Blackwell’s skunkworks fights digital interlopers

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Titles galore: Blackwell’s will eventually have 9.5 million books on its digital platform, but intends to start with ‘the right 10,000’, says digital director Matthew Cashmore

The biggest commercial threat to Blackwell’s, the academic bookseller, is not competition from giant online retailers such as Amazon, which have already forced long-established book stores such as Borders out of business. Rather, it is the small, innovative start-up companies that have gravitated towards Shoreditch in East London that are disrupting the way academic books are consumed, according to Blackwell’s digital director, Matthew Cashmore.

It is these organisations that the 135-year-old company is now trying to emulate, and it is not doing so by halves.

Blackwell’s has invested millions of pounds in establishing its own “start-up” company to develop its digital products, and it is based in a converted fire station in the very part of London where the disruptive technologists reside – “Silicon Roundabout”, or “Tech City”, near Old Street.

“Amazon isn’t a competitor in the digital textbook world – it doesn’t have the platform, the tools or the content,” Cashmore says. “Our biggest competitors are the start-ups around here, which are doing really interesting things with technology.”

Companies in the area include Flooved (recently moved to nearby Blackfriars), which provides mathematics and physics students with open access textbooks as well as lecture notes from professors across the world; Mobento, which collates educational video content for students; and 24symbols, a subscription service that allows users to read books online. Notably, Amazon has also opened its Digital Media Development Centre nearby.

“I knew we were going to have to be disruptive both to our own business model and to potential competitors,” Cashmore says of the decision to base his team away from the firm’s Oxford headquarters. “I didn’t think we could be as disruptive or as innovative in Oxford, within the mother business, as we could be if we came away and employed people not from publishing.” In the digital team of about 20, only two have a publishing background.

“I want to help, support and develop that start-up scene both for the cynical reason that we can then see what is coming, but also because I believe this kind of disruption in our industry is a good thing, and I would rather be in the middle of it than on the outside trying to defend against it.”

The product that the London team has been charged with developing is “Blackwell Learning”. This digital service, scheduled to launch in September, is built for university students and academics, allowing them to download and annotate e-books on their tablet, mobile phone or computer. It is a growing market. According to the UK Publishers Association, digital formats accounted for about 12 per cent of all academic textbook sales in 2012, compared with 5 per cent in 2010.

The service, which will be designed to integrate with universities’ virtual learning environments and learning management systems, will allow students to get books on loan or to buy texts, which can be annotated and shared with fellow students. Academics will be able to add their own notes to texts, and students using the product will have the option to see them.

Information outlets

It is a bold move for the company, which has long been associated with campus-based shops. However, it is these bricks-and-mortar outlets that Cashmore believes will be key to the success of the bookseller’s digital venture.

“All sales, even those made online, will still be assigned to a physical shop,” using postcodes and customer information, he explains when asked if Blackwell Learning will damage retail outlets’ sales figures. Also, he continues, “we are installing new tills with 14-inch touchscreens…in all our shops so [customers] can see the digital products [and] log in to their account. It is not a case of digital here and physical there. It is all together.”

Although he concedes that Blackwell’s has “significantly fewer” shops now than it did five years ago, Cashmore insists that there are no plans to use the digital platform as an excuse to reduce the chain’s number of physical outlets. “We are the only business with the campus presence that we have, meaning that our contact with lecturers and academics when planning their courses is second to none. We are also the only people who are really good at understanding which books are going to be needed when, and how exactly [they are] going to be used.”

With 9.5 million books on Blackwell’s website, the process of converting them all for the digital platform will take time – although it is hoped that tens of thousands of titles will be available when Blackwell Learning is launched.

“I don’t want 9.5 million books to start with – I want the right 10,000,” Cashmore continues, adding that the idea of having almost 10 million titles on a new platform “scares the bejesus” out of both him and the developers.

Along with Borders bookshops, high-street names such as HMV, Woolworths and Blockbuster Video have all struggled to cope with digital competition. Creating a multimillion-pound London start-up to spearhead its digital arm will be seen as a gamble by some, but Blackwell’s is determined not to be the next name on the list of retail casualties.

“We have, over the past five years, gone from losing millions of pounds to losing less than a million – by closing loss-making shops, developing a more flexible model and getting out of areas that were not profitable, such as library services,” Cashmore says.

He adds that it would have been “a perfectly legitimate business decision to continue to manage that decline” given that “we are a niche bookseller, and there will always be a space for that in the market”. But the company has chosen to throw the dice and take on the digital innovators at their own game.

“I’m on a knife edge at the moment,” Cashmore says. “In the darkest hour of the night, I am petrified about the launch in September. But when I get up in the morning, I’m excited because it can’t do anything other than succeed.”

chris.parr@tsleducation.com