A Bad Week for New Zealand Publishing

It’s been a bad week for New Zealand publishing.  On Tuesday, Pearson Education announced the imminent closure of its New Zealand office. The global publishing giant is restructuring to focus on ‘core’ and ’emerging’ markets, and New Zealand is neither. And yesterday, Harper Collins joined the exit, announcing its plan to move most of its New Zealand operations, including editorial, to Australia. 

Pearson Education’s sister company, the trade publisher Penguin, will probably face a similar fate shortly when it merges with Random House and chances are, even the combined entity is likely to be merged with Australian operations.

We’re now seeing the inevitable end-game brought about by digitisation. In spite of the enthusiasm of Kiwi workers to embrace digital technology, global publishers have done little to support their digital resourcing here, instead concentrating those digital efforts in bigger markets.

That makes business sense for large, global players but it’s bad for small countries like New Zealand which will continue to lose both economically and culturally — unless local players can step in to fill the gaps. 

[UPDATES as things unfold further: Hachette to close NZ publishing after 2013 list (26 July 2013)]

There’s good news

This is going to be a tough period for New Zealand publishing, and for hundreds of good people who are caught up in these far-reaching changes. But there’s potentially good news too.

Our major publishers grew by buying up successful local publishers and winning most of the top talent, so there’s only a tiny independent industry left. There’s now a chance for a renaissance, led by independent publishers — and by new ventures formed from the break-up of global publishers as they exit. Expect to see pieces sold to local management and investors, or picked over by staff to form new start-ups. [UPDATE: Pearson appointed start-up Edify as its New Zealand distributor, led by former Pearson Managing Director Adrian Keene.]

And there’s a big prize if we can grasp it. Books are a US$100 billion global industry (and will remain a big global industry post-digitisation). Yet our foreign-owned publishers have had little incentive to build an export industry here (why would they when they already publish in most key markets?)

The next wave of home-grown publishers will be much more outward-focused, thanks to the same technology that’s driving change, plus our native English language and many other assets.

Authors, it’s time to make your move

One of the first places we need to look is our own authors, especially the top talent that sells thousands rather than hundreds of books. With few exceptions, most of them publish with the multinational imprints, leaving very lean pickings for independents. But quality authors are the cashflow lifeblood of any publishing business.

The time is right for our best authors to consider the role they can play in supporting a renaissance of local publishing. I’m not advocating a wholesale exit from multinational publishers. That would be bad for everyone, and bad for the industry. But there’s plenty of room for new titles and some digital rights to help rebuild an independent local industry.

And a wake-up call for New Zealand education

The exit of major publishers like Pearson can hurt New Zealand education too. Self-determination in teaching and curriculum development goes hand-in-hand with the ability to produce high-grade support materials and, increasingly, to deliver them in sophisticated digital ways. If we rely increasingly on offshore suppliers, we’ll have diminishing influence over their content.

ExitWe need some local publishers who can operate at scale in a digital future. We can’t rely entirely on small businesses and enthusiastic self-publishers, though it’s a positive aspect of digitisation that will help education too.

The Education Ministry should plan now for the retreat of large publishers to offshore locations. Technology will ensure that others follow Pearson’s lead. Doesn’t matter, perhaps? Let’s do some research and deep thinking before making that call. My hunch is that it will probably matter to our self-determination in education, and will certainly matter to what a reinvigorated local industry can deliver.

Learning Media is one of the few locally-owned companies potentially big enough to fill gaps left as multinationals exit. But this SOE (state-owned enterprise) is facing a tough future itself after the Education Ministry cut its long-held preferred supplier agreement.

Whether the government chooses to help Learning Media through its difficulties, or let it fail, it should think carefully about how it uses its multimillion dollar spending power to build a sustainable local industry that will have New Zealand’s particular education system at its core.

It will be philosophically difficult for this government, but public education is not a truly free market — governments are the biggest funders and purchasing is dominated by government-controlled entities.

An offer of free training in digital publishing and online marketing to all Pearson and Harper Collins New Zealand staff

I’d like to do what little I can to help turn this tough time into the start of something better. If you’re working for Pearson or Harper Collins New Zealand, this week’s news will be pretty tough as a lot of good people will be forced to consider their futures in the industry. I want to offer all staff at Pearson NZ and Harper Collins NZ free access to my online courses in digital publishing at DigitalPublishing101. There are two courses, Digital Publishing 101 for Ebooks and Marketing 101 for Ebooks.

If you finish both courses (and half an hour a day for a few weeks should do it), I’m sure you’ll know enough to get started with a digital publishing business of your own, or to contribute to the digital success of the next venture you’re part of.

To take up the offer, email me at martin[at]digitalpublishing101[dot]com. I’ll send you a coupon to get both of them free with a year’s access. No hidden gotchas or strings attached, and no application form needed.

The role of multinational publishers in New Zealand

Finally, it’s important that New Zealand continues to be a place where global publishers will want to do business. We certainly need to work hard supporting ventures that are rooted here, even tipping the balance in their favour as we struggle to rebuild. But in doing this, we shouldn’t create an environment hostile to offshore suppliers.

The local industry has gained enormously from the resources, networks, and the sophistication that international businesses bring. I spent a lot of my career working for an international publisher and I know the huge benefits they can bring, both personally and to the wider economy.

And chances are, we’ll want to lure them back when the next wave of change tips the balance in New Zealand’s favour again, and our successful entrepreneurs are looking for global partners, or well-earned exits.

What else can we do?

Feel free to put any suggestions in the comments.

Comments (36)

  1. AngelaS

    Thanks for that summary Martin. And if people want to know what schools need get in touch with me and a school librarian network. New Zealand content is crucial to our users/students/staff.

  2. Martin Taylor (Post author)

    Good suggestion, Angela. That’s probably where we’re going to get the best insights into what’s needed, and what the issues will be if we have to rely more on international content.

  3. Christine Hurst

    Its very sad for the good folk at those publishing houses. I think this heralds the new age for indie publishing and I can’t wait to see what it brings. Maybe some of the displaced Harper Collins people could reach out to those writer who are keen (and able) to venture into the indie publishing world? Could be some fantastic collaborative outcomes…

  4. Martin Taylor (Post author)

    Yes, couldn’t agree more and I hope that one of the things that comes out of all this is some connections between people that spark new ventures.

    There’s a very good network on LinkedIn that has its origins in the Digital Publishing Forum initiative. It has about 650 members with two-thirds from New Zealand. I’ve been meaning to organise a meet-up or two so perhaps this might be the prod that’s needed.

    Here’s the link.


  5. Bev Robitai

    Hi Martin, you’ll be happy to know there are some healthy indie publishers springing up to replace the fallen giants. The Mairangi Writers group, largely inspired by your talk at our seminar a couple of years ago, has set up a distribution website for our list of around 40 titles and we’re happily selling to schools, libraries and independent bookstores. We have a mix of editions from ebooks to large print on most titles and the next step will be audio books. We can reach a world audience from here in NZ and gain all the value of that huge market. It’s a great time to be in publishing!

  6. Martin Taylor (Post author)

    Hi Bev. That’s terrific to hear. What’s the address of the group’s website?

  7. Bev Robitai

    Thanks Martin – the address is http://www.letsbuybooks.weebly.com.

  8. Sean

    NZ writers will not be able to continue operating in NZ without some type of funding. The music industry has this in place. This is a matter of urgency and is not being flagged anywhere.

  9. Martin Taylor (Post author)

    @Bev, excellent. The can-do spirit is alive and well on the Shore:-)

  10. Martin Taylor (Post author)

    @Sean, what sort of financial support for artists has been effective in the music industry? How is it allocated? Any ideas that could carry through to writers?

  11. Anna von Veh

    Hi Martin

    Thanks for this article, which clearly outlines the issues and opportunities for NZ publishing.

    As you know, I was Editorial and Production Manager at Pearson Ed until a couple of years ago so I really feel for all my wonderful ex-colleagues.

    For the multinational publishers, there are of course considerable benefits to using good content management systems and streamlining operations. The downside though for smaller local branches is that operations are most likely to be concentrated in the larger locations.

    In Pearson’s case, I hope (and I am only speculating) that although operations may be concentrated elsewhere, probably Australia, with all the benefits that content management can bring, excellent NZ Education authors will still be commissioned, there’ll be some Sales reps here, and hopefully NZ schools and libraries will still be provided with locally written Pearson textbooks, media etc.

    And if not, as Bev has said, there are huge opportunities for indie publishers and authors. I and my business partner (a published author himself) started a digital services and publishing company a couple of years ago, and have had the kind of international exposure that only the internet and digital publishing makes possible.

    Thanks again for your article, and for your great contribution to local digital publishing.

  12. Martin Taylor (Post author)

    Thanks, Anna. As you point out, it’s still in the interests of Pearson and other international players to serve this market, it’s just a shame that it will be further removed in many ways.

    The same technology that is taking jobs and skilled people away can bring them back and I hope that’s what we’ll increasingly see happening, provided we can develop the skills here to warrant their return.

    The sort of things you and Zirk have been doing with Say Books are, I’m sure, what we’ll see a lot more of. http://saybooksonline.com/about-say-books/

  13. Jill Marshall

    Hi Martin, and thanks for this insightful report on the publishing industry.

    As you’ll recall from our conversation when I sought out your august advice, I set up an indie publishing house two years ago with the core aim of establishing new NZ authors on the global book market by using the new digital advances.

    While we’ve certainly got many excellent authors and books ‘out there’, and I agree wholeheartedly that this is the most exciting time to be a writer, from our experiences I would say that there are still some issues which may need to be overcome in NZ before it really takes off for the indie/boutique publisher or the self-published author:

    1. Creative NZ still funds large chunks of the publishing industry in New Zealand but they do favour the traditional publishers including the big six (five, four, three …). Furthermore, they tend to fund print. I’ve put in six different applications over the past two and a half years for all sorts of different book formats, and have been turned down on every occasion. Nary a cent from them, despite extensive discussions with CNZ personnel on how to fill out the applications properly and devoting weeks of effort to producing appropriate budgets, statements of support and projections.

    It’s the start-ups who need the funding to exploit all these new possibilities, rather than the established publishers who should by now, surely, be operating independently as fully commercial businesses.

    By way of example, I still have in my files an outstanding studio recording of beautiful dystopian YA novel, Aroha by Anaru Bickford, by none other than Oscar nominee Keisha Castle-Hughes. The plan was to co-produce the audio books with Rhonda Kite’s Kiwamedia, but without cashflow, investment or funding, I’ve never been able to get it to market. One of our Creative NZ applications was for precisely this cause. CNZ, to my mind, needs to get with the times and start sharing the love beyond the traditional recipients and accepted media forms.

    2. The reading public in NZ needs to be made more aware of what’s available to them, and how cheap it can be! Popular NZ books are still typically: rather literary, in print, and sold in bookstores. Bookstores then suffer when NZ customers go to the Book Depository or Amazon for their low-cost versions.

    However, there is outstanding NZ fiction (and non-fiction, although fiction is our speciality so that’s what I know best) available as ebooks, as print on demand, and via websites from cooperatives like the Tauranga writers and the Mairangi Bay bunch as above. The difficulty is letting the public know about them. As writers, we spend a lot of time telling each other about our books, but not enough is devoted to letting the buying public know that there are fabulous books out there from all NZ authors across all genres and ages, maybe on Kobo or the Apple Bookstore or directly from someone’s website – and it can be as cheap as a Kindle book. The Pear Jam Books titles all sell for $4.99, and that includes some amazing, weighty (figuratively) novels.

    There is no excuse for publishers charging print-type prices for an ebook, as it’s the production, distribution and sales of the books that loads up the cost and henceforth the price. The process of creating an ebook is much more straightforward. It’s still got to be a great book, of course, and much of the back-end work still needs to be done properly (editorial, design etc) but that doesn’t warrant 1000% mark-ups while still limiting the royalty to the author. I wonder if a wonderful marketplace for NZ ebooks from a number of different suppliers might be the answer … Meantime, readers can definitely find great ebooks at http://www.pearjambooks.com!

    3. While they’re poising themselves to take advantage of the new world of publishing, authors need to be realistic too. I’m an author myself, first and foremost, so I know first-hand how important it can feel to an author to hold a copy of their book in their hand, to see it on a shelf, to sign a copy for a fan. Nothing like it in the world.

    However, printing books has crippled more than a few publishers, and the printed book and authors’ expectations of them causes the majority of the problems for publishing companies. Authors need to be aware that ‘getting published’ these days does not necessarily mean seeing your book in print. I’ve had many an author asking me when their book’s coming out, and it always surprises me when in fact it may have been out for months – just not in print.

    Personally, I love the fact that I can bring my own book to market in just days instead of trawling through the traditional process with which I’m all too familiar. The first Jane Blonde book was 8 years in the creation, including one year with an agent and two and half years with the publisher before being published.

    This IS a very exciting time to be an author, and to be an indie publisher. It’s not all straightforward, though, and the whole industry needs to pull together to make the transition to a new world as successful as it has the potential to be.

    I talk more about this in my why-to guide on writing and getting published in 21st century. As all good books should be these days, Writers Gotta Write! is available on Amazon, Smashwords, and the Pear Jam website (www.pearjambooks.com), where you will also find great fiction from NZ authors.

    Yes, that is a shameless plug. But this is the age of digital publishing and digital marketing, and that’s what we need to be doing. Great offers you’re making on this front, Martin. If I can help in your mission, let me know!

    Jill Marshall

  14. Dawn Grant

    I’m one of the original Pear Jam authors and when my book High Speed was taken on by Jill, I never expected to come out in print. By this time I was disillusioned with the traditional print publishers and had decided to give up on writing. I could see that ebooks were the way to go but couldn’t see how I could join that revolution. Pear Jam Books got me dusting off an old manuscript and presenting it to the world. Read the dedication – I meant it! I thought bringing that book out as a print book was a mistake although it was nice to have the physical book in hand. In my opinion NZ authors need to get over the traditional print route and accept the digital revolution. Forget CNZ who only give out, in my opinion, cash to established or literary authors while ignoring the fringe writers who are neither well-known or writing that great NZ novel. When you do get a digital provider on board ie the recent Kobo prize -you get a digital book for distribution in NZ only-eh? There’s a big wide digital world out there. And is the prize winner going to be the person who has written the Great NZ Novel or the bestselling thriller that will knock Dan Brown off his perch? Remember now that it is the reader who is deciding what is hot and what is not. Opportunities abound for the writer and we have to be poised to take advantage of these but we no longer need to hold onto our dream of a physical print book in order to validate ourselves as a writers.

  15. Martin Taylor (Post author)

    Hi Jill

    These are three excellent points. I hope people do take notice of them because you’ve been putting in the hard yards over the past couple of years and these are things that can make a huge difference.

    1. Creative NZ. Agreed, the criteria applied by Creative NZ needs to change. Maybe this is another area where some of our most prominent authors will need to help break the barriers down, if they begin to actively support NZ-based indies as a first choice. Ebooks and pbooks need to be put on a more even footing. With half of fiction sales now digital in some genres, this should be a no-brainer.

    2. Industry promotion. I couldn’t agree more with the need for a collective way to promote NZ works to the wider public. They’re scattered and difficult to find across so many places. It’s really hard for our publishers and authors alone to break through the online clutter, and ‘discoverability’ is the lifeblood of online publishing. Online promotion was meant to be the heart of the Great NZ Ebooks project but somehow that got completely lost, and NZ lost crucial years and the early-mover advantage.

    It saddens me to think of where we are now compared to where we could have been in this most critical driver of publishing success. I’d always hoped libraries would play a central role in promoting our ebooks to Kiwis (and beyond, frankly) so maybe it’s their time to pick up the ball that the industry dropped? I sense a lot of goodwill and potential in this sector.

    3. Should print still define “real” publishing? It shouldn’t. You’re right, the emphasis is really about attitude and emotion rather than any commercial reality. It should diminish over time as authors experience digital success and start to see that readers actually care less about the packaging than the content.

  16. Martin Taylor (Post author)

    @Dawn, I wholeheartedly agree with your points about the global market – both the fact that we should now aim for it, and that we need to embrace genres that haven’t traditionally made it into print in NZ but for which we already have talented writers. Proof of this has to be that many of our best-selling authors, who’ve been selling to the rest of the world for years, are in genres like romance, crime, and fantasy.

  17. Sue Copsey

    Hi Martin

    Heck, I seem to have spent all my holiday weekend commenting, blogging, emailing and generally not being on holiday as a result of last week’s news about Pearson. Here we go again.

    As a full-time freelance editor working on Pearson school books, and as a Pear Jam Book author, I have worked closely for many years with both Anna von Veh and Jill Marshall. Both are hugely talented and think well outside the box, in fact I would say they are well ahead of the game as far as NZ goes – so we should pay close attention to what they are saying here.

    Jill’s model for a transmedia publisher of quality fiction was inspired, but it was never going to be viable without a good deal of investment and support, whether from business or CNZ. I have never understood why such support was denied by CNZ, given her championing of local authors. And we are not talking author wannabes here – almost all of her first (2011) list consisted of books by established and award-winning NZ authors who wanted to support Jill.

    The key thing here is surely government support, both for creative writing and educational material. If Pearson goes and we still want New Zealand textbooks written by New Zealanders, we need Ministry of Education subsidies, as small publishers will not have the resources to do this – NCEA textbooks are very costly to produce. And similarly, as Dawn and Jill say, CNZ needs increase support for small indie publishers who are nurturing NZ talent.

    Thank you Martin for getting this timely debate going; I look forward to reading what others have to say.

  18. Julie Thomas

    I’ve read the comments above with much interest. I’m a Harper Collins author and my first novel, “The Keeper of Secrets” is released here June 21st.
    I uploaded it as an ebook myself in September 2011 and sold 45,000 copies on Amazon and Smashwords before getting an email from Harper Collins USA. I worked extremely hard to promote my four ebooks on forums, book sites, guest blogs and on social media. When I started getting 5 star reviews, the novel started rising through the Amazon rankings to #1 for Jewish fiction, the only Gentile on the list.

    However, when I signed my Harper Collins contract in June 2012 I took it down from all ebook platforms. A year later, it has a slightly different title, a new cover and has had a line by line edit. It’s been out for three days and is selling well in the US and Canada as a trade paperback and ebook and will be released in the UK and Australia on June 13th. A Dutch publisher bought the rights for the Netherlands and there will soon be Russian and German versions.
    I have an agent, based in London, who is actively shopping the film rights, which I retain, and will handle the next book, optioned by Harper Collins USA. I’ve received a Creative New Zealand grant to write this and am currently working on it.
    I loved being a self-published author and would love to have had a NZ based publisher and agent, but realistically I wouldn’t have had this level of success with either. I have a 75,000 print run in the US for a debut novel. Harper Collins have been truly amazing to work with. There is room for both in the world of publishing.


  19. Martin Taylor (Post author)

    Julie, that’s a fantastic story. You’re right that there’s a place a publishers (and agents), especially when it comes to scaling up a book which shows potential, and handling the business details so you get more time to write. The fact that you were ‘discovered’ and contracted by the US HarperCollins rather than HC New Zealand shows just how much things are now changing.

  20. Tina Shaw

    Great article, Martin. I personally really hope that there will be a surge in local, independent publishers! As an author, I find these current times quite depressing – it has become almost impossible to be published in print – so here’s hoping that more passionate book people out there will look at setting up their own small presses, in the way that Steam Press has done, so that good New Zealand books can still be published in print. If I ever happen to win Lotto, that’s one of the first things I would do!

  21. Martin Taylor (Post author)

    Hi Tina
    The economics of print are extremely challenging. That’s one of the areas that I hope some of our best authors will be able to help. A couple of hits a year and a few backlist sellers could make a huge difference to an independent press, giving them a platform to build from.

  22. Dawn Grant

    Earlier in this blog, Jill Marshall commented on the lack of funding from CNZ and the obsession with print books by readers and authors and those that control funding. This week Pear Jam Books also closed – whether it is either of these two reasons that are to blame we will never know but the fact that she commented on it within this blog seems to suggest that this is the case. And why would you want to print when you can make a book available online to the whole world? I did that for the first time this weekend and I have never been so excited since my first book was published by Scholastic. A self published book still needs editing and proofing but a good book well written will always appeal, no matter what form it is in.

  23. Martin Taylor (Post author)

    @Dawn, yes, it was sad to hear the news of Jill’s closing Pear Jam. It’s understandable, given the challenges, which I think she spelled out very clearly.

    Jill, anything to add?

  24. Bev Robitai

    Just jumping back in on the print vs ebook question. There’s no need to sacrifice the book in the hand when Print on Demand makes it affordable anywhere. Of course, upload your book as an ebook to all the digital platforms, but don’t forget companies like Createspace that produce a library-quality paperback and instantly make it available via Amazon to any reader worldwide. The author can buy copies at cost to supply the local market and in small numbers to avoid that big upfront cost. Up to around 200 copies it’s cheaper to POD than print locally.
    Cinderella, you SHALL have your book in print!

  25. Dawn Grant

    Yes, I did exactly that over the weekend with my book In Too Deep and now awaiting the proof copy. While that is on its way, that same book is up for digital download on Smashwords and soon to be on KDP. I wouldn’t say it was easy first time around but it was do-able.

  26. Lis Sowerbutts

    As someone who has come new to publishing via website development and promotion, this whole publishing gatekeeper model appears about as relevant as the requirements for horse and buggy parking in modern urban planning.

    I think that a lot of authors in NZ are thinking way too small. I happen to be a NZer, but I don’t consider my books as “New Zealand” books – I don’t hide my nationality, but my non-fiction is written in English (US) and edited by American editors. That’s the largest market online at the moment, why would I aim at anything smaller?

    The only barrier I see to selling my books offshore is the weak US$, but that’s something that all exporters deal with. Certainly 99% of my readers neither know, nor care, where I live.

    Also we need to stop thinking about books as intrinsically related to their format – I self-publish in both eBook (several formats) and print-on-demand. I’ve only ever done a print run as a marketing experiment, books are printed as they are sold, not before. But that’s just the start of it – why would a static book be the best way to teach something like a lanugage or maths?

    That content should be in an interactive app, as well as, or instead of a traditional paper book. We no longer use slates in schools, and I suspect in another 10 or so years text books won’t be used in some subjects either – because an interactive app is just better fit.

    The current publishing industry is still struggling with the concept and development of eBook, 5 years after they went mainstream, I can’t imagine they are the ones to lead the app development for academic textbooks. I’d be looking for a gaming company to partner with for that – and New Zealand has some world leaders in that space.

    Now the app space is not nearly as easy to get into as say eBooks – anyone with basic HTML can program an eBook, or you can have it done for US$100 or less. But app development is far more specialized and, today, expensive. How long will it be like that? Oh I’d give a couple of years, maybe less.

  27. Anna von Veh

    Sue, thanks for the recommendation and your kind words. (BTW, if any authors particularly of non-fiction/educational texts are looking for a fabulous editor, Sue is one of the best.)

    I’m really enjoying reading all the comments above. There are some fantastic stories here.

    And yes, Liz, I agree completely re game developers. The problem of course for such a small NZ education market is cost. We need authors who will write for our NCEA standards and the local market. So we need to think of innovative ways to educate, ideally with smartphones in mind, but not necessarily app development until the costs fall. And as you say, that may not be too long from now.

    I have long been a proponent of also using the web, in some way, as a format for long-form narrative, to enable interaction with readers on a global scale. Ebooks are after all like “a website in a box”; a portable package. NZ ranked very low in the take up of ebooks according to an international survey done last year, but we are fast adopters of technology once the channels are made available. So I see this indeed as being a great time for authors and publishers to reach a wider market.

  28. Sue Copsey

    Hi Martin

    I would just like to make a further comment on the Pear Jam closure. Jill changed her business model after the publication of her 2011/2012 list, from publisher-pays to author-pays. (Author pays a lot.) Unfortunately she was unable to deliver the quality product her paying authors expected and paid for, and there are some very upset people out there. I’m not going to speculate on fault here – Jill set off with great ideas and a genuine desire to help authors, but with no capital and a business model that, frankly, had no chance of working.
    So I think we need to be very wary of these sorts of author-pays models. Instead, with NZ being a small publishing community, new authors should self-publish but join networks and co-operatives to get advice on how to navigate this new world, particularly in the area of marketing. (I have just started your courses Martin, and the online publishing one is great.)
    And thanks Anna for your recommendation – sorry guys if this is beginning to sound like a love-in!

  29. Teresa McIntyre

    If you haven’t already caught it, the Nine to Noon interview with Maggie Tarver from the Society of Authors is most interesting, and I rather like her suggestion of some sort of guild for self- and co-publishers.

    Maggie Tarver interview

    or go to Nine to Noon for Friday 21 June and scroll down to find.

  30. Lis Sowerbutts

    I heard that interview Teresa – I was a bit surprised by it – I’m a member of NZSA – and I hadn’t seen any discussion of this in their newsletter or emails

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  32. Jody Bloomfield

    Your comments about the ‘good news’ are interesting. I am a Kiwi based in Asia (home at the moment on holiday). I started my career in publishing working for Pearson Asia and these days consultant to one of their competitors.

    I agree – the global opportunities are vast. What interests me about your analysis is you say that foreign-owned publishers have little incentive to build an export industry in NZ. I am not so sure I agree.

    My experience is not that the publishers (at a global level) don’t want to develop an export-driven business in NZ, but instead that the people working within the NZ operations of the global publishing houses can’t or don’t want to see the opportunities and therefore don’t go after them.

    In 1999 I was asked to set up and manage the school import business for Pearson in Asia. The US and UK school publishing houses got in behind us and saw the opportunity to build an export business for their educational products across Asia, but I struggled to get both the Australian and NZ operations on board. In the end we built a very successful school import business in Asia but I could not get the NZ operation to buy into exporting to us.

    Many years later I did some consulting for another publisher looking to sell locally produced NZ books into Asia, but the stumbling block was the people working in that NZ publishing house and their inability to see the opportunity and take the risk.

    In my opinion, the opportunity to export has little to do with ownership of the company and more to do with the NZ ‘psyche’ towards taking risks, seeing opportunities and getting out of our comfort zone in markets like Asia. If we can conquer that, then you are indeed right, there is ‘good news’.

  33. Martin Taylor (Post author)

    Hi Jody. Good points. You certainly need an appetite for risk-taking to tackle new, international markets. Maybe it’s a lack of incentives within these organisations: Why take a chance if you can make your numbers and earn your salary and bonuses without going the extra mile? Or perhaps it’s a cultural issue, reflecting a more conservative approach with less inclination to think big. We might be happy being ‘comfortable’ rather than pushing hard for growth.

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  35. Adrian Keane

    Hi Martin, with all respect to Jody (who I don’t know personally), Pearson of 1999 has little resemblance to Pearson in 2013. The decisions taken by Pearson in relation to New Zealand were not specifically related to local performance. The Pearson NZ ebit was exceptionally good. The decision to close the New Zealand operation was part of a global strategic re-organisation which any rudimentary google search, try “pearson global strategy” will provide plenty of information freely available. To quote John Fallon the new Pearson CEO “This new organization structure flows directly from the strategy that we set out earlier this year. It is designed to make Pearson more digital, more services-oriented, more focused on emerging economies and more accountable for learning outcomes. This is a significant change in the way we run the company that will take time and sustained commitment, but it is one we must make to be able to accelerate the execution of our global education strategy.”

    As to export, Pearson NZ’s export sales since 2007 were the 3rd highest revenue earner after its domestic Higher Education and Secondary schools business. Pearson NZ was very active in pursuing Export opportunities and there were no disincentives or barriers to the company pursuing these.

    Its never an easy time to lose your job but knowing the calibre of the folks at Pearson I’m sure many of them will be instrumental in helping shape the future of educational publishing and content creation in New Zealand.

  36. Martin Taylor (Post author)

    Hi Adrian, all the best with Edify as the new distributor for Pearson in New Zealand. It was good to see a local business established from the Pearson exit.

    I saw the reference to Pearson focusing on ‘core’ and ’emerging’ markets (noted in the first par of this blog) when I read Pearson’s global results announcement back in March or thereabouts. At that time, it looked unlikely that NZ would be one of those markets, regardless of how successful it was in local terms. So it was no surprise things turned out as they did, and as you say, no reflection on the success of the NZ team. The size of the NZ market opportunity and its lack global importance was the driver.

    Notwithstanding Pearson’s export successes, I think that independent NZ businesses will have more incentive to invest in export. Typically, multinationals invest in New Zealand to reach its domestic market rather than to use it as a base to develop risky export markets.

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