Skip to main content


CREATe Public Lecture report: ‘Digital Disintermediation and Efficiency in the Market for Ideas’

Posted on    by Admin
BlogPublic Lectures

CREATe Public Lecture report: ‘Digital Disintermediation and Efficiency in the Market for Ideas’

By 26 March 2020March 18th, 2021No Comments

Report by Kenny Barr (Research Associate in School of Culture and Creative Arts, University of Glasgow)

On 5th February, Dr Christian Peukert (Católica-Lisbon/ETH Zurich) gave a CREATe Public Lecture on the effects of digitalisation in the book publishing industry. This was part of the work stream on Intellectual Property and Business Models of the AHRC Creative Industries Policy & Evidence Centre (PEC).

A CREATe Fellow from a disciplinary background of applied economics, Christian is interested in questions related to how digital technologies affect firms, consumers and markets, particularly from an innovation perspective. In tackling some of these issues in the contemporary book publishing realm, the talk touched on many themes that permeate the discourse around creative production and copyright markets including: primary creators operating on the margins of the mainstream industries; barriers to entry; the role of gatekeepers; and democratisation.


The speaker opened by invoking Joel Waldfogel’s idea of a “digital renaissance”, suggesting that, after a period of relatively modest negative effects induced by online piracy, the opportunities digitalisation presents to the content industries have largely ameliorated the challenges. Of course, the first part of this proposition remains contentious within the industries lobby where online piracy is characterised as an existential threat not only to their business, but also to the continued supply of creative works. Moreover, the industry lobby often contend that recent growth in digital markets is merely restoring what was lost during an era of disruption and turbulence. Rerunning such debates was not a matter for this talk, of more significance to the speaker was the extent to which the book publishing sector has harnessed the opportunities provided by digital technologies.

Historically the barriers to entry to many spheres of creative production were high, for example film production, the recording industry and book publishing. The traditional book publishing industry was, and continues to be, characterised by high fixed costs of production, distribution and marketing. In this environment, publishers occupy a strong position as ‘gatekeepers’ controlling the relationship between creator and audience. Crucially, to a large extent they decide what authors’ works make it to the mainstream market. The oversupply of creative labour in relation to opportunities offered by intermediaries like publishers is a feature of most copyright-intensive industries: ‘many are called, but few are chosen’.

In a marketplace dominated by powerful commercial gatekeepers, where predicting success is hugely speculative and commercial failure is endemic, the bargaining position of primary creators and small-scale producers is said to be very weak. This has close allusions with the issues discussed in an earlier CREATe public lecture by Naysun Alae-Carew, looking at the TV production sector where powerful intermediaries such as public service broadcasters and new-entrant subscription video platforms wield disproportionate bargaining power in their dealings with smaller producers.

The advent of accessible digital technologies has led to predictions of a so-called ‘disintermediation’ of many industries. These accounts suggest that lowering barriers to entry, largely by way of the reduction in attendant production, marketing and distribution costs, has allowed creators and consumers to circumvent ‘gatekeepers’ such as publishers. The speaker noted that digitalisation has resulted in a great many more products coming to market, not only books but also movies, songs and new forms such as user generated videos.  It is at the confluence of ‘old world’ and ‘new world’ that Christian sought to make an intervention by interrogating the extent to which the proliferation of new technologies and business models had altered the book publishing market.

The history of copyright is a history of technological and business model innovation and the speaker identified two key examples of this in the contemporary setting: the proliferation of e-reader hardware technologies such as Kindle and iPad, coupled with business innovation driven by digital platforms like Amazon and Lulu. The study reported here drew on a sample of nearly one hundred thousand book and rights deals involving in excess of fifty thousand authors between 2002-2015 taken from a publishing trade website PublishersMarketplace. These deals were categorised according to their financial value. Contemporaneous sales data gathered from Neilsen Bookscan was used to gauge commercial performance. This methodologically innovative and ambitious research design sought to test a number of hypotheses relating to: notions of technologically-induced ‘disintermediation’ of the publishing industry; the extent to which the democratising effects of digitalisation have improved the bargaining position of primary creators; and broader questions around the overall efficiency of the market.

The main findings reported here were that:

  • Self-publishing has indeed allowed more authors to publish works and a greater variety of titles to come to market. This is far more pronounced in the USA than in Europe, illustrating that national markets retain distinct characteristics. However, this is skewed towards the Romance genre, in terms of overall volume and commercial success. In the traditional market there is no such skew.
  • License fees for authors have increased, suggesting a redistribution of income from publishers to authors. This speaker more tentatively advanced the argument that this is potentially offering an increased incentive to create.
  • In a sector where the number of commercial failures far outnumbers successes, publishers have become more accurate in predicting the appeal of new works.
  • It was argued that this increased efficiency in prediction of appeal since the emergence of online publishing has, on balance, proved reciprocally beneficial to traditional publishers, nascent digital platforms, authors and audiences.

The talk was followed by a probing Q&A that interrogated the findings reported. As one member of the audience suggested, the dramatic increase in the number of titles available could possibly drive down prices. It could follow that while the overall market may have grown, individual authors may not necessarily be able to carve a living from their creative labour. The speaker recognised that self-publishing offered opportunities both for niche creators whose work might otherwise not make it to market, and also for established writers who had built a bankable brand and could operate without the underlying infrastructure and investment offered by traditional publishers. Less clear is what this new digital environment means for creators operating between these two extremes. Furthermore, the extent to which larger fees for licensing serve as an increased incentive to create remains one of the most contentious issues in copyright discourse.

Overall this thought-provoking lecture provided valuable insights into the relatively new sector of self-publishing and considered the potential ramifications for creators, investors and consumers in the wider publishing sphere. Moreover, it served as an exemplar for researchers seeking to conduct research into creative production across copyright-intensive industries. Empirical studies of this type that draw on quantitative datasets relating to ‘real-world’ transactions between creators and commercial intermediaries operating in the contemporary industries are particularly timely.