evil Swedes and their quest to conquer the world.
