S&S's Carolyn Reidy: Worse Publishing Environment May Be on the Way
By Cindy Crosby -- Publishers Weekly, 11/12/2008 6:07:00 AM
Simon & Schuster president and CEO Carolyn Reidy called for CEOs to step up and lead during “the deep economic slump” and warned that possibly worse scenarios may be on the way. Her comments were made at the first of two addresses at the Evangelical Christian Publisher’s Association’s CEO Symposium and Publishing University at the Westin Hotel in Lombard, Ill., Nov. 2-4.
Reidy addressed about 20 religion house CEOs at a special dinner held before she gave ECPA’s opening keynote for all publishing attendees. Noting the dramatic changes that have occurred in the past month, Reidy said she hesitated to use the word “crisis” but “there is no question that we are currently dealing with a set of problems that will test us to our limits.” Critical issues facing publishers included: significant decrease in retail traffic, less consumer purchasing, a gloomy economic forecast, declining backlist sales, brand name authors continuing to sell but “everything else is far off normal levels,” and retail partners who demand more favorable terms and concessions “as if we are the answer to their problems,” she said. Other pre-existing problems she enumerated include retailers competing with publishers, low barriers to self-publishing, and the economics of digital publishing that appear to bring in less revenue.
She also posed several questions, including raising the possibility that publishers “may be required to cut even closer to the bone” to maintain profitability in a time when they are trying to bring their companies into the digital age.
Reidy told PW she felt the severe economic downturn is the most immediate challenge, while the digital question is the most serious long-range concern. Reidy said although many call books “recession proof,” she believes publishing houses cannot wait out the current environment. “We have to act now, and turn over every stone for possible savings in our operations, in order to be prepared for what’s coming, which is possibly an even worse scenario in six, nine, 12 or even 18 months,” she told the CEO’s.
Reidy reminded publishers that industry changing practices, such as the concept of returns, came out of the Great Depression, and asked, “Are there similar industry changing practices which will evolve out of the times we are facing? “ What might evolve, in her opinion is that publishers “taking a good hard look at returns causes, effects and practices, and coming up with ways to diminish or eliminate them,” as well as looking for opportunities to apply a consortium model for the distribution part of the supply chain.
