South korea, spain or australia. If you were to create a society with these companies you would have something that looks like the b. C. Him out of the matt damon movie. This year, when america wakes up to the fact that google, amazon, facebook and google are the biggest tax avoiders in the world offering 20,000 to store their eggs and offer battery eternity benefits, there and municipal Transportation Health benefits, dna testing, effectively economically through lobbyists they have achieved what the south was unable to do militarily, he effectively seceded from the u. S. And i think theres going to be a revolt against the. They decided they opted out of our tax and government system as they feel they can do it better on their own. So lets talk about amazon. We think amazon will decline in influence. That is why i was invited. I one of the few who believes that. Why is that . We dont believe pure play mono channel, retail works for anybody including amazon. The best example of this is 250 million in sales, raise money, billion dollar valuation at the end of 2013, 14 months later sold for scrap, declined 98. 5 in market capitalization. And i dont know how many of you use a fantastic Consumer Value proposition, giving you 100 of value for 80 bucks. Is great for everyone except shareholders. It cant work. The new Ecommerce Stores accessing cheap capital the consumer always wins. A great website great retail or great retail over the digital connected tissue between stores great web site and the consumer the answer is no. 3. I argue theres not a Single Company that is going to survive. We fail slowly over ten years. Pure play ecommerce does not work. For all the excitement and hype once the media falls out of love with magnetic founders and capital rise of these companies will be sold or go out of business. So they are opening stores. The number one most successful retailers in the history of business, apple in terms of economics number 2, parker just have tiffany, now opening stores. Retailers are not be funneled waiting to get disrupted by amazon. These are retailers additional brick and mortar retailers who grew Online Business faster than amazon this year. If you thought of innovation and stock reaching you would not think amazon has been the best return to shareholders, it hasnt. Macys outperformed over the past five for ten years. Has has nordstrom. Where it is amazon trying to establish competitive advantage . They made a multibilliondollar investment, trying to get 50 of americans between two to four hours. It is an extraordinary investment. They have tremendous ip around one click ordering. We believe the achilles heel in the amazon deal is the less investment. And shipping costs last year took in 3 billion and that is growing 40 year. That is not sustainable even for amazon. The last mile is too expensive for amazon with the current solution. When you look innovation in the payment space near catching up to one quick in things like apple pay giving us the opportunity, and we think that will erode their advantage. More often anything the Disruptive Force for amazon will give other retailers a solution for a fraction of the Capital Investment when i see hoover, it came to be in florida, i forgot my beach chair, and came back and was 4, gave my grocery list to the organic market, 12 bucks, we affectively at the post Office Without unions for collective bargaining, without uniforms and they buy their own trucks, becoming a vascular system to the business world. A private car service, the last solution for every retailer entity billions of dollars to create that solution. If you are visiting from out of town, take a taxi. They are going to die, they are the driving debt. This is the ratio of taxes tos in 2014, this is change in los angeles, miami, atlanta. Ready for this . Taxes are dying. They are going to go away. They make no sense. They offer Worst Service but are more expensive. The rise of the biggest trend in retail globally is we didnt realize consumers left the order to pick up and score. The biggest mistake including amazon is they opted for speed over convenience the consumer would rather go to fifth avenue and pick up their order when they want as opposed to getting home and finding out the listed on their door within an hour of ordering and they werent home. Convenience over speed, that is what stores offer even in france, not thought of as an innovative economy, 3,000 pick publications versus a year earlier. The future looked like me sees more than amazon. Closing a lot of Stores Opening new ones where they can justify reinvesting capital and fulfillment technology. It is a larger metaphor for what is happening in the economy. We are losing a lot of jobs to government, a typical middleclass jobs. You get into the information economy you have the right skills and never been a better time to be an american. If your anybody else it never is going to worst, there has never been a worse time, most of the job growth is the service jobs are basically 350 million serving 7 million lords in the u. S. We are turning into the middle class is going the way and theres a decent argument the middleclass the free market economy basically rewards the most productive people to an unbelievable extent at this is playing out in the labor markets. The ultimate destroyer of jobs, Technology Creates jobs, it doesnt. It destroys jobs. Google needs, and people for every 10 million in revenue, they need 50 or 60. Amazon needs 12 people, macys need 65. For every 10 million these Companies Growing revenue you will lose 40 to 50 middleclass jobs, they will grow 30 to 40 billion a year so you can take the meadowlands, Madison Square garden the rose bowl, pasadena, copywriters retailers, and give them a pink slip and say courtesy of amazon, google, facebook and apple, you are now out of business. Some predictions. Amazon will decline in value. It will be forced to make the transformative brick and mortar acquisition. I dont think theyre going out of business. They will be an enormous retail. They will buy gas station companies, we are used to driving in and out of gas stations and picking up stuff, the perfect Consumer Behavior compliment amazon, going into that place and picking it up and stopping for ecommerce companies. Lets talk about facebook. Facebook has redefined what it means to have a relationship or be a friend. It be defined the semantics of relationships. They also pull out the greatest data switch in history, they convince brands to spend tens of millions of dollars to build communities and put a Walled Garden around these communities in sages king you have to pay. It is 6 meaning one in 16 messages they send to their community actually reach them. Facebook sales represent assumed the organic reached is zero and forcing everybody to pay to access the communities they can pay the bill. I say that in a respectful way. It is the bait and switch. There probably the smartest supplier of companies in the country. Instagram, remember he sold that company. It is worth 40 billion. If you look at what it is, it is strong everywhere facebook is week. Facebook is the most Successful Company in shares of relationships in the history of business. Facebook is losing teams the instagram owned by facebook. The most Popular Social Network wealthy teens, you never hear any individuals and we are not interested in will be teens, theyre the future of business, most Popular Network is instagram. If you look it engagement rates by the percentage of community on a piece of content, by the community, it is the most powerful platform in the world. Some of the losers interest will be blown off the map the moment instagram announces pages where you can be your phone is you see piece of the interest to go to less than the one billion dollars. I wish was a public stock. It broke my heart, but the product, Image Management team going away. Twitter is oversheight and fantastic opportunity to shorten my view. Social media traffic actually converting to purchase, very low. Social commerce is an enormous head fake and twitter has been over. There are more advertisers on linkedin the and twitter. The last 7 years, tumbler, instagram, the last five years tom was purchased for more and instagram will be 1. 5 billion, Marissa Meyer never mentions tumblers in their earnings fall. Theres a quiet war between facebook and google and that is key to the war on line, to attach your identity to your specific actions so the company can sell more specific higher price dads to advertisers. Facebook is winning the war. We decided it is okay for facebook to attach actions to identity. We are not comfortable with people attaching our searches to our identity. We would rather people not know what we put in that box and attach it to an identity. That would make me uncomfortable. Crazy stuff goes in that box. As a result the only way google can attach identity is for g mail and google plus which the have the same attraction. Facebook was winning the war of identity. I want to have some customer content from here. In the board of the new york times, the first Board Meeting of this in recommended a shot off google, they are the enemy of all Media Companies. They quoted information that wants to be free but they fought intention should be sold to the highest bidder and a lot of Media Companies were totally blind sighted in the enamored with the cool kid who decided to be part of the pepsi generation to let google called a data and we debased content to slice it up and sell to the highest bidder when we got a bunch of cheap meaningless traffic. You would have thought we would have learned from this mistake. Theyre doing it twice with facebook, publishing on the platform in exchange for 100 of revenues of people dont leave the platform. Theyre doing it again, expediting their own demise. They want to be scarce and expensive. That is the future of great media and these have taken it for the second time. And they pulled the trigger again. What a stupid move. Facebook, 1 billion step identified catholics in the world, 2. 4 billion people have a relationship with facebook, the most successful product, religion, nation in the history of mankind. Sales facebook associates should go Something Like this. And twitter, tumbler or anything else a lot of awards, when you are interested in building a brand globally and i have more relationships and gone and i am on a mobile phone. We think google will decline in value, dominant share but new places to searches, there are a billion search query they on facebook 3 billion on google a billion on facebook. The cost per click is going down. Revenue and profits have stalled. Google didnt see the ship to the mobile economy happening as fast as they did. 80 of our time on mobile in apps and in air when we are less likely to search. We are moving away from Google Search by every time we spend less time on the desktop and move to mobile is bad for google. Google plus is that, harvested for its organs. Theyre taking its best features and incorporating to other products. People talk about youtube disrupting tv, facebook is likely going to disrupt youtube. There are more videos being up loaded to facebook native lee then youtube. That is a seminal moment in terms of the eco system. Google glass is not where rubble, it is prophylactic insuring you never conceive a child because no one will get near you. This e pmi is is how Technology Companies to for granted how difficult it is to get people to put something on their person and how meaningful is in our decision process about branded items. Berkshire would never have let this happen. Lets talk about apple. We teach luxury, it is a light corn and i cant describe it but they can recognize that. The touch l. A. What luxury is. An artist with a passion for a product. And iconic founder that embodies the product, the brand in a 3dimensional format that identifies you as a luxury player, and more than 50 of Luxury Brands are sold, branding moved through broadcast to the store, at the gap. It starts to put money into the stores from 96 to 2004, it used to be a Parent Company in the world, 7 billion to 4 billion. Your global Luxury Brands permeate cultural and geographic boundaries that is in any other grand because the most boring people in the world, smell the same. And middleclass people that different tastes. Rich people fly british airways, they are strikingly homogenous and boring and Luxury Brands have an easy time going global. You have self expressive benefits. And it is incredibly based the this is the key to shareholder value and the most successful industry in the world. If you look at the riches 400 in the world and take inherited wealth, more people from luxury and technology. A tremendous amount of irrational decisions translate to profit and margins based on what we are signalling to other people, self expressive benefiting. No one knows this better than Luxury Brands. This is not a time piece. It is my main attempted for masculinity to people i need and at the end of the day is really about signaling to females that children will likely survive and if you meet with someone with a swatch watch. This basic notion we dont like to talk how distinctive or how many books we read your how many subscriptions in the new or times or graduate degrees we have, has been for tens of millions of years, the primary source of the greatest Value Creation in the history of modern business, luxury of the last 20 or 30 years. Apple is the best luxury brand in the world now. You have partisanship, iconic founder, exceptional price point, the First Technology product in history that expanded its margins and matured. You have incredible vertical management, the most successful Retail Company in the world is a tech company, 13 years ago has blown out every notion of core competence. Apples core competence, seven including retail, incredible Global Management or associations across geographic boundaries but they are from the in luxury. We now know through the wash, only 3 things we do in business and we appeal to a three organ, the rational, these are bad businesses because rational decisions mean lowmargin transportation to Petroleum Service industries for survival. We appeal to peoples hearts, choosy moms choose just other species, we need to love to be loved how long you live, how many people in your life you are actively loving, new mothers to not die people take care of parents and live longer, that is the number one, how fat you are how skinny whar or how much you smoke or dont smoke but how many people in your life you love that how many love you directly related to happen is that dont live in the locker, some people you are taking care of. P n g figured that out and communicate to people if you watch kids detergent you love the more. Martians when the. We then appeal to reproductive organs, informed signaling to weather people buy more attractive, stronger, more interesting. These are highly irrational decisions. As you move down for so margins get better. Tesla is not an environmental car. It is a humble way of saying i can afford 140,000 car but i am groovy on granola. It is a way of signaling. Women will continue to buy 600 ergonomic the impossible shoes to solicit inbound offers from the simpson driving those teslas. That is the evolution of what is driving business right in all. Apple has migrated down the torso, rational decision used to be a better computer singing to our heart with music and now is the self expressive branch. Mobile operating systems in new york if you want to live in new york in and upper income household you own and apple. If you live in lowincome households in new jersey you own and enjoy. If you live in el a near the beach or Beverly Hills or South Central the inland empire you own and android. People think the apple watches the world market it is the death of the wearable market. They were more in 24 hours than in the entire world market in the first in the last year. The apple watch is not terrible, it is the Second Screen for your iphone and about the everywhere rubble company out of business. The first year of launching the apple watch is going to be the biggest box company in the world. This hurts everybody. King retailers have been wrecked by looking at problems at apple problems kids identify themselves with their phone these Companies Take a hit. The number of 300,000 product people can buy when you have to and to 20 billion consumer discretion of the eco system will be reduced substantially it feels there at the naval about brand or product problem. Some predict apple will be the first trillion dollar market that company unsuccessful migration down the course of the luxury end hit a wall. Lets summarize with amazon and google declined in value, facebook and apple will increase in value. My name is Scott Galloway and i appreciate it. [applause] i am going to go to introduce you to our panelists and we will jump into the discussion. To my right is my mentor and role model Dominique Raccah who is publisher of source book and the Largest Independent Book publisher in the u. S. And to my left i have gareth cuddy, Enterprise SoftwareCompany Providing ebook distribution, sales analytics and data to publishers around the world. Bethlam forsa from peers learning centers who oversees their k12 curriculum technology. Trip adler is ceo and cofounder of script a leading Subscription Service offering unlimited access to 1 million ebooks, audio books. To start us off i thought i would go back to the a word scott talk about in his presentation, the one that film these hallways with dread, amazon. Stock Scott Galloway sees weakness in amazon, potential achilles heel. I want to look down the table to trip adler. I imagine this is music to your ears. I think you also see that there may be weakness to amazon and i would love to hear your thoughts on that and bring us back a little bit as part of the day at that amazon has that is so enormous that it is sharing with no one and how that plays into amazons future. Definitely agree with some of the things that were said about amazon in that the whole idea that this one big store that appeals to every single vehicle of commerce make the little thin and there are opportunities for retailers who are attacking certain niches of the market in more specific ways to be able to compete with amazon. Amazon has a lot of books. We are generating a lot of online books and use that to deliver a personal experience for readers. We take all of the data you are using to read and we can offer a personal experience where the more you read the smarter the experience is. We can use the signals like the books, author genre what time of the day you read. We have human editors who go through the book and look at each book one at a time and pick out tags for the books. We can look at what the themes in the book are, the settings the page of the book and all of the signals recommend new books to you as a reader. We can lower the barriers in a way amazon hasnt been able to do. All of the data allows you to do a lot and i would like dominique to talk about what she is doing with the data and the personalization. I wanted to answer in part what you asked because scott made two other points that were interesting. Retail in bookstores is growing in the united states. That is probably a surprise but speaks to the point scott is making. There are more book retailers and they are growing and doing interesting work. And the omni channel is growing for us as well. We are working in an interesting space. It is between the content providers and actually the readers. We are creating books that are personal for you and allow you to put your childs game and image and actually creates Something Different. The copyright where someone owns that content and the reader. How to you want to be connected to Something Like star wars . Row do we create a new experience . That is the work we are working for. The thing i think is so shocking about this is data can changing the product we offer and how we create the product. You use this in education. And i think there is a lot education can learn and that can teach the broader book business. I would love to hear your thoughts on that. What are you doing that could apply to education . In terms of education we have gone through the process of transformation and we were known as a text book company and now more education solution provider. We are moving faster and more data driven. We had text books traditionally and all of the children were taught the same way before. What this has enabled us to do is to create a highly personalized pathway for students by leveraging data that is based on leverage technology. We are able to create a model where a teacher is not going to be able to touch every kid and require enhancement for those who are behind and some kind of intervention in the past a kid when was reading two grades below probably dont remember middle school, used to be pulled out and you read Something Different than the other kids. So everybody in the world would know you are not the leader. So today Technology Enables us to keep the kids reading the exact same text by leveraging Different Technology and sitting in the same classroom but those two or three grades behind which is normal in a number of schools, to engage them in that same. We use and leverage a lot of that data to create a prescriptive path that the teacher can leverage so they can create a learning path highly individualized for every child. We also are able to use the data so that you know, i need different help than you do and that enables us to do that. So is the feeling that the publishing indust reis resisting instead of embracing it. Harris wrote a piece urt a complacency taking thoefsh book industry and there is a lot of danger there. How do we make sure we are embracing data . You put out a wakeup call we need to embrace the new technology and innovations and what they can offer instead of holding back. I think i echoed something scott said because i think it is important particularly for the trade indust reand that is amazon pulled off the bait and switch move twice. They offer wider distribution new marketface and now amazon is dominating print space and able to dictate terms and same with ebooks. And the biggest problem is for trade publishers. They dont have the same likes in terms of what the end user is doing. It is very difficult to do that. I would like to think newer companies can share more active data with publishers because it is hugely important to allow them to make changes. We are a Technology Company first and Publishing Company second. We do this in two ways. We have 400 publishers using our platform so we can understand how to help them improve, and we can understand where they are stuck in the system and how they are engaging with our product and changes off the data. On the flipside we are getting the Sales Information of 400 publishers so we have an opportunity to use that data and give advice on optimized pricing for example. I think publishers will have to get to the roaders. Dominique has built a bran that is recognized and very few are recognized. I totally agree with gareth it gives you an incredible competitive advantage. We introduced a story called put me in the story and we knew we had a problem and enough data to tell us there is a problem with this book and we need a shift in delivering it. Having that data is useful because we think of changes quickly. And what is is especially amazing is the well known brands you are working with. You are working with star wars every sort of known brand that is out there brands people know. And you are also capturing data on them. So what is powerful is what you offer back as a publisher to all of these different places. I think scott spoke wonderfully about brands and relationships. If you think about the brooks we produce as a community, we have authors have remarkable relationships with readers and what we are doing is thinking about how to make that relationship more personal. And i think that will provide a lot of insight down the road. We are enjoying that. I think one of the points made about publishers being risk adverse i think that is true and afraid of new things to a certain extent. Which is remarkable for what in map ways is the riskiest many industry out there. You find ten projects you like back them, seven are duds and two might be okay and one is successful. They are afraid to do this sometimes. How do we avoid what scott talked about and Book Publishers dont go down the road newspapers went down and think Technology Companies are cool lets partner with them and give them the keys to the castle. I dont know if this is a benefit or liability. I know nothing about your industry. I see dominant players with 7080 percent of the share dealing with companies that are fragmented and that means you are going to be a price taker. You need to be radical and bound together. I felt at the new york city times we needed to go the the piersons the tribunes and bind together going to the two Search Engines and say none of our content of or all of it at an outrageous price. Unless you innovate radically and bound together you will suck the oxygen out of the room and industry. The problem is people are human and the older generation and i am making a plank statement about most industries used to make a great living now it is good and probably dont want to make a good living to make the requirement in the investment. They are coming after you, though. And you need to bind together and have some resemblance of power to go toe to toe with these guys and you dont right now. One thing in education to a certain extent that made a difference and also in this world where there is a democracy of content and content is being pubished by everybody. In our world someone says why do i need to buy text book i can write something, utit up and they can use it. The enforcement thing is the fact what we do is Research Based and ethicacy based and we are a very outcome driven industry. We are able to say i always say one of out of two kids in america learns how to do math using one of our products. We have the efficacy that enabled them not to have the disruption to a certain extent we are seeing in the trade books. The second thing is the direct relationship with our users; the children the learners around the different parts of the country and world. There are 15,000 districts in america and they are our customers and access our content directly. Yes, you can buy it through amazon apple and so forth but the vast majority of the relationships we have happen to be directly with our consumers. So i think that makes a difference as well. So kwlou so you have a relationship with consumers and are taking what they want and making that experience better. But you have to content providers as well. How doyou bridge the gap between the Old School Players that are resisting a lot of change and knowing what your customers want and giving it to them. We think of the pun publishers and readers as two different groups. On the reader side they get the deal of paying once and read whatever they want and forget about the concept of buying books going from the ownership model to the access model where they can open the app, be recommend books, tap on a book and read the entire book without a pay wall between every book they want to read. On the publisher side we tried to keep the Business Model as consistent as possible which is the individual sale model and pay publishers every time a book is read. Once a consumer hits a certain percentage of the book we pay the publisher. We are open to trying other models but that has been able to bridge the publisher and reader the most and we have been making it work. I think if you look at the industry i dont see any major innovation industry in 20 years. That is because the model worksed for a long period of time. Innovation is taking something and making it better. Ebooks are derivative of the physical book and dont enhance the story telling experience. I saw a major publisher stand this morning and one of their Big Marketing push is the e ebooks are available in full color and they have always been but the device was black and white. So there is no innovation happening there. There was a talk about Digital MediaSenior Executives and 70 percent of those senior level executives said they would forego short term revenue in order to have long term digital sustainability. I am not sure if you took the poll among publishers it would be the same. Radical innovation is where we need to be and that is what we are committed to. But i think the first path we took at things as an industry may not have been perfect. Okay. But the second pathway will be fabulous. If you look at the first pathway we took on the retail for example, to look at independent book stores are respect to google, that didnt work. But i think the next path may work. So i think we are iterating on innovation as an industry and creating really interesting stuff. I think you will see more radical innovation from us that you have seen in the past, probably in the next three to five years. Totally. I think there are Things Holding publishing back particularly fraid publishing which is the lack of data on the end user and also the lack of common standards that inhibit us because if you look at Google Facebook or twitter there is not a lot of original code. They are using other technologies out there. Totally agree. And you have fairly fundamental problems in terms of talking to one another that we dont seem to be getting past that need to be taken care of in tern terms of standards. Lets go back to data and dock about the power of data but the downfall. I want to know if there is a aha moment where you take the data and realize you can build the winning team . Is there the other side with the downside of having too much data or as one publisher told me this is great but i dont have the systems or infrastructure to do anything with it so what good is it to me. Starting with dominique i would love your thoughts on the power of data and the real downside that might be there. I think data is going to revolutionize innovation in Book Publishing and we are finding it used in every single part of our business. However, from my point of view there are two real downsides. The first is we have more data than analyst. As an industry we dont have enough competent analyst. We need them. Get training now. We are gathering a lot of data but also gathering a lot of noise so lets straighten that for ourselves. I think there is a statistic that 90 percent of the worlds data has been created in the last two years. It is astonishing. So when you approach big data questions you can do it one or two days. One way is symbolize it and come up with unexpected outcomes. I dont think that is unrealistic. But what i think publishers can do to minimize the impact of the noise is to try to answer the specific questions rather than worrying about all of the data being collected. In education you have data the analytical engine that is available on our platforms and the whole presentational level. We use the data to provide the teacher with the analytical dade data they use to help the students. So any data that is able to support learning becomes more powerful. And that is focused around the user interface, they dont have a huge bench strength where they can do the analysis themselves. So we really focus around the old user interface, analytics and presentation and it is easier and the teacher is able to look at something and use it affectively. To do that you need to invest in your infrastructure. Any downside . Anything you are getting too much data and it is counter productive . It is not it is counter productive because you need to understand what is noise and what is real data that enables you to use that from a prevent preventive perspective. Identifying atrisk children is early and saves the system money. How do you identify the right data . The key is not to be is to be very conscious of privacy. The district owns the data and has the access. You talk about the expensive infrastructure in technology you need to get. Chris are you using this and what are you seeing happening . We have a tremendous mount of data. Not just the books you are reading but even with how people read within a book. We know which pages you read which pages people read fast, slow, if people go to the end of the book before starting the book and we thought this was going to be a very Interesting Data set and were willing to share it with publishers but we have not seen wanting to do anything in theteresting with it. I would be happy to hear what the panelist think about this data we have that we are happy to share but unsure kwhautwhat to do with it. We have looked at the data and i am not sure what to do with it beyond giving it to authors who are very interested in who skipped to the end of the book and where people get stuck but we are not the content creators so it is hard to look at the data. This is probably talking about people coming to page and the Conversion Rate and no further image at all. We love that kinda data and that is the kind of data amazon has provided to marketplace people but not to Book Publishers and that would be fascinating to all of us, i think. Scott, you said you are an out sider with the most objective look. You have a sense of data that is being created in the book industry. Any sense of the watt the players should be should be doing . How do they not not let it go to waste or create value . You are generous. So the points have been stated we are a wash in data. We need intelligence. The nsa collects so much data and the cia plays a more valuable role distilling it down to one page every day for the president. That is the hard part. It isnt data. It is what to do with it. When i am sitting here i look role models. Find the most successful industry in content and try to duplicate it. Software we talk about what adobe did. They said we have the radically innovate and went to 10 a month and the revenue dove. This is the future we have to jump on the grenade and i wonder if the industry is capable of the leadership, fear and capital out there, to get together and offer a massive offering of a subscription bases on a low price that makes it irresist irresistable. It doesnt take a brain surgeon to see your Business Model isnt working. And this entire eco system feels like it is getting the crapped kicked out of it. Anyways i will stop there. I see dominique shaking her head. Scott we are not having the experience. It is not looking quite like that. But part of what you are recommending so you know is actually illegal. So which part . Lawyers in the audience are shaking their head yes. Which part . Getting together is called cohersian and we are not low aed to do that. In my opinion someone is going to aggressively test that. Your primary players have 90 percent market share. Google has 90 percent marketshare and what is amazon . 3040 percent of online commerce. What share of your industry . 60 percent. So to me this is going to challenge it. They get 60. They get 90. But we get in trouble above 10 . You want to know what to do with data . Show there is justifiable reasons for you to start speaking more loudly with one voice. From an outside perspective publishers are against changing the model. I agree it doesnt look like it will sustain but publishers are focused on a fixed amount of revenue from a big book. It is always focused on the book where bits of content we have and monitor in any way. Buit links back to the fact without common standards it is hard to monetize it. And i am just going to comment on one thing scott said he thought that amazon and other players were dominant in the industry and it would be beneficial for the books to be put in one lowcost Subscription Service. It can be done and it is not going to be done by the publishers coming together but there are independent parties doing this. And i am proud of the success we made in signing up public enemypublishers. This is the skyped of model that could shake it up. The terms with publishers are not sustainable from a business perspective. It will have to be a ship saying i expect a set amount for each book subscription or wholesale there is going to be have to be a shared thing where the vendor is slicing their part off top. There has to be a change in how we modify the content. We are publishers are not the determinant here. We are really not talking about the most Important Group of people who actually do determine what happens to content and that is authors. Authors and agents control content and it is while we are totally thinking to myself and totally open to radical Business Models there is a conversation about how it works for a model and on behalf of the su sustainability of the industry going forward. We are running out of time. Another thing for dominique in addition to authors and agents we should not forget the users to ultimately will be asking for different Business Models. There is a whole generation of kids growing up having a different relationship with technology. They are going to be expecting a much more flexible Business Model and the ability to interact with content in a different way that none of us have probably thought about. Very simply on that if you think about it for years information has been having to be found. You could not go to google as a kid. You had to go to the library. Google is successful in indexing that data. It is foreseeable things like the apple watch and whole movement about sending personalized data to people before they want it or are asking for it and how does that factor in the publishing world and getting your information to people in that fashion. Lets see if i can add one more thing. In our business that is called cure curerated content. Scott talked about the changes in terms of online commerce and social commerce and that future that is on not going to a specific site but rather having that content come to you in a specific way. I think we talked about the obstacle obstacles to business and changes we need and we are running out of time so i would like to close it off with pre predictions for the future. What do you think will be different . I would love to go down the line and here the big changes we are expecting in the next 510 years. Do you want to start us off . I i think subscription is going to be a big Business Model. I think if you look at other related spaces like video or music their description is important model. In video netflix 60 million subscribers and spotify with as a million subscribers. There is no reason that should not be in the book space. You think publishers will change the model or publishers will change or a dramatic shift in author power . What do you think will allow those changes to happen . I think it will just gradually happen over time. When we started in this direction over two years ago, every book publisher said no, and now we have a few thousand publishers signing up a new one every day. Four of the big fives are providing books in some form or another and expanding the number of books they are giving us. We have not had a single publisher put up books and take them down they only put occupy more over time. Tow so i think it is just a matter of time. What do you see . Your industry is education. But from what you see in education what do you think the trade book world is going to look like in five to ten words . I think for the trade industry a long time ago i used to say we all expected ebook to be growing faster several years ago and it took quite some time to get where it is today. I think our notion of book itself will be different in terms of how we present the content and the idea of having a variety of content. I dont know what i want frankly i say this is much better on what i want to watch rather than me. Similar to that is the notion of something highly personalized already telling me this is what you like model and using information much more than people who look like you, sound like you, read this thing. But a lot more data that describes me as an individual as a different level of granule using data and providing that information and getting around the issue of discoverability and realizing that is the book and content i want. I think that is where i believe a lot of the technology is going to be. Four really quick things. One i think mass market is going to disappear almost entirely. I think amazons share will decline not because of what they are doing but no regional and local sellers of content both physical and digital as well which makes it more complicated for publishers but more opportunities as well. I think Digital First publishers and author collectives and companies driven by agents will increase in popilarity lairpopilarity and they will have to move toward common standards. I see no two records are the same. It is not a standard. The ability to leverage like an atis and examples around big data that is critical to publishers security. Interesting. So first the obvious. Print lives on. 70 percent of books are print and i would be surprised if in the next five years it knows to 50. Retail brick and motor retail lives on. You mean see changes there and it will be interesting as they move their channels on to something interest. Online commerce big developments social commerce army retail google rethinking their search and retail platform so i am expecting all of that to take place. I am expecting a tremendous innovation in education. Those guys are really doing amazing work. I see some great work in potential publisher and i am interested in the space between content and reading and great work in social reading. Good luck. I will talk about my industry. I am in education. And i dont mean to be disparaging about your industry but i will be the man in the mirror test the way you know if you are about to be disrupted is if your prices increase faster than inflation. And in my industry we tripled tuition and my class is no different than 14 years ago. We charge students 6,000 to teach my class. 140 kids every night and every night we walk in it is 65,000. That is outrageous. It is moral issues because most of it is taken on in debt in these talented young people. It is having a huge ripple affect. My industry is ripe for disruption. And i dont know who amongst you does textbook but wow are you sticking your children chin up waiting to get clocked. Textbooks and education we are due. Anyway it will be a very interesting ten years and i appreciate your time. Thank you all of the panelist so much for being here. I want to thank bea and the Incredible Team that makes it happen and thank all of the audience members. I hope you have a great 2015 and lets see if we can make the exciting innovation happen in the future and make it work for us. So thank you. [applause] this is the inside of the Convention Center on the west side of new york. Book time is happening today. This is a book festival open to the public that follows the on the heels of the Bookexpo America and booktv has been live all week at the Bookexpo America and today we are taking advantage of the fact we are here and chris hedges has been invited on to talk about his most recent book coming out this month called wages of rebellion the moral imperative of revolt the first line in your book, we live in a revolutionary moment, what do you mean . I mean that is ideas that have sustained the old system of global capitalism, the idea that an elite accruing to itself massive amounts of money will somehow trickle down and make the middle class and the working class more prosperous has been exposed as a lie. The Political Institutions that continue that have lost their support and efficacy. Congress has an Approval Rating of 79 percent and we enter what the theorist describe as an inter a period we are lost place in ideas that create an Economic System but we have yet to find a vision on what should replace it. But the discon tainttent and sense of betrayal is there. In essence Corporate Power no longer concerns itself with the rights or grievances of citizens is wide spread. Would you see collapse of the Current System . Ultimately, yes. The system is not sustainable. Any time a small cobble takes power and a twist institutes power to serve their own end you can go back to airistotle you end up with revolt or tyranny. The austria empire because in rot until 1842 until the end of world war ii. They dont respond rationally to the needs of the citizens. It doesnt matter what the citizens want. No one wants wholesale surveillance but we get it anyway. Everyone is sick of the wars in iraq and afghanistan but they never end because they make a certain part of the economy, manufacturing arms, very wealthy. No one wants the trade agreements but they are ran through and are held in secret and our legislature are not allowed to speak about them. I sued obama over section 1021 of the National Defense act that allows the overturn 150 years of domestic law and allows you to strip people of their rights if they are deemed to be terroristmentterrorist. We won in the Fifth District court of new york and was vetoed by the president. We know it had a 97 disproval rating. These are symptoms of a state that doesnt work on behalf of us. And that ink i think really runs all the way across the political spectrum. If the state continues to ignore the legitimate suffering of the population despite appeals for a sensible reform then inevitablely it will trigger more radical responses that may lead to a confrontation between large segments of the state. When it comes and what is triggering it often times it is a crisis, but an economic meltdown, severe droughts in places like california, another act of catastrophic domestic