A Textbook for Publishing: Selected Articles from Personanondata

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A Textbook for Publishing
Selected Articles from
Personanondata
Michael Cairns
Information Media Partners:
2017

PersonaNonData: Predictions & Commentary 2006 - 2017
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Dear Reader,
Since I started my blog PersonaNonData in 2006, I had no idea where the journey would take
me but I have always seen the blog as a close extension of what I’ve been doing since my
career in publishing started: Trying to make sense of the business amid an ever changing
environment.
That’s the nature of business, and I’ve always believed that if you don’t have an interest in the
dynamics and influences pervading your company and business you should probably think
about making a change. I frequently meet people who after long periods in publishing really
have no idea what’s going on. I find that quite sad.
PersonaNonData has always been a selfish preoccupation but I do hope I’ve been able to shed
some light on the business – at least as I see it – for some small group of publishers who enjoy
my point of view.
And the photos of course!
Best regards,
Michael Cairns (aka PersonaNonData)
Michael.cairns@infomediapartners.com
@personanondata
908 938 4889
Text and Images © Michael Cairns

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Introduction:
Michael Cairns is a publishing and media executive with over 25 years experience in
business strategy, operations and technology implementation. As a business executive,
Mr. Cairns has successfully managed several troubled and under-performing
businesses, creating new business opportunities, developing new funding sources and
enhancing shareholder value for investors. His years spent as an operating executive
have largely been with brand-name publishing companies such as Macmillan, Inc.,
Berlitz International, Wolters Kluwer Health, Reed Elsevier and R.R. Bowker. As a
consultant, Mr. Cairns has worked with clients as diverse as AARP, Hewlett Packard,
InterPublic Companies and Reed Elsevier with an emphasis on business strategy,
market development and corporate development.
His skills and experience include:
▪ Business and corporate strategy development and implementation
▪ Operations management and business transformation
▪ Traditional and digital publishing and operations
▪ Print-to-digital transformation and adoption of new business models
▪ Software development and software services
Mr. Cairns holds an MBA (Finance) from Georgetown University and a BA from Boston
University. He has served on several boards and advisory groups including the
Association of American Publishers, Book Industry Study Group and the International
ISBN organization. Additionally, he has public and private company board experience.

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Introduction: Information Media Partners
Michael Cairns established Information Media Partners in 2006 as
a boutique strategy consulting firm focused on the information and
education publishing segment. The work conducted by the firm
includes product development, corporate development, sales
management and corporate reorganizations. We work with
established businesses, private equity owners and potential
acquirers.
Examples of our work include:
▪ Reorganized and re-focused a $25 million software
publishing company by aligning business operations with
client priorities; implementing internal collaboration tools
and project management standards; re-building executive
team to focus on effective and efficient management
▪ Defined a new business strategy for a large non-profit
association and advocacy group expanding their business
model into global markets to exploit their core knowledge
and expertise across a broader market
▪ Led an information technology capabilities review at a large
international advertising holding company. Completed over
200 interviews in 15 international offices and multiple group
focus sessions to define the operational ‘gaps’ between
existing agency capabilities and those necessary and
important for client delivery by region
▪ Completed a sales management effectiveness review for a
global software company and defined six key project
initiatives to improve sales effectiveness, market
development and account management
We approach our client engagements in a standardized, logical
manner which creates the best environment to identify key
business drivers, administrative and logistical road blocks and/or
product or market definition issues. Our investigative approach
leads to better insights into your business and supports the
development of workable solutions and recommendations for
success.
Visit the Information Media Partners website for more information.

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TABLE OF CONTENTS
PREDICTIONS 2017: SUBSCRIBE TO ME 6
WHERE ARE ALL THE E-TEXTBOOK USERS? 8
PREDICTIONS FOR 2016: EDUCATION, CHINA, PLATFORMS AND BLOCKCHAIN.
AS I SEE IT. 10
PREDICTIONS 2013: THE DEATH OF THE MIDDLEMAN. 13
PREDICTIONS 2012: THE SEARCH FOR ATTENTION 16
PREDICTIONS 2011: THE GROWTH OF INTIMACY 20
PREDICTIONS 2010: CLOUDY WITH A CHANCE OF ALARM 24
PREDICTIONS 2009: DEATH AND RESURRECTION 27
PREDICTIONS 2008: RETURN TO THE SCENE OF THE CRIME 29
PREDICTIONS 2007: TAKING IT IN LEAPS AND BOUNDS 31
CORPORATE DATA STRATEGY AND THE CHIEF DATA OFFICER – SEPT. 8TH,
2011 33
BUSINESS OUT OF THE ORDINARY 40
I STEAL STUFF – MARCH 15, 2011 42
WELCOME TO THE MIGRATION (AND OTHER LESSONS) – FEBRUARY 8TH, 2011
44
CONFUSING A SILO WITH A BUSINESS – AUGUST 3RD, 2010 47
UNITED ARTISTS REDUX – JULY 20TH, 2010 48
THE BAKED BEANS ARE OFF – JULY 13TH, 2010 49
DO YOU SINCERELY WANT TO SELL BUSINESS? - JUNE 29TH, 2010 50
THE CURATOR AND THE DOCENT – JUNE 22ND, 2010 53
A DATABASE OF RICHES: A REPORT ON THE MARKET AND PRICING FOR THE
GOOGLE BOOKS PROJECT – APRIL 20, 2010 55
YOUR PRICE MAY VARY – NOVEMBER 18TH, 2009 67
SEGMENTING THE PUBLISHING INDUSTRY – NOVEMBER 9, 2009 69
580,388 ORPHAN WORKS – GIVE OR TAKE 72
THE ISBN IS DEAD – AUGUST 4TH, 2009 76
A DIGITAL CONCIERGE – MAY 21ST, 2009 78
SILOS OF CURATION - APRIL 29TH, 2009 79
WHO WANTS TO PAY FOR “CONTENT”? - MARCH 9TH, 2009 80
PRESUMING NO BOOK – FEBRUARY 17TH, 2009 84
PIMP MY PRINT - DECEMBER 10TH, 2008 86
DEATH OF THE BIG BOX - DECEMBER 3RD, 2008 87
RACK JOBBING THE E-BOOK - JULY 16TH, 2008 88
AMAZON THE MONOPOLY – MARCH 28, 2008 89
MUNICH: FEBRUARY 6TH 1958 - FEBRUARY 6, 2008 90
BRANDS TO PUBLISH – JANUARY 13TH, 2007 91
NEW MODEL ARMY OF SELF-PUBLISHERS – SEPTEMBER 19TH, 2007 93
THE NEW PUBLISHING EXPERIENCE: BUILD YOUR OWN BOOK - JULY 10, 2007
94

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HAIL THE DEATH OF THE BOOK REVIEW SECTION – APRIL 30T, 2007 95
WHY DON'T LIBRARIES HAVE PUBLISHING PROGRAMS? - APRIL 9TH, 2007 97
BORDERS STRATEGY PLAN: WHAT THEY COULD HAVE SAID - MARCH 26, 2007
99
GIFT REGISTRY FOR LIBRARIES – JANUARY 19, 2007 103
JUST TRYING TO KEEP MY CUSTOMERS SATISFIED - JANUARY 18, 2007 104
MY EDUCATION SPACE: 'ED-SPACE' - OCTOBER 17TH, 2006 105
THE TEXTBOOK IN THE 21ST CENTURY – JULY 13, 2006 107

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Predictions 2017: Subscribe To Me
The end of one year and the beginning of another always represents an opportunity to reflect
and think about what the future will bring. That is, if you've nothing better to do over the two
week break for Christmas and New Year’s. Like many others, I've been doing this for most of
my career and, over the past ten years of PND's history, I've been publishing annual
prognostications. As I have said before, it is less about being right about the future than being
thoughtful about the future. Trying to think about what it all means and making sense of what
you see is important to planning how your business operates and confronts change.
This year I also looked back to 2016 at some of the big stories of the year and I've decided to
use a similar, shorter format for my predictions for 2017. At the bottom of this post are links to
my predictions from prior years. Read them (and perhaps laugh).
Subscriptions Are All In:
The explosion in podcasting is an indicator for publishing – specifically of the rapid growth of
subscription models for content. According to McKinsey's annual Entertainment and Media
Report, consumers are spending less to buy content and more to access it without owning
it. And, as the trend gains in momentum, any doubt or concern about ownership seems to be
waning. Subscription models are offered for everything from jets and cars, to vacation homes
and movie services. Spending to buy content fell by 8% and access to view content grew by
31% in 2015. Access to content will overtake ownership by 2018, according to McKinsey.
How subscription models will continue to evolve and expand will be a strong theme during 2017.
According to consulting company Activate, subscription revenues represent 50% of the
$1.7Tillion content market and will grow by $226B (or 5%) by 2021. Additionally, consumer pay
models (subscription) for the top 100 (by revenue) non-game apps represent 71% of app
downloads and 86% of revenue generated in 2016 versus 65% and 82% in 2015. The strength
and growth of content subscription models is real and will expand beyond video and
entertainment to all content markets in the coming years.
Personalization and Opt-in Marketing
More content and technology companies will work out how to tailor content for specific users
and they will do this via browser and opt-in newsletter marketing. Driving usage of content will
become a mantra - not at the expense of irrelevance - for engaged users who receive highly
relevant content, which will drive high-value subscription revenues. The NYT has been using
technology to "profile" users and deliver relevant content for several years now and the
Washington Post (under new management) has aggressively used technology to create opt-in
marketing programs oriented around user interests.
For publishers, the effort to market their content more effectively cannot be done without the use
of third-party platforms such as Twitter and Facebook. In particular, the adoption of live events
(Facebook Live) will help publishers enliven their content and also reach a much wider market -
than traditional book tours, for example. Additionally, publishers will create "news teams" to

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maintain (constant) activity via these new avenues to readers. Thus, avenues such as
Facebook Live, Opt-In marketing/newsletter programs and similar initiatives will become vibrant
channels delivering content to specific interested groups which will, in turn, drive
purchasing. Facebook Live Audio will be particularly applicable to the expanded role audio
books will play in publishers planning for 2017.
While platforms are critical and an unavoidable necessity, don't underestimate the power of
newsletters and personalized content delivery. Understanding how your users interact with your
content, making sense of that and then acting on it via a variety of efforts will be a focus for
publishers in 2017. Simply counting page hits “vanity stats” is not good enough. Renewals is
where it's at.
Rights Management
For many publishers, rights management and royalty processing is a complex business
process. And things will only get worse as markets become increasingly border-less. Managing
a more complex environment of publishers, authors, companies, territories, business segments,
product types, formats and many other criteria will become standard practice with each
deal. All interested parties (not least authors) expect the "Amazon experience" where
information is presented in real time and in an easy-to-understand manner. Most media and
publishers are years away from achieving anything like this level of transparency, but movement
in this direction will be precipitated by numerous high-profile royalty audits as well as possible
financial regulation requirements.
Over the coming years, more publishers will need to replace their royalty software as well as
extract more value from the rights they hold. These two trends are not mutually exclusive.
Some other more quick thoughts:
 It’s unlikely we'll see much consolidation in publishing this year. S&S is probably still stuck
in the Viacom mess. If only: Pearson may be sold to private equity.
 I expect a big shake-out in the K-12 edtech market. Some consolidation but more failures
than you can count. The market is too saturated for (me-to) edtech products and with
uncertainty over the direction of federal policy this will cause many small providers to run out
of time.
 How long can NetFlix owner(s) withstand the ever-increasing values and still not sell? More
to the point, can Apple resist buying its own content business? If the ATT/TW deal is not
approved, then does the value of NetFlix go even higher? Stay tuned.
 Publishers will be doing much more with data - particularly in scholarly and academic - and
will use tools like Tableau to rapidly experiment with and iterate new products.
 Will Trump's AG go after Amazon for unfair trading practices because of the Washington
Post’s coverage of the Trump administration? I'd buy that subscription.

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Where are all the e-Textbook Users?
A whiff of great expectations and inevitability
trails behind any discussion of digital
textbooks like the scent of Grey Flannel from
a middle-aged man. But it’s time to clear the
air of both, and face the fact that the highly
anticipated digital revolution just isn’t
happening.
I’ve been as guilty as anyone, speculating
about the demise of print in the classroom.
But a combination of institutional resistance, vested interest and simple disinterest have
ultimately conspired to position digital textbooks on the slow train to never. In fact, in a recent
survey conducted by Campus Computing on behalf of the National Association of College
Stores (NACS), “never” was the answer over 24% of respondents gave when asked when
content in the classroom will be primarily digital. [Correction: The survey was sponsored by the
Independent College Stores Association, not NACS - sorry]
Surveying faculty and students on the adoption of and/or readiness for academic digital content
has become a competitive sport, resulting in regular reports presented by associations, trade
groups and retailers. You don’t need to look at many of these to spot the themes consistent to
all: Students prefer print, textbook cost is an issue and faculty isn’t inclined to experiment.
In spring 2015, NACS announced the findings from their Student Watch™ survey and admitted
that digital course materials were growing steadily, but only at a rate of approximately 3% per
year. Hardly fuel for a revolution. They went on to make the following statement regarding the
future of educational content in the classroom:
But one thing is certain: Every institution will need to consider a multidimensional and boundary-
spanning learning content strategy if the transition to digital learning content and courseware is
to proceed smoothly. Failure to do so likely will fragment the student experience as decisions to
adopt learning content vary from course to course and as untested courseware and digital
academic services are adopted and discarded. Unmanaged, the gap between courseware’s
capabilities and the faculty's use of them will frustrate students and lead to substantial
underutilization of the institution’s investments.
My response to that is . . . why? If the growth of digital is slow and its value to students and
teachers questionable, why does NACS believe that doing the above has become such an
imperative?
Is it a justification for the big investments made by the largest educational publishers, who have
bought companies and built content creation and delivery platforms to facilitate digital
delivery? Perhaps these investments, which looked so strategic and important to the industry

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(myself included), were premature or even misguided. Recent financial results for some of the
largest educational publishers have been soft and maybe the slow take-up in digital, coupled
with heavy up-front investment, is partly to blame. The most important question to ask now may
be “Is there a digital future for educational content at all?
There are certainly many boosters who would answer “yes”. Several years ago, Education
Secretary Arne Duncan announced that the US educational market needed to move, as quickly
as possible, away from print to digital, primarily to compete with other countries already making
serious advances in this area.
“Over the next few years, textbooks should be obsolete," he declared, going on to say that
students in other countries are leaving their American counterparts in the dust because of those
countries’ more enlightened education policy. Duncan noted that South Korea “has set a goal
to go fully digital with its textbooks by 2015.” But, in 2016, our government appears to have
done little to support the expansion and development of the infrastructure required to support
digital content delivery in colleges--particularly community colleges, across the US.
While the number of community college faculty surveyed by the recent NACS study was small
relative to that of four-year institutions, the concerns over accessibility were clear. Most
students attending community colleges can’t afford digital devices and their lifestyles –
balancing academic, work and home life – make using anything other than a print textbook
difficult. These problems are pretty basic but they don’t have easy solutions – and may not
until the tablet is as affordable and ubiquitous as the Slimline phone.
To my mind, there are other challenges which may be even more intractable, and these concern
institutional resistance and vested interests. Publishers, colleges and faculty, retailers and
others are dis-incentivized to move away from print content to digital. I’m not at all saying they
operate unethically or outside the best interests of their constituents; however, the current print-
based world does afford important benefits to many of those who participate in the business
model. Consequently, the desire to press for change might be somewhat muted.
The survey conducted by Campus Computing sampled approximately 3,000 faculty members at
29 two- and four-year colleges and summarized the findings:
 The majority of faculty agreed that digital materials generally cost less money.
 Less than half believed that digital content added value to their courses.
 55 percent said that students prefer print textbooks to digital.
 39 percent reported they had never heard of open educational resources (OER).
While the majority of faculty members professed concern over high textbook prices, there were
some inconsistencies in the responses that may not entirely bear that out. For example, faculty
members believe themselves to be the final arbiters of textbook selection and, certainly, the
price of the textbook is a known variable they can take into account during the selection
process. Even more telling is the finding that very few faculty members know about, are aware

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of, or would select open-source content for their course material. If selected, this courseware
would be free to the student! As summarized in Campus Computing:
Two-fifths (39 percent) of the survey participants indicated that they had never heard of
OER, while just over a third (36 percent) indicated that they knew a little about OER but
had not used or reviewed OER materials. A tenth (10 percent) had reviewed but decided
not to use OER materials for their classes, while another tenth (11 percent) were using
OER materials and 4 percent were currently using OER in their classes and also making
their own course materials available as OER.
The results were similar with respect to digital content: While respondents believe it to be
cheaper than traditional print textbook content, a disappointing proportion of faculty are willing to
select digital content for their students. Despite their apparent unwillingness to experiment with
the selection of digital course materials, the faculty surveyed are more than willing to judge the
quality of digital course materials as inferior to traditional textbooks. It’s hard to understand how
the ‘quality’ of digital content can be questioned when it’s seldom selected!
These and other contradictions may be a result of the survey methodology itself (i.e., how the
questions were asked), but what is patently clear is that digital transformation of content in
higher education is going to be progressive, not revolutionary as predicted. This doesn’t make
sense when you consider all of the great advantages perceived in providing digital content to
students. But obstacles remain and may be difficult to overcome--especially since they are, in a
sense, “protected” by incumbent publishers, administrators and suppliers. In the meantime,
Arne Duncan’s fear that the US is losing the education race to countries at the digital vanguard
becomes more and more real.
Predictions for 2016: Education, China, Platforms and Blockchain. As
I see it.
For many years now I’ve been putting my thoughts about the future of the media and publishing
in writing. Here are my thoughts on the coming year.
2016 Predictions:
Education publishing may well see a lot of turmoil during 2016. At Houghton Mifflin, CEO
Linda Zecher has continued to make changes to her organizational and executive team, while at
Cengage Michael Hansen‘s team is now well bedded in. In both cases, the companies are
focused in investing in digital products and distribution, which they couldn’t do doing while their
businesses were under considerable financial constraints prior to refinancing. Where change
will really be evident is at Pearson, Wiley, Scholastic and Macmillan. Given the share slides of
both Wiley and Pearson, I expect some restructuring is inevitable at both companies. Pearson
has already announced significant headcount reductions and has sold off most of its ‘non-core’
operations. Pearson’s share price is at a ten-year low and any long-term shareholder must be

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wondering what happened to the ROI from the asset sales and education company purchases
made during the past 10 years. At the current price, the company must be a target for private
equity. Perhaps even Bertelsmann will take a close look at the company in collaboration with a
PE company.
Similarly, at Wiley there is an argument that their educational division is not big enough to be a
“real” player against the bigger companies. That may have been fine when the business as a
whole was running well; however, the business is fighting a general market slow-down and
internal operational issues, all of which are reflected in their operational results. Look for some
announcement in 2016 that Wiley is looking at ‘strategic options’ for parts of its business. It is
also possible that Scholastic may consider similar options for its education business and
perhaps Macmillan could look to pick up more assets to grow the scale of their education
textbook business.
The expansion of China. In years past I’ve predicted that a Chinese publisher would make a
significant purchase in the US/Europe of an academic/professional publisher, but that has yet to
happen. Still, there have been small, modest investments by Chinese publishers over the past
few years and the Chinese publishing industry has begun to expose itself internationally at
BookExpo, LBF, etc. I think this shows increasing confidence (which may have been lacking
five years ago) and that makes expansion into western markets a probability. In addition, there
is a recognition that the domestic Chinese publishing market is significant, both in size and
reputation, and this presents international expansion opportunities for Chinese publishers which
were not appreciated five years ago. This developing strength will also help propel Chinese
publishers towards global expansion.
And, just this week, a Chinese consortium announced it was bidding for Opera, a web browser
design company based in Norway. While this deal is not directly in our market, it is indicative of
the intention of Chinese investors to expand into the media market in a big way. (Opera actually
has a larger role in content distribution than may be obviously apparent).
Platforms purposely open will become a strategic imperative for all CTOs looking for new
content management options in the coming years. The launch of Facebook, Apple News and
other large distribution networks will actually convince more content owners that their content
repositories and distribution networks need to be built with open-source, non-proprietary tools,
and retain open APIs so that linking and third-party application development can be encouraged
and fostered. While the entry of the larger players is important, it will not diminish the need for
individual publishers (and/or aggregators) to maintain their own market presence. What
becomes more important is that the platforms on which these are built are true platforms which
can be upgraded frequently, without disruption or added cost by the developer. In addition,
development and third-party app “tiers” sit on top of this base platform to enable extensions and
‘bespoke’ applications. These latter elements can be built by the software provider, the client
publisher or third-party developers. The third-party development capability will become a
marketplace for applications similar to the manner in which salesforce.com has established their
developer community. These product criteria will become critical entry points for any

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technology provider presenting their solution to education, academic and scholarly publishers
from this point forward (if it isn’t already).
The growth of corporate communication platforms is another prediction I’ve made in years
past. It hasn’t yet become prevalent; however, I believe virtually all corporations and
businesses are becoming publishers to some degree. Accelerating this is the availability of the
tools needed as well as the business imperative for companies to manage their own internal
and external content in more effective ways. I recently met an ex-colleague who has
developed a content tool that enables a company to host its HR and policies and procedures
manuals in a central service. This content platform offers edit features so, not only is the
content updated daily, but employees are empowered to offer input to improve procedures and
safety practices, which can then be immediately rolled out to other offices. A global retailer is
now testing this tool across its business. Similarly, communication with external constituencies
can be improved significantly for many businesses by adopting many of the same practices
which publishers have employed with their subscribers, like content platforms and access and
control features.
Growth of licensing revenues: CCC has been on an accelerated expansion of overseas
activities which underscores the opportunities for publishers outside the US marketplace. Most
publishers are still focused on the form of their content but, increasingly form will be less and
less important (the aforementioned Facebook and AppleNews sites are instructive on this
point). This will mean publishers providing flexible content and making it available to as many
sources as possible will increasingly drive their revenues. Licensing fees are becoming a very
important source of revenue for publishers and if your revenues in this area haven’t increased
more than 20% over the past three years you may want to re-think your policies. Undoubtedly,
licensed content will become one of a publisher’s main sources of revenue in the coming
years. This will have implications across businesses, especially for systems and accounting
processes.
Application of Blockchain: And, speaking of copyright, expect to see the application of
Blockchain to intellectual property rights. As you know, Blockchain is the underlying foundation
for BitCoin and, as such, its application to the protection and distribution of intellectual property
will be another very interesting use. Each step in a Blockchain transaction is protected by a
tamper-proof encryption technology which supports BitCoin as a legitimate financial transaction
service. The use of Blockchain is being considered in several other applications, and media is
one of them.
Blockchain can be used to facilitate the transfer of intellectual property from one owner to
another. Bitcoins are ‘tokens’ that represent money and are exchanged on the Blockchain
network. But there is no reason why a ‘token’ couldn’t represent some other specific item of
value, such as a book or an article or a business case. Once a transaction occurs, the user is
supplied with a unique key for accessing the content. If the user subsequently wants to sell or
lend the item, they pass their unique key to the next person for their use. This process
eliminates the ‘residual’ copy issue which arises when someone tries to sell a second-hand e-

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file.
Ultimately, a network of “bitRights” ™ could represent a universal content repository or
bazaar/market where rights and content could be exchanged or bought, traded and sold. In
addition, this aggregation would also generate significant user data and analytics to inform
future pricing, content/topic areas, distribution models and a host of other benefits which
currently get lost in the very inefficient rights and copyright clearance process we have
today. Recently, Ascribe received $2mm in seed capital to establish a Blockchain product for
artwork.
Open Access for federal funded research will clear Congress in 2016. In recent years, the
Fair Access to Science & Technology Research Act (FASTR) bill has failed to pass Congress
due to opposition from publishers and others. FASTR will require any federal agency which
provides more than $100million in grants (which, let’s face it, is a huge hurdle) to adopt an
open-access policy. Coupled with this will be more excitement and activity around the Obama
Administration’s open data initiative. Either way, there will be much more to happening in 2016
with open access to government information. App developers and non-profit foundations are
working together to drive better access to this type of information, and I recently saw a demo
from CivicHall, which is doing just that for several cities already.
As always, I expect the coming year will be another exciting year with, I hope, the above trends
occurring but almost certainly many other new and interesting things as well.
Predictions 2013: The Death of the Middleman.
It seems to some that we’ve entered a period of stasis in
the ongoing transformation of the publishing
industry. This time last year, I noted that the routine
operations of many publishers had fully realized the
transition to electronic content and absorbed its
implications. So perhaps the last twelve months have
been about catching our collective breath. But anyone
who thinks the big changes are behind us is probably
fooling himself, and may be lulling himself into
catastrophic inaction.
The harbingers of dislocation are easy to see . . . if you know where to look. In the second half
of 2012, we saw a slowdown in the growth rate of eBook unit sales; indications of a possibly
significant substitution of tablets for eBook readers; a major strategic publishing merger
destined to create a trade publishing goliath; and the sale of one of the big three education
companies. Any one of these developments occurring independently could have been analyzed
at length but, taken together, they suggest to me that more-- rather than fewer-- changes are on
their way.

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The expectation that the big trade houses would consolidate has been going around for at least
five years: in fact, it may be more surprising that the Random House/Penguin deal didn’t happen
sooner. Now that it has, it’s a foregone conclusion that there will be another trade merger
announced in the next few months, involving some combination of Harpercollins, Simon &
Schuster and Hachette. Perhaps all three will combine and, if so, that deal would equal the one
announced last year in scale and significance. But that’s probably unlikely. One publisher will
almost certainly end up the “odd man out” and it will be interesting to see which it is and what
they do next.
On the education front, there has been widespread speculation that some merger of Cengage
and McGraw-Hill Education will take place this year, since the two companies may end up with
a common owner. In the short term, there may not be a full combination but some trading of
assets may take place immediately to rationalize the respective businesses with deeper
integration to come, perhaps, in 2014-5.
In education more broadly, all education content companies (other than Pearson) are only at the
beginning of their transition from content providers to embedded content and services
providers. Professional information publishers provide content and services at the point of need
and education publishers will be doing the same thing in the not-too-distant future. At CES this
week, McGraw-Hill made some interesting announcements about product development
investments they have been making which presage how this “services approach” may take
shape.
To segue slightly, the justification for a merger is often presented as an opportunity to save cost,
apply economies of scale and/or gain access to a new market. At this point, expense and
efficiency gains are more likely to be the primary drivers in both the McGraw-Hill and Random
House Penguin cases. Each publisher anticipates significantly reducing costs in headcount,
facilities, distribution and other areas in order to deliver the same total quantity of titles. They
need to undertake this effort because the publishing value chain is compacting, making it easy
for content producers/authors to reach consumers directly which, in turn, is also changing the
financial model on which publishing is based. The functional areas where publishers added
margin in order to make a profit – overhead, distribution, marketing & sales--are becoming less
important (though not unimportant) when authors and contributors can reach their market
directly. The implications of these changes for publishing houses have been clear for many
years but addressing how their businesses must change to cope with them is nowhere near
complete in the larger houses. Smaller, more nimble companies like Hay House and
SourceBooks have travelled much further down this path.
Education publishing is seeing similar changes but the process of dealing with them will be
different. I expect we will see an aggregation model emerge in education, where content
‘platforms’ deliver content and services on a per-user basis. As I’ve mentioned before, this
model is already in operation. Academic librarians and universities will be offered an extensive
database of educational material from which faculty can choose the material – probably pre-

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selected, topic-driven packages – best suited to their classes. Platform providers such as
Amazon, Blackboard, Pearson and EBSCO may soon be the only efficient way for publishers
wanting to sell content (or access to their content) to reach students. The platform providers
will negotiate distribution agreements with all other content providers and may compete against
each other to offer the best combination of content. But a more likely and important point of
differentiation will be the unique services and level of integration they can provide faculty,
administrators and students. Instead of Pearson and EBSCO, think Reuters and Bloomberg .
And instead of profit models based on revenue per book, think per head or per desk. (This
model may begin to undermine the argument for DRM in education.)
A very positive byproduct of this change in education will be a complete integration of library
resources, institutional resources and consortia buying/negotiation that will allow better
alignment with objectives for student success. It seems odd (to me) that educational content
components, as they are currently supplied to students and faculty on campuses, often stand
independently of each source and can only be ‘integrated’ through a manual, rudimentary
process. And it’s even more odd when you consider that libraries have long been licensing
tools and services from EBSCO and Serials Solutions which provide deep integration of and
access to the databases and content the academic library licenses. It will only be a matter of
time before pan-university content assets and access are brought together.
Ultimately, 2013 may bring more significant change in the trade and educational landscape than
we’ve seen in many recent years. While there will be a lot of focus on the big trade merger and
its constituents, the industry’s other players will have to fight aggressively not to lose any
advantage—we all recognize that “bigger is better” when it comes to applying economies of
scale in a business whose underlying business model is changing radically. In education, we
may be paying attention to McGraw-Hill and Cengage but Pearson, as the market leader, is
likely to embark on even more aggressive strategies this year--under its new CEO, and with the
divestiture of Penguin and possible sale of the FT Group, the company has forcefully declared
education to be its focus.
Opportunities for innovators will continue to emerge, as one would expect in a rapidly changing
market. However, many of the niche or narrow solutions currently on offer--whether they be
assessment , content-delivery or search tools-- are likely to ‘run out of market-space’ as these
solutions become embedded in, and offered as an attribute of, the platform solution. I see
opportunity in the delivery of solutions that help specific users – say, university faculty – take full
advantage of the integration of content and services that will occur—for instance, on campus--
since many user groups may need to change the way they conduct their usual activities. The
outcome of these work changes will be to produce more productivity and better solutions, but
getting there will require ‘intelligent agents’ to facilitate—to help assemble content, training
programs, workflow and productivity tools and similar applications to rewire their work
environments. In education, this requirement may give platforms like Blackboard and
Desire2Learn an advantage, given their installed base on campus.
While change often produces anxiety, I see dynamism in the book (and “content”) industry that

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is exciting and invigorating. There will be many big changes in 2013 but in contrast to the most
recent past where publishers were buffeted by macroeconomic changes, I expect these
changes to reflect the elements of a positive shift in the way publishing companies operate and
consumers – especially in education – consume content. We're going to end 2013 thinking
completely differently about this industry.
Some other trends I see emerging during 2013:
• There will be more experimentation with subscription programs, possibly similar to the old
book club model, with curated collections and incentives (such as free eBook
readers). These could also be combined with social network capabilities to allow reading
group subscription models and social networking. For example, these could be ‘self-
defined’ groups: A reading group could set themselves up and choose from a variety of
subscription models that allow their group to read a specific number of books, use a unique
set of social tools and pay by subscription rather than per book.
• A Chinese- or Middle-East- based publisher will acquire a major, brand-name media
company. CurrentTV notwithstanding, this will be in information/professional or education.
• “Self-publishing” will see huge international growth as Asian and Latin American markets
develop.
• The unlucky leftover of the three trade houses in play will be immediately acquired by
Amazon (just wanted to see if you read this far).
• There will be some consolidation in the eBook provider market.
• The Apple bookstore will be re-launched and will end 2013 poised to surpass the Nook and
move into second place behind the Kindle.
• Similar to what takes place in gaming, innovative publishers will begin to engage readers in
new book and content ideas even before the book is ‘completed’. In game development, it
isn’t unusual for games to be released with only the first three out of 10 game levels
completed--why build the whole product if no one wants to play? Book and content
producers may try to adopt and adapt this model for their new product development.
• Manchester United will win the English Premier League title
Predictions 2012: The Search for Attention
There’s little more to say about eBooks these days:
The migration is now embedded into business
operations across the industry. Yes, there remain
some issues and problems day-to-day but it would
seem that the issue of most concern to publishers
for the past five years (trade particularly) is now
subsumed under business operations as usual. And
that bores me.
Sure, we could argue about the future purpose and
value of a publisher but most (if not all) the big trade houses are doing better now than
they were three years ago and continue to sign the big authors and sell lots of units.
The amount of attention given to the self-publisher model is disproportionate to its

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viability as a solution better than that delivered wholesale by a traditional publisher. Yet,
to some, the counter argument or disruptive solution is always more interesting and
therefore garners more attention. There will be more big success stories in self-
publishing but the larger point isn’t about replacing the old model with the new—it’s
more about incorporating the new model into the old. Where self-publishing was
derisively termed ‘vanity publishing’ 10 years ago, it could now be considered a vital
component of a better, more efficient publishing industry.
This set of predictions was harder to conceive that those in prior years and I am not
sure why that it is. I’ve been going through this exercise since 2007 (the year I started
this blog) and so went back over some of the things I suggested in years past. For
example, in 2007, I said:
 Several major US colleges will teach various social science courses entirely in
simulation. The courses will not be taught in traditional lecture form but entirely
within the software simulation.
Now, five years later, there have been some experiments in this area but my comment
was uttered in a time when everyone was building a home in the simulation game world
and, at the time, it seemed inevitable we would all be spending half our lives in
SecondLife. Clearly that never happened, and on the other hand, during 2011, I spent
many weeks looking into the medical simulations ‘business’ which is very impressive
and continues to push the boundaries of real simulation in education and training.
What’s important here is that simulations solve several business, operational and
administrative issues for schools and hospitals which drives the business case for their
adoption. That might not have been the case for SecondLife (at least in a
comprehensive sense).
The anticipated benefits of simulated learning will only be realized if they solve a
business problem(s). As I saw during my short research project, in medicine and
especially nursing, there are very real addressable problems that simulations solve for
educators and administrators. Some of the simulations centers I visited are almost exact
replicas of hospital wards and operating theatres. It is quite incredible. The money
poured into hardware at these centers is significant (and growing) but the next big
change in simulations training will be how traditional medical content is integrated into
delivery in the simulations context. No easy thing, but the merging of the practical and
the theoretical is viewed as critical by educators and practitioners. The medical segment
is representative of how education publishing in particular still has significant challenges
to address as their industry deals with changes in technology, delivery and performance
measurement.
The following year (2008), I incorrectly predicted “McGraw-Hill will reorganize its
business much as Thomson [Cengage] has done. MGH education could be sold to
private equity.” The impact of the sale of MGH in 2012 is unlikely to drastically change
the publishing landscape in the short term, but there may be larger structural changes
across the entire business that will be more interesting. As we know, Apple is set to

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make an announcement soon which is rumored to be about educational publishing. If
that’s true, it might stimulate some fundamental changes in education similar to the
impact iTunes had on the music business.
Sticking with education, in 2009 I suggested that the Obama administration would make
wholesale changes in education policy and become more ‘federalist’ in approach. As
some ‘celebrate’ the ten-year anniversary of ‘No Child Left Behind,’ the administration is
pushing more (or allowing more) responsibility to the states for education policy while at
the same time providing more assistance to ‘failing’ schools so they can improve. If
anything, the Obama administration may be more ‘activist’ with their assistance versus
the prior administration and this policy (or set of policies) is likely to aid education
publishers in the provision of the next generation of assessment tools, which will be
oriented more toward remediation and intervention (and which I touched on in 2010).
Last year, I focused my prognostications on the concepts of curation and community:
The growth of intimacy assumes that users will seek closer relationships with their core
community of friends, workers or communities of interest in order to make decisions
about the content they access, the products they use and the entertainment decisions
they make. Book publishers, retailers and authors will need to understand how to
actively participate in these communities without ‘marketing’ or ‘selling’ to them.
Facebook is obviously the largest social community but, within Facebook, there are a
myriad of smaller ‘communities’ and, within these communities, the web becomes highly
personal. The relationships among the participants becomes ‘intimate’ in the sense that
the participants share knowledge, information, even personal details that in a traditional
selling or marketing environment would never be breeched by the vendor. The dynamic
of selling becomes vastly different in this context and publishers must find a way to
understand these new communities, the influencers that dictate behavior and the
motivations that contribute to selling products (and services potentially).
I still believe the above to be a trend even though it hasn’t developed as quickly as we
might have expected. I fully expect the concept to mature over the coming years.
Which suggests a lead-in to a theme for my 2012 predictions: Where 2011 was about
the community providing a filter for its ‘members,’ 2012 will be more about the
community helping focus/apportion the attention of its members. In a screen-based
entertainment world, publishers will struggle to assert their right to a user’s time against
competition that includes every media option out there from games to TV to social
networks. This is different than the former paradigm because all media usage is rapidly
migrating to tablet and applications-based consumption. And this includes television.
With both major book retailers actively engaged in the tablet wars, it seems inevitable
that tablets will be the predominant delivery mechanism for publishers’ content,
including trade and education content. So, if our content is delivered on these devices,
how do we establish and hold the user’s attention in an environment where the user can
skip from media to media with almost no friction whatsoever.

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The answer to this question is partially reflected in last year’s post regarding community
and curation. The most significant challenge publishers will face is getting their content
shared and linked to and powerful social network marketing programs will be at the
center of this effort. This doesn’t only apply to trade content--‘communities’ organized
around ‘influencers’ such as academics/professors, institutions, specific courses, etc.
will also drive the sharing and linking of educational publisher content. For example, an
individual interested in business entrepreneurship might ‘friend’ the Harvard class
‘Entrepreneurship 101’ and use the reading list to guide his or her personal reading.
Another key aspect of the quest for attention revolves around the metadata and the
supplemental content publishers produce for all their content. Most of this remains
either dis- or un-organized. A lack of depth and accuracy of meta-data is still a
deficiency shared by most publishers, even as the need for more meta-data expands.
On the whole, publishers are probably getting further behind. The thing that will help
publishers win a larger share of attention will be multiple ‘entry points’ that enable the
user to interact with their content and allow influencers to share and link to it. Not only
do meta-data files need to be robust and detailed, but users need to be able to easily
find references, indexes, TOCs, links, etc. and reviews as well as alternate views of the
content (audio, video, even perspectives). Not only do these various elements provide
‘hooks’ which users can grab in multiple ways, they will also serve to build loyalty and
authority for the content itself. And this could ‘index’ the content so that it scores high-
ranking positions when consumers seek the content you are selling. Thus, the entire
process feeds on itself.
Searching for Attention will represent a significant challenge for all content owners but
particularly publishers, as content amalgamates via the tablet platform. Not for nothing, I
think I’d rather go on that journey with B&N and Amazon versus Apple or Google
because at least they are booksellers. Whether that’s enough remains to be seen.
Here are some additional trends to watch for over the next year or two:
 The MGH deal aside, there’s a good chance we will see additional movement in the
ownership of segments of the education business. Cengage will have little difficulty
with their refinancing (doesn’t mean there won’t be any pain) but educational units
on the periphery (medical, legal, etc.) may witness more consolidation in the coming
year.
 With the ‘settling’ of eBook content and processes within many publishing houses,
we’ll begin to see more experimentation from publishers especially with expanded
definitions of traditional book content. We’ll see eBook content – the ‘book’ part as a
component of something that looks more like an issue of an online magazine.
Obviously, an ‘issue’ where the ‘book’ part is the focus but ancillary material (in the
magazine sense the supporting articles) lend deeper meaning, context and even
leads to obvious tie-ins and sequels. Essentially, I think we will begin to see the

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beginnings of the renaissance of the ‘book’ that everyone has been moaning about.
 In an area that I am focused on, we will begin to see a rapid movement towards
atomizing educational content. Apple may well announce an educational publishing
version of iTunes where content is such as chapters, cases and articles are sold in
parts as songs are sold versus albums. Watch for a painful realization about pricing.
The al a carte approach for content purchasing is something educators and
institutions are looking for and initiatives similar to the iTunes model (and
AcademicPub) are being welcome because they empower people to make better
choices.
 In sport, it will be a tight run thing at the top of the premiership this year but I still
believe Manchester United will beat out Manchester City for the title. England will
come second in the medals table at the London Olympics.
Predictions 2011: The Growth of Intimacy
Things might have been worse: As 2009 came to a
close, there wasn’t a lot of optimism about 2010 yet;
as the year unfolded, things were neither worse nor
better than they had been. And now, there is even
some excitement spurred on by the launch of the
iPad and the rapid growth of eBook sales. Certainly
any analyst, technology company or consultant
publicizing his or her [proprietary] forecast of eBook
and eReader sales for the next decade was almost
guaranteed to gain some attention, especially as
each successive forecast sought to outdo the prior
reports.
Encouraged by the boosterism, many pundits think this is ether the end of book
publishers or a new dawn. I don’t think it’s either, but the transition from print to
electronic could mimic the transition music made from vinyl to disc which stuffed record
company profits in the short term (only to entirely undercut the industry for the long). It is
too early to tell how book publishing will survive this transition, but it is entirely possible
that we will look back on these ‘transition’ years as ones in which publishers missed an
opportunity to connect directly with their readers, having limited their ‘opportunity’
merely to replicating the book experience on the screen.
Change and progress is glacial in the book industry while, all around the industry media
markets and products advance at break-neck pace. Evidence of massive and rapid
change surrounds the publishing industry: This time last year, tablet computers were
utilitarian business equipment; now, with the iPad, they are status symbols and, for
millions, a gateway page to life online. In 2009, few televisions were web enabled but
this year this is a standard feature opening up the web for living room leisure activity on

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a big screen. Content produced by publishers is now showcased in these channels and
on these devices, yet book publishers continue to be bit players in the evolution of
eContent and indications are this is unlikely to change appreciably in the future.
Some of the macro changes I mentioned last year continue to roll out into the
mainstream, such as the migration toward subscription models for education content
and trade reference, collaborative content and data sharing in academic publishing and
an adoption of the rent vs. buy model for content. And while none overtook the business
in any wholesale manner, all continued to grow in significance during 2010 as they will
in 2011.
The Growth of Intimacy
In 1961, Newton Minow (newly installed as Federal Communications Commissioner)
made a famous speech to the National Association of Broadcasters in which he
described television programming as a ‘vast wasteland’ and he suggested those in
attendance watch a day of television where,
“You will see a procession of game shows, violence, audience-participation
shows, formula comedies about totally unbelievable families, blood and thunder,
mayhem, violence, sadism, murder, western badmen, western good men, private
eyes, gangsters, more violence and cartoons. And, endlessly, commercials--
many screaming, cajoling and offending. And most of all, boredom. True, you will
see a few things you will enjoy. But they will be very, very few.”
The web may be all of this in spades but, increasingly, the web user is demanding
guidance and intermediaries who will then aid in their selection of appropriate and
meaningful content. As I’ve discussed before, curation will become a marketable skill
set and audience building around specific interests and specialties will be increasingly
valued by content users. Just as publishers may have purchased publishing companies
with defined title lists in years past, they may now consider purchasing “communities of
interest” (and their associated apps and Facebook pages, etc.) to which they can
market content/products. These communities may become the ‘imprints” of tomorrow
with defined – even built in – product development, marketing and selling channels.
The growth of intimacy assumes that users will seek closer relationships with their core
community of friends, workers or communities of interest in order to make decisions
about the content they access, the products they use and the entertainment decisions
they make. Book publishers, retailers and authors will need to understand how to
actively participate in these communities without ‘marketing’ or ‘selling’ to them.
Facebook is obviously the largest social community but within Facebook, there are a
myriad of smaller ‘communities’ and, within these communities, the web becomes highly
personal. The relationships among the participants becomes ‘intimate’ in the sense that
the participants share knowledge, information, even personal details that in a traditional
selling or marketing environment would never be breeched by the vendor. The dynamic
of selling becomes vastly different in this context and publishers must find a way to

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understand these new communities, the influencers that dictate behavior and the
motivations that contribute to selling products (and services potentially).
This is the next level of social networking: It isn’t enough to have a Facebook page or a
Twitter account. Authors and publishers need to engage deeply where it matters in
order to build awareness, build their brand (if necessary) and establish selling channels.
In the case of Facebook, the company already has a vast amount of book-related
information broadly collected from their community and undoubtedly the sales volume
that results from the discussions on Facebook is large. Most importantly for vendors, the
‘conversion’ rate from an ‘intimate’ recommendation to purchase is likely to be far higher
than from any other source or marketing activity. Finding and understanding the
applicable nexus within these communities that delivers the widest possible ‘conversion’
rate will be critical if publishers are to participate in the growth of intimacy.
While publishers may think the ‘growth of intimacy’ will have more relevance to trade
publishing, this may not be the case. As LexisNexis and some other professional
publishers have proven that a social strategy that encourages users to act as curators
for other users has significant value in building and supporting the publisher value
proposition and brand. I see this evolving in education as publishers encourage
academics and students to participate in social networks focused on specific topics and
content. But a word of caution: Building a social network simply to facilitate the sale of
your content or textbooks will never work. A critical aspect of Facebook is that it is
vendor agnostic and thus provides the latitude for the community to come up with the
right solution or product.
With reference to Minow, it won’t be the ‘broadcasters’ that ‘[could] do better’ as he
suggested, but it will be the consumer that will find a way to get to the content they
value using their web of ‘intimate’ relationships. Curators (or docents) will become
critical for users in this discovery process and, if publishers aren’t connected to this
network a meaningful way, they will be consigned to the vast wasteland of
skateboarding dogs and porn.
The growth of intimacy will be a recurring theme for all content producers over the
coming years and addressing the various aspects of this trend may result in important
changes in the way publishers develop and market their products.
Here are some additional trends to watch for over the next 12-24mths:
 Prices for dedicated eReaders will fall to $30-50 and will increasingly be used as
“fee-with-purchase” subscription promotions with newspapers and magazine
subscriptions or combinations thereof.
 That newspapers will be moving toward a paid subscriber model is rapidly becoming
old news (with the NYTimes expected to launch their service in January); however,
to raise their value proposition, newspapers will be more interested in limited content
syndication partnerships that lower the number of outlets with access to specific
content, thus raising the exclusivity for the content and the value proposition for
consumers. Rather than the same story appearing in hundreds of outlets,

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consumers will be looking for exclusive insights, analysis and commentary that can’t
be found elsewhere. (Again, a ‘curation’ theme going on here).
 Tentatively, ranking “best social sites” will attempt to do the same thing that
bestseller lists do in reflecting interest and popularity. The parameters will be unclear
(or experimental) initially but this data – organized as a ranking – will become a valid
measurement of commercial success and reader interests in the same way that
bestseller lists do today.
 Print will increasingly be diminished by publishers - not directly because of electronic
versions, but by their dismissive attitude to the quality of paper and bindings. Shoddy
quality will serve to undermine value as paper rapidly yellows, bindings split and
pages fall out.
 The popularity of eBooks and eContent will also chip away at the Byzantine (or
British Empire- like) organization of many international publishing companies, which
effectively splits rights by country and region rather than by language. We will start
to see international publishing companies completely rethink the ‘local office’ formula
where in different editions with different pricing, layouts, covers, release dates, etc.
are produced by local staffing. Instead, publishers will begin to dismantle these
operations and replace them with ‘centers of excellence’ where specific offices prove
their expertise in specific functional or content areas and provide these services to
the rest of the worldwide publishing operations. Direct customer-focused staff will
remain but the duplication of functions – driven primarily by the content
normalization that eContent imposes – will result in the elimination of functions
across the global enterprise. Publishing companies will become stronger as a result,
since they will be able to aggregate expertise in specific areas and distribute it
broadly across their operations.
 International ownership of publishing companies is par for the course but we haven’t
seen entities from China, India or the Arab world make a material impact on English
language publishing. That will change as these markets mature and local investors
determine they needn’t be simply buyers of English language materials but they
could own the producers of this content as well. Most of these markets are still
untapped: the market for English language content continues to grow and the supply
of content locally produced and distributed internationally is still in its infancy. There
are over 5mm college graduates in China each year versus less than 2mm in the
US. This represents a vast market opportunity for all types of content and it is more
than possible that a Chinese investor will buy a large English language publisher to
address both supply and demand in this market. The same scenario could be true of
the Indian and Arab markets. Watch for a big news takeover during 2011.
Lastly in sports: Last year I predicted that Manchester United would win the Premier
League title over Arsenal but, in fact, United lost by a point to Chelsea. The point was
effectively lost in a late season loss to Chelsea but, this year, Chelsea look well out of it.
So again I predict United will win the title over Arsenal. I also predicted that England
would win the Ashes series in Melbourne which they did last Tuesday. Hooray!

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Predictions 2010: Cloudy With A Chance of Alarm
As we greeted the New Year in 2009, we knew we were in
for it economically and, as I suggested in my prediction post
this time last year, one of the most obvious assumptions was
that things would get worse before they got better. Contrary
to expectations, publishing may have come out a winner in
spite of the steady litany of bad news on the magazine,
newspaper and television fronts that percolated all year.
While recognizing the economic challenges in store for us
back in 2009, I also suggested a resurrection of sorts could
be had as businesses began to accommodate the
fundamental changes that were taking place in the industry
as they executed their business plans. Sadly, there have
been few bright spots in media during 2009, and after having
taken the pulse of views on the near-term future in publishing
by speaking to a number of senior publishing executives, my belief is we will not see
any appreciable improvements during 2010. While some of their collective views can be
attributed to ‘hedging,’ external trends support the lack of optimism whether they be
reductions in education funding and library budgets or the increasing reliance on
“blockbuster” authors or pricing issues.
Many of the macro trends that I have noted in years past remain prevalent and in some
cases have accelerated. For example,
 Educational publishers appear to be increasing – rather than decreasing – their
investment in electronic media and more importantly, are beginning to think of their
electronic products as distinctly different from their print precursors. In particular,
educational publishers have started to talk meaningfully about “databases” and
“subscriptions.”
 Newspapers – particularly NewsCorp – have been particularly active in attempting to
build paid content models which support the separation of ad-based and
subscription-based models. Newspapers aside, even trade publishers – notably
Disney - are beginning to experiment in interesting ways with paid subscription
models.
On the other hand, my expectations for further compacting of the publisher supply chain
and increasing collaboration across publishing segments appear to have run aground.
Interestingly, an executive I recently spoke to noted that the separation of publishing
units that historically sat together – education with trade with information, for example –
has negatively impacted publishing companies ability to learn and benefit from the
experience and market testing of their sister companies. Possibly a decrease in access
to ‘institutional knowledge’ has, in general, contributed to some media companies’
hesitancy to experiment.

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Prognostication being the point of this post, there are some newer macro changes I see
that will define the publishing and media space more and more over the next three to
five years and it will be interesting to see how these develop.
 Firstly, 2009 was the ‘year of the eBook’ as new devices seemed to launch each
week. But the eBook, as we understand it today, only has three more years to run.
By the end of 2010, we will be focused on the ‘cloud’ as the implications of the
Google Editions product become clearer. This accelerated migration away from a
physical good – even with an eBook, the title was ‘physically’ downloaded – will
challenge our notion of ‘ownership’, rewrite business rules and provide the first true
‘strata’ for communities (or social networks) to develop around content. The Apple
iSlab (iSlate, iTablet, iEtc) will become a key driver in this development as the
company becomes the first consumer electronics maker to apply their design
expertise to multi-content delivery. (I don’t count SONY because they got it
completely wrong).
 A closely related (but somewhat tangential) development will be the realization by
publishers that the library market could become a threat to their business models as
mobile and remote access is aggressively marketed by companies such as Serial
Solutions and EBSCO. Currently, these products are not specifically related to trade
and academic titles; however, the implications for all published product will become
clearer as patrons’ ease of access to ‘free’ content grows and as the resolution
services improve. Remote access to information products by library patrons is
obviously not new, but applied to mobile computing it will change many things about
the library model. This trend coupled with the ‘cloud’ concept above, will require an
industry-wide re-think of the library business model.
 There are hints that the silo-ing of content that has been endemic to information and
education for many years could become a trend in trade as well. Examples remain
sparse, though Harlequin and Tor are routinely cited as exemplars of this trend.
 Subject-specific concentrations of content in trade will become a more broadly viable
model; but simply concentrating content is not enough. Trade publishers will begin to
license or commission ancillary content that adds a transactional element to their
offering (not exclusively in a monetary sense). In effect, this additional content will
provide a reason for consumers to return periodically to the site for free reference,
news or dictionary content. Thus, this content will complement the subject-specific
content that publishers generate themselves. As each segment develops, the
ancillary content will also become core content to the publisher and may eventually
be produced by them (although, initially, the content may be licensed). Over time
other services will be built within each subject silo, and this maturity will replicate the
product development seen in information publishing over the past ten years as those
businesses established subject specific franchises around topics such as business
news, tax and legal information.
Aside from these macro trends that will grow in importance over the next few years
maintaining the status quo will still be the operative task during 2010. Here are following
are some more specific predictions for 2010:

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 Certain segments (financial, legal and tax information and education, for example)
continue to be challenged and any business that relies on the library market will face
a very difficult time. Funding will be worse in the coming year (fiscal 2011) making
retention, renewals and price increases problematic. By the end of this year, we
could see some consolidation in the information media space.
 We will see the return of an old model of collaboration between magazines and
traditional publishers as magazines look for ready-made content. Witness the return
of the serial and short story to the pages of periodicals as their publishers look for
low-cost content for their plodding (but suddenly more aggressive) migration to
electronic delivery. In turn, electronic magazines will offer publishers a more
effective, targeted and supportive mode of marketing than publishers have seen in
years.
 2010 will be a year of warfare: Publishers against retailers, wholesalers against
retailers, retailers against retailers, publishers against consumers. It may be nasty,
brutish and short, but will any of them truly understand the stakes? (See macro trend
number one).
 Finally, we will see consolidation of at least two major trade houses. This is likely to
precipitate another combination by year end. An outsider company (not a current
trade publisher) may make a major move into the trade market.
 Last year, I predicted that out-of-work journalists would become ‘content producers’
and we have seen that develop as companies like Demand Media and Associated
Content build market share. I see this trend accelerating during 2010. As magazines
migrate to platform models, they become 24/7 publishing operations with a
significantly increased demand for content far beyond their capabilities. Where they
will succeed is in curating content for their specific audiences; however, much of this
content will be produced for them, rather than by them in the traditional manner. In
effect, magazines will outsource editorial.
 And in sports, Manchester United will retain their Premier League title, winning on
goal difference over Arsenal; Barcelona will win the Champions League; and
England will win the deciding fourth Ashes test in Melbourne in December.

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Predictions 2009: Death and Resurrection
Like the guy who is asked how he went bankrupt, ‘slowly and
then quickly’, the escalating economic downturn in 2008 has
really been brewing since the end of 2007, but we only fell off
the cliff in fall 2008.
I still believe (as I noted in January 2008) that 2007 will be
viewed historically as a watershed year for media: the
economic decline will further accelerate the macro trends the
industry witnessed as 2007 evolved.
These trends include:
 The rapid commitment to electronic delivery of
content in both education and trade
 Separation of ad-based and subscription-based models in both information and
professional publishing
 Forced concentration in the traditional publishing supply chain countered by
(nascent) new channels including direct-to-consumer
 Further blurring of the edges across media segments: More publishers will offer all
content – not just their own - wider services and applications, and broader linking
and partnerships designed to draw customers
The economic difficulties today are stark compared to the boisterous 2007 where the
price for publishing assets kept going up and many big deals were made. During 2008,
many high-profile divestitures were either abandoned (Reed Business) or ignominiously
completed (TVGuide magazine sold for $1). 2009 is likely to see both the unraveling of
some of the deals done in 2007 and some opportunistic buying but, more generally, the
deferment of many companies' corporate development strategies.
Naturally, 2009 will see new companies emerge and there are numerous precedents for
companies launched in economically challenging markets ultimately becoming very
successful. Perhaps challenging the status quo is easier when the status quo is
concentrating on just staying "status".
Predictions 2009
 An easy one: It gets much worse before it gets better. When times were good an
oversupply of market options – particularly in retail – hid a myriad of structural
problems. Right-sizing in media retailing and distribution will result in one major
physical book retailer, one wholesaler and one online retailer. Media will be a
sideshow compared with some other segments, particularly clothing and department
stores.

28 | P a g e
 Another easy one: Several major city newspapers will change hands for less than
the debt they carry. Local and hyper-local models will expand and further encroach
on the market for traditional big city news. Coupled with linking, content licensing
and arrangements with classified providers like Craigslist and EBay, there will be a
rapid expansion of the (hyper) local online news provider market.
 Out-of-work journalists will see increasing opportunities to become ‘content
producers’ as more and more companies seek to enrich their sites with professional
content that appeals to their target market. The typical website ‘experience’
becomes more expansive and deeper than a company catalog or press release site.
Journalism as a function becomes more widely dispersed across many business
segments.
 The NYTimes will either close the Boston Globe and ‘rebrand’ a NYTimes version for
the Boston Market or sell it for a $1 saddled with as much debt as they can get away
with. Sunday's paper will now come on Saturday: The UK market successfully went
down this road and the US will (belatedly) follow.
 In media M&A, look for companies that have lots of cash to act opportunistically:
NewsCorp, Holtzbrink, Bauer, Bonnier, Bertelsmann, Axel Springer, Lagardère, BBC
(Commercial).
 Gathering of ‘equals’: Media owners unable to sell assets may seek to partner with
another media company in the same boat and combine assets to form a new
company. One combination that could be interesting is Nielsen Business Media with
Reed Business Information (– pure speculation on my part). Others in this space
looking for options might include PRIMEDIA, McGraw-Hill, and Penton.
 The Obama administration will make wholesale revisions to education policy which
will pain education publishers who have made particular investments in assessment
companies. Long term, the assessment market will be robust; however, with explicit
indications that student performance is no better for the ‘no child left behind’
programs, fundamental changes will be instituted including a more federalist
direction. Ready your lobbying dollars.
 Evidence that the edges of media segments continue to overlap: Google will bid for
the 2014 and 2016 Olympic broadcast rights.
 Social networking and ‘community’ building will become the CEO’s pet project as a
‘cheap’ alternative to decreased ad and marketing budgets with, predictably negative
results. Senior-level misunderstandings of what constitutes effective social programs
will result in efforts being treated casually. Piecemeal approaches will predominate
and there will be a continued lack of cohesion of marketing with social networking.
Programs backfire as customers witness the cynicism. Effective social networking is
not just for Christmas.
 Professional and information publishing will effectively leverage LinkedIn-like
networks (possibly using their platform) to extend social networking to their closed
networks. Lexis/Martindale is creating a private legal social network platform.
 Too much LinkedIn with my Facebook. More people will do what I did in 2008 and
build barriers around their online social networks and selectively cull ‘friends’ or
‘connections’ Sheer numbers have no logic, friendship is earned and legitimate
business connections are money. Quality, not quantity, will reign. Don’t take it
personally.

29 | P a g e
Predictions 2008: Return to the Scene of the Crime
This is the time of year when prognosticators attempt to
handicap the future while, at the same time, trying to explain
why they were so horribly wrong with respect to the prior
year. I am no different. 2007 saw some stunning
developments in the publishing and media space--
particularly in mergers & acquisitions—and, broadly
speaking, I see several trends emerging. First, I expect more
change driven by M & A activity in 2008. Second, as more
companies bound by traditional publishing models migrate
online and join those already there, the application of
technology in our industry will accelerate. Third, we will see a ‘squeezing’ of the value-
chain (from author to publisher to consumer) driven by publishers looking to build
community models around content and authors.
Associated media markets, such as broadcasting, newspapers and games, also
influence our industry in interesting ways. We are starting to see our traditional segment
descriptors – publishing, newspaper, broadcasting, information – become meaningless
as content becomes ubiquitous and network access (or distribution) becomes universal.
Publishers and information providers must expand their capabilities beyond traditional
market segments if they want to remain competitive. On a related note, there is an
escalating ‘compacting of media’ taking place, where the interests of all media players
are converging on issues like rights, piracy, market concentration and access to
markets or even consumer attention. (Text) book content, broadcast TV programs,
movies, music, games and news can all be delivered via Xbox or IPod: In this
environment, where does the power lie? Who “owns” the customer? And how are
content-selection decisions made? A publisher can no longer be one-dimensional and
hope to survive, which is why companies like Lexis, West and Pearson are building
delivery ‘platforms’ where (traditional) content is only a part of the offering.
In the not-too-distant future, we may look back on 2007 as a significant transition year
for the media business. In education, a number of large companies were taken private
and will reemerge five years from now as fundamentally different, platform-based
companies. The Hollywood writers strike will redefine how content producers are
compensated as content distribution expands to the Internet. Journal publishers will
trace the history of their ad-based revenue models back to Reed Elsevier’s experiment
with oncology online. And in the news & information segment, NewsCorp’s purchase of
Dow Jones and Thomson’s acquisition of Reuters will radically change the model of
information delivery. Even the self-publishing market showed a level of maturity with the
consolidation of AuthorHouse and iUniverse.com. Outside our immediate universe (but
no less relevant as advertising becomes a more important revenue stream) is the
purchase by Google of adserver DoubleClick.
Here are my predictions for 2008:

30 | P a g e
Education:
 Recognizing the potential for aggressive competition, McGraw-Hill will reorganize its
business much as Thomson has done. MGH education could be sold to private
equity.
Cengage will spend aggressively to round out its content and assessment products
with course management and school resource planning tools.
Information:
 We will see at least one mega-deal involving, perhaps, D&B, the information assets
of McGraw (S&P) or Bloomberg. Following closely on the heels of past investments
in tax, legal, financial information, the insurance segment will become a focus of
aggressive new investment for information providers.
Trade:
 It also seems inevitable that there will be some additional consolidation in trade and
this could result in a higher profile for Hachette, Bloomsbury and/or Macmillan. One
publisher may get out of the self-publishing market but another will jump in with both
feet. A company like Lulu.com or the AuthorHouse/iUniverse combination could be
targeted by a trade publisher seeking to expand its market and build an author
community. More trade publishers will eliminate imprints in favor of theme-specific
content.
Retail:
 The ongoing rumors of a Barnes&Noble/Borders combination will continue until one
of these retailers purchases a third. This new combination will not materially change
the book retail market, but the combination of the two companies will result in a
financially stronger retailer.
Other:
 Broadcasters will have a strong advertising year due to the political calendar and the
Olympics. (A three-party race for President will be an added boost).
 Facebook and LinkedIn will join forces, but we will also see the development of more
‘by invitation only’ social networks. (Potentially, these could be administered by the
current incumbents but they are more likely to be new entrants).
 As many as ten brand-name magazines will cease publication or reduce their
frequency due to ad-base declines and the rise of specialty web sites.
 News sites (either branded or not) will ramp up efforts to harness niche bloggers and
online publishers (either by acquisition or association) in an effort to boost traffic,
broaden audience and develop more relevant op/ed and reportage. Incumbent news
providers are realizing that acquiring an established online presence with a built-in

31 | P a g e
audience represents a path to growth and they will begin to employ this tactic during
2008.
As always, it looks like the coming year will be an exciting one in media. At least
according to me.
Predictions 2007: Taking it in Leaps and Bounds
There are any number of people offering media predictions
for 2007 and it is a fun exercise which can also be a useful
tool for strategic planning. Consultants use a tactic called
‘scenario planning’ to generate discussion and thought
focused on issues impacting a business. In sessions I have
managed, I have placed up to ten ‘scenarios’ or predictions
on the walls of a conference room where each member of the
group is given instructions to vote on the likelihood of each
scenario without speaking to the other participants. The
scenarios reflect a combination of the existing status-quo and
an extrapolation or exaggeration of anticipated market
change. Each scenario should be plausible and represent a
challenging future environment in order to generate legitimate discussion.
A red dot placed on the scenario means it will never happen and green means the
participant agrees it will happen. The scenarios can be anything that the facilitator
decides could be relevant to the company but should be done in consultation with
someone at the company. (The scenarios are not shared before the meeting).
Additionally, they can be absolute; ‘this will happen’ or more general ‘over the next five
years…’
As the group completes the ‘voting’ the facilitator has the group examine each scenario
in detail and will encourage the group to think about the implications of each scenario in
a few dimensions; technology, human resources, competitors, etc. The outcome of this
exercise is a better understanding of the company’s challenges and an understanding of
the company's possible weaknesses (or strengths) relative to the scenarios the group
thinks most likely. A document should be prepared from this seminar session and this
document can become a material part of the development of a strategic plan. Even
discussion of those scenarios the group does not believe are likely can be useful in
challenging the executives to closely examine their assumptions.
This is an exceptional exercise in encouraging senior management to examine,
understand and interpret what is going on in the wider world as a fundamental
requirement of their daily responsibilities. It can be the case that management develops
a bunker mentality and is subsequently blindsided by events that they should have
anticipated.

32 | P a g e
My predictions below are not fully thought out scenarios for a number of reasons – they
are not specific for one thing – but nevertheless they are fun to think about. As an
editorial comment, I emphasize that I have no inside information on the veracity of any
of these.
Predictions for 2007:
 NYTimes will eliminate the Saturday print edition of the newspaper. It will also create
local web news sites for every major metropolitan city in the US and will stream
video from their owned broadcast television stations, classified advertising will be
free. The company will also launch a citizen’s paper: The New World Times. NYT
will create suite of news gathering tools – web services – and make available to
‘citizen journalists’ content and research traditionally only available to professional
journalists.
 YouTube TV: Just like America’s funniest home videos we will see a TV show based
on original YouTube video content. It will win its’ night by 10% and will be turned into
a weekly Saturday night talent show.
 Using cell phones’ camera as a barcode reader will lead to an explosion of mobile
in-context/ in situ mobile advertising – followed in 2008 by RFID based in-store
advertising (with software for cell phones). Mobile advertising will surpass 5% of all
ad dollars spent by agencies by end 2007. (Web currently at 20%)
 Google launches product placement advertising program. Based on similar key word
algorithms advertisers will bid for placement in movies, television, other broadcast,
sports, etc. prior to production and/or live telecast. Program will represent 10% of all
fall 2007 upfront spend.
 FCC will hold hearings on standards related to product placement advertising in late
2007 as the market explodes.
 Apple will think about buying Disney and Electronic Arts but will buy TiVo and
SlingBox. Apple will also launch a Beatles version of the I-Pod including the entire
Beatles catalog plus video/movies. The Beatles I-Pod will retain the tradition Apple
artwork (Green apple front, cut away apple on the back).
 Yahoo will by EA and within six months launch a social network gaming site based
on EA content.
 No-one will buy Netflix
 Social Media in Education: Several major US colleges will teach various social
science courses entirely in simulation. The courses will not be taught in traditional
lecture form but entirely within the software simulation.
 News Corp will buy Dow Jones and Financial Times and sell HarperCollins and
Hachette will by HarperCollins.
 EBay will by Linden Labs (Second Life). Within six months they will integrate EBay
selling tools into SecondLife enabling virtual store fronts, sales assistance and virtual
trading. Will launch program with major retailers and create first Second Life mega-
mall in cooperation with Westfield. EBay also launches SecondLife media placement
agency to handle all media inventory on SecondLife.
 T Mobile buys Skype from EBay.
 Linden dollars will be included in the Feds M1 currency calculation.

33 | P a g e
 Neil Young’s Living with War wins the Grammy for best Rock Album.
Corporate Data Strategy and The Chief Data Officer – Sept. 8th, 2011
(Part 1 of 4)
Are you managing your data as a corporate asset? Is data – customer, product,
user/transaction – even acknowledged by senior management? Responsibility for data
within an organization reflects its importance; so, who manages your data?
Few companies recognize the tangible value of the data their organizations produce
and generate. Some data, such as product meta-data, are seen as problematic
necessities that generally support the sale of the company’s products; but management
of much of the other data (such as information generated as a customer passes through
the operations of the business) is often ad-hoc and creates only operational headaches
rather than usable business intelligence. Yet, a few data aware companies are starting
to understand the value of the data generated by their companies and are creating
specific business strategies to manage their internal data.
Establishing an environment in which a corporate data strategy can flourish is not an
inconsequential task. It requires strong, active senior-level sponsorship, a financial
commitment and adoption of change-management principles to rethink how business
operations manage and control internal data. Without CEO-level support, a uniform
data-strategy program will never take off because inertia, internal politics and/or self-
interest will conspire to undermine any effort. Which raises a question: “Why adopt a
corporate data strategy program?”
In simple terms, more effectively managing proprietary data can help a company grow
revenue, reduce expenses and improve operational activities (such as customer
support.) In years past, company data may have been meaningless in so far that
businesses did not or could not collect business information in an organized or
coordinated manner. Corporate data warehouses, data stores and similar infrastructure
improvements are now commonplace and, coupled with access to much more
transaction information (from web traffic to consumer purchase data), these
technological improvements have created environments where data benefits become
tangible. In data-aware businesses, employees know where to look for the right data,
are able to source and search it effectively and are often compensated for effectively
managing it. Recognizing the potential value in data represents a critical first-step in
establishing a data strategy and an increasing number of companies are building on this
to create a corporate data strategy function.
Businesses embarking on a data-asset program will only do so successfully if the CEO
assigns responsibility and accountability to a Corporate Data Officer. This position is a
new management role and not additive to an existing manager’s responsibilities (such
as the head of marketing or information technology). In order to be successful, this
position carries with it the responsibility for organizing, aggregating and managing the
organization’s corporate data to better effect communications with supply chain
partners, customers and internal data users.

34 | P a g e
Impediments to implementing a corporate data strategy might include internal politics,
inertia and a lack of commitment, all of which must be overcome by unequivocal support
from the CEO. Business fundamentals should drive the initiative so that its expected
benefits are captured explicitly. Those metrics might include revenue goals, expense
savings, return on investment and other, narrower measures. In addition, operating
procedures that define data policies and responsibilities should be established early in
the project so that corporate ‘behavior’ can be articulated without the chance for mis-
and/or self-interpretation.
Formulating a three-year strategic plan in support of this initiative should be considered
a basic requirement that will establish clear objectives and goals. In addition, managing
expectations for what is likely to be a complex initiative will be vital. Planning and then
delivering will enable the program to build on iterative successes. Included in this plan
will be a cohesive communication program to ensure the organization is routinely made
aware of objectives, timing and achievements.
In general terms, there are likely to be four significant elements to this plan: (1) the
identification and description of the existing data sources within an organization; (2) the
development of data models supporting both individual businesses and the corporate
entity; (3) the sourcing of technology and
tools needed to enact the program to best effect; and then, finally, (4) a progressive
plan to consolidate data and responsibility into a single entity. Around this effort would
also be the implementation of policies and procedures to govern how each stakeholder
in the process interacts with others.
While this effort may appear to have more relevance for very large companies, all
companies should be able to generate value from the data their businesses produce. At
larger companies the problems will be more complex and challenging but, in smaller
companies, the opportunities may be more immediate and the implementation
challenges more manageable. Importantly, as more of our business relationships
assume a data component, data becomes integral to the way business itself is
conducted. Big or small, establishing a data strategy with CEO-level sponsorship should
become an important element of corporate strategy.
Setting the Data Strategy Agenda - September 8th, 2011 (Part 2 of 4)
Once a company has recognized the tangible value of its data, the CEO will assign the
role to a direct report making this initiative his or her sole responsibility. As noted in my
first post, managing data as an asset is so important that it requires direct senior
management responsibility and should not be delegated to the head of marketing &
sales or IT (in each or any case, both bias and conflict with their ‘real’ responsibilities
will prevent the program's benefits accruing to the entire business). In addition, the
ability to break down silos, confront the assumed internal politics and impose a solution
will be greatly diminished if the executive in charge already has other functional
responsibilities. In my view, if this is the approach of the CEO, the initiative will fail. By
way of example, the Chief Data Officer at Dun & Bradstreet sits at the highest levels of

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