Apparently Borders can’t pay its publishers.
Borders has been delaying payments to book publishers in signs that it may be one of the first major victims of e-books. Early reports from Publishers Marketplace on Friday said it was putting off the payments to help refinance its debt but also wasn't certain that the plan would be effective. It might have to break its existing credit deals early into 2011 after facing a "liquidity shortfall," it said.
That doesn’t surprise me. Seeing the number of Kindles received as holiday gifts by “Computer illiterate” friends and co-workers has convinced me the e-book revolution has started. But something else about this article did surprise me…
Any financial collapse at Borders could have a ripple effect on the e-book business. It would cost Kobo one of its most important markets for e-readers and would close one of the few major online book stores. The shift could feed Amazon, Apple and other survivors with extra customers.
That may be true but I’m surprised it’s what he chose to focus on. Rather than the much bigger ripple effect this would have on society. That effect is something I’m becoming more and more passionate about because I think we need to realize a digital future requires fewer workers.
Borders is the perfect example of this…
Whether we’re talking about e-books or paper books the transaction is still the same. An author writes a book, a publisher distributes that book and a consumer purchases and reads that book. These facts don’t change. But with the Paper Book that process also requires…
- Various people who work to cut down trees and ship the lumber
- Various people who work to create the paper from those trees
- People to ship that paper to the printer
- A person to operate the printer that prints the book
- A person to examine the output of the printer to verify the product
- A person to pack that book to be shipped to the publisher
- A person to unpack the book at the publisher and verify the quantity is correct
- A person to then repackaged the book and ship it to individual retailers
- A shipping company (UPS, FedEx,etc…) with various agents (carriers, pilots, handlers, etc…) to carry the package to the retail store
- A clerk at the retail store who both unpacks, stocks and sells the book
Compare those people to what is required for an e-book…
- A person in the publisher’s IT department takes the digital copy of the book, converts it to the approved format and uploads it to a server
That’s really it. Yes there are maintenance people for the servers and the content management systems. But you can’t believe those few IT people are more than all the ones I left out of the paper book list. Remember companies that deliver packages, print books, sell lumber and so on all require IT departments of their own. So if anything the comparison favors the e-books.
My contention is there’s no way to compensate for that kind of job loss. Think about this for a second. A couple servers could replace the jobs of every Borders sales clerk in the United States.
We always see these utopian societies in Science Fiction. The “Star Trek Society” where people choose to work for their own betterment and not because they need to. That’s a great ideal and I believe humanity will one day get there but in realizing that from our perspective you have to look at another less pleasant fact.
There will be a transition.
A period where some will still have skills that are needed by society while others don’t and society will have to deal with those who don’t.
This is a very complex topic and one I’m sure I’ll revisit at various times throughout the coming year. But if I could make one request of you I’d ask that you think about this and ask yourself what will happen if Borders does disappear at the hands of e-books. Where will those 25,000 people go if there’s never a new job for them and how can we as a society keep them from destitution?