The future of publishing takes shape

The wind blowing UK publishers over the water to the annual Frankfurt book fair also carries with it a heightened sense of an industry in revolution. The long-promised digital market is finally with us, and with it come the now-familiar calls for the death of the "heritage" players in the industry. But in favour of ... what?

Publishers perform roles that writers need. The question now is whether writers will continue to turn to existing publishers to perform these tasks, and whether they believe they offer value. Some authors will bypass publishers (some always have) but among most authors and agents I deal with, there is no appetite to do so, because publishers continue to perform essential roles for writers in both the physical and digital worlds (editorial, marketing, distribution, and so on). However, urgent questions are rising about how a successful 21st-century publisher ought to look and function, and whether existing publishers can adapt quickly enough ...

The brief furore surrounding Odyssey Editions, a digital-only imprint launched by the Wylie literary agency in July, showed us just how appealing a new entrant to the field can appear to those eager to dig the grave of "old publishing". In times of rapid evolution, a newcomer can always steal a march; but such times also offer a great opportunity to more established players who can adapt quickly. Here are four challenges to existing book publishers – in which the new entrants will reap the rewards if the older hands don't change their ways.

1. Digital royalty rates

Odyssey Editions declared one fundamental advantage for its authors: a higher royalty rate on backlist. But the launch of Odyssey was more a response to a deadlock over royalties for classic titles than a challenge to the notion of the publisher's role. (Royalties for new books are pretty much agreed: it is the split over backlist that's at stake). Publishers must understand that aspects of the model around royalties may change. Equally, authors need to know that the pricing and costs around ebook publishing are far from fixed. No one yet knows where digital publishing will stand in the life of a work – what proportion of the overall value it will represent alongside the physical book, and at what cost. This is a moving debate, but one on which publishers cannot afford to make a ruling from their own point of view alone.

2. The editorial relationship

Over the last decade, heavy discounting of books in the mass market, plus the rising expense of marketing, have forced publishers to reduce their costs. One area on which some have cut back is the actual editing of the texts for publication. This is a mistake. High-quality editorial support is of tremendous value to most writers, and to readers too. It's no accident that the independent publishing sector, where the best companies put editorial vision at their core, is thriving.

3. Creating audiences

Since the collapse of the Net Book Agreement, publishing has become increasingly dependent on mass market distribution. That's no longer adequate in our digital age, where readers, ever more visible and opinionated, do not defer to the book trade or traditional media alone. Publishers who continue to rely on big marketing spends and piling books high in bookshops will see their role gradually (if not rapidly) diminish. All publishers will have to navigate global mass markets, but they will also need to build audiences for writers, not just by the traditional means of great publicity campaigns and retailer marketing, but through direct engagement with readers, on and off-line. If a new entrant has a social media strategy better than any existing publisher's, they may well find a role in the market at the cost of the old-timers.

4. Technology

This is perhaps where book publishing is most vulnerable. In a tough recession, investment in new skills, people and technology is difficult. Start-ups or new entrants that are more technology-based, less encumbered by the costs and habits of the print world, may find it easier to find new writers and reach readers in new ways. However, looking around I can already see a marked acceleration among existing publishers. Penguin, for example, through their Puffin imprint, started to tackle the question of illustrated reading for young children (see the Spot app on the iPad.) There is a brilliant new entrant in Nosy Crow, who are conceiving all their children's publishing in an entirely hybrid world of print and digital. This autumn, readers will be offered a wealth of digital products from publishers, based around the ideas in books and the talents of their writers (witness Stephen Fry's publication), some quite unlike anything you would traditionally have called a book. The definition of "book publisher" is up for grabs, and those in the industry will have to be brave and imaginative, in double-quick time, to lay claim to this new definition. Others might find it easier to begin with a blank sheet.

At heart, publishers exist to create more value for writers than writers can (or wish to) create for themselves. It's clear that the specifics of this role are changing. Some writers have decided that they can create as much value as they need alone, and feel freer by doing it themselves. Elsewhere there is a debate about where the line lies in a fair return for licensing copyrights, particularly when it comes to older books. Fundamentally, though, the need for publishers endures, even if not in their current form. Readers will be best served by publishers who can marry the best of what is sometimes labeled "legacy" publishing to the new means of developing and delivering what readers want and writers need. And if that marriage is achieved, then the persistent reporting of the death of old publishing will continue to be mere exaggeration.