MediaWeek (V4, N43): McGraw Hill, Springer, Hilary Mantel, Amazon, Metadata +More

The tires are being kicked at McGraw Hill Education by a predictable group of private equity players (Cengage is backed by Apax) but the asking price looks steep (Reuters):

McGraw-Hill Companies Inc's (MHP.N) education unit is expected to draw final bids from private equity firms Bain Capital and Apollo Global Management (APO.N) as well as rival Cengage Learning Inc, in a deal that could fetch around $3 billion, several people familiar with the matter said.

Cengage, the No. 2 U.S. college textbook publisher, and the two private equity firms are working on final offers for McGraw-Hill Education, the world's second-largest education company by sales, with the bids due later in October, the people said.

McGraw-Hill, which is running the auction as an alternative to its planned spin-off of the business, wants to get more than $3 billion and could still decide against a sale if the bids fail to meet its price expectations, the people said this week.

Note - If you read my post this week about Pearson the Apollo Group owns for profit University of Phoenix making me some kind of fortune teller.

Journals publisher Springer is up for a recapitalization based on reports from Reuters:

The company has performed well and earnings before interest, tax, depreciation and amortisation (EBITDA) have risen to around 330 million euros, bankers said, from 310 million in 2011, which was quoted on EQT's website.
Although there is no urgency for the company to do anything as its debt does not mature until between 2015 and 2017, conditions in Europe's leveraged loan market are such that it could be good time to do an opportunistic deal.
There have been a number of such deals recently as banks and private equity firms seek to make money and take advantage of stronger market conditions, after a lack of deal activity over the summer, including dividend recapitalisations by the RAC and Formula One.

Hilary Mantel interviewed in The New Statesman:

Mantel wondered if she was being too demanding. But then she thought that to adjust her style in any way would be not only a loss, but patronising (“You simply cannot run remedial classes for people on the page”). Some will be lost along the way, but she doesn’t mind. “It makes me think that some readers read a book as if it were an instruction manual, expecting to understand everything first time, but of course when you write, you put into every sentence an overflow of meaning, and you create in every sentence as many resonances and double meanings and ambiguities as you can possibly pack in there, so that people can read it again and get something new each time.”

She can sound arrogant, Mantel, assured of her abilities and candid about them in a way that seems peculiarly un-English. But even the arrogance is purposeful. It is one of her pieces of advice to young authors: cultivate confidence, have no shame in being bullish about your ideas and your abilities. She was patronised for years by male critics who deemed her work domestic and provincial (one, writing about A Place of Greater Safety – the French 800-pager – dwelt on a brief mention of wallpaper). So she makes no apologies for her self-belief.
...

After all the research, the reading, the note-taking, the indexing, the filing and refiling, it is a question of tuning in. Alison, she says, is how she would have turned out if she hadn’t had an education – not necessarily a medium, but not far off, someone whose brain hadn’t been trained, and so whose only (but consi­derable) powers were those of instinct, of sensing, of awareness. Mantel describes herself as “skinless”. She feels everything: presences, ghosts, memories. Cromwell is researched, constructed and written, but he is also channelled. Occupying his mind is pleasurable. He is cool, all-seeing, almost super-heroic in his powers to anticipate and manipulate. (Craig thinks Mantel made the mistake of falling in love with her leading man and that her version of Cromwell is psychologically implausible for a man we know tortured people.) Mantel relishes his low heart rate, the nerveless approach to life, a mental state unbogged by rumination. She says that when she began writing Wolf Hall, first entering this mind, she felt physically robust in a way she hadn’t for years.

Amazon chief Jeff Bezos was on a promo tour in the UK this week and was interviewed in The Telegraph:

He says the business quickly realised that if they wanted to make ebooks work, they needed to make hardware. Eight years later, the Kindle is into its fifth generation. The latest, film and music playing, multimedia tablet takes on Apple’s iPad and is, on pre-orders alone, the site's number one best seller.

Bezos, though, doesn’t want to take on Apple at their own game. “Proud as I am of the hardware we don’t want to build gadgets, we want to build services,” he says. “I think of it as a service and one of the key elements of the service is the quality of the hardware. But we’re not trying to make money on the hardware – the hardware is basically sold at breakeven and then we have a continuing relationship with the customer. We hope to make money on the services they buy afterwards.”

And make money they do, but Amazon is still not Apple’s size. Would Bezos like it to be? “Even though this device is only £159, in some ways it's better than a £329 iPad – way better wifi, the iPad only has mono sound and the Kindle bookstore is by far the best electronic bookstore in the world.”

Colin Robinson writing in the Guardian suggests ten ways publishing can help itself. Extra points if you can find anything either new in this list (Guardian):

This year, on the face of things, it's been business as usual at the Frankfurt book fair, with some 7,500 exhibitors setting up shop in the gleaming white Messe. But scratch beneath the surface and a tangible unease about the future of the industry is evident: book sales are stagnating, profit margins are being squeezed by higher discounts and falling prices, and the distribution of book buyers is ever more polarised between record-shattering bestsellers and an ocean of titles with tiny readerships. The mid-list, where the unknown writer or new idea can spring to prominence, is progressively being hollowed out. This is bad news not just for publishing but for the culture at large.

Three magazine publisher's experience with Apple's Newsstand (Journalism UK)

When Goldsmith delivered presentations on Newsstand at publishing conferences a year ago, he said he would be asked a common question.  "The first question from the audience would be 'aren't you cannibalising your own sales?' And that question would come from our editors as well."  "But 80 per cent of sales are overseas, 90 per cent of customers are new to the brand." And 40 per cent of all of sales are for subscriptions. "That's brilliant, because it is offsetting that sad decline in print.
It is a similar story for Conde Nast. "We are reaching a new audience, we are able to target them in new ways, we are able to market to them in new ways, it's a pretty exciting new development for us," Read said. "It means that the overall circulations of our magazines in these particular instances are growing very healthily so that we are seeing very big increases in circulation with titles such as Wired and GQ." Overseas sales vary from title to title, Read added, "A magazine like Vanity Fair will see quite a big proportion of its iPad sales coming from overseas, something like 60 to 70 per cent will be international, but that applies to print as well.

Metadata on Stage at Frankfurt reported by Publisher's Weekly:

Indeed this is the thrust of their exchange—the ever-increasing numbers of books and the faulty metadata being circulated about them—over the next half hour. The transition from print to digital has made metadata—which can mean anything from an ISBN to customer ranking on Amazon—not just simply useful, both Dawson and O’Leary emphasized, it is now critical to the ability to find and sell a book. The rise of digital publishing, and the lowering of barriers to entry for just about anyone—from professional publisher to newest self-publisher—has resulted in an explosion of metadata of all kinds. And apparently a sizeable chunk of it is either inaccurate or missing outright, compounding the problem of book discoverability. 

“When it was only the print bookstore, BISAC was a luxury,” O’Leary said, “but with all the digital products, we need accurate and granular metadata. It’s what we need to make book discovery possible.” The explosion in the amount of digital book content, “puts pressure on the metadata,” said Dawson, who pointed out that once inaccurate metadata is published online, “it’s there forever. If you’ve ever tried to correct a mistake in the metadata you know it’s a game of Whack-A-Mole.”
In fact in the olden days of print, O’Leary said, “It used to be that once you shipped the book, that was the end, the metadata was done. But with digital it never stops, there are constant updates and changes.” And as more consumers around the world go online they encounter information on all kinds of books, many of which they will want—but will be unable to buy. “Today, every book you publish is visible everywhere, even if you can’t buy it [because of territorial rights],” O’Leary said, “This encourages piracy, because if people do try to buy it, they find out they can’t.”

From Twitter this week:

From the fashion and style section of the NYTimes (??) The Education of Tony Marx head of NYPL.  (NYTimes)