I'm blogging from a Barnes and Noble which is readying for Harry Potter's final book going on sale at midnight. Handmade, full-size "magic" brooms are hanging from the ceiling and anxious Potter fans are rereading the past books in line for wristbands for tonight's pre-Potter party. This book is a pricey 35 dollars, five dollars more than the last book's listed price, and it's going to make several companies very, very happy.
"Harry Potter and the Deathly Hallows" release has been plagued by scandal. The series' U.S. publisher, Scholastic , has taken legal action against several Web sites that posted what looked like pictures of the book's pages. The children's and educational publisher is also chasing down the booksellers around the country that have let the book sneak out (several reporters have bought copies.) And J.K. Rowling herself is furious at the New York Times for reviewing one of those sneakily-sold books and breaking the embargo.
Still, this is expected to be the biggest book in years--with about 14 million copies expected to fly off shelves. Scholastic will bring in an additional 250 million in revenue from this book, about 9 percent of its annual revenue. And it's not just Scholastic that benefits from Potter mania. Scholastic's CEO told me that the whole children's' book industry has grown by about 10 percent since Potter hit the scene, and the book industry as a whole has even grown a few percentage points.
How did Potter's rising tide lift all boats? For one thing, people got excited about reading, and spent more time in bookstores, so they bought more. It also encouraged authors to publish similar fare-- no one ever thought kids would read such long books or that a book could appeal to both adults and kids.
Scholastic will miss the occasional revenue boost, but it in no way relies on the Potter series, and the extra Potter revenue has helped it buy back stock and bolster its balance sheet. What of the booksellers. Sites like Amazon.comhave been pre-selling at seriously discounted prices, so margins will be slim. But as Pacific Crest analyst Steve Weinstein told me, this is a perfect opportunity for Amazon to impress customers for their ability to deliver value. And then there's Barnes and Noble, where I'm surrounded by dozens of different Potter related books and tchotchkes devoted fans can buy when they're waiting to buy the book.
All this foot traffic I'm watching right now has got to be a good thing, even if they're discounting the book's listed price.
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