Bill would freeze new-book prices for two years

As Hebrew Book Week opens, publishers say deep discounting threatens their viability.

By RON FRIEDMAN
book week 88 (photo credit: Courtesy)
book week 88
(photo credit: Courtesy)
With Hebrew Book Week opening on Wednesday, MK Nitzan Horowitz of Meretz announced he plans to submit a bill that would freeze the price of books for the first two years after their publication. The proposal, modeled after a law in France, would help regulate Israel's volatile publishing industry and protect the earnings of authors and publishers, Horowitz said. Hebrew Book Week, which has been an annual event since 1926, is taking place under a cloud of publishers' deep concern over the continued viability of their industry, which has undergone a dramatic upheaval during the last 10 years. After decades of near-total dominance by bookstore chain Steimatzky, a new chain of book retailers, Tzomet Sfarim, entered the market, and has successfully challenged the 170-store veteran bookseller with an aggressive price-cutting strategy. The strategy worked. Tzomet Sfarim, which was founded in 2000, now has nearly 80 stores nationwide. But while consumers enjoyed the benefits of the competition in the form of cheaper books, publishers have suffered greatly. "The competition between Tzomet Sfarim and Steimatzky brought about this situation, where they began undercutting each other and fought between themselves at our expense," said Avner Fahima, owner of Korim publishing house, a medium-sized publisher operating out of Kiryat Gat. "As time goes by they announce another sale and another and another. In short, we're selling at a loss." Fahima said that over the last year, since the start of the global economic crisis, things have gotten worse. "They're slaughtering us," he said. "A book that we sold for NIS 40 last year, today we sell for NIS 15." Korim is not alone in its worries, Yaron Sadan, chairman of the Book Publishers' Association of Israel (BPAI) and director of Am Oved Books, is also concerned. Sadan argues that most publishers can't afford the discounts they are encouraged to offer. This system can't sustain itself over the long term and some publishing houses are already faltering. Sales during this year's Book Week are going to have to be pretty dramatic to be able to top the discounts regularly offered by the chains. With month-long promotions like "buy one and get the second for 10 shekels" at Tzomet Sfarim and "a free book for every book purchase" at Steimatzky, the publishers will have to be creative in order to compete. For their part, the bookstore chains credit the discounts for an overall rise in readership. Some 15 million books were sold in 2008, a seven percent increase over the previous year, as Israelis were buying more books than ever before. In an interview with Globes in January, Tzomet Sfarim CEO Avi Shomer said his chain made up for the discounts in prices by sharp increases in volume of sales. He conceded, however, that they'd reached the bottom in terms of discount viability. "In a country where 5,000 new titles were published over the last year, I don't know of a single store that can contain everything that came out, not even half of it," said BPAI director-general Amnon Ben-Shmuel. "The outcome is that the shelf-life of a given new book is measured in days, If it's not an immediate success, after a few days it will be transferred to the back shelves and then, not much later, will be moved to storage. "In effect, during this week, we open Israel's largest book store, where people can find many of the books that are no longer on the shelves in bookstores," Ben-Shmuel said. Ben-Shmuel, who is in charge of organizing Hebrew Book Week, said that events will be taking place for all 10 days in nine major cities and in a three-day format in smaller towns. In addition to the publisher's booths, various literary and cultural activities are scheduled to be held. When Masada Press publisher Bracha Peli first set up a booth to sell books on Rothschild Street in Tel Aviv in 1926, she established a tradition that lasts to this day. Over the years, as additional publishers joined her, the annual event ballooned from a day to a week; these days, the official events span 10 days and some publishers and stores have simply declared June "book month." Ben-Shmuel credits Hebrew Book Week events with raising public awareness and promotion of reading. "The very fact that you're interviewing me and writing about books is good news for the industry," he said. This year's festival marks two important milestones. The first is Tel Aviv's centenary and the second is the 70th anniversary of the establishment of the book publisher's association. Both milestones will be highlighted with special events scheduled for Kikar Rabin in Tel Aviv. Extended coverage of the publishing industry and its challenges will be featured in this weekend's UpFront Magazine.