by Adventist Today News Team

Last week the boards of the two main publishing operations of the Seventh-day Adventist denomination authorized their presidents to enter into negotiations that will lead to a merger. The process will also make the new publishing house an institution of the North American Division, not the General Conference. Review & Herald Publishing Association (R&H) in Hagerstown, Maryland, is the oldest organization in the Adventist movement, beginning with a small periodical launched in 1850 by James White. Pacific Press was launched in 1874 in California when that state was a mission field for the small denomination.
The boards first met jointly with the officers of the General Conference and the North American Division officers on Wednesday morning to review an analysis of the publishing institutions and related distribution systems. This analysis is the result of the work of several commissions and groups that over the past several years have studied the challenges and opportunities arising from rapid technology changes in publishing as well as changes in how society accesses information. "The bottom line is that these two institutions are no longer sustainable," a source familiar with the studies told Adventist Today.
The boards of both institutions then met separately Wednesday evening, and each, by overwhelming majority votes, expressed agreement to consider a yet-to-be-developed merger proposal, stated a bulletin from the Adventist News Network (ANN), the denomination's official news service. In addition, each board authorized its chair and president to represent the institution on a taskforce assigned to negotiate the details of the merger.
The plan must be approved by six groups all together. First the GC and NAD administrative committees must approve the plan. Then it must be voted by the two boards and the constituency sessions of the two publishing houses. This is where previous attempts at merger have foundered.
Pastor Ted Wilson, GC president, affirmed the importance of “publishing and distributing materials to advance the proclamation of the gospel" and stated, "We believe that restructuring the two … institutions could serve even more effectively the future needs of the church, especially in North America as well as … the world.”
Over the past two years, the NAD has been developing a comprehensive approach to all forms of media witnessing initiatives, and as an adjunct to … other media platforms is a prominent component of this strategy,” said Pastor Dan Jackson, president of the denomination in North America. “A publishing house closely linked to church infrastructure and intimately involved with planning, implementation and coordination of witnessing and nurture programs is a key component in accomplishing our mission objectives.”
Neither publishing house receives regular operating subsidies from the GC or the NAD. Both publishing houses have had greater income than expenses in recent years. At the same time each institution has much greater capacity than it ever uses. In fact, most publishers no longer own printing equipment and purchase such services from the large number of commercial suppliers.
The R&H owns four large printing machines, a Harris M-300, a Harris M-120, Heidelberg 102 Speedmaster and Heidelberg GTO, according to its official web site. Pacific Press owns a Harris M-200 and a MAN Roland 700, also according to its official web site. In addition, both institutions have a full array of plate-making, binding and cutting equipment for the production of magazines, paperbacks and hard cover books. This totals nearly 40 large, expensive machines capable of a much larger output than the combined circulation of all the products at both institutions.
Both institutions have over the years done some printing and production work in addition to its own products, including materials for organizations that are not affiliated with the denomination. Where to draw the line on commercial work has long been a topic of controversy among publishing house employees and other church members.
The official history of the R&H on its web site recalls how in the 19th century "the company focused more and more on the bottom line, workers lost sight of their Christian principles" and Ellen White, one of the denomination's cofounders, had visions of fire over Battle Creek, where the publishing house was located at the time. "She had warned the … managers to pay their workers fair wages, not skimming so much for themselves, and to pay authors their due royalties. Her warnings were ignored." In 1902 the R&H building burned and the following year it relocated to Takoma Park, Maryland, as did the GC.
R&H moved to its present location in Hagerstown, 65 miles out the edge of the Washington suburbs, in 1983. It owns 127 acres along Interstate 70 and the building itself covers six acres. Pacific Press began in Oakland, California, and later moved to Mount View, another San Francisco Bay area suburb. It is now located in Nampa, Idaho, a suburb of Boise, where it has 61 acres and a building larger than three football fields.
R&H has 170 employees and Pacific Press 280, as well as more than 400 independent sales representatives called "Literature Evangelists" who make presentations of children's and health products in homes. It operates five Home Health Education Service entities to support the sales personnel, providing inventory, shipping, credit and billing functions. It also owns and operate 24 Christian bookstores across the U.S. and Canada.
Historically, the Adventist Church has operated several publishing houses in North America. In addition to the two that remain today, in the 1890s Southern Publishing Association was established in Nashville, Tennessee, to support a new strategic initiative to introduce the Adventist faith in the American South and meet the needs of African Americans still suffering from generations of slavery and an Apartheid-like legal regime in the southern states. In 1983 Southern merged with R&H due to many of the same concerns under consideration today.
Each of the publishing houses "must make important decisions regarding its vision for the future and the investment of capital to maintain efficiencies in publishing and printing processes. Such decisions will have far-reaching impact," the ANN bulletin stated, evidently paraphrasing the study that the group saw but has not been released. "In light of present surplus manufacturing capacity it is [better] for the two organizations to plan for the future as one unit rather than separately and to be directly connected to" the NAD.
ANN quoted the presidents of both institutions in support of the merger concept. “It is a strategy in response to 21st century realities,” said Dale Galusha, president of Pacific Press. Mark Thomas, president of R&H, added, “Commercial and private publishing houses today are finding it necessary to redesign their business plans. We need to be proactive in addressing a rapidly changing publishing environment.”
The quotes referenced a "case statement," evidently a second document distributed at the meeting which has also not been released. Adventist Today is seeking copies of both of these documents.
The next step will be for the taskforce with representation from the GC, NAD and the two institutions to prepare a blueprint for merger. It is expected that a report from the taskforce will be presented to the two institutional boards by late September 2013. Each board will then have the opportunity to determine its response to the merger proposal.
The Seventh-day Adventist Church operates 63 publishing houses worldwide, each operating under its own governing board. These institutions publish materials in hundreds of languages and operate under many different market conditions. A large share of the publishing output is consumed internally by local churches and members, including such things as the Sabbath School materials, yearly devotional books, magazines for church members, etc. The majority of the customers that deal with the bookstores operated by the denomination are church  members purchasing materials designed for an internal market.
A smaller portion of the publishing output is consumed by non-members. How much of this is sold through home visits by Literature Evangelists and door to door distribution programs is not clear from the available information. One of the most widely-distributed products is The Bible Story, a collection of 411 stories for children published in 10 volumes and covering the entire span of the Old and New Testament. More than 42 million copies have been sold of this product developed in the 1940s and 1950s by Arthur S. Maxwell who spent much of his life working for Adventist publishing houses.
A source familiar with the situation told Adventist Today that Ellen White cautioned against merging the publishing houses. When mergers were discussed in the 1980s this argument was used to prevent the course of action now being recommended by the GC and NAD leaders. In fairness, it needs to be pointed out that the context is far different today than it was when White wrote these cautions in the late 19th century.
One of the options that will likely be discussed by task force planning the merger is to sell both of the facilities owned by R&H and Pacific Press, and secure a new facility in the middle of the continent where the cost of doing business will be less. Part of the problem is that neither institution has kept up with new technology in the publishing industry, the source told Adventist Today.
"I don't think it is a good idea because if they merge the publishing work would go into the hands of just a few people," the source stated. The competition of two or more publishing houses is not bad for any business.
J. David Newman, editor-in-chief at Adventist Today, made a similar observation. He believes that there would be cost savings if the printing and manufacturing operations were merged, but "we need to separate editorial boards and book committees." In the 1980s he predicted that the merger of These Times published by Southern Publishing Association with Signs of the Times published by Pacific Press would ultimately result in a lower circulation than the combined circulation of the two periodicals, which has proved to be true. The two publications were able to reach a wider audience than the merged journal.
The closure of the current operations in Maryland and Idaho will cause some dislocation such as a loss of local church members, families with children in local Adventist schools and various kinds of community involvement. Employees near retirement may be negatively impacted by having to move or find new employment. "But these kinds of inevitable negatives must be weighed against improvements in both the missional capacity of the new institution and the increased cost effectiveness," a retired church administrator pointed out.
An Adventist member (not a denominational employee or former employee) who works in the publishing industry, but does not care to be identified, said, "The real question is whether we have people in key management positions who really understand the new technology and what is happening across the board with all publishers? Do we have personnel with significant experience outside the cloister of Adventist publishing institutions?"
Paper media is undergoing tremendous change in America as the various kinds of electronic media become more widely used and "the new normal" for younger generations. Only Time is left of the major weekly print magazines that dominated American readers for generations. More and more local newspapers are shifting to electronic distribution or dealing with reduced print circulation. The distribution of E-books is booming while the production of paper volumes is static. A growing percentage of young adults believe that to use paper products, which requires the harvest of trees, is unethical when the same material can be consumed in an electronic format.