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My mark of a good conference is how I feel when it’s over. It’s a given that I’ll be exhausted (I am an introvert after all), so the test is whether or not I’m inspired to do something. Read, write, create, think. This is how I felt at the end of this year’s Tools of Change conference. Ready to roll.

There are a lot of of conferences focused on the changes facing publishing. Some might say too many, but I disagree. Over the next few decades, we will see all sorts of shifts in publishing, and these conferences — which thanks to the magic of technology have extended beyond the in-person realm to include far-flung audiences via social media discussions, webinars, and more — tackle the wide range of opportunities, challenges, and imaginative thinking that leads to innovation.

As I explore my takeaways from this year’s Tools of Change, I start from this position: all publishing is already digital.

Granted, there may be a few authors out there who submit handwritten or typewritten manuscripts (and if so, dear publishers, allow me to express my sympathy). Those are the exceptions. Every manuscript begins its life in digital format. So. All publishing is already digital.

What I see as one of the biggest challenges facing existing (or traditional) publishers is that they still haven’t managed to make the shift from a print-based workflow to a digital workflow. Motoko Rich of the New York Times wrote about the costs of producing a book, yet didn’t explore the fact that some (not a lot, granted) savings could be realized through more efficient workflow.

(Actually, there is a lot of to chew on in Rich’s piece, including the ever-popular advances-not-earning-out problem, something that increases costs for everyone.)

I’ve watched this conference evolve from a curiosity to a conversation. The “tools” of “change” are not always apparent. Sometimes the tool is as simple as attending something outside your wheelhouse; sometimes it’s hearing how someone else does something and realizing parts will work for you. It’s the “tools, not rules” thing. If anything, this year’s TOC highlighted the need for even more nuts-and-bolts discussions — and there were quite a few of those mixed in with equally important long-term vision sessions.

So a few takeaways:

Contracts and Systems

When Angela James and I proposed our “A Different Model” presentation, we had a very different agenda in mind. A lot has changed since last summer, and I was thrilled when Angie, who is the Executive Editor of Carina Press suggested focusing on some of the specific issues she’s encountered as she and her team speed toward launch.

As a digital first publisher, Carina is essentially a start-up within an established publisher. Rather than building new infrastructure from scratch, they are leveraging existing systems within the parent company, meaning some big questions have to be addressed. As more publishers explore the digital first, print maybe model, these are some of the questions to be expected:

• Royalties: The digital author expects higher royalties, often ranging from 35% – 50%. For publishers who have set royalties, what does it take to accommodate different royalty rates for different distribution models?
• Reserves/Automatic Calculations: It’s not unusual for royalty systems to do automatic calculations for reserves for returns or bad debt. Of course, in the digital realm, returns are possible, but the rate will be far lower than the amount coded into the system. What changes are required to your existing system to accommodate a different type of sales model? Do you even need to hold reserves?
• Reporting Frequency: Authors who forego advances expect to be paid earlier and more frequently. Some systems are hard-wired to spit out statements and any related payments on a semi-annual basis. This won’t fly with the digital author. How flexible is your system when it comes to reporting?
• Word Count: In the world of digital books, page count means next to nothing. Word count is the measurement. Do your internal systems allow you to reflect the manuscript/book word count? Do you have the ability to feed this information to your trading partners?
• Contracts: The above points likely make it clear that standard house agreements need revising to reflect a digital first author/publisher relationship.

Saving Time and Money

For those wondering about digital publishing models and how they work, the “Agile Publishing Model” session hewed very close to the session Angie and I had originally planned. The digital model developed by Dave Thomas and Andrew Hunt of Pragmatic Programmers will be familiar to some: no advances, higher royalties, DRM-free ebooks, digital workflow, direct sales. It’s not just a case of great minds thinking alike — it’s a business model that works, even as it evolves, and this presenter team offered up real numbers.

Thomas and Hunt, however, are tech guys, and their background allowed them to bring their own specific solutions into the discussion. Thomas, and I paraphrase, noted he’d attended a workshop demonstrating the process of porting an InDesign file to EPUB, and the number of steps involved made him cry. During that same workshop, he managed to create his own EPUB file in approximately 40 seconds; the two also demoed the creation of MOBI file during their workshop. Total elapsed time was about a minute, and this was done live.

The two demonstrated how using the right tools — in this case, structured mark-up of manuscripts and solid scripts to create files — can save publishers time and money. Every publisher is different; I don’t imagine many trade publishers will be inclined to force their authors to upload their manuscripts using the structured XML (they call it PML, their own flavor of the mark-up) necessary to make the process easier. But there are ways to achieve these goals, starting with editorial.

(But, hey, how many publishers right now are thinking about this as a great idea? Imagine if the manuscript you got from an author was already in your system, marked up, and ready to flow through the editorial process?)

The takeaway from the Pragmatic presentation is that basic tools exist (and even more are being built) to streamline workflow. The creation of a solid digital file is Goal One. That file is then used to create the various flavors of books, from ebook to print book. This saves conversion costs and much time. The exact implementation depends upon the publisher.

Or, as my yoga teacher used to say (usually while we were standing, forgotten, in half moon position), “Take what you need and throw the rest away.”

What Are Enhanced Ebooks, or Does Your Staff Have the Right Skills?

Okay, that’s a trick question, one I’ve already asked. While major publishers are trying to sell reading guides as “enhancements”, companies like Enhanced Editions are re-imagining the book in the digital era. Peter Collingridge demonstrated the iPhone app for Nick Cave’s The Death of Bunny Munro. I admit it, I swooned when he said that Cave wrote the soundtrack for the book (Cave also read the audio version).

Soundtrack. That’s what I’m talking about. Reading guides are marketing material. Enhanced Editions is, well, enhancing the story experience. Likewise, Peter Meyers offered up a very low tech vision — pen and paper models — of how storytelling might unfold on the iPad (formerly known as The Unicorn). In both instances, one thing was made clear: publishers will need to re-imagine the skills sets of staff and reconfigure their views of the publishing “team”.

In his closing keynote, Tim O’Reilly exhorted publishers to focus on the boring stuff. The boring stuff is actually the important elements that publishers bring to the table. I’ve wavered about what I thought he meant. Sometimes I think he saw the lay of the land and realized major publishers weren’t going to step up in the creative, multi-media realm. At other times, I think he understands these new job skills, new team thinking, are part of the boring stuff. Right now, I honestly think he meant the latter. Mostly because I believe the really good enhanced ebooks start at the beginning of the editorial process. They are not afterthoughts.

To me, this means either having the right people, with the right skill sets, on staff, or developing the right relationships with creative minds. It means providing the right tools to people who need to get their jobs done. It means ensuring readers get the best possible experience out of a story is the boring stuff. And I have my eye on the publishers who are already positioning themselves to lead the way.

The World is the Market

Both Kirk Biglione and I wrote about emerging markets back in October, specifically focusing on the work of Arthur Atwell and Ramy Habeeb (link is to Kirk’s piece). It is somewhat stunning to realize there are major, massive markets still unexplored by publishing as we know it. Possibly even more stunning is that the industry is just now waking up to this idea.

A few key issues come into play as publishing looks at these markets. The first, of course, is that “piracy” might actually be an indicator of demand for books in under-served markets around the world. The development of viable marketplaces where none exist can only increase sales, particularly since many of these areas have none. I firmly believe viable marketplaces are the first line of defense when it comes to piracy.

Territorial rights (ah, you knew I’d bring it up!) also become critical (Emily Williams and I both used the “world without borders” concept, and her piece Must Be Read). The solution to licensing and exploiting digital rights around the world is one I’m glad I don’t have to manage because I suspect it’s going to get knock-down, drag-out before too much longer. However, it must be resolved…if not for piracy reasons, then for the authors. They are losing sales!

Oh, and the readers. In the Emily Williams piece linked above, she talks about the vocal (and admittedly minority) group of readers who demand simultaneous releases. These readers do not — nor should they have to — understand the insanity that is book licensing. As the borders shrink, publishing’s challenge is not trying to explain a nonsensical (from the reader perspective) business model as it it figuring out how to solve this problem sooner rather than later. See: piracy as indicator of demand.

Step Right Up

One thing I’ve noticed at TOC and other industry conferences is the lack of serious participation from large trade publishers. This is not to say they are not there and talking. There was a large presence at Digital Book World, but there wasn’t a lot of discussion of bold initiatives or innovation (that was not the focus of the conference). There was a large presence at TOC. As I look back over the years, only one large publisher — Harlequin — has consistently discussed successes, failures, and specific ideas in the public forum.

I get the need for big surprises and playing cards close to the vest, but as I lead into my final point, I think the fact that large trade publishers aren’t sharing information plays into a larger industry criticism. Where is the innovation? Where is the leadership? Individuals and small publishers are openly sharing their work, but where are the big publishers?

The digital transformation is something the entire industry is making up as they go along, and now is the time to have public discussion. The conversation feels a bit one-sided. We saw innovations in storytelling, reading tools (hello, Ibis Reader, an HTML 5 iPhone app), workflow, new business integration, channels, marketing, and even reader concerns (hey, meet them halfway!) — all independent voices. I would love to see larger houses chime in as well.

(Some have wondered where the money is, how it will be made. A few of the presenters I’ve highlighted discussed finances. Others are engaged in experimentation. The world of digital books is a nascent business, and there is a healthy amount of experimentation happening. Not every idea will make money, not every idea will be embraced, and not every idea will hit the commercial market looking exactly as it does today.)

The key is sharing information, sharing successes, sharing failures. This is where larger publishers can provide leadership. I think my biggest disappointment in TOC, and other industry conferences, is the unwillingness of market leaders to step up and share their experiences. It’s not rocket science, heck, it’s not even pharmaceutical science. It’s not the project, it’s, ultimately, how you do it. And everyone will do it differently.

Which leads to…

More Targeted Education is Needed

Throughout the conference, various themes emerged. Kate Eltham has a great post at Electric Alphabet on this topic. She outlines three key areas: analytics, metadata, and fresh thinking. These are not new challenges, but the fact that they keep coming up at conferences like Tools of Change tells me they are subjects the industry is struggling to address.

(In the Dear Author piece linked below, Fran Toolan of Firebrand Technologies makes a good point in the comments. What sort of world do we live in where customers are discussing metadata, or lack thereof? Shouldn’t this be invisible to the consumer, however defined?)

It is very difficult to offer the required type of detailed, hands-on training in a conference environment, though the various workshops that preceded the actual TOC conference focused on this specific type of training. We need more of them, particularly more outside the Manhattan area. Large publishers can afford to throw resources at solving these problems — one hopes they will! — but small publishers cannot justify trips to New York to get this kind of training.

In addition to Kate Eltham’s piece linked above, here are a few other wrap-ups.

• Mark Coker of Smashwords offers his view, including a few words about sponsors
• At Publishing Trends, Laura Hazard Owen focuses on DRM and piracy. One of the funniest thoughts from Kirk’s presentation was that consumers were spending Christmas week trying to figure out how to circumvent DRM on their gifts.
• Tools of Change: Thoughts from a Reader’s Perspective: Dear Author’s Jane Litte weighs in with her observations.