The Price of Books
In fact, the report is a dud. This is confirmed by its facile suggestion that the government abolish GST on books. This shows the inquiry recognises the problem (that the ban on parallel importation has made books too expensive in Australia) but it fails to settle on the only sensible solution (the abolition of the ban on parallel importation). I make this prediction: there is no way the Federal Government will forego revenue from the GST on books in the tough fiscal climate it now faces.
The report acknowledges that publishers depend on a defective supply chain but it suggests that the government should somehow pick up the bill for improving it. Forget that. And they propose a Collaborative Council to oversee the process. Another industry body, more bureaucracy, more talk.
This is taking an industry to a whole new level of subsidy by Australian taxpayers without improving the supply chain efficiencies.
What a joke.
Here’s the better course. Let the market work. Allow Australian bookshops to purchase books from the cheapest source, an overseas or a local publisher. Liberate them to compete with overseas sites that don’t pay a GST when they sell books into the Australian market.
Australian publishers now recognise that their victory in late 2009 when the Rudd Cabinet voted narrowly to retain the ban on parallel importation was no long-term protection. There was Henry Rosenbloom of Scribe telling The Australian on the weekend the industry was in “a profound slump” because of on-line competition. Well, Henry, you were warned but you argued that opening up the market would hurt Australian culture. Where is the once-audible Louise Adler of MUP who argued that price didn’t matter when the works of Australian authors were involved?
The publishers got what they wanted – continued protection – and the results are in. Happy now, Louise? Delicious outcome, Henry? Bookshops have closed and Australians are buying fewer books. Good for authors? Great for the culture?
To conclude, here are three key points about this report:
• This report will not reduce the price of books and will not improve supply chain efficiencies to the extent required to keep customers coming into Australian bookstores (Prices stay up and releases will be 14 days after the rest of the world).
• The 14/14 day rule (assuming it is adopted by the industry) is internationally and locally uncompetitive. Makes no difference. It is an admission that the publishers have been wrong about this all along.
• Printers to receive even more subsidy. Hand out more money; it is policy bankruptcy when in the end all you do is ask for handouts.
A better solution: admit you were wrong and open the market.