Print Books Dead? "Not Even Wounded," Says Lightning President

Here's a trick question. Do you think that books printed on demand are tangible merchandise? That they are no different from traditionally printed books?

It's natural to think they are, but you might find it helpful instead to think of them as a form of digital book even though they are delivered by UPS instead of by your Internet service provider.

Because the trade publishing industry is in the doldrums we tend to think the book printing industry is suffering too. Nothing could be further from the truth. As I've contended again and again, there's nothing wrong with the book business that can't be cured by distributing books a different way. And that's why I believe print on demand is the salvation of the industry.

This is admittedly a pretty extravagant declaration, but it's supported by some statistics reported in an interview, conducted by Liz Thompson for Bookbrunch, with David Taylor, President of Lightning Source Inc., arguably the largest POD press in the world. (As a matter of disclosure, LSI is E-Reads' printer.) Taylor stated that LSI has printed 70 million books in the decade since POD was introduced, and its facilities in Tennessee and Pennsylvania hold about a million digital files. The business has "grown 20% to 30% in the last six months," he said. LSI prints, binds and ships 10,000 copies a day on machines that run around the clock. In Britain, the firm is building a facility the size of an English football pitch.

Just as the current recession has laid bare the weakness of a traditional book distribution model based on the returnability of merchandise - with return rates soaring deep into the double-digits - it has also revealed the strength of an on-demand system with a negligible return rate.

"The recession," Taylor told his interviewer, "is focusing publishers' minds on cash, on the amount of inventory they have sitting in warehouses, on the cost of transporting stock. Most global publishers in the academic and STM [scientific, technical and medical] markets are saying they want to get out of inventory, and some pretty radical discussions are now taking place which will allow publishers to do just that. Believe me, it's an exciting time to be part of the business."

Among the radical solutions to the inventory problem is the creation of digital warehouses. These are in essence a network of servers containing vast archives of POD files linked to Espresso printers, miniaturized machines that can print and bind paperback books in under 10 minutes. Someone called them ATMs for books, but while the logical place for them is bookstores there's no reason why Espressos could not be set up in facilities not necessarily book related (we half-jokingly suggested a bagel shop).

Certainly one place such networks could be set up is Third World countries, says Thompson, "which have none of the infrastructure of western publishing in place (warehouses, distribution companies) and where building it would not, at this point, make much sense."

In short, says Liz Thompson, David Taylor "believes that far from the being dead, 'or even slightly wounded', digital technology is powering a genuine revolution in so-called traditional publishing."

To witness the revolution, watch this video of an Espresso producing a book in front of your eyes. Order your book, buy yourself a cup of (liquid) espresso and by the time you've consumed it, your book will be ready.

Perhaps it will become apparent why, in 2005, Amazon.com acquired a modest little print on demand operation called BookSurge, and why, three years later, Amazon launched an aggressive campaign to promote its POD services to publishers. Though Amazon's is the quintessentially modern book retailing operation in the history of the world, a number of underlying brick and mortar functions - notably, some 12 million square feet of warehouses - compromise its efficiency and profitability. In The Nine Gazillion Pound Gorilla Bares Its Fangs, a blog posted at the time, I wrote:

If Amazon is capable of printing books on demand, they will no longer have to carry any physical books in their warehouses at all! They simply have to load the files of Random House, HarperCollins, Hachette, Penguin, and every other publisher onto their server and print all of their books - frontlist as well as backlist - on demand. It would not only be a huge savings for Amazon in terms of warehouse space - it would be a huge savings for the publishers, too: they all would eliminate printing, warehouse, and freight costs at a stroke.

That all middlemen are impediments in a digital world is bedrock truth. As stupendous as Amazon is, it is nevertheless a middleman between book publishers and book buyers. The key to disintermediating that function is print on demand. Amazon's 2008 foray in this arena was only the first skirmish. You can expect the company to continue seeking a large share of the POD business currently enjoyed by Lightning Source.

Richard Curtis