But overspending isn’t going away, even with a rotten economy. Last month, Harvard economist Anita Elberse wrote a piece debunking the hypothesis of Chris Anderson’s anti-blockbuster blockbuster, The Long Tail (which Bob Miller acquired at Hyperion for a mere $550,000). Elberse led off with a tidbit from a study of Hachette’s Grand Central Publishing. Of 61 books on its 2006 list, each title averaged a profit of almost $100,000. But without the top seller, which earned $5 million, that average drops to $18,000. “A blockbuster strategy still makes the most sense,” she concludes.
It’s inherently risky, though. You have to wonder about the prospects for one new book that Elberse had her students case-study—Dewey: The Small-Town Library Cat Who Touched the World. Grand Central, inspired by the best seller Marley & Me, is betting on the new mini-genre of cat-related nonfiction. Grand Central initially offered $300,000, then went up to $1.25 million. Gobs more will be spent on marketing. You’ll likely be hearing about Dewey when it comes out this month, and if half a million of you still feel that you can’t get enough heartwarming pet stories, it just might earn back its advance.
So publishing ends up looking like a mini-Hollywood, but even more dependent on sleeper hits and semi-reliable franchises. Dan Brown’s The Da Vinci Code buoyed Random House tremendously in the past five years, but with Brown’s sequel delayed, sales were down 5.6 percent last year. When Simon & Schuster announced that sales were off almost 10 percent in the first half of ’08, it cited the 2007 success of The Secret as the reason for the relative shortfall. Other companies did better—but on the strength of surprise hits. Sales grew 11 percent both at Penguin and at Hachette’s U.S. division, largely on the backs of two authors—Oprah-touted self-helper Eckhart Tolle at Penguin and Stephenie Meyer at Little, Brown.
Morgan Entrekin remembers meeting Larry Kirshbaum, then-CEO of Time Warner Books, right after two of Kirshbaum’s books had been anointed by Oprah in 1999. “It’s like winning the lottery twice,” says Entrekin, “but Larry didn’t seem that happy. He said, ‘Now my bosses are going to expect me to do better next year.’ ’’ Kirshbaum eventually left to become an agent.
“If someone like Jane Friedman can’t survive the industry, who can?” —AN EDITOR AT A HARPERCOLLINS RIVAL
The ideal publishing CEO can “read vertically and horizontally,” in the words of ex-Penguin CEO Peter Mayer. But even those who clearly can do both, like Jane Friedman, seem powerless to keep their bosses happy. Friedman had an odd retirement party. It was thrown not by her former employer, HarperCollins, but by her rival and close friend, Doubleday publisher Steve Rubin. The turnout for mid-August was impressive: Power agents Amanda “Binky” Urban and Mort Janklow and legendary editors Sonny Mehta, Gary Fisketjon, and Dan Halpern all converged on Rubin’s elegant roof deck off Central Park West. They surprised the guest of honor by wearing disturbing Jane Friedman masks. Friedman herself gave a defiant speech insisting that it wasn’t a retirement party at all. “Books mean civilization,” she said, perched on iron steps that resembled a barricade from Les Misérables. Later she proclaimed, “I am not done, and I am not done by a long shot!”
Friedman was an emblem not of publishing’s genteel old days but rather its postmillennial media- and tech-savvy era. She came up through publicity at Random House, and over a decade as CEO, she turned HarperCollins from a floundering beast into the business’s tightest, shiniest ship. She also attended personally to writers. She had such a good relationship with Michael Crichton that he followed her from Random House to HarperCollins. Yet a few days after being the belle of the industry’s annual confab, BookExpo, held in L.A. last spring, she went into Rupert Murdoch’s office and was told that her own protégé, Harper No. 2 Brian Murray, was replacing her. As one editor puts it, “She went over there thinking they were going to discuss [her] contract, and instead she got a two-by-four across the face.”
Friedman was never known as a gentle soul, but her brutal “resignation” spooked the industry. What exactly had she done to deserve this? HarperCollins’s recent numbers were down but had recovered reasonably by June. With both parties refusing to comment, theories abounded, the most plausible of which is that Murdoch thought she had become more noise and trouble than she was worth, running a part of his conglomerate that, relatively speaking, isn’t worth all that much to him. There was her messy dismissal of Judith Regan following the O. J. debacle—a tabloid event that dovetailed too well with Friedman’s reputed love of publicity. Murdoch, people at the company say, didn’t like seeing Friedman’s name all over the papers.