In Theresa Brown’s latest blog for the New York Times’ Well feature, she writes beautifully about how a “snow day” at a hospital is different from one at home. It may not involve hot cocoa and missing school, but it has lessons to offer about life and death, and what it means to have an effect on another human being.

It was about a year ago that Susan Danziger, the brilliant founder of DailyLit.com, turned me on to the “success tips” that Tom Peters had been posting on his blog. Reading them was like eating popcorn; once I started I couldn’t stop. But unlike popcorn, Tom’s tips made me want to make something happen.

It was in that spirit that I wrote to Tom on his site, saying that I thought his success tips should be published as a book. To my amazement, Tom actually wrote back, inviting me to visit him at his farm in Vermont. A few days later, after driving through the snow and spending the day with Tom (and his colleague, Erik Hansen, and his wife, Susan Sargent, who provided us with the world’s most delicious sandwiches), my head was spinning with provocative thoughts about business, and books…and we had agreed to give it a try.

I suppose I should have realized that a guy who writes about excellence (“If not excellence, what?”) would push me and the staff of HarperStudio to question all of our book-making assumptions. Why not make the book bright orange instead? Why not do two-color endpapers so “The 19 E’s of Excellence” would have 19 red “E”s? Why not re-write the existing success tips and add new ones, and then re-arrange the whole thing thematically? Why not, indeed?

Tom pushed us to go the extra mile, and now we’re grateful. Because now we’re holding his new, bright orange, chock-full-of-inspiration book, THE LITTLE BIG THINGS, in our hands, and damn if he wasn’t right: a book that tells businesspeople that they should over-deliver should be a book that overdelivers. And this one certainly does so.

Thanks, Tom!!!

Of all the many remarkable things to notice about the exchange between Amazon and Macmillan this past weekend, perhaps the most remarkable, at least from a linguistic point of view, is Amazon’s use of the word “monopoly” in their message to their customers yesterday. Yes, the company that has frightened the book business so badly with its attempt to create a closed system for e-book delivery on its Kindles said that Macmillan had a “monopoly on its titles.”  This nasty monopoly of Macmillan’s was forcing Amazon–now the David to Macmillan’s Goliath–to “capitulate.”

Whatever your point of view on this, the use of “monopoly” to describe a publisher’s control of its content is a bit overheated, no?  Maybe we can go back to calling it what we used to in the old days: “copyright.”

In yesterday’s Publishers Weekly, Jim Milliot reported on a new study of online book piracy done by a company called Attributor. According to Attributor, publishers “could be losing out on as much as $3 billion to online book piracy.” On the face of it, this is bad news for publishers. We all know what Napster did to the music industry. And it sure would be nice to have that $3 billion back, no? But reading further into the report, we learn that the average number of free fiction downloads was just over 2,000 copies. Wait a minute. 2,000 copies? Is that a bad thing? It isn’t unusual for publishers to give away more than 2,000 advance reading copies of a piece of new fiction. Why? Because we want people to read the book and tell other people about it. And what about libraries? Don’t we sell copies to libraries that they then lend out over and over again—for free? How much money are we “losing” to free reading in libraries? (I shudder to think of how my wife and I may have contributed to the problem, taking our children to the library every Saturday and letting them each take out ten books. Who knew that we were raising a bunch of pirates?) Furthermore, how much money are we losing to people who lend a friend a book they’ve just read, saying, “You have to read this book!” We’d better put a stop to that right away…

We need to protect our author’s copyrights, and make sure that we don’t get Napstered by massive illegal online distribution. But small quantities of people reading our books for free may not be harmful, and may actually promote literacy, and the joy of reading…and the business we’re so worried about protecting.

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way – in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.”

- A Tale of Two Cities, Charles Dickens

Decades from now, when we look back at the book business in 2009, it seems likely that we’ll see it as a threshold year, one in which all of the signs were there for what followed. It was a year in which sales held steady (Nielsen Bookscan, which covers 75% of the market, reported that overall unit sales through December 20 were 724 million copies, only a 3% drop from last year—and adult hardcover fiction was up an amazing 3%), and a few authors were so successful (Stephanie Meyer, Jeff Kinney) that the fates of entire publishing houses were altered by them; however, it was also a year that saw publishing’s profit margins squeezed in perplexing new ways. It was a year in which some of the most highly-respected bestsellers (Audrey Niffenegger’s Her Fearful Symmetry; Andre Agassi’s Open; Edward M. Kennedy’s True Compass) were also apparently the year’s biggest money-losers for their publishers, due to their multi-million-dollar advances; at the same time, some of the books with the highest rumored advances (Dan Brown’s The Lost Symbol; Sarah Palin’s Going Rogue) were likely the most profitable. It was a year in which e-book sales increased exponentially, with the cherry on the sundae being Amazon’s announcement that they had sold more e-books on Christmas Day than p-books (though of course this was helped by all the people who got Kindles as presents and spent the day filling them); but it was also a year in which the prices charged for those e-books made them a threat to the health of the p-book retailers on whom publishers continued to rely, and possibly a future threat to publishers’ ability to make money on the e-book format itself, in spite of that format’s wonderful ability to eliminate the costs of production, distribution, and returns. It was a year in which the largest publishing houses slowed title acquisitions and reduced the number of titles they published, while one company—Author Solutions—increased its annual output to a remarkable 24,000 authors (even more remarkably, these authors were all paying for the privilege). It was a year in which review coverage of new fiction disappeared almost entirely, and yet one first novel (Kathryn Stockett’s The Help) sold more than a million hardcover copies thanks to word of mouth alone. It was a year in which publishers continued to spend exorbitant amounts of money on print advertising, in spite of data showing how ineffective such advertising tends to be, but also a year in which some publishers discovered the power of online media to reach niche markets at significantly lower costs.

What does this mean for the future? That for every trend there will be a counter trend. And since this is the time of year for Top Ten lists, here’s mine:

1. Trend: The large publishing houses will continue to reduce overhead as profits shrink in the years ahead. Counter trend: Publishers will be looking for mergers and acquisitions to compensate for those shrinking profits. The Big Six could be the Big Three within five years.

2. Trend: These companies will continue to focus more resources on fewer titles, using their strengths as large-scale marketers and distributors to publish brand-names. Title count at the largest houses could drop by as much as fifty percent over the next five years. Counter trend: At the same time, self-publishing (including partnerships like the one announced recently between Author Solutions and Harlequin) will grow exponentially.

3. Trend: Title reduction will be most significant for new talent, with the largest houses entrusting support of new authors to a handful of editorial imprints. The editors at those imprints–editors with proven ability to choose new material successfully–will increase in value. Counter trend: Editors whose job is to handle existing talent will find their roles diminished.

4. Trend: In terms of advances, the amounts paid for brand-names will continue to increase, with seven-figure or eight-figure acquisitions commonplace among authors with established track records. Counter trend: There will be an increase in five-figure acquisitions (perhaps with profit-share arrangements) for less predictable material. The six-figure advance—that dangerous neighborhood inhabited by books with lots of potential but few guarantees—will become a rare species within the decade.

5. Trend: E-book sales will grow exponentially, with the proliferation of new devices and applications for reading on smartphones, etc… Within five years, half of all reading will be done electronically. Counter trend: There will be a resurgence of appreciation for well-designed physical books, as keepsakes, gifts, etc… While e-books will create a downward pressure on pricing, there will be notable exceptions (as seen this year with Carl Jung’s The Red Book, in great demand at $195.00, or Thomas Keller’s gorgeous Ad Hoc at Home, a bestseller at $50.00).

6. Trend: As more consumers become e-book readers, demand will increase for the availability of e-books simultaneously with p-books. Counter trend: Publishers will try a variety of strategies to meet this demand while not undercutting their p-book sales, such as offering more expensive “enhanced” e-books at publication and plain vanilla, less expensive e-books several months later (the strategy recently announced by Macmillan) or by offering a variety of “bundled” discounts to purchasers of multiple formats (prediction: within five years, it will be common practice to give every p-book purchaser a “free” e-book version of that book at time of purchase, as is already the case in the music business, in which someone who buys a cd can also listen to that cd on other devices in digital form, without paying a separate fee).

7. Trend: Fewer and fewer books will be sold to publishers at “auction,” and that practice will disappear completely within five years, as more and more publishers realize that the “winner” in such auctions—the publisher willing to pay more to acquire a book than any of their competitors–is often actually the loser in the end. Sales will be made either by brand-name authors to their previous publishing company or by new authors to carefully chosen editors with strong reputations. Counter trend: Instead of auctions for the highest advance, there will be auctions in which a basic advance is established by the agent, with the auction winner being the publisher who bids the most in marketing committed to the book.

8. Trend: As the initial sale becomes less of the focus for authors, the agent of the future will become more of a business manager who handles every aspect of an author’s career, overseeing the author’s online presence, developing sources of revenue outside of book sales such as workshops and lecture tours, and acting as the author’s publicist in between publications. Counter trend: Publishers will create free-standing departments whose services can be purchased a la carte by authors, whether that author is self-published or published by a competitor who doesn’t offer such services.

9. Trend: As the Boomers lose their eyesight and their children become teenagers, demographics will favor books for young adults over books for adults. This is also the generation most likely to embrace a variety of online and offline formats, without feeling the need to choose one over another. Counter trend: While auctions and advances diminish for adult titles, they could heat up for young adult material as publishers bet big in search of the next Stephenie Meyer. (Prediction: publishing houses will soon have entire departments devoted to developing books about the undead.)

10. Trend: Every year for the foreseeable future, books will be purchased between Thanksgiving and Christmas about how to prepare high-calorie foods (a favorite from this year: Fat: An Appreciation of a Misunderstood Ingredient, by Jennifer McLagan). Counter trend: Every January for the foreseeable future, the bestseller lists will be dominated by books about how to lose the weight gained by eating those high-calorie foods. (Not much of a prediction, sorry…but I needed a tenth trend to complete the list!)

In “The Do-It-Yourself Economy” in yesterday’s New York Times, Tom Friedman wrote about how the “Great Recession” was forcing companies to take advantage of the “Great Inflection,” his name for “the mass diffusion of low-cost, high-powered innovation technologies,” giving a powerful example of a recently downsized marketing agency that had made a film for 20 percent less using online technology. There is a clear message for book publishers here as well, who have not only experienced a recent downturn in sales that led to layoffs across the industry, but also face a future in which e-book pricing will inevitably bring down revenues through traditional models in the years ahead. The “good news,” as Friedman calls it, is that technology has arrived that lets us move more quickly, with less cost and a smaller staff. We all need to find ways each day to embrace it–or be victims of the “Recession” without the “Inflection” that might save us.

Our author Theresa Brown, whose powerful book about her first year as a nurse (Critical Care) will be published next June, takes on health care reform in an editorial that ran on the front page of the editorial section of yesterday’s Pittsburgh Post-Gazette.

Image: Latest book prices at Walmart.com

The argument over book pricing started to heat up with Amazon and then BN.com offering e-books at $9.99; now that Wal-Mart and Amazon have started offering the top ten industry hardcovers for $10.00 each, that argument is reaching a boil. Beyond the news stories about this “price war,” there is a lot of traffic on blogs, Twitter, etc…about what this means for authors and publishers. For instance, on today’s “ShelfAwareness” Robert D. Utter of the Other Tiger bookstore in Westerly, R.I. says,

What ARE the economics? How much money are these two behemoths losing on each sale when costs are taken into account? What would the P&L and balance sheets look like for this model? At what point is their behavior illegal and anticompetitive?

To answer him briefly, retailers pay publishers roughly 50% of the suggested retail price for books. For instance, when Wal-Mart buys a $35.00 book from Scribner, they pay Scribner about $17.50. If Wal-Mart then chooses to sell that book for $10.00, they are losing about $7.50 per copy sold. So, the “P&L” doesn’t look so good in this case for Wal-Mart, but clearly there are larger agendas involved for these companies, who are willing to use these books as “loss leaders” to establish their predominance on the retailing landscape. Their behavior is not illegal or anticompetitive; in fact, it would be illegal for publishers to tell any American retailer what to charge for a book; that’s why it’s called a “suggested” retail price.

The short-term results of this price war are some losses for Wal-Mart and Amazon, and some brisk sales for the publishers whose books have been chosen. But the “road kill” here are the accounts who can’t afford to participate in the race—traditional booksellers. And in the long term, these large retailers may succeed in convincing consumers that $10.00 is the right price for a book, whether digital or physical. That would put an enormous squeeze on an already-squeezed business, since of the $12.50 we get now for a $25.00 book, we spend about $2.00 to produce each copy, about $1.00 to market each copy, and another $1.00 or so on freight and warehousing, etc., leaving us roughly $8.50 out of which we must pay the author (who would get $4.25 if this were a profit-share, or $3.75 if this were a 15% royalty) and cover our significant overheads, before we end up with a slim profit.

If you love Mollie Katzen (and what fan of the mushroom barley soup from The Moosewood Cookbook doesn’t?) you’ll want to check out Mollie’s new cookbook, GET COOKING: 150 SIMPLE RECIPES TO GET YOU STARTED IN THE KITCHEN, which we’re publishing next Tuesday (October 13, in honor of Mollie’s birthday). It’s Mollie’s first cookbook ever specifically designed for beginners…and her first ever to include all the food groups. The idea is to welcome everyone into the kitchen, whether you are vegetarian or vegan or carnivorous, and whether you think you can cook or not. In fact, if you think you can’t cook, this is the perfect book to wean you from takeout and get you on your way to making easy, fresh, inexpensive meals for yourself and your friends.

And if you love Kashi, the natural foods company (and what fan of their Cinnamon Harvest cereal doesn’t?), you’ll be excited to hear that Kashi will be promoting GET COOKING on the backs of 8 of their most popular cereal boxes this Fall!!! Kashi has also partnered with Mollie to create a fantastic new video-based website called Get-Cooking.com, which launches today. Check it out for terrific instructional videos that will have you making everything from polenta to pilaf in no-time.

Do you like green eggs and ham?

I do not like them, Sam I am.

Would you like them in a blog?

I would not like them in a blog.

Would you like them in a vlog?

I would not like them in a vlog.

Would you like them in a vook?

I would not like them in a vook. What are you, some kind of kook?

No, I am not some kind of kook. A vook is a new kind of book.

Could I buy this vook on Woot?

Yes, of course this vook’s on Woot.

Then that is something I will tweet.

Oh, how sweet that you will tweet;

Please tweet it out and all about.

And I will download this for free:

Green eggs and ham for you and me.