Aiming Frustrations

There seems to be a growing unrest among America’s bibliophiles. And they seem to have voiced their message very clearly; we want e-books.

Now the growing challenge for publishers like Harper Collins is to reconcile this increased demand with an eye for maintaining profitability.

It is no secret that the jury is still out on whether e-books are a blessing or a curse for the publishing industry. On the surface, it seems like a godsend; increasing general interest and convenience in reading while dropping printing-related costs. The dilemma, however, is in the distribution. The nationally dominant book sellers Amazon and Barnes and Noble (and, in a few months, Apple) are involved in their own increasingly heated competition to sell their e-book readers and, subsequently, their own digitally unique versions of e-books. It is this battle that is hurting the business of the publishing companies. As each company jockeys for market position, their demands for low-cost content becomes more and more unreasonable.

Unfortunately, this reluctance to abandon profitability is increasingly being perceived as publisher’s resistance to changing technology; which is going to be one of the most difficult challenges facing the public relations efforts of Harper Collins in the very near future.

There is already some evidence that the growing impatience of consumers waiting for cheap and abundant content is being blamed on the publishers rather than the distributers. For example, one tweet by user Moriajovan that complained a book she was looking for “had the cover on site, but not in ebook file. That's Harper Collins.” Despite her inability to find her desired e-book on a distributer’s website, she assigned the blame to the publisher.

The challenge of addressing these concerns is one of posturing Harper Collins' brand as one that is on the cutting edge of technology. Some ways to accomplish this is by engaging consumers in honest conversation about what content they would most like to see in e-book format, and then working to meet the needs of the greatest number of people.

Because it is becoming increasingly clear that consumers are pinning their frustrations on publishers, Harper Collins should take this opportunity to posture themselves as a leader in the field by being the most in-tune with consumer demands.

Technological crises in e-book publishing

In this week's reading, we learned about the different sources of organizational crises. One of the potential external situations which could adversely effect Harper Collins is its ongoing struggle with Amazon over rights to set e-book pricing. This crisis is explored in an article by BNET which suggests that publishers like Harper Collins are succeeding in their efforts to help determine e-book prices.

The obvious category of this crisis is one of technological forces. E-books are an industry innovation that have the potential to ruin book publishers. In this situation, Amazon, a major book wholesaler has used its technological innovation, their Kindle e-book reader, to set e-book prices market-wide. In selling many of their most popular e-books for $9.99, other retailers such as Barnes and Noble are forced to sell for the same low price in order to compete. Being that Amazon and its few e-book competitors have the market cornered, they can easily use their leverage to undervalue the product, much to the chagrin of publishers.

This dispute could be a major source of organizational crisis for a company like Harper Collins for its propensity to rapidly deflate the value of the published product, and thereby cause a great deal of damage to the bottom line.

Fortunately, according to the article, Harper Collins, with its corporate backing by Rupert Murdoch owned News Corp, is one of the publishers that has established the widely used model for author royalties and manuscript acquisitions, and it can use this as leverage against Amazon in its pursuit to compete in its own e-book/reader market, thereby hurting the book market in general.

The outcome of this struggle will be very interesting, and it is something that I will be following closely in the next few months. But it should be noted that while competition driven deflation of e-book prices may look like a good deal for Amazon, its potential to adversely effect those companies which provide the product could be disastrous for Amazon as well.