The dot-com bubble has burst. The era of irrational exuberance is over. Technology spending is flat, and the recession is dragging on. What's a computer book publisher or seller to do?
"Follow the Nasdaq," advises Richard K. Swadley, executive group publisher for Wiley Technology Publishing Group. When the tech-heavy stock market is depressed, conventional wisdom goes, interest in computer books drops, too, Swadley explains. Conversely, when technology is hot, the need to learn about it rises, which in turn fuels the demand for computer books.
But the Nasdaq's recent dismal performance is unlikely to cheer anyone involved in technology books. Clearly, the halcyon days of publishers cranking out computer titles for a hungry public are gone. The category reached its apex in 2000, during the dot-com frenzy, and the number of titles published has since declined 25%—30%, estimates Brandon Nordin, group publisher of McGraw-Hill/Osborne Media.
Bookspan, which operates a computer book club, offers about 55 new titles per month now, compared to about 80 a year ago, according to Don Jackson, editorial director of Bookspan's Computer Books Direct. The reason? Fewer titles to choose from, Jackson says.
The short-term forecast is for continuing soft demand overall, Swadley tells PW: "Businesses are closely watching their technology budgets. Until the investment in technology increases, which is tied to an economic recovery, demand for technology books will remain fairly weak, like it is today."
Not surprisingly, books on Web-based business and Web site design have been the biggest losers. "The biggest casualties have been e-business and e-commerce books," says Nordin. "It was an overpublished category to begin with, and it totally collapsed in 2001—2002." Adds Jackson: "All the computer publishers were coming out with books about how to use the Web in your business, and most of those have disappeared." Similarly, telecommunications and networking titles shrank in number after the bust. "Osborne had significant success in this market during the Internet bubble, with a few titles exceeding a $1 million in sales," Nordin says. Once corporations began reducing their investments in telecommunications equipment, the market for high-end networking books, he notes, became "very challenging."
Gloom and doom aside, opportunities still exist for publishers and booksellers. Interest in digital photography, music, video and ways to use the computer for creative and personal reasons is on the upswing, which fuels the sale of books on those topics, says Luc Lambert, v-p of digital services for Gateway Learning, an educational division of the Gateway computer manufacturer. Gateway Learning currently offers five multimedia courses on subjects such as "Create and Share Digital Photos" and "Use Your PC to Explore Digital Music." Plans are to offer a total of 12 consumer course offerings by year's end, Lambert says.
As computers become more powerful and less expensive, consumers will be attracted to books about creative applications, such as Adobe Photoshop for image enhancement, and Apple's Final Cut Pro for video editing, adds Swadley. Among professional computer book categories, security titles are increasingly in demand, the result of growing concerns about viruses, hackers and cyberterrorism, says Jackson. Obsorne's Hacking Exposed series titles are among the computer book club's most consistently popular, he says—"After September 11, interest in computer security went up exponentially."
Books about network applications are another potential growth area, according to Tim O'Reilly, president of O'Reilly & Associates. "The dot-com bust is like the PC industry bust of the early 1980s," O'Reilly notes. "In both cases, there was a shakeout prior to the market's maturation." Network computing will become an important part of the Internet's maturation, he adds, driving interest in technical titles about XML, SOAP and other Web-based standards.
Despite the current hard times, some say that the computer book business is already starting to look up. "I think we've seen the bottom," says Jackson. Slowly, publishers are beginning to add new titles. As a result, the number of books available each month in Bookspan's Computer Book Club is creeping up again, he says.
"Right now, we're in a technology lull," says Nordin. "It's the first real break in a pattern of continuous technology innovation and adoption for at least 10 years." As technologies mature, demand often declines for computer books, which often results in an oversupply. That causes the industry to "start wailing about the death of the computer book market," he adds. "Then, the next thing you know, some hot new technology comes out, and the computer book category is seeing 15%—20% growth again."
