Urging Authors to be Entrepreneurs: iUniverse CEO Kevin Weiss (Part 7)

SM: What should I have asked you that I didn’t?

KW: We have not talked about our overseas facility yet. I recently did a press conference with the governor of Indiana where I announced the closure of our Shanghai facility. We are moving that work to Bloomington. I know we can be more cost-effective having those folks here. We can also do a much better job working with authors one-on-one. The authors never talk directly to anyone in Shanghai. Now they will have the ability to talk directly with our team. Finally, it is critical that our entire team works together. I want galley design to talk to the publishing services associate who works with customers on a day-to-day basis.

We did the same thing back in January when we moved the iUniverse brand from Lincoln to Bloomington. We have had no issues whatsoever hiring college-educated, talented people. This year we have hired 130 people in Bloomington alone. We are just a tad shy of 400 employees in the company.

SM: When you shut down Shanghai and move that workforce to Bloomington, how many people are you talking about?

KW: We are going to hire approximately 30 people. We continue to expand, not just because we have done consolidations but because we have the ability to grow organically.

SM: What is your take on Amazon’s announcement about their print on demand publisher network, where the printing is done organically?

KW: Amazon is doing what is best for their business. They are extracting a fair amount of profit from the supply chain. They are going to be able to print everything they need to print when they need to print it. The thing that is lost on everybody is that what they are really doing is cutting out Ingram. I don’t know how many print-on-demand books they sell at Amazon every year, but when you look at what happens at University Press of America, it is fairly substantial. I don’t know what it truly meant to them, but it could have represented $10 million-$15 million of margins.

SM: The opportunity Amazon has by doing this kind of vertical integration is actually quite substantial.

KW: I keep telling the mainstream publishing industry they need to wake up. It is not a big deal for me because I do not sell all of my titles through distribution, and I never will. I have a lot of authors who are talented speakers and who sell their books at their presentations. With the mainstream publishers, some major author is going to say they are going direct with Amazon. What is it, Amazon keeps 65% and the author keeps 35%? Amazon will make more and the author will definitely make more.

SM: All these agents, publishers, and intermediaries are going to get cut. Authors have not been able to make any money and that will change.

KW: A handful make a lot of money and the rest make hardly any. Take the Harry Potter effect out of the industry and it is really not all that an attractive one to be involved with. I think Amazon must be careful, too. Choice is an important thing. If they eventually freeze the market to the point where there is no choice for people, the results will be negative. I am all for making money; I think it is very important. But if they start to change the industry to the point where nobody else can be in publishing or people do not feel comfortable getting involved writing books because they do not like the experience, then I think that would be very bad.

SM: I don’t think that will happen. The dynamics of the industry will change, at least that is my hypothesis. The market will tip, and the market will get better for authors.

KW: It should, at least I hope so. I think mainstream authors also need to think through the model they have followed in the past. There are lots of people like you who are sharp, talented people who have something to say. If we can find a cost-effective way for authors to do that, perhaps it will make more people read.

This segment is part 7 in the series : Urging Authors to be Entrepreneurs: iUniverse CEO Kevin Weiss
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