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Israel recently introduced a Fixed Book Price law, bringing changes for publishers and retailers. Leading publisher Racheli Edelman reveals the new climate for publishing.

How is Israel's book sector performing?

2013 and (especially) 2014 were very bad years. We had a difficult, extended price war between the two chains that control 75% of Israel's book market. Most publishers were pushed by these chains to give higher and higher discounts and were losing money as a result. In February 2014 a fixed book price law came into effect, but the market only started to follow it from September 2014. At first there was a slowdown in the market. Then there was the Gaza war and after that one of the main book chains (Steimatzky) almost went bankrupt - its new owners forced most publishers to write off 30% of their debts.

What was the background to the Fixed Book Price law being introduced? What impact has it had?

Most publishers supported its introduction. Before the law, 66% of one chain was owned by two publishers. They used to focus mainly on selling their own books. They used their floor space to display their own titles, and give their sales people incentives to promote mainly their titles. The second chain had special arrangement with two other publishers and promoted mainly their titles. Now the law does not allow the chains to give sale incentives to individual titles, and requires the chains to display books from at least seven publishers.

The law gives publishers the right to fix the price of a book for 18 months. Every year, a publisher and a chain will agree sales terms for the next year, whereas previously, chains demanded new discounts each month. Publishers feel that the chain stores have been the main beneficiaries of the law (an unintended consequence). We will have a new government after elections in March, and the Book Publishers Association will lobby to change the law to limit the size of a discount that the chains can demand from a publisher.

Within this difficult context, which sectors of Israel's book market are doing best?

Educational books were not subject to the price wars and therefore have done OK. Children books are selling better than adult titles, although they suffer from huge price differentials.

People's reading habits are in constant change. Whereas years ago people appreciated more serious literature and non fiction, today there is more interest in commercial novels, in thrillers, life style, new age, and how-to books.

In order to promote a book successfully in Israel one has to have strong public relations embracing all channels – TV, radio, newspaper articles and interviews, social media etc, anything which gets people talking about a book (and hence going to buy it).

How are bookstores doing?

The chains seem to be doing OK. Independent book stores, which almost completely disappeared, are working hard to survive. We hope that in a year or so their situation will be better as a result of the Fixed Book Price law, and that once the market stabilizes new independent book stores will open.

How is the e-book market developing in Israel?

It's nascent. There are still problems in creating books in EPUB because of the Hebrew language (which reads from right to left). There are already several web sites that sell e-books and probably 1,000+ being sold, but the public is still reluctant to embrace e-books, even though they sell for less than print. E-books' share of the market is still roughly 1%.

What needs to happen to protect and promote book publishing in Israel?

Unfortunately, Israeli copyright law contains the American Fair Use clause, which weakens publishers' positions. The main pirates are actually the schools and academic institutions that scan and photocopy without permission or without paying the copyright owners. Attempts to reach an agreement with the ministry of education have failed. Publishers have sued the Hebrew University for piracy and got a compromise payment until 2017.From that year onwards new agreement should be signed.

The main things that need to happen now are that we stabilise the market through the new Fixed Book Price law, and that we fight piracy from within the education system.

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20 May 2020
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