Pearson to Install IBS Bookmaster in Europe

A recent press release from IBS, excerpted below, on the decision by Pearson to install IBS Bookmaster at sites in Benelux, Spain and Poland, Korea, Taiwan and Japan highlights what we see as one of the key competitive advantages of the IBS Bookmaster solution;

IBS Advantage: IBS with offices in 22 countries supports, installs & maintains their software with local staff.

"IBS has signed an agreement with Pearson, a leading international media company, for the installation of Bookmaster, IBS’ publishing and book distribution solution, in four European countries. The planned installation includes software, services and hardware with a total value of EUR 4.5 m.

Pearson, one of the world’s leading media organisations, first installed IBS Bookmaster, a software solution designed specifically for publishers and book distributors, in Australia in 1991. Today, the software is used in Pearson’s publishing and book distribution operations in Australia, New Zealand, Hong Kong, Singapore, Malaysia, India and South Africa, with Korea and Taiwan scheduled to go live in 2008 and Japan in 2009.

Based on Pearson’s positive experiences from their relationship with IBS in Asia, Australasia and Africa, Pearson has decided to expand the installation of the software to include four additional locations in Europe including Benelux, Spain and Poland. In total, 260 concurrent users will use IBS Bookmaster, which covers everything from editorial and book production, to distribution, warehouse management, e-commerce, business intelligence and royalties."

Production Scheduling for Book Publishers

When I walk into a publisher, the most frequent question is what production management tools are available for publishers.

The book publishing specific tools - such as those offered by Klopotek for publishers with sales over $30M USD, Vista or Quality Solutions are often too expensive or hard to customize.

The one tool that small and mid-sized publishers use most often is FileMaker. FileMaker is an affordable database program designed for ease of use and the software that we recommend to small and mid-sized publishers looking for a solution that they can customize to meet their needs.

At http://www.filemaker.com/solutions/customers/industry/printing_publishing.html you can find stories about publishers that use FileMaker.

These include; Harvard University Press (a scholarly and trade publisher), Rebus (a medical publisher), and Holt, Rinehart and Winston (a text book publisher) .

IT Security - External Threats #2

One of the biggest threats to security occurs when managers access their corporate systems from remote PCs, which may or may not be secure.

Currently, we are recommeding that employees of our larger clients use an IRONKEY usb flashdrive with hardware security and 128 digit encryption to initiate all remote accesses.

Why?

"It starts with the onboard IronKey Password Manager. As you visit your online sites, the Password Manager will ask you if you want it to remember your usernames and passwords. These are then stored with hardware encryption on the IronKey drive.

When you wish to log back into one of your accounts, the Password Manager compares the website that you are visiting with the website where you originally entered your password. If they match, the Password Manager enters your password for you without you having to type it in. If they do not match, then you may be on a phishing site, and the Password Manager will not enter the password for you.

This gives you simple but effective protection against phishing attacks and spyware that tracks your keystrokes."

IT Security - External Threats #1

Recently we reviewed the IT security systems for a publisher, who shall remain nameless, that had just undergone an audit by a CPA firm. The CPA firm overlooked a major hole in the publisher's management information system (MIS) security.

In our experience, 95% of security threats are internal (employees of the company) and 5% are external (hackers, viruses and worms).

ERP solutions, that store data in encrypted files are relatively secure against external threats provided that the external threat (i.e. hacker) can't gain access to a user id and password that allows access to the system and the user id that allows access to the ERP software.

At this publisher, we found that although the internal systems were secure managers who accessed the system's web site interface remotely were often doing so via systems that had expired internet security and firewall software or in two cases had turned off the security software on their laptop (as they said that it slowed their internet access).

With the security software on the external laptop turned off or expired, it would have been relatively easy for a hacker - perhaps using keyboard logging software - to obtain a copy of the user's userid and password as he entered it.

IT managers need to review and secure external internet access with an integrated set of policies, procedures, software and hardware designed to protect the company's property and customers.

New Software Vendors - Risks and Benefits

Looking at a new software vendor, a vendor with a small but growing customer base?

At Kensai International, Ltd. we tend to prefer established vendors with a customer base of 100 or more publishers, that said solutions from new vendors usually offer unique advantages over that of more established vendors.

These advantages include;

a. Features not offered by their larger competitors.

Example, iPub ( http://www.ipubtech.com/ ) and HiPoint ( http://www.hisoftwareinc.com/ )solutions offer integrated EDI processing, a feature for which some competitors charge $15 to $25K.

b. Newer Technology

New vendors are more likely to have software built using the latest software development tools.

c. Lower Pricing

With newer solutions that have a small customer base there is a risk that they will be here today and gone tomorrow.

To evaluate this risk we recommend that a publisher consider three factors;

1. Is their customer base growing?
2. Can they cover their operating expenses?
3. Do they have "glowing" references?

SAP Book Publishing Software

SAP's book publishing software offers two unique advantages when compared to other solutions.

First, it offers the most highly customizable software solution available for book publishers that want a customized solution. When Random House realized they a customized rights solution for their unique needs they were able to construct a customized solution in SAP. Standardized software for larger publishers; such as IBS Bookmaster or Klopotek, does not offer this flexibility.

Second, SAP is multilingual. Workstations in Japan, Germany, United States, Russia and France can access a centralized database in their own language. This feature allows a multinational publishing company to standardize their operations around a single solution that provides management with real time information on their global operations.

That said, in our experience, SAP is best suited for large book publishing companies with sales or $100M+ USD. Why? In the past we have suggested that multilnational publishers with sales of $30M to $75M contact SAP. SAP was not interested in dealing with them, and recommended that they seek other solution providers.

Cats Pajamas Signs 4 New Contracts

Four publishers selected the Cats Pajamas software offered by the Media Services Group.

The publishers are:

New York Botanical Gardens Press, the largest publishing program of any independent botanical garden in the world.

Smithsonian Books which will use Cat's Pajamas to calculate and process rights and royalties.

Kumon Publishing North America, a subsidiary of Kumon Publishing Corporation, an educational publisher founded in Japan in 1988.

Eastern Washington University Press

Bookmaster Selected by EMC Paradigm Publishing

PRESS RELEASE

IBS North America, March 15, 2007

EMC Paradigm Publishing signs a software license agreement for IBS Bookmaster software.

EMC Paradigm Publishing, which recently celebrated fifty years in the publishing industry, has signed a software and services agreement with IBS to install the world-leading software suite for publishers – IBS Bookmaster. The new system will include financials, book production, inventory control, warehouse management, subscription management, royalties and retail management.

“The IBS Bookmaster software suite will help take our publishing business to the next level, while making us more competitive and more efficient,” states Pat McKeown, Director of Information Systems, EMC Paradigm Publishing. “We are especially looking forward to the Book Production Module that will be able to track our process from inception to final printing. Throughout the evaluation process, we felt that the IBS Bookmaster software was the most comprehensive of all the software applications we looked at.”

About EMC/Paradigm Publishing

For more than 50 years, EMC Paradigm Publishing has been committed to developing quality educational materials and providing personalized service to educators. Their School Division offers textbook programs in World Languages, Business Education, Literature, and Language Arts with supplementary and multimedia materials. The College Division offers textbook programs in Computer Technology, Allied Health, Accounting, Office Technology, Distance Learning, Staff Development and Biotechnology with supplementary and multimedia materials. EMC has customers throughout the US and Canada.

Acumen Rights Management Module

The new Acumen Rights Management Optional Module enables you to manage rights submissions and contracts, and increase lucrative subsidiary rights sales. Subsidiary rights sales provide the benefit of leveraging existing intellectual property into other industries, geographic regions, and languages.

While the core ACUMEN system provides basic support for rights sales, the Rights Management Optional Module builds on the basic rights features by integrating Submissions, Customers, CRM, Regions, Products, Invoices, Accounting, Royalties and Cash Receipts into a full-featured system that enables you to manage all aspects of rights submissions and contracts—from the initial contact to the signing of a contract and receipt of royalty payments.

CyberWolf Inc. has been helping publishers grow since 1990 and is used by over 180 publishers. To learn more about ACUMEN Book®, visit www.acumenbook.com.

Sales Channel Statistics: 2006

The Wall Street Journal of March 22, 2007 reported that book sales by sales channel for 2006; according to R.R. Bowker LLC, were:

• 38% - Traditional Retail
• 24% - Library
• 18% - Non Bookstore Retailers
• 13% - Online
• 05% - Book Clubs
• 02% - Direct publisher to consumer sales

Lerner Books Selects Global & Klopotek

Press Release from Global Turnkey

Minneapolis-based Lerner Publishing Group, specializing in educational books for K-12 markets, has selected Global Turnkey Systems (GTS) as its publishing solution provider. After an 8-month review of solution alternatives, GTS – a division of Klopotek – was chosen for its range of functionality and professional team. The full spectrum of software from GTS’ UNISON and Klopotek product lines will be implemented to handle Lerner Publishing Group’s publishing lifecycle, from acquisition through distribution. Having recently merged with Klopotek, GTS is able to offer Klopotek’s industry-leading front office solution for title management, production and rights management. GTS’ UNISON product line covers the sales, distribution and accounting needs of Lerner Publishing Group’s back office. Lerner Publishing Group’s distribution center operations will be streamlined and automated through the implementation of GTS’ newest integrated module: Warehouse Management.

Adam Lerner, CEO of Lerner Publishing Group, stated, “GTS offered us the back-end system we need to meet our strategic goals in fulfillment and distribution. With Klopotek we’ll have a fully integrated publishing system, from planning to shipping. As an independent publisher, we look for strong and long-lasting business partners. The collaborative approach GTS took right from the start has been impressive. The addition of Klopotek made this an ideal solution for LPG."

Margaret Wunderlich, VP/CFO of Lerner Publishing Group, stated, “The integrated solutions from GTS and Klopotek will help us streamline our publishing process and gain valuable efficiencies in our distribution operations, while establishing a platform for growth that Lerner Publishing Group has planned for the next several years. The GTS team shows a strong depth of knowledge of the publishing process and is able to understand the unique requirements of our environment.”

Media Services Opens Office in Brazil

Media Services Press Release:

"São Paulo, Brazil - February 9, 2007 - The Media Services Group, a leading provider of integrated publishing and event management solutions, recently announced the opening of a new office in Brazil. Based in the city of São Paulo, MSG Brazil will sell and support a number of core software applications that have been translated into Portuguese and adapted for the Brazilian marketplace, including the latest releases of Ad Manager, Sales Prospector and Right & Royalties.

"The publishing market in Brazil has grown significantly over the past several years and we see a number of great opportunities here," explained Frank Skwirut, Vice President of MSG Brazil. "There simply aren't many software options for Brazilian publishers looking for flexible and dynamic business systems. Our value proposition is very simple: Better software means better business."

Founded in 1985, The Media Services Group provides integrated software solutions and related services to publishing and event management businesses worldwide. Software modules include Book Publishing, Circulation Management, Directories Publishing, Membership Management, Advertising Management, Event and Conference Management. Offices in: Seattle, Santa Monica, Phoenix, Houston, Stamford, Toronto, London and São Paulo.

What is a 1+1=3 Acquisition?

We classify a book publishing software vendor's merger or acquisition as a 1+1=3 if it has a dramatic effect on the sales of the vendor's publishing software.

Example: 1+1=2 Acquisition

The Media Services Group Ltd's 2005 acquisition of S3 Pubtech; and its CisPub book publishing software product line, complemented their existing Bookworks product line, increased their customer base among book publishers & distributors, and improved technical support for existing customers; however, it has not lead to increased rates of sale for either book publishing software solution - CisPub or Bookworks.

Example: 1+1=3 Acquisition

International Business Services' (a $300M+ company) 2005 acquisition of TMS ($10M+ company) and their Bookmaster book publishing software dramatically increased the sales potential of Bookmaster. The number of new clients signed up in the United States has greatly increased since the merger and Bookmaster is now supported and sold by IBS offices in 22+ countries. The software is being extended to support the Spanish language, and support for additional languages is forthcoming. This merger has the potential to quadruple the sales of Bookmaster.

Vista Merges with Ingenta PLC

In February Vista; a leading book publishing software provider of ERP solutions, merged with Ingenta, a provider of online publishing services to form Publishing Technology PLC, a publicly traded company listed on the London Stock Exchange AIM market.

"Publishing Technology plc will employ approximately 180 people across North America and Europe. The company will have over 350 publishing customers, including eight of the ten largest publishing houses in the world, such as Hachette, Random House, Penguin, and Reed Elsevier and, unlike large international ERP providers, the company will deliver configurable publishing-specific software solutions tailored to its clients. The company will also have 1,000 academic and corporate research library clients, such as Louisiana State University Library and Glaxo SmithKline’s research library, and a number of multilateral institution clients, such as the World Bank, the IMF and the OECD."

Our conversations with the employees of Vista revealed that both companies are truely excited about the merger. The employees talking about developing new products and marketing campaigns that build upon the strengths of both Ingenta and Vista.

From our perspective, the Vista-Ingenta merger is unlike any of the other recent mergers in the industry as it has the potential to truely grow the size of the market for both product lines. A true 1+1=3 merger.

Oxford University Press Implements SAP IPM

At Book Business Expo 2007 we learned that Oxford University Press is implementing the SAP Intellectual Property Management module.

The SAP IPM module's functionality covers rights management; including rights availability tracking, and royalty accounting.

From our perspective, the key advantage of SAP IPM is that the publisher can extensively customize its functionality and user interface to meet the "unique" needs of their publishing house.

Software Selection > Programming Language Evaluation

Any software selection process should include a review of the application layer; programming language, that drives the software and the financial strength of its vendor. An application layer supported by a profitable and growing company will facilitate future improvements to the software.

At Kensai we rank the application layer on a scale of 1 to 5, with 5 being the highest rank.

Example 1.

One publishing software vendor uses Unify Corporation’s Vision product as its application layer.

A visit to the application vendor’s website; http://www.unify.com/, (on Feb 25, 20007) revealed the following;

• For fiscal year 2006 ending April 30, 2006 Unify reported total revenue of $11.2 million, compared to $11.3 million in the prior fiscal year. Net loss for the year was $682K compared to $2.4M in the prior year.
• For the first six months of fiscal year 2007 ending October 31st, total revenues were $3.9 million, a decrease of $0.9 million, or 19 percent from fiscal 2006 six-month revenues of $4.8 million. Year to date net loss from all operations was $941,000 or $0.03 loss per share, compared to a net loss of $107,000 or $0.00 loss per share in the comparable period last year.
• The Vision product does not appear to be the primary focus of their R&D efforts.
• They have offices in the UK, US and Paris.
• They have 60 employees.

Based on the above information we would assign a rank of 1 or 2 to the application layer. Why? The vendor's sales are declining, the company is losing money, the application - Vision - is not the primary product of the vendor and they have only 60 employees.

Example 2.

Another vendor uses Microsoft .NET VB as their programming language.

Based on this information we would assign a rank of 5 to the application layer. Why? Microsoft is the world's largest software company, the .NET initiative is a major focus of Microsoft, and there are tens, if not hundreds, of thousands of programmers and businesses that use this programming language.

Vista Acquires Ingenta

Wow, Vista - a leading supplier of ERP systems to large publishers - acquired Ingenta; a distributor of online products, in a reverse merger to form a new company called Publishing Technology Plc.

What does this mean?

1. Vista is now a publicly traded company on the London Stock Exchange's AIM marketplace. As a publicly traded company it will have access to the capital markets to fund future growth via acquisitions or increased R&D spending.

2. Vista is now a provider of distribution software for both printed and online products.

3. Access to Ingenta's 266+ publisher clients will likely facilitate increased sales of Vista book publishing software in the future.

4. Vista, now a $33M USD publicly traded company (based on Pro-Forma financials) has increased its competitive strength vs. Klopotek (a $23M company) and IBS Bookmaster; its two main competitors.