Lonely Planet: This is Not the End

not-the-endCommenting on the affairs of past employers is bad karma, but the media circus surrounding Lonely Planet’s recent restructuring, with Skift’s hash of disgruntled misinformation and the Guardian’s premature obituary, is sufficiently misguided to warrant an unsolicited opinion.

Lonely Planet is and has always been a print publishing operation. Despite their carefully cultivated hippy-dippy image, the Wheelers ran a tight ship and LP was known in the industry for being able to produce and distribute more guidebooks of higher quality at a lower cost than anyone else in the business. This was achieved by a relentless focus on tweaking the publishing machine, and during my time there were regular mini-celebrations for (say) switching to a new printer that allowed cheaper color pages or trimming editing time by 10% by automating tasks that were previously done by hand in layout.

Yet being a print house left the company unprepared for the digital era, and despite its early web presence, it never seized the chance to become Expedia or TripAdvisor. Two anecdotes illustrate why:

Industrial History Museum, Merrickville, CanadaEarly on, one of the publishing execs was taking me through The Spreadsheet, which forecast in minute detail and often with stunning accuracy how much a book would cost to create and how much it would sell, taking into account everything from the cost of public transport in the destination to the impact of upcoming titles from the competition. Offhand, she remarked, “I don’t think we should be investing in digital until its revenues exceed print.”

Taken at face value, this seemed absurd. How would digital ever grow without any investment? Only later did it dawn on me: “investment” for her meant doing what the spreadsheet measures, which is putting money into books. Digital revenue would come anyway from e-books, which would be faithful replicas of print books, and once the magical 50% tipping point was reached, they could start by adding video clips of the Eiffel Tower to page 294 in the e-book.

But what if people don’t want e-books?

Later on, I mentioned the travel potential of Google Glass to one of the people in the product development team, responsible for dreaming up Lonely Planet’s future products. “Yes!”, he enthused, “just imagine if somebody wearing Glass looked at our guidebook, and they could see the latest edits superimposed on top!”

But what if people stop buying printed guidebooks?

Mind you, these were both consummate publishing professionals who live and breathe print. So at the end of the day, even though they and others at LP knew in their bones that print was falling, and that e-books and apps weren’t making up the slack, they simply didn’t know what to do about it, other than to cut more costs and churn out more books.

The new CTO Gus, on the other hand, does. LP’s asset is its independent content beholden to no-one, which drives its website and its brand. Despite debacles like BBC’s catastrophic mismanagement of Thorn Tree, at 100m+ visitors/year LP’s digital footprint remains head and shoulders above its print competitors, and its vetted content has no match (yet) elsewhere in the digital world. What’s more, they’ve already spent years putting in the hard yards to bring their technical backend up to speed as well. A relentless focus on digital is LP’s best shot at survival, and last week’s layoffs, far from being a portent of doom, are the most concrete sign yet that NC2 Media gets this as well.

National Arboretum, Canberra, AustraliaParticularly important is the unheralded switch to a “destination editor” model, which finally breaks the stranglehold the book publishing schedule has had on the operations of the entire company.  For example, this will allow the website to be updated continuously, instead of having to wait for the next book edition to roll around.  Far from giving up on content, this puts it front and center, and the move parallels The Guardian‘s digital transformation that has seen the newspaper grab a sizable online audience far outside its native UK market.

None of this diminishes the human tragedy of letting go people who have poured years of their lives into what was indeed for many more of a family than a company. But as the only alternative is slow and inexorable decline guaranteed to lead to the elimination of every single job, this is the best hand the company can play.  As the last page of LP’s guidebooks used to proclaim: “THIS IS NOT THE END”.

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Why Google will most likely kill Frommer’s, and why that’s probably a mistake

By buying a travel guidebook publisher solely to bolster its local search content, Google risks both straddling itself with an unprofitable albatross and missing out on a way to differentiate itself from its rivals.

Google’s recent acquisition of Frommer’s has given rise to much comment about the “real” intentions of the Big G and what this means for other travel publishers.  While it’s less entertaining than some of the theories floating around, for time being I’m willing to accept their stated rationale at face value: just another stepping stone to “provide a review for every relevant place in the world“, and thus a tactical move to bolster local coverage for the ailing Google+.

There are, however, two fundamental problems with the purchase and this goal that do not seem to have garnered much attention.

The first is the problem of content creation.  Frommer’s claims “4,500 destinations, 50,000 images and 300,000 events“, but they leave unsaid the source of every one of those bits of data: their own printed guidebooks.  Google thus has an unpalatable array of choices:

  1. Keep producing printed guidebooks and digitizing the incoming content as usual.  This is clearly Google’s starting point, as they will be retaining Frommer’s print staff, but it’s also almost certainly a money-losing proposition: given the fire sale price of barely over 1x revenue, there’s no way the books are making money.  With the overall travel guidebook market declining by 10% year and the new owner focused on entirely different things, a turnaround seems fanciful.  Google will thus be looking to jettison them as soon as it can, which leads us to the next option:
  2. Stop print production, but keep the authors and editors around producing travel guides in digital form.  Alas, this would only exacerbate the losses, as e-book and app sales make up only a small fraction of printed book sales and the actual printing is only a fraction of the cost of book production. This option seems thus very unlikely, and my money is thus on:
  3. Stop producing guidebooks in any shape or form, dispense with narrative content entirely and focus purely on points of interest.  (This is what Zagat has always done.)  It also means throwing any direct revenue model out the window, although it does keep their B2B arm Frommer’s Unlimited afloat.  It will be interesting to see how much money Google is willing to sink into paying authors and editors to update those reviews, but it’s quite conceivable that the answer is “none”, in which case we end up at the final option:
  4. Fire all editorial staff and let the content decay.  If the purchase is indeed purely a tactical ploy to temporarily beef up their reviews while they wait for Google+ to reach critical mass and start to create fresh, user-generated content à la Zagat, this actually makes perfect sense.  Google doesn’t even need authors for the other half of their usual job, verifying practicalities details (addresses, telephones, etc), as Google has already mastered that process through other means.

If Google goes with the 3rd or 4th option, and I have hard time seeing them not do so, their second problem (or, rather, missed opportunity) will be the lack of content curation.  By treating guidebooks as no more than a database in print form, turning them into a homogenous soup of atomic points of interest, Google is effectively conceding to compete on a level playing field with local search rivals like Facebook and Foursquare.   All three now assume that users are searching for individual points, easily filtered on individual axes: “best five-star hotel in New York by user ratings”, “cheap Japanese restaurant in Melbourne CBD open for lunch” etc.

But a guidebook is not the same as a phone book: it’s supposed to contain a careful selection of the best places to go, arranged in a sensible way.  Neither Facebook nor Foursquare can offer a sensible answer to real travel questions like “Funkiest bars in Brussels”, “Romantic day in Paris”, “Three-day hike in New Zealand”, whereas any guidebook about those places that is worth its salt can.  As an engineering-driven company, Google has given things like this little thought simply because they are hard problems for artificial intelligence to solve — but using Frommer’s team of authors, it would be possible to augment the automated results produced by things like the Knowledge Graph to field hand-curated content as well.

If Google goes ahead and does this, then the Guidebook of the Future will be that much closer to reality and travel publishers will have a real problem on their hands.  But I doubt it, and that’s why those publishers are breathing a sigh of temporary relief: one competitor less means a bigger slice of the shrinking pie for the rest.

Slicing the fruitcake of atomic content

Atomic content is the buzzword for distilling travel information into its smallest possible units, the atomlike single points of interest (POIs) that stud the pages of a guidebook, in the same way that nuts stud the innards of a rich, rummy fruitcake.  And the premise certainly sounds seductive: once these nuts are liberated from dough tying them together, so the theory goes, then they can be repackaged and recombined into all sorts of new, sexy pastries and confections.  Baklava!  Pistachio ice cream!  Nutty monetized eyeballs!  The sky is the limit!

And from a purely technological point of view, atomic content does make huge amounts of sense.  Tag POIs with geographical coordinates and store them in a database, and all sorts of neat things that you can’t do with a printed guidebook suddenly become easy: you can create a dynamic map that can pan and zoom, you can serve them up in a car navigator, you can get a list of all restaurants within 100 meters of a point.  Whee!

Yet the fallout of decomposing a fruitcake into its constituent parts is insidious and dangerous.

People rarely count the number of nuts in a slice of fruitcake, but if the price is the same, any shopper will take the 1 kg bag of nuts over the 500g bag of nuts.

Atomic content emphasizes quantity over quality.  A guidebook lists only the best 10 restaurants for a town, not all 500, but any feed consumer will prefer the feed of 500 POIs to a feed of just ten.  This pervesely incentivizes lowering the bar and keeping around old and even actively harmful information simply to inflate the POI count.

The only perceptible difference between the various brands of peanuts at your local supermarket is price.

Atomic content is commoditized.  There are a handful of sources out there for local POI information, all offering the same basic bits and bobs of information: name, address, coordinates, perhaps a telephone number, web address or opening hours.  The only differentiating factors are quantity (see previous point) and, as distant second and third, accurary and recentness, resulting in a race to the bottom that only the largest can win.  The quality of the review doesn’t really figure as far as Google is concerned, which means that user-written reviews, even if they’re crap or spam, can easily trump professionally authored reviews.

If I pick an almond from a bag of mixed nuts and eat it, there is nothing stopping me from eating a macadamia or cashew next.

Atomic content is not sticky.  If I Google “how do I get from Narita airport to central Tokyo“, Google will return 140,000 pages all advising me to take the train, not a taxi.  Having gleaned that atom of information off the page — and the way the Internet works, it’s the page most whole-heartedly devoted to answering that question and only that question that will bubble to the top — I have no incentive whatsoever to stay on the page, and odds are extremely high that the next question I ask, whatever it may be, will take me somewhere else entirely.

It’s the dough that makes or breaks the cake.

Ever heard somebody praise the quality of the raisins in a fruitcake?  Me neither.  Atomic content lacks the core of good travel information: the prose that binds it all together.  A sentence or two telling me where to find cheap late-night eats and where to go for romantic haute cuisine dinners is a far more useful starting point than an alphabetically organized phonebook of restaurants.

People value a slice of good nutty cake far more highly that a bag of nuts.

But the biggest morsel to take away is this: travel itself is not atomic.  Yes, there are occasions when I want to find an atom of information like “a good Chinese restaurant open for lunch in Northbridge”, but the true value of a guidebook is when it can help you with Rumsfeld’s “unknown unknowns“: the things I should know about a destination, but do not know to ask about.  I will not Google “gem scams in Bangkok” if I have never heard of the Thai capital’s shifty diamond dealers; I will not take a 30-km detour to an awesome museum in a neighbouring town unless someone tells me it exists.

The way to compete against atomic content is thus not to play the atomic content game, at least not to the extent of letting it corrupt your core cake-baking skills.  Bake cakes that are dense, filling, rich and nutty, which taste good from the first bite and leave the traveler hungry for more.