DEPARTMENT OF ECONOMICS Faculty of Business and Economics Macquarie Economics Research Papers Disruption and innovation in the Australian book industry: Case studies of trade and education publishers RESEARCH PAPER 1/2016 (FEBRUARY 2016) Jan Zwar Number 1/2016 February 2016 ISSN 1833-5020 (print) 1834-2469 (online) Zwar, Jan Disruption and innovation in the Australian book industry: Case studies of trade and education publishers Research paper 1/2016 (February 2016) ISSN 1833-5020 (print) 1834-2469 (online) Published by the Department of Economics, Macquarie University Building E4A, Room 443 Eastern Avenue Macquarie University NSW 2109 Tel: +61 2 9850 8474 Email: [email protected] Papers in the series are also available at www.econ.mq.edu.au/research Disruption and innovation in the Australian book industry: Case studies of trade and education publishers Jan Zwar1 ABSTRACT The disruption and structural transformation underway in the global book industry is well known. Major changes include the development of technology which enables digital publishing, distribution and retailing; the entry of disruptive players including Amazon, Google and Apple; the introduction of hand- held digital reading platforms and devices; upheavals in the bricks and mortar retailing sector; and the rise of online and social media as important channels for promoting books. Education publishers are also affected by disruption taking place in the education sector itself, further complicating their business models and operations. To date there has been little systematic examination of the responses of Australian publishers to change and the ways in which traditional publishers are experimenting and innovating, both as defensive responses and initiating change themselves. This report examines changes that are underway in nearly every stage of the publishing process, drawing on findings from interviews with senior Australian publishers. It includes 25 case studies and detailed discussion of the key findings. A broad range of publishers is represented, including major trade and education multinational companies, small and large independent trade publishers, experimental literary presses, scholarly presses and more. These case studies are illustrative, not comprehensive.2 The publishers recount reforms and initiatives that demonstrate a variety of innovations being trialled and implemented in the Australian industry. Keywords: Book publishing; disruption; innovation; authors; publishers; booksellers; books; ebooks; literature; education; cultural economics JEL classification: Z10, Z11 Acknowledgments: ‘The Australian Book Industry: Authors, publishers and readers in a time of change’ is a three-year research project led by Professor David Throsby, and funded by the Australian Research Council under Discovery Project grant DP 140101479 and Macquarie University. Thank you to Professor Throsby, Dr Tom Longden and Mr Paul Crosby: discussions during the ARC project were a beneficial part of the process in preparing this report. Thanks also to Laura Billington for copyediting work and formatting the report. 1 Dr Jan Zwar, Postdoctoral Fellow, Department of Economics, Adjunct Lecturer, Department of Marketing and Management, Faculty of Business and Economics, Macquarie University. Ph 61 2 9850 8491, Email [email protected] 2 A later stage of this research project involves a survey of traditional Australian book publishers, with the findings due for release in 2016. This survey will indicate the extent to which the initiatives documented in this report are occurring across the industry. i CONTENTS ABSTRACT ........................................................................................................................................................................ i INTRODUCTION ............................................................................................................................................................ 1 Methodology ................................................................................................................................................................ 2 Overview of the Australian book industry ................................................................................................................. 3 Disruption and innovation in the book industry ...................................................................................................... 8 Changes in trade publishing ...................................................................................................................................... 8 Changes in education publishing ............................................................................................................................. 19 Stages in publishing a trade and education book or learning resource .................................................................. 25 Overview of the case studies .................................................................................................................................... 26 Maintaining momentum in a changing global industry ......................................................................................... 28 PART 1: TRADE PUBLISHING CASE STUDIES ......................................................................................................... 29 GENRE PUBLISHERS .................................................................................................................................................. 30 Momentum ............................................................................................................................................................... 30 Harlequin Enterprises (Australia) Pty Limited ...................................................................................................... 38 Pantera Press ............................................................................................................................................................ 49 MULTINATIONALS ...................................................................................................................................................... 57 Hachette Australia .................................................................................................................................................... 57 Simon & Schuster Australia ...................................................................................................................................... 71 LARGE AUSTRALIAN PUBLISHERS .......................................................................................................................... 87 Allen & Unwin ........................................................................................................................................................... 87 Hardie Grant Books ................................................................................................................................................. 99 SPECIALIST LITERARY PUBLISHERS ...................................................................................................................... 113 Spinifex Press .......................................................................................................................................................... 113 Seizure ..................................................................................................................................................................... 127 Pitt Street Poetry ..................................................................................................................................................... 136 Overland .................................................................................................................................................................. 145 If:book Australia ..................................................................................................................................................... 154 SCHOLARLY PUBLISHERS ....................................................................................................................................... 166 ANU Press ............................................................................................................................................................... 166 Re.press ................................................................................................................................................................... 174 Monash University Publishing ............................................................................................................................... 181 COMMUNITY-BASED PUBLISHERS ........................................................................................................................ 189 Malarkey .................................................................................................................................................................. 189 Kids’ Own Publishing ............................................................................................................................................. 202 Magabala Books ...................................................................................................................................................... 214 PART 2: EDUCATION PUBLISHING CASE STUDIES ............................................................................................. 227 Pearson Australia ..................................................................................................................................................