Yesterday I noted the resilience of book sales in the UK, with a big surge in digital sales and a small decline only in physical sales. The figures were for total revenues. Looking at the Publishers Association yearbook (the absence of an apostrophe is theirs, not mine), there are some interesting unit price figures too.

In total, for physical books, average price increased by under 1% in 2011 and 2012, to reach £4.28. But big jumps in 2009 and 2010 mean the average price has climbed 17.2% since 2008. So, more or less matching general inflation in a flat economy, which is good going for items of leisure spending. However, in most categories, the price increase was rather lower, and in fact prices of non-fiction and reference books have declined over the five years. But school book prices have rocketed by 83.9% in four years, rising from £3.08 on average in 2008 to £5.66 in 2012.

Not surprisingly, unit sales have declined (by 13.3%), but at the price elasticity of demand implied by the figures, the profitability of the relevant books – is it all phonics textbooks? – must have been pleasing. Unit sales were down across the board, and by much more in most of the other categories (fiction, non-fiction, children’s, ELT, and by a similar 12.9% for academic books). There isn’t a long enough run of data to be sure but eyeballing the figures, it looks like roughly a unit price elasticity in the other categories.

However, the annual gives no figures on e-book prices. It would be fascinating to know what the pricing patterns, and profit margins, are.

Nature has a long and interesting article about the costs of open access scientific journals, exploring both the difference in publication costs between different journals, and the allocation of costs between funders/institutions employing scientists, researchers publishing papers, and subscribers. It’s well worth reading for the figures on costs and charges alone – I’d not seen them gathered together before. Coincidentally, I also met up this week with a friend who publishes journals for one of the big publishers (not Elsevier).

The open access case is intuitive: research is funded publicly by taxpayers, so it should be free to read. The Nature article shows that the charges open access science journals make to researchers vary widely, as do the cost bases and profit margins of the different journals. The publication fees are also the only revenue stream, in most cases. Not surprisingly, existing journal publishers see it differently, arguing that they provide other services – peer review, editorial judgement, curation, marketing and the delivery of attention to articles, hosting technology, and no doubt more. There are counter-arguments to some of these points. For example, peer review and editorial work is normally done by other researchers, who are not paid for these tasks – again, taxpayers fund the work via their financing of academic salaries.

It’s clear that journal publishers were, like other traditional media providers, slow to adapt their offer to the online world and one or two well-known ones have tried to hang on to excessive monopoly profits. But the average profit margins cited by Nature for the scientific journals don’t seem outlandish, and it is very likely that some traditional journals are hampered by a higher cost base than newer online journals, hence a partial reason for high subscription charges.

Still, there does seem to me to be a need for clarity about the bundle of services being discussed in this debate. It is not just a question of providing an online platform for researchers to report on their work, the bit that is taxpayer funded. If academics only needed to get their work out there, they could publish it on their own websites – as many do. But journals obviously do play an important role in organising peer review to give research a kite mark, in selecting and curating papers, and in marketing to draw attention to research. The importance of editorial objectivity in these services makes me tilt slightly towards preferring the old-fashioned subscription model, especially now non-academics like me can legitimately access research via JSTOR. If only the old model hadn’t been discredited by the greedy minority of publishers hiking subscription charges so much, or lumbered with its inherited high cost base.

It’s probably too late, even though there are, ironically, signs that the subscription model may be starting to function for other online publications. The new RCUK open access policy came into effect this month, & states: “Free and open access to publicly-funded research offers significant social and economic benefits. The Government, in line with its overarching commitment to transparency and open data, is committed to ensuring that such research should be freely accessible. As major bodies charged with investing public money in research, the Research Councils take very seriously their responsibilities in making the outputs from this research publicly available – not just to other researchers, but also to potential users in business, charitable and public sectors, and to the general public.” RCUK will in future fund eligible research institutes and universities to pay submission fees to open access journals.

My friend is bitter about the Government casually torpedoing the commercial business model, and predicts that academic journals of the future will increasingly be hosted and part-funded by universities, research funders and learned societies, as the business is becoming decreasingly attractive for commercial publishers. I’m not sure the future landscape for the publication of academic research is at all predictable.

There’s a fascinating, provocative article, What is the business of literature, by Richard Nash trailing the next issue of the Virginia Quarterly Review. In it he poses the question troubling man in the publishing world: what’s the business model for books’ enduring contribution to culture? His argument is essentially against “book fetishism”, the product-centric obsession of publishing: “[T]he business of literature is the business of making culture, not just the business of manufacturing bound books.” Book publishers and retailers need to move towards the provision of “cultural hubs”, arrays of services and products, he argues – much, I suppose, as the music industry is having to shift from an LP or CD-centric model to one combining online sales with merchandise and live tours and films.

The essay starts by noting that books are themselves a technology, and have been at the forefront of consumer capitalism. He cites Rachel Bowlby’s demonstration (in Carried Away: The Invention of Modern Shopping) that early department stores were modelled on bookshops. “[B]ooks aren’t sitting grumpily in economy class on the airplane to the future. They’re in the cockpit.” I’ve posted here a couple of times about the impressive degree of innovation in publishing (and also here, a post featuring dwarsliggers), rather a contrast to the music businesses’s early response to the digital disruption. But Nash continues: “For the most part, however, the technical and business-model innovations in literature were one-sided, far better at supplying the means to read a book than to write one.”

The innovation in writing books is now under way. The rapid increase in the number of titles is one sign. The article dates this to: “July 1985, when a company called Aldus, naming itself after the great Venetian printer Aldus Manutius, releases PageMaker. You put PageMaker on a Mac, put the Mac in a new chain of photocopy shops called Kinkos, you rent them for six bucks an hour, and you’ve got Publishing 2.0. Exhibit A: Soft Skull Press, a publisher founded in a Kinkos in 1993, and which I ran from 2001 to 2009. Further exhibits: the hundreds of thousands of zines, chapbooks, and books produced since, many of which begat small media businesses, magazines, and book publishers. The number of U.S. titles created by traditional print publishers, whether of the indie variety like Soft Skull or the large corporate publishers, increased from about 80,000 per year in the 1980s to 328,259 in 2010.”

He argues, too, that copyright law as it stands is a law for the analogue world: “Until recently, it was more expensive to make a copy of a book than it was to simply buy the book. So when society agreed to grant authors and publishers the monopoly, it was a good bargain. Now …. the public has proceeded to make copies anyway, regardless of the previous bargain… As with any law that loses the consent of the governed because it no longer reflects the logic of society, the law is not overturned, just ignored. It recedes into the past, like laws forbidding pigs to enter saloons or alcohol sold on Sundays or adultery or interracial marriage.”

The existing value chain (agent-publisher-wholesaler-retailer) will be disrupted, he concludes. It will not be saved by gimmicks like video embedded in e-books: “The lack of video, the lack of audio, the lack of ways to change the forking outcomes of plot (what is rather crudely referred to as “interactivity”) is a feature of literature, not a bug. And, as it turns out, books are interactive. They’re recipes for the imagination. Conversely, video is restrictive—it tells you what things look like, what they sound like.” Rather, the innovation will be in the value chain – he cites Kickstarter, a subscription model (like the one prevailing in the 18th century), tie-ins with fashion designers, links between book retailers and galleries, and so on.

On the whole I agree with the argument – although I’m a serious “book fetishist” myself, in love with the physical artefact (favourite website to relax by: Bookshelf Porn). Nash underestimates the value of innovations to the object, I think. However, I entirely agree that the disintegration of incumbents’ business models does not mean books have no value. The digitally-driven innovation is rather exhilarating, as long as you’re not one of those anxious incumbents.

I’ve skated over the surface of the article – well worth a read.