Plenty of people in the publishing world fear that new media and the Internet will kill interest in reading literary fiction. Andy Hunter and Scott Lindenbaum, however, think of Twitter, YouTube and the iPad as opportunities to introduce new audiences to the art of the short story — and to tell stories in unique ways. They are the founders of Electric Literature, a quarterly literary magazine that publishes using a print-on-demand model and also offers digital versions via e-book, the Kindle e-reader, the iPhone and audio. In addition, Electric Literature uses multimedia to enhance stories by well-known authors — including Pulitzer Prize winner Michael Cunningham (The Hours) and MacArthur “genius” grant winner Colson Whitehead (Sag Harbor) — through collaborations with animators, filmmakers and musicians. The endeavor was the first to publish to the iPhone, the first to create a YouTube channel and the first to serialize a short story using Twitter.

Hunter and Lindenbaum sat down with Knowledge at Wharton at the recent Future of Publishing conference in New York City to discuss their company and the importance of adapting to new publishing and distribution models.

An edited transcript of the conversation appears below.

Knowledge at Wharton: Tell me a little bit about Electric Literature, the concept behind it, the site’s mission, and how it works.

Andy Hunter: Well, Scott and I met at an MFA program. We are both fiction writers. At the time there was a lot of pessimism about the prospects of, for example, us selling our books, but overall just whether people [would continue] reading fiction, particularly literary fiction in the future. People as prominent as Philip Roth were forecasting the demise of serious reading in the next 20 years. We were working on The Brooklyn Review, which is a literary journal put out by Brooklyn College that has been around for 25 years. But it wasn’t really getting the kind of reach that we wanted it to have — and it wasn’t paying writers.

We felt like there was a new model that could be done where we could take some of these forces like new media that seemed to threaten literature … and use it to promote literature instead. And we felt like we could develop a new model where we could pay writers by offsetting the costs that are normally spent on upfront printing, shipping and warehousing [by] using mostly digital distribution. We are about 75% or 80% digital and the remaining 20% is print-on-demand, which means that whenever anybody buys a copy of Electric Literature in paperback form they print it automatically … so we never have to put up up-front costs. Instead of spending $10,000 to have something printed, we can give that $10,000 to the writer and distribute [his or her work] digitally and via print-on-demand.

Scott Lindenbaum: [The model] also allows us to focus more on engaging with the reader through various marketing and public relations. When we were at The Brooklyn Review, for instance, which is a really good example of a traditional literary magazine, we had no money to do that. We would spend almost the entire budget [buying] pizza [for the staff] and then printing the thing. … We will take some of that cash that is now displaced and [use it for] new media initiatives.

For instance, we have a thing called the Single Sentence Animation Series where we will take a writer we are going to publish — like Rick Moody, who was in our most recent issue — [and] we will take a single sentence from his story that he selects, give [the selected sentence] to an animator, [and] let them riff on it in any way that they desire…. They will come up with something [and] then we give it to a musician. They score [the animated sentence], and then we put it out on YouTube. We can pay everyone all along the way in this process. A small amount, but still it makes it so that there is a real incentive there. And we get to create a great art object. We are able to engage with our readers where they already are, which is on YouTube, looking for interesting content. That doesn’t mean that they are not interested in Rick Moody. Maybe they are, but now there is some real interesting, creative, collaborative content on YouTube that is related to Moody and it kind of brings them back toward our brand and hopefully back toward reading.

Hunter: I would like to say a little bit more about our videos. By using prominent artists and prominent musicians sometimes, we expose their audiences … to literary work, and then we expose our literary followers to the work of these artists and musicians. [That creates] the cultural dialogue that we think is so important [for] literary fiction [to be] part of. We don’t want literary fiction to be in an ivory tower and disassociated from our common culture. We want it to be a vital part of our culture…. These experiments that we do online and with new media are all about keeping literature a part of the dialogue.

Lindenbaum: The mission of Electric Literature turns into a 2-pronged initiative. It is using innovative distribution … and then using new media in order to create that kind of dialogue. When we talk about an 80% digital distribution, we are really talking about device-based reading. We are talking about distributing through the iPhone — we were the first literary magazine to do that — [and] the iPad. We are talking about reaching readers on the Kindle…. The model that we are trying to create sets a precedent, and it shows how by rearranging the elements and finding where people are used to paying for content you can then pay the creative people as well — the content creators. So it is very important that people understand that [Electric Literature] is not an online magazine. We are talking about new distribution — totally new. The iPad is right now. We are talking then about agitating for literature by using new media.

Knowledge at Wharton: You just talked about the animation of a single sentence from a particular story. Electric Literature also had a Rick Moody story that was distributed as a series of posts on Twitter. How do you decide on which platforms are best for distributing individual pieces of content?

Lindenbaum: When we did the Rick Moody serialization — micro serialization — it is not that no one had ever Tweeted a story in segments before. But Rick wrote it for Twitter. And that makes it different because he is taking into consideration the constraints of the medium. Knowing the way people use Twitter and knowing the 140-character restraint, he was able to craft a narrative that would live on Twitter specifically. So now you are talking about creative content being made specifically for a distribution platform. When we micro serialized it, we would roll out 1 of the 153 Tweets that made up the story every ten minutes for 3 days. It didn’t feel like a story that was hacked up. Rick described it as kind of [like] writing haiku that also kind of had a cumulative effect as well — each Tweet being kind of a satisfying experience on its own and then the larger narrative also being told over time.

We took that [story] and in a strange kind of reverse, we ended up reprinting it in the print issue. But when you see it in the print issue it doesn’t look like something that would typically be in print. You really do feel like you are getting a kind of collection of something designed for another medium. It is really important, I think, that the content match the medium. People, when they are reading, can kind of sniff out when something is just being cut up or done in a way just to try to take advantage of Twitter because Twitter is cool, as opposed to something really trying to take advantage of Twitter [with] all the kinds of restraints that it would take to really make something [specifically] for Twitter or for YouTube. At the end of the day, we ended up netting about 150,000 followers, which is more than any publisher in the world. So people really did seem to enjoy it.

Knowledge at Wharton: I’m enjoying imagining Rick Moody trying to figure out how to fit everything into 140 characters because I know how hard it is for me.

Hunter: Yeah, he said when he wrote it that he had the little Twitter window open at the same time and he was constantly checking [to see if his updates fit the character limit.]

Knowledge at Wharton: You have worked with Rick Moody and Colson Whitehead and a lot of other well-known authors. When you first started out, how did you convince them to buy into this whole concept?

Hunter: In the beginning, of course, it was the hardest. Somebody like Michael Cunningham, who can publish with The New Yorker, doesn’t need to publish with us. And when we had no track record his agent obviously didn’t think it was a good idea. I’m sure his publisher didn’t think it was a good idea to go with these two guys that just had nothing — no track record — [and] no publication yet. Jim Shepherd was up in western Massachusetts, and I rented a car and drove 6 hours so I could buy him a cup of coffee and talk to him about it. Because I knew if I sent him an email, I didn’t have a chance.

But the thing that united them is that they were all as equally concerned about the future of literary content as we were. I think our passion for keeping it vital and kind of using digital technology to revitalize it was very clear to them. I think that when we outlined our approach it seemed to make sense. In the end, they took a big risk by supporting us. We are super grateful to them, but also having them take that risk upped the ante for us as to making sure that we actually delivered on our promise. We hustled and we still are hustling to make this thing successful. We are working 60 hours a week. We had to quit our day jobs because literary magazines don’t usually have the kind of reach that we are trying to get.

Lindenbaum: One of the things that has been really affirming for me is that, when we work with a writer like Michael Cunningham or like Lydia Millet or Rick Moody or whoever, often times it will be a month later or two months later and they will come back to us and say, “Oh this experience was so great.” Or, “This is one of the coolest collaborative things I’ve ever done in recent memory.” Then they have that conversation with other writer friends of theirs, and then those writers start to kind of come back toward us.

We are doing a show on Friday at [New York restaurant and arts venue] Le Poisson Rouge and Rick’s band is playing. But so is Myla Goldberg’s band — she wrote Bee Season. We have never published Myla’s work, but as what we are doing is successful with writers we have published, the reputation starts to expand and then more people come into the fray. It has been very affirming and it makes me feel like what we are doing is working and people do want to get involved.

Knowledge at Wharton: You spoke in a panel at the conference today about how difficult it is for traditional publishers to innovate, that it is difficult for innovative ideas to make their way up the ranks. What do you think is blocking those ideas? What do you think traditional publishers can do to foster more of an environment for innovation?

Hunter: I was talking to a very prominent editor and he was talking about one of his authors who had a huge following on the Internet. This [author is a] very funny guy, and they wanted to do an iPhone application for him. It seems like a slam-dunk that this guy’s iPhone application would be massive. Even though this editor has a ton of power and he is really well-known, when he tried to get his corporate to sign off on this iPhone application, they said, “Well, we don’t want to have an outside company create this application because then all of the knowledge for how to create an application will be outside. We won’t have it in-house. We want to be able to have our own people work on it.” First of all, you can’t get the very best people because you are working with your in-house IT team…. Second of all, once you are trying to work with your in-house IT team, they have their own backlog. Maybe they can start working on it in a year. There is a huge bureaucracy of corporate red tape that gets in the way of somebody [saying], “This is a cool idea. Let’s jump on it.” I think [publishers] have to set up an environment where they reduce the amount of rules that their people have to follow. They have to restructure it so that they at least have a few creative people who are able to do whatever the heck they want when it seems like the right time to do it, because timing is everything. Opportunities come and go very quickly. If you can’t react quickly and nimbly, then you are doomed. Small publishers have the advantage of being totally nimble. We don’t have nearly the same resources that these major publishers do, yet we are able to be more effective in online marketing and promotion because of that nimbleness.

Knowledge at Wharton: If somebody out there is considering starting a multi-platform publishing vehicle, what would your advice be to them?

Lindenbaum: It really does depend on content. I think one of the reasons we have gotten a lot of attention recently is because not only are we publishing literary content, but we are publishing short stories, which are the most neglected, least marketed, and probably least bought form in the history of literary publishing. The fact that we are making a name for ourselves has a lot to do with us hustling all of the time. If you are going to be putting out a fashion magazine, which has maybe a larger appeal and is more graphic based, and then it is a totally different ball game.

I don’t know what kind of advice I would give to the people except for maybe [that] you have no idea how much effort it will take. Just because you are on the iPhone or on the iPad, or if your friend can code for the iPhone or the iPad, doesn’t mean that you can be found there. In some of the largest bookstores in the world — like or on the iBook store that’s now growing — there’s no organizational structure. Electric Literature would never be found on the app store unless we are letting people know outside of the app store that Electric Literature exists. You have to be prepared to be marketing and branding yourself all the time.

Hunter: I think that’s the key. The key advice is branding. That sounds like kind of a corporate idea and we are kind of a creative business so we don’t use it that much, but it’s about having an identity. If you have an identity then people can identify with you. When somebody identifies with you, they are a reader. Then they are going to be interested in the stuff that you are publishing. Making sure that you have a clear identity is super important.

Literary magazines are such a niche market that I don’t even know if many people have seen one. But if you have seen one, they generally tend to [be organized similarly with] a short story, and then an essay, and then a poem, and then a black and white photo of a doorway, and then a charcoal drawing of a bowl of fruit and then another poem. They are all like that. There isn’t a lot of individualization. Some of them are higher quality than others, but they are all just kind of a grab bag. When we made the decision to [include] just fiction, we immediately streamlined who we were and we gained more of an identity. When we decided to use images that were striking, and to have a more subversive and irreverent advertising campaign, we further identified ourselves because we want to get young readers. We figure that [including stories written by] Michael Cunningham will bring in the 46-year olds. But if we want the 20-year olds, we have to be slightly subversive and have fun with our promotional stuff.

All of this comes together and builds an identity, and a new form of relationship, with your readers. You make sure that they feel included through Facebook and Twitter and e-mail blasts. Developing a good e-mail list and having a place on your website that is very prominent where everyone can sign up to get your updates is super important. Have an identity — and be prepared to be a marketer. We started this because we love reading and we love stories. But we spend 10% of our time — or maybe 20% on a good week — actually reading stories and getting excited about literature and talking about literature. Our curse is that we have to spend most of our time marketing and promoting and letting people know that we exist.

Lindenbaum: We only get to spend 20% of our time [reading because we’re trying] to convince other people to spend 80% of their time reading, which is of course what we would love to do. One other thing I want to add is that, if you are taking Andy’s advice and my advice about this streamlining thing, what you end up with is a product or a magazine that doesn’t have a ton in it. So it is really important that all of [the content] be totally top-notch. One of the things we talk about all the time is this no nepotism policy, which can be a problem in other small publishers. Don’t publish yourself and your friends. If you are going to strip it down, and you decide as we did [to include] just five stories [an issue that are] all fiction and with a particular look…. You have got to make sure that all of those stories are incredible. There is no room for you to just sneak in your friend’s work that really isn’t going to be that good because [then] 20% of your issue is kind of corrupted in some way. When you do form these close relationships with readers, it is very important to not just see it as a benefit to your business, but that now you are shouldered with the responsibility of giving someone you are in a close relationship with something of value. They don’t want to be betrayed.

For more coverage of The Future of Publishing Conference:

Will Newspaper Readers Pay the Freight for Survival? Knowledge at Wharton

Changing Times at The Washington Post: Engaging Readers, Enhancing Content

Upended by eBooks: Is This the Last Chapter for the Book Business?

Cuil’s Seval Oz Ozveren: Creating the Next Generation of Internet Search