Asking why trade publishers fail is the wrong question

(Inspired by the discussion surrounding this evidence-free rehash of a PR release.)

Your average trade publisher is a laundry list of bad business characteristics:

• Consumer customers (the worst/least predictable kind of customer).
• Entertainment good (the worst/least predictable kind of product).
• A market that’s shifting increasingly to the blockbuster model (the worst/least predictable kind of market).
• Dominated by vendor duopolies (Amazon and B&N in the states, Amazon and Waterstones in the UK).
• No access to customer data.
• No direct communication possible with the customer.
• Archaic production infrastructure dependent on enterprise products from completely disinterested tech companies (mainly Adobe).
• Extremely expensive locations (London and New York).
• Low average pay across the board.
• Staff that on average has little training or experience (the combination of low pay and expensive location results in experienced staff burning out or leaving for greener pastures).

Instead of asking why a trade publisher fails, ask yourself this:

How in hell have existing trade publishers survived?

Luck? Scale? Back catalogue? Relationships? In an industry with these characteristics, the default for any business entity is massive, gross, painful, and ugly failure with more collateral damage than a cluster bomb.

If you’re planning to start a trade publisher, first consider not. Really. Lie down for a few moments (or a day) and see if the urge passes. Book an appointment with a therapist. If you feel you have to, focus on the industry successes and see if they have characteristics you can replicate. If they don’t (“I’m going to start the next Penguin Random House,” eh, no) go do something more sensible, like offering professional training products/courses or B2B services.

Aside

The app stores share a lot of characteristics with trade publishing. Making apps for an app store is, indeed, a horrible business to be in. Fortunately, most developers have the option to sell web apps or desktop apps directly instead. Then they can limit their engagement with the mobile market to a sideline (e.g. hobby apps) or to a subsidised complement to an existing direct business (e.g. a mobile app client for your web app).

Similarly, the rational approach to trade publishing would be to limit your participation in the industry to a sideline. This is easy if you’re an author (in fact, it’s generally the default) and tricky but doable if you’re providing services.

Of course, none of us are rational economic actors in real life. We just play them on Twitter.