The Week That Was

October 23rd, 2009 · 31 Comments
by Kassia Krozser

A lot happened in publishing this week — so much that just as I wrapped my head around one thing, something new popped up to either make me re-evaluate my previous thinking…or to send me down a different rabbit hole. Let’s just put it out there: once you’ve gone subterranean, things start to make a lot of sense.

Which probably accounts for my mood today. Here in the dark and dangerous world of the publishing underground, spirits are sapped and minds are bent. Sometimes you travel toward the bright light, only to find a seemingly insurmountable pile of “that’s how we’ve always done it” in your way. The intrepid, of course, find new routes and discover magical beings; they’re here, too. Follow the intrepid, I say, follow the intrepid!

  • An Old Twist on the Price Wars Becomes New Again: Remember Crown Books? They were going to Destroy Publishing as We Know It (this is not the same thing as merely Destroying Publishing). Luckily, family tensions destroyed Crown Books first. Sometimes you catch a break. Now we have Amazon, Target, Wal-Mart, and Sears battling each other for dominance; their weapons of choice are front-list, high profile hardcover books.

    In any other situation, publishing would be thrilled to get so much free publicity (woe to those whose titles are not mentioned in every breathless news story!). However, this battle has bigger implications. Naturally, the industry fallback position is that these deep, deep price cuts will destroy the industry. No, but if the trend sticks, it’s going to add to the increased retailer pressure on book prices. Retailers will not subsidize the difference between wholesale and retail forever — as they’re doing here with print (and as Amazon, Barnes & Noble, and others have been doing with ebooks).

    Prices for a few books have dropped below nine dollars (yet, the new Stephen King ebook, discussed further below, remains priced at $35.00. For an ebook.). That hurts independent publishers, though the smart ones are also seeing opportunity. Why buy from traditional distributors when a trip to Wal-Mart will offer more margin. Poke ‘em in the eye! (Contrary analysis here, worth reading and deep thought)

    Where is the consumer outrage? Hint: there isn’t any. Or at least there’s not enough to note. That should probably give the industry pause. Luckily, the American Booksellers Association is on the case: they’re asking the Justice Department to investigate.

  • Stephen King Repeats The Stupid Meme: I am opposed to the current trend of delaying ebook releases until after the initial hardcover window. Especially when the stated reason is to protect someone or something (like, oh, hardcover sales). It’s false logic. You are not going to help independent booksellers by delaying the ebook release. That’s like saying eggs and lemons are interchangeable.

    No seriously, Stephen King, delaying the ebook to “help” independent booksellers (an irony you acknowledge, given the recent price wars) is about the silliest notion I’ve ever heard. How about this instead: if the ABA had a serious and robust ebook sales system, then the customer (reader, buyer) could purchase the format s/he wants from local booksellers. Delaying the ebook doesn’t “help” anyone (Scribner? that digital list price, even if these discounts weren’t happening, can you justify this?). People who prefer ebooks will not shrug and say, “Well, that’s okay, I’ll just buy print.”

    (Yeah, this means that publishers will have to get smarter about pricing ebooks. The current approach remains unsustainable and, let’s say it again, silly.)

    When publishers justify this behavior by noting staggered releases have long been the norm (“that’s how we’ve always done it”), they discount the reader, especially the rabid, money-paying, willing to buy books reader. Yeah, I should be treated with deference. I should get preferential treatment. I want to pay for these books right now, not borrow them from a library or a friend, not buy them used. Protecting the old business model only works if…oh, the market will remain frozen in time forever. It won’t.

  • Barnes & Noble Puts Up Its Nooks: When the Barnes & Noble ebook store was launched, I was underwhelmed. The store was slick, the prices were right, it had an iPhone app. It was…okay. Nothing made the store stand out from the others. Honestly, it felt rushed. Like maybe the competition was getting to them and they wanted to grab some of the land. Rumors ran rampant — like rumors often do — and facts sometime emerged. I was soon convinced that B&N was working very hard to Get It Right.

    The nook (apparently lowercase is correct) show much promise: wireless, wifi (in-store only, right now), EPUB support, other format flexibility, limited sharing, even expanding the ecosystem beyond Barnes & Noble stores. B&N understands that eInk can only do so much, but, ahem publishers who are not taking cover art seriously, also leverages other technology to make some of the experience visually interesting. Oh sure, it’s not perfect, it’s not magic, and it’s not going to kill the Kindle.

    But B&N has shown a willingness to push the envelope, if only a little. Amazon, following the iPod/iPhone development and release pattern, will likely debut new Kindle family members that compete with the nook, but I’m not seeing Amazon opening up to new ecosystems. Right now, they don’t need to. Who suffers most? Yeah, Sony. Develop faster, little Sony, develop faster!

  • Readers Have (Copy)Rights: I know, I know, it’s hard to believe, but the basic premise behind copyright protections included the idea that the public had rights and, in exchange for protecting the copyright of an artist, would be granted a sort of quid pro quo. In the early days, this came in the form of things like, oh, limited copyright terms, which encouraged further artistic expression. I call the change in attitude about copyright “The Mickey Mouse Syndrome” as laws have certainly changed due to the influence of the Walt Disney Company.

    In all the talk about about piracy and file sharing and just plain exchanging books among family members, the rights of readers have been lost. We, the consumer have deal with this attitude about basic (and limited) sharing of books, which, you know, actually encourages reading and future sales (from Publishers Lunch, probably behind paywall):

    One executive, speaking not for direct attribution [BS: Why not? Make your case to us.], told us “We will work it out with them. We need the competition.” But another articulated the concern about setting a precedent. While agreeing that they “will keep talking to B&N and haven’t ruled anything out because details are still coming and I want a strong offer” from them to promote competition, this person expressed concern that “if publishers agree to lending then every ebook offer now and in the future will come with this consumer feature. Over time, I’m concerned that lending won’t grow the market and in fact could hurt it. I’d be more open if I thought ebook lending created a sustainable competitive advantage for BN over the Kindle – but I don’t think it does.”

    A few authors and readers are fighting back because sharing is not pirating. The industry perception that sharing is stealing and that readers are engaged in evil will lead to serious backlash. It’s never good to treat your best customers as thieves (no really, it’s just not!). Authors realize there is benefit to them when books are shared.

  • Territorial Rights Is Good For Whom?: When Hilary Mantel won the Booker Prize, digiliterati noted that the book was not yet available in the United States (nor, I believe, were any of the other finalists). Neat. Book gets a boatload of publicity, is on the mind of readers, and the ability to purchase is, uh, not there? Ditto, as Ryan Chapman notes, for the new title from Stieg Larsson.

    Think about the publishing people: you have books people want to buy and read. And they can’t. Not in print, not in ebook form. Give me five paragraphs on why this is a smart business plan.

  • Minds Were Blown: Remember the intrepid? They never engage in hand-wringing: they are too busy doing for such nonsense. At last week’s Tools of Change Frankfurt, Peter Brantley and Keith Fahlgren debuted BookServer. Afterward, Kirk Biglione noted to me that it might have been the biggest, most important session of the conference. A week later, during the “Make Books Apparent” conference, Fran Toolan of Firebrand Technologies agreed: “What I saw, was many of the dreams and visions of e-book aficionados everywhere becoming a demonstrable reality tonight.”

    I am incapable of explaining the entire project, so I am going to recommend that each and every one of you find a conference where BookServer is being introduced and — this is important — attend the demonstration. Don’t get sucked into hallway conversation. The takeaway, the important message, the critical thinking is that BookServer creates a framework that allows people to access freely available books, purchase them, borrow them, and all of the above and more. Let me say that again: the system supports all models from free to pay.

    This is why I believe in the future of publishing, libraries, and booksellers.

    (And I’m not even getting into the incredible implications this has on accessibility.)

I’m sure I’ll more thoughts on these topics because, well, I always do. The common thread, for those who skimmed, is that removing barriers between books and readers is the new publishing imperative. It’s time for change. We’ll give the final word to Richard Nash:

Publishing will never be stable again.

File Under: The Business of Publishing

31 responses so far ↓

  • Lady T // Oct 23, 2009 at 5:46 pm

    I frankly don’t see what the big deal is about releasing the e-book edition a little later than the print version-are paperbacks released along side a new hardcover? No, and even audio books are sometimes available before the print edition is out and about. Patience is a virtue and if it means that much to an e-book person,they can hold out for the download just as much I would wait for the DVD release of a hit summer movie from a couple of months ago.

    Your comments regarding this of “Yeah, I should be treated with deference. I should get preferential treatment. I want to pay for these books right now, not borrow them from a library or a friend, not buy them used. ” make you sound as mature as Veruca Salt or Cartman waiting for the Nintendo Wii to be on sale. Just because you have a shiny new toy to play with,that doesn’t mean the world should stop to make sure you have all the goodies in your basket.

    I have nothing against e-books themselves or the growing market for them,but those who promote it’s causes do themselves and the e-book market no favors by whining. Yes,the pricing should be fair and equal to both the print and the audio market but fight over the big issues that are most important rather than squabbling over petty points.

  • Brian O'Leary // Oct 24, 2009 at 6:44 am

    @Lady T If pricing and availability of e-books don’t qualify, what are “the big issues” we should be discussing?

  • Keith Fahlgren // Oct 24, 2009 at 7:48 am

    Thanks for highlighting the BookServer opportunity. Peter and I have gotten a lot better about explaining it over the last few months, but we’ve got a lot of work ahead of us in terms of listening to what folks big and small could do with this ecosystem (and then also building and defining it).

  • Lady T // Oct 24, 2009 at 8:25 am

    Fair pricing is what you should be concerned with,Brian and as I stated,I have no problems with e-book users voicing their concerns about that. As to availability,waiting a few weeks after the print edition of a new title seems reasonable to me.

  • Kassia Krozser // Oct 24, 2009 at 9:26 am

    @Lady T — While I appreciate the Veruca Salt reference, I respectfully disagree with you. The “shiny new toy” I have isn’t so new. The commercial ebook market is over a decade old. Patience might very well be a virtue — I cannot say for sure — but the current industry thinking is out of line with reality. The reason for delaying the release is to “protect” the hardcover sales. I’m sorry, but that’s not logical. It’s akin to shutting the barn after the horse and all that.

    So what’s the big deal about releasing the ebook edition a little later? A certain number of former hardcover readers have made the switch to ebooks, for various reasons. They will not purchase the hardcover edition of a book just because the ebook is not available. It is more like that the purchase of the book will not happen at all. There are a lot of books out there, and unless a title is a “must have” (there are relatively few of these, compared to the number of books released on an annual basis), out of sight, out of mind, and all that. Delaying the release of an ebook defies logic in this instance because the risk is a lost sale entirely.

    On the flip side is strictly mass market customer who, for her own reasons (including reasonable pricing, at least from large vendors) chooses ebooks, who makes the purchase in the hardcover window — a year or so before the book would have been purchased. Two different kinds of customers, two sales scenarios. The benefits to publishing are obvious when you consider them. Now the benefits to publishing if I buy a book used are also obvious: there are none, beyond discovery. I don’t enjoy reading the hardcover format; it’s uncomfortable. Some people, however, will simply buy that book used, if it’s a book they must have. Or they’ll borrow the book from the library — again, one-time sale.

    The DVD argument, to my mind, is false, and not just because studios are doing everything they can to close that window as quickly as they can, moving it from six months to under three if not less (in the olden days, production and prints and marketing costs were largely, if not not wholly, covered by the initial theatrical run; in these times, due to escalating costs, studios count on the DVD market to help recoup these costs, which are largely financed. The longer it takes to recover them, the more it costs the studio). However, books are not movies, and the per ticket cost of going to the theater versus purchasing the DVD is not that different. Comparing these two markets and using the theatrical release pattern to justify the same in books ignores two key points:

    Repeat Viewings: The theatrical customer, the DVD customer, the pay cable customer, the network customer, and even the syndication customer can be the same person. Unlike books, a person who “buys” the movie in the theater setting may also buy the movie in DVD format. They might watch the movie on HBO if they’re inclined. They’ll watch it on an airplane. When it pops up on a major network (less likely these days), and when flipping channels on a weekend afternoon. The DVD market is comprised of a mix of new and returning customers to that movie.
    Value Added: In order to entice that repeat customer — and convince the new customer — studios try their best to make the DVD purchase, the secondary market, better than the theatrical experience. They add content to differentiate the DVD from the theatrical release. Unlike publishing where all hopes are pinned on the hardcover to recover costs, motion picture studios understand how important the DVD customer is, and they do everything they can to seduce this customer into making a purchase, particularly if it’s a purchase already made once.

    All evidence points to ebook readers being the best customers the publishing industry can have. The business is changing. Telling me to exercise patience will not negate that. The customer base is shifting, and stupid publishing tricks will not change this, but it will anger the very people who have far too many entertainment choices available to them. Publishing is not an industry where lost sales to reliable customers is easily tolerated on a financial level.

  • Lady T // Oct 24, 2009 at 4:08 pm

    While I respect your preference for the e-book format,I must disagree with you upon several points:

    1) Yes,the e-book has been around for about a decade(I recall early models of it being touted to booksellers back when I worked at an independent book store)and in comparison to such other advances in the publishing world such as the mass market paperback(starting in the 1930s),the audio book(which adapted from cassette to CDs during the last couple of decades)and the printing press,the e-book reader is reasonably still in it’s childhood stages.

    2) You say that the DVD comparison is inaccurate due to availability,repeat usage and value added. Allow me to politely retort:

    -limits on availability: I believe we are both aware of the out of print market and demand for many titles,including current ones such as the newest Nobel Prize winner and the Man Booker winning novel which is not yet available in the U.S. at the moment. The same factors that limit film also apply to books and as to the cost,check the list prices of new DVDs vs. the discounts offered by retailers and you’ll see the similarities with books.

    -Repeat Viewings: Rereading a book in any form is a great pleasure and just as various as the one you described for movies. You can read a book in a library or borrow it from a friend/relative or receive it as a gift. You can read it on the way to/from work,during the commercials as you watch your favorite TV shows or take it along with you on vacation.

    You can also find them in unexpected places(waiting rooms,hotel night stands,on a park bench,etc)and either find a new treasure or enjoy again the same delights as before-not much different than channel flipping and catching a movie you’ve never seen before or one that you haven’t seen in a long while.

    -Value added: Paperback editions have been adding extra content such as reading guides for book discussions,author interviews and preview excerpts from the author’s upcoming new book for quite some time now. Even classic titles have been getting this treatment-Modern Library is a fine example of that.

    3) There have always been those readers who are loyal to one format or another for their books and refuse to accept any other. There’s nothing new about ebook readers demanding to be taken notice of first,just as some folks will insist upon hardcovers being the only ‘real” books around or constantly asking “when is it going to be in paperback?” The cost of putting out a physical copy of a book is going to naturally be more than it is for the digital version,so it only makes financial sense to go about earning that money back as soon as possible.

    Yes,the market is changing and that’s a good thing for all concerned. However,it is not smart to focus entirely on one segment of the consumer base simply because they are making the most noise. The truth is that while e-book will be a major part of the publishing world for some time to come,they are not the be-all and the end-all of books as we know them.

    The main reason for that is financial;there will always be a strong section of the book buying public that will either not be able to afford e-books and reader devices(no matter how low the prices will actually get) or want to use them at all. It would be unwise of any business to cut off customers who are just as reliable,if not more so,and overly cater to those dazzled by technology. No industry likes to lose any sales to reliable customers and by chucking out any consideration to the print market,that’s precisely what they would be doing.

    Should there be changes in publishing? Yes,indeed and perhaps with the advancement of the digital book and the shifting economy,some will be implemented sooner than expected. As for my own reading choices,sometimes I like a hardcover,other times I don’t. I haven’t yet tried the e-book market(which ,no doubt,you will immediately credit for my previous opinions here)but I’m sure that if I did it,I might enjoy it. I don’t begrudge any e-book fan his/her delight in using this new technology but I do object to the upturned nose approach taken to those who not not completely in love with this literary Tonka toy or the “I WANT IT NOW!” tact to getting special treatment over the rest of us.

    So,in conclusion,while it may take some time for all of the available book formats to be in snyc with each other,it will happen and stamping your foot about it is not going to make it occur any faster.

    The best way to sum up my feelings about books and computers is this bit of dialogue from one of my favorite TV series:

    Jenny: Honestly, what is it about them that bothers you so much?
    Giles: The smell.
    Jenny Calendar: Computers don’t smell, Rupert.

    Rupert: ” I know. Smell is the most powerful trigger to the memory there is. A certain flower or a whiff of smoke can bring up experiences long forgotten. Books smell… musty and rich. The knowledge gained from a computer is… it has no texture, no context. It’s there and then it’s gone. If it’s to last, then the getting of knowledge should be tangible. It should be, um… smelly.”

  • Biblibio // Oct 25, 2009 at 1:20 am

    I think you’re right that Sony suffers the most, but I think Sony is also most ignored and given the least amount of credit. Sony has come up with some great ideas recently (the library one? Anyone remember that bombshell?) and their open format move was pretty cool, but it’s all ignored because the Great and Wondrous Amazon has internet and power.

    I don’t trust B&N right away because that’s how markets work – new products are typically less trustworthy than established or updated ones. Yes, everyone does battle with Amazon because it is the Giant Bookseller, but that doesn’t mean it deserves all the chatter. And while I’m sure Sony is going to cut prices soon to counter these, and while I’m sure they’re trying to figure out what they’re doing wrong with updates, I don’t think they’re necessarily failing on any front. Reviews of the nook have so far been mostly theoretical – in practice, little is known. And wireless just in the stores is kind of lame. In the same way that Amazon has its flaws with its close-mindedness, the nook will probably have flaws with practicality. Sony is ahead in a few counts and while the nook does push it back a little further, it deserves a heck of a lot more attention than it’s getting. Just my thoughts…

  • Kassia Krozser // Oct 25, 2009 at 9:32 am

    @Lady T

    I think we need to agree to disagree, though I remain confused by your argument. You seem to be implying that a) it’s necessary to release ebooks as a secondary window in order to recoup costs of the physical book while noting b) I’m suggesting ebooks are the be-all, end-all of books because c) there is a market segment who can’t afford ebooks. To that final point, I note that the cost of production and distribution, coupled with real-world technology favors the ebooks and digital distribution. See last week’s post about cool uses of existing technology to bring books to areas where no traditional commerce exists.

    You seem to be equating *ebooks* with *ereaders*. Ebooks have been around for a few decades, but the commercial market has been in place for over a decade. Ereaders, starting with the Rocket eBook, have been making inroads into the marketplace, bur remain a small segment of the device marketplace for ebook reading. Far and away, in the United States and Western Europe, the desktop/laptop is the primary source of readers utilizing ebooks. In other cultures, the cell phone is emerging as a primary reading choice. It’s not new, nor is it particularly innovative. The bottom line, from my perspective, is that real people who buy books are increasingly adopting this form of reading, and it makes no sense at all to treat them like second-class readers (and this happens on many levels) when they also represent the best customers publishing has.

    Second, I think you misunderstood me. I wasn’t talking about rereading/rewatching as much as I was noting the potential for secondary and tertiary sales when it comes to motion pictures (each of the windows I outlined, up to free television, comes with an associated cost). This is a relative rarity in books, but the value added aspect of special content on DVDs is to encourage this type of extra sale by offering something not offered in the theater. Unfortunately, I don’t think reader guides come close to this level of experience (especially as they are often available on publisher or author websites). Quite possibly, the best chance for publishers to encourage this type of secondary sales channel is via well-loved backlist being resold to readers as ebooks.

    Your argument about earning money back as quickly as possible only make sense (to me) if the ebook customer is willing to buy the hardcover instead. There is no evidence of this. I won’t do it. Other readers I know who have made the switch won’t do it. In fact, there is a strata of readers who have become initial release readers (formerly mass market customers) because of the price. Most advances don’t earn out, and many of us are advocating for smarter financial models. So if it’s a matter of recouping costs, this strategy doesn’t fly. Withholding the book from one segment of the market to protect another is a losing strategy. It’s smarter, in my opinion, to use this current window of time to migrate to better business models.

    Regardless, it makes no sense to me to protect one market while ignoring another that is comprised of very good customers. Who wins? Not the author, not the publisher. I return to my constant argument: the competition is not other books, it’s everything else. And everything else is very seductive.

    (I don’t understand your commentary on limits of availability in the motion picture market. The comparison to Hilary Mantel’s Booker Prize winner and movies doesn’t make sense to me. The lack of availability of the Mantel title in the US immediately after winning the prize was a marketing disaster. How in the world could publishers, knowing the Booker shortlist, not have all finalists ready to go? Wolf Hall is losing sales due to this lack of availability. Having the ebook for sale would certainly have done wonders for filling the in the gap for readers.)

    The Buffy quote is nice, but, honestly, I have no patience for the smell of books argument. I’ve heard it far too often. In fact, one correspondent went on and on and on about how much she loved books. Everything about books. Except one thing: the actual stories. She worshipped the object to the point that she neglected the truly important part. I don’t care from format. I never have. I care about the story.

    You don’t read ebooks, and that’s absolutely fine. You don’t have to. In fact, nobody has to. I made a choice based on many personal issues, but — again — this is not a new thing, this is not something that popped up last year (in fact, yesterday, I had an email conversation with someone who was looking for historical pricing information; interesting tidbit: in mid-2004, during the height of The Da Vinci Code hardcover craze, the ebook was retailing for $9.95). Readers are migrating to this format rapidly; ebooks are the only consistently rising market segment. By all accounts, ebook readers are the best customers for books. It makes absolutely no sense to alienate a passionate and growing market segment to protect a business model that, frankly, is financially unsustainable. Most books released in hardcover do not earn out their advances. It’s a crapshoot at best.

    I’m done being polite with the trade publishing industry (and yes, they know this, we talk. A lot.). I care very much about publishing, but I care about books even more. I believe publishers serve an important role in our society and for readers. However, I don’t owe any trade publisher my business. If a publisher does not consider me to be important, then I have many, many other options. Unfortunately for these publishers, this is the prevailing sentiment among readers — we are exercising our right to make other choices.

  • Kassia Krozser // Oct 25, 2009 at 2:13 pm

    @Biblibio My thinking behind the Sony problem is that it’s too pricey and doesn’t have the wireless/wifi capability that the other devices have. If they were competitive in that space, I’d feel much better. It’s a fine device (my household possesses one!), but my worries spring from the lack of seamlessness in the purchasing process. If that existed…

  • Richard Adin // Oct 26, 2009 at 5:46 am

    Two things I would like to address: the nook and territorial rights. First the nook.

    B&N has blown it and blown it badly. No, not the nook itself, but rather the selling of the nook. It has done what any first-grade marketer knows NOT to do to succeed: B&N has antagonized its B&N club members (like me) by making both the nook and the ebooks off limits to the discount that club members are supposed to get as a result of both being loyal B&N customers and paying $25 to join. B&N has also antagonized club members and nonclub members by not accepting B&N gift cards as payment (or partial payment) for the nook and ebooks. How dumb is that? B&N has also blown it by having an onerous return policy on the nook. Buy a Kindle, don’t like, return in 30 days and get your money back. Buy a nook, you’ve got 14 days to return it and if you have removed the wrapper, which you have to do to try it, you have to pay a restocking fee and may also have to reimburse B&N for the “free” shipping you got. And B&N has compounded blowing it by having ebook prices that are significantly higher than its chief competitor Amazon.

    I’ve been a loyal and avid B&N bookbuyer for years. I buy a large number of hardcover books from B&N every year (more than 25 so far this year with more on order; in addition, I have bought more than 70 ebooks from Fictionwise, its subsidiary this year) and yet B&N has done nothing to make me want to move from my Sony to its nook and start buying B&N ebooks in addition to hardcovers. And it is doing nothing to encourage me to buy more books from Fictionwise; I currently only buy multiformat books there but would buy more with DRM if I owned the nook.

    So B&N has stuck its toe into the water but refuses to put anything more into the water for fear of actually succeeding in ebooks and becoming a viable Amazon competitor.

    On to territoriality —

    Publishers do have some blame in this game but most of the blame, I think, belongs with authors and their agents who negotiate contracts that limit rights. I find it hard to believe that the publisher of Hialry Mantle’s book, or Stephen King’s, or most any author, wouldn’t gladly accept worldwide rights. But very few contracts grant such rights because authors and agents do not want to give up the chance of having multiple contracts and multiple revenue streams. So let’s be fair and pass the blame for territoriality around. Worldwide rights requires rethinking on the part of both authors and their agents and publishers, not just publishers.

  • Richard Adin // Oct 26, 2009 at 5:50 am

    Kassia, several of the Sony devices do have wireless/wifi capability already and the forthcoming Daily Edition will as well.

    Personally I find the wireless experience a bit overhyped. If you have enough smarts to comment here (or even to read these comments) you certainly have enough smarts to connect a USB cable to transfer books from your computer to your ebook device.

    Besides, if the sole connection is wireless, most people will rely on the bookseller to store their purchases. Having to use the USB cable acts as a way to prevent bookseller from taking back a purchase and as a reminder that you should store a copy of your purchase some place safe from prying digital fingers.

  • Kassia Krozser // Oct 26, 2009 at 9:06 am

    @Richard — As far as I’m aware, only the forthcoming Sony 900 has any sort of wireless capability (no wifi) — the husband, who is a Sony Reader owner, has been incredibly frustrated by this lack of connectivity. The introductory price point for the 900 is set at about $399. Given recent moves by Amazon and B&N, that’s a lot of money without a lot of additional functionality to make it competitive. I’ve been rooting for Sony because I like the experience and many of the business decisions they’ve made. The reader space is highly competitive, and I think Sony is making the same errors in the reader space they made in the television space: an excellent product that is priced above what the market with (currently) bear. I hope they pull it out.

    As for the wireless/wifi thing being overrated, sure, I can connect with a plug. I do it all the time with my Kindle when I buy unencrypted .mobi files from other vendors. Despite that (and despite knowing Amazon owns my soul), I really do love the wireless capability. And if the browser experience improves (and it must — things don’t go backward), then that will become an increasingly important feature for some readers. I also like to think this capability can/will open up the marketplace for independent booksellers.

    (The cloud thing is something we’re fighting about right now…who gets to write about the topic in more detail; I suspect I’ll lose to Kirk Biglione as he’s far more informed about the technological ins and outs.)

    Your point about B&N and their lack of service to their best customers is well-taken. I somehow missed that in the coverage. It makes no sense at all, does it? They have the potential to turn these customers into evangelists for the store and device; that has to be worth whatever loss they incur on the device. I hope they rethink this decision.

  • Lady T // Oct 26, 2009 at 9:55 am

    Perhaps I have misunderstood you,Miss Krozser,but please allow me to make a few more points before we end this discussion:

    You say that” Withholding the book from one segment of the market to protect another is a losing strategy. It’s smarter, in my opinion, to use this current window of time to migrate to better business models.” However,it’s not really withholding,it’s delaying. If it means that much to an e-book person to only purchase the digital edition,then wouldn’t that person take note of that particular release date and make plans to have it by then? Is it really such a hardship to wait a little bit longer? Delayed gratification is becoming a lost art in these high tech times,if you ask me.

    Also,your assumption that because you and a few other like minded individuals won’t buy a print edition and a digital one is just that,an assumption.

    As a person who does own more than one copy of certain books(both classic and contemporary),I know full well that there are plenty of book lovers out there who will buy both and some who strive to have every available format of a particular author’s work or their favorite story. Those people are just as “real” as those who prefer the e-book market and I’m sorry if you think the publishing industry is treating you like a second class citizen but as the old saying goes,no one can make you feel inferior without your consent.

    I don’t know your work background,Miss Krozser,but as a former bookseller,I’m not shocked at the lack of availability of the Mantel book(part of which is due to what Mr. Adin mentioned in his comment regarding worldwide rights). Asking all of these publishers to have all of these books on deck in case it wins is about as sensible as spending your sweepstakes winnings on scratch off lottery tickets. Also,it’s not as easy as it sounds-why not ask a few folks in the industry about this and see what answers you get? Might be interesting there.

    Finally,I also love stories just as much as the format they are in. Experiencing a good book in new ways is a delightful challenge and one that keeps your interest in literature alive and healthy-for example, I’ve learned to appreciate audio books,which I once thought were only useful to travelers and folks with vision problems(I wear eyeglasses,btw). After listening to a few,I now understand the pleasure of having the time honored tradition of storytelling come alive in a brand new modern way. You do have a point about those who seem to have a fetishism for an object over it’s contents but I don’t think it’s wise to paint everyone who still admires the classic format of books with such a broad brush.

    It’s your anger about this issue and your insistence about e-books (which perhaps may have been around a little longer than I knew,but in the history of the book,it’s still a drop in the bucket of time there) being the only market worth pursuing that gives one the impression that you consider all other literary options to be obsolete. I get very passionate myself about arts and entertainment(amongst other things going on the world) but sometimes,it’s better to check yourself before you wreck yourself,emotionally and intellectually.

    Maybe you should channel some of that anger you have towards publishing into expanding some of your personal horizons there. It’s never too late to learn and grow,Miss Krozser. I’m still struggling to do that myself and wish you the best of luck in all of your endeavors.

    Sincerely,

    Lady T

  • Kassia Krozser // Oct 26, 2009 at 10:25 am

    @Lady T — This is the gist of the problem:

    You say that” Withholding the book from one segment of the market to protect another is a losing strategy. It’s smarter, in my opinion, to use this current window of time to migrate to better business models.” However,it’s not really withholding,it’s delaying. If it means that much to an e-book person to only purchase the digital edition,then wouldn’t that person take note of that particular release date and make plans to have it by then? Is it really such a hardship to wait a little bit longer? Delayed gratification is becoming a lost art in these high tech times,if you ask me.

    The pace of books being released versus the reader’s ability to read them means that very few books are Must Haves. Most are “Sure, I’ll buy it and maybe I’ll read it”, but that depends on consumer awareness at their ability to purchase. If it’s a book like, oh, the Stephen King, for me, it’s not a must have. So the fact that it’s not availabe in my preferred format is a lost sale for the publisher and author. Delaying/withholding, it doesn’t matter. If it were a book I wanted above all others, then, yes, maybe I’d make a note, but…rarely do publishers give me the actual date of ebook release (see: every other person writing about this space for more information about this frustration). Again, it’s not a loss for me and it’s likely a gain for another author.

    As for territorial rights, wow, don’t get me started. It’s an issue I know well and have discussed for many years, from both the publisher and author perspective (for the former, obtaining all rights is desirable, for the latter, parsing them out can be more lucrative but that is sometimes countered by the bookkeeping required; as a rule, I advise authors to retain as many rights as possible, but this is becoming a losing battle for them as publishers want these rights). It was sloppy on the part of the US publisher not to have the Mantel book available. The Booker shortlist is known far enough in advance (and it is a short list), the translation of English to English is generally fairly simple, and to lose momentum that comes from worldwide marketing is a mistake. Now the publisher is playing catch-up, and, as with the ebook market, there were many readers ready and willing to buy the book. Now it’s a matter of notifying these readers that the book is available for purchase. Given the many other distractions readers face, that’s a tough battle.

    I don’t care what format you choose for reading (and I’m pleased you have discovered how audiobooks are useful beyond traveling — I live in a commuter city and know many people who only “read” via audiobook — they face many challenges and are extremely frustrated as well; these are working mothers whose only downtime is while they’re in the car, in traffic, and they are underserved). I care that books are available to readers. Publishing is an industry that is struggling against many forms of competition, and, yes, I’m angry about moves being made. I have the luxury of history on my side. This isn’t the first entertainment industry I’ve witnessed making the the digital transition.

  • Theresa M. Moore // Oct 26, 2009 at 11:09 am

    I read this argument you are having with Lady T – and I am baffled that neither one of you have talked about the many readers who actively pursue the “free” ebook, and claim that it is their “right” to get them that way. I don’t think it’s the issue of making the books available on a certain schedule, or pricing them a certain way; it’s the issue of re-educating a huge segment of the reading population who seem to think that all books ought to be free and who are wholly ignorant of the cost to publishers. That is the biggest form of competition all publisher face today, from the biggest 50,000 print runners to the POD publishers. Digipiracy does not apply to this system of thinking. So unless and until we make readers understand that an industry created the books, in whatever format, they will continue to hunt for the freebies and forget about the ones with the prices. This in a sense segregates the material unfairly for the reader, since his choices limit the variety of topics and genres. But publishers are (or were) in this business to make money, and everything which threatens their ability to do so only makes them limit their choices, too. If publishers are forced to create product consistenly below cost they will go out of business altogether, and it’s the reader who will suffer.

  • Lady T // Oct 26, 2009 at 11:26 am

    Speaking for myself,Theresa,this is an issue that I’ve heard about,mainly from the music industry with the fights against Napster and others of that ilk,but don’t know enough about to make a strong statement about on either side.

    I do agree that it sounds like it could be a real problem down the line(and may be making a major impact already) and is worth further discussion amongst those more knowledgeable about all the variable of it than I.

  • Sean Cranbury // Oct 26, 2009 at 11:33 am

    I would like to address a few things here because there’s a lot of dancing about architecture going on in these comments and it’s getting ridiculous.

    First, Richard, I completely agree with you about spreading the blame on territorial rights around a bit. I was speaking with an agent this weekend about this very subject. These rights questions are a huge part of the changes affecting the book publishing industry. A pivotal part of it.

    Second, Lady T, I can tell you as an independent bookseller with more than 10 years experience that there’s absolutely no excuse for publishers not to have Book shortlisted books on hand in every territory on the day the winner is announced. Even if that means that a quickie ebook was made available while the books shipped to the stores. You cannot make up for the impulse buy and you can not capitalize on the huge media coverage 4 weeks later. The lack of execution around the Booker winner was ridiculous.

    As for the dissemination of ebooks – and this touches on the territorial rights thing, too – any attempt by a publisher/agent/author to control their books in the digital realm is akin to clutching a handful of sand tighter and tighter. It’s slipping thru your fingers and the tighter you squeeze the more you lose.

    I think that book publishers need to put the horse IN FRONT of the wagon on this issue which means they should be using DRM-free digital content (cost free and/or not free depending on the situation, author/book/time of year) ahead of the release of the physical book to plant seeds in the market, publicize and variously promote the arrival of the physical book.

    The files should be trackable (but, again, without DRM) and should contain strong branding for the publisher/author/imprint and should contain as many easy options for purchase of the physical book, other books in the series, etc… as possible. The files should also include a sincere THANK YOU to the reader for taking the time to invest in their author/story.

    Hiding the ebook – or being completely out to lunch on making one available – will only create the pirate market that everyone thinks is already out there.

    You have no control over electronic files. Ask Ursula LeGuin how she feels about readers being so passionate about her work that they scanned the Left Hand of Darkness and made it available on P2P sites because her publisher dialing ‘9’ on their rotary dial phone.

    The sooner the industry starts to pay attention to the abundant digital lessons that their fellow media industries have already suffered thru the better for everyone.

    This means getting out of the way of the digital flow, quit trying to contain it and make up flimsy excuses that have no real evidence to support them and find ways to innovate and connect directly with customers.

    Just do it already. Hire smart people, quit making excuses and engage the reader.

    By implying that Kassia is ‘angry’, Lady T, you’re only inflaming the argument and providing little support for your argument.

    Kassia is passionate and articulate and I’ll take that, Lady T, over the incoherence and anonymity of your argument any day of the week.

  • Nero // Oct 26, 2009 at 11:34 am

    To Laty D: Finally someone is speaking some sense around here. I do not care what Kathy K says, we all know how important the smell of books is. Fortunately there is a solution to this problem.

  • Kassia Krozser // Oct 26, 2009 at 11:39 am

    @Theresa I cannot speak for Lady T, but haven’t addressed this aspect of the market because it’s not part of this discussion (though, yes, it does come into play as withholding a book means there is no legal option for the consumer; JK Rowling has never sold a legal copy of a Harry Potter ebook, but we know many illegal versions have been accessed). For what they’re worth — and Brian O’Leary who commented early in this thread has done quantitative research on the issues of free and piracy; I highly recommend checking out his work for more scientific information (here is link to some information, and if you need more, there is a report available from O’Reilly — here are my thoughts on piracy/free.

    Yes, there is a group of readers who will claim free books as their right. They represent a small segment of the population, and one thing that puzzles me is why their fellow readers do not do more to shame them. I hear about readers who proudly share books with their friends and how appalling this behavior, but never hear from other readers who say they have spoken up, called out a person by name, and told them this is wrong. The industry talks a lot about social DRM being a viable solution to aspects of the piracy problem, but what about social conditioning?

    I digress (but it’s worth thinking about). I firmly believe that *most* people will happily pay for books as long as some basic criteria are met: 1) the right price; 2) the right format; 3) convenience (shopping, portability, etc). One key aspect to fighting piracy is to make it the least attractive option for consumers. If the iTunes store has taught us anything — and there are a few valuable lessons to be learned — it is that the marketplace will thrive if these basic conditions are met for the consumer. People get that they are supposed to pay for goods and services.

    There will always be a segment of the marketplace that will be pirates (this has been part of the human condition as long as we’ve had commerce, and commerce always seems to win, though sometimes piracy forces change in the market). However, it’s really important, from my perspective to distinguish the forms of sharing that occur in the freespace (yeah, I’ve thought about this way too much over the years). We have, of course, the philosophical pirates; they will not pay for anything if they can get away with it. We have the accidental pirates; they simply do not know they are accessing illegal copies of material (yeah, I know, but they’re out there, and it doesn’t help when there is no legal alternative…because the legal outlets often return higher in search engines like Google due to various factors, including longevity, inbound links, better SEO). Then we have samplers — I won’t call them pirates — they are seeking out free material to determine if a purchase is warranted. Finally, we have casual sharers, book lovers who pass favorite books to friends and family.

    It is the three final groups who require the most focus. Piracy cannot be stopped, but it can be managed. Yes, I firmly believe that efforts must be focused on closing down pirate networks, but I also believe the better the consumer experience, the more likely it is that legal purchases are made. Me? I wouldn’t want to risk my system and security via a torrent network. As noted, I’ll forego the purchase if the book is not available. I don’t pirate; I don’t even buy used books.

    As for the pricing thing, that is another long discussion. I’m sure I’ll be posting in great detail on this topic as I prepare my presentation at Digital Book World. I believe Brian O’Leary will be presenting on free and/or piracy at the upcoming Tools of Change conference as well (it looks like I’ll be presenting on the digital publishing business model, details to come).

  • Sean Cranbury // Oct 26, 2009 at 11:40 am

    Theresa

    I sympathize with your argument but the genie is out of the bottle and quite honestly how do you plan to ‘educate’ the segment of the population that understands how to use P2P technologies and uses P2P for many reasons beyond something that you are calling digipiracy?

    Making it a moral argument means that you have already lost.

    There is nothing that you can do to prevent file sharing except adapt your business model to take it into account and figure out a way to make it work for you.

    That is the big challenge that the book industry has in front of them.

    The ‘kids these days’ argument hasn’t worked in decades.

  • May You Live in Interesting Times | Ditchwalk // Oct 26, 2009 at 5:42 pm

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  • Lady T // Oct 26, 2009 at 6:44 pm

    Sean,as someone with eight years of bookselling experience,I respect your feedback but think over what you said for a moment about the Booker nominees,that all of those Man Booker titles should be at every store,ready and available to be sold on the day that the winner is announced.

    Perhaps that might be feasible for the chain stores but for many of the smaller independents,getting stuck with several titles with the possibility of one out of five being in demand as the hot ticket item due to being the lucky winner might not be such a great thing.

    “But the other books will sell,because they’re nominated!”

    Maybe in some quarters,but not in all. I do agree that the industry can be pretty slow on certain things,like timely releases,but unless you have a crystal ball on hand,picking a literary prize winner isn’t as simple as it sounds. I think it’s still a gamble,anyway you slice it.

    As for my opinion about Miss Krozser”anger”-that’s just I see it and I prefer to be honest about why her argument for e-book releases rubs me the wrong way. Nothing personal against the lady but to me, sometimes you catch more flies with honey than you do with vinegar.

    I do hope this response is coherent enough for you,Sean:)

  • Sean Cranbury // Oct 26, 2009 at 7:31 pm

    Lady T – I did not write that stores should be stocked to the rafters with books on the long and/or short list.

    What I did write is… “that there’s absolutely no excuse for publishers not to have Booker shortlisted books on hand in every territory on the day the winner is announced. Even if that means that a quickie ebook was made available while the books shipped to the stores. You cannot make up for the impulse buy and you can not capitalize on the huge media coverage 4 weeks later. The lack of execution around the Booker winner was ridiculous.”

    There’s is a big difference.

    It is the publishers job to have titles available for the bookseller. The bookseller then sells the books to the customer because the customer has just read in the paper that the book is worthy of being noticed/short listed/read. Makes no difference whether that book exists in paper or digital.

    If the publisher can not capitalize on a book award, especially the Booker – one of the few guaranteed events in a calendar year that sells lots of books – then they’re of next to no use to their authors or customers and of zero use to the bookseller.

    Your Vinegar/Honey analogy is duly noted but I would submit that your commentary comes across more as nameless industry apologist than critical observer, Lady T.

    I think that someone familiar with Kassia’s work would recognize that it’s not negative emotions that drive her to write what she does.

  • Kassia Krozser // Oct 26, 2009 at 11:23 pm

    @Lady T You have an absolute right to react to my anger, just I have a right to my anger. As you can see if you’ve checked out the five plus years of this blog, I have written extensively on this topic. I have spoken at publishing industry events. I have made my thoughts clear to publishing professionals — many of whom I admire greatly, even when we disagree.

    I understand that you’re new to some of these issues, and I appreciate your perspective. I have strong opinions on this topic, many of which stem from experience, not petulance. If you explore beyond this site, you will discover a lot of anger about these issues — pricing, release patterns, formats, DRM, and more — stemming from consumers. There is no honey anymore. The industry is changing extremely fast, and if traditional publishers don’t figure out a way to get ahead of consumers, they will not win this battle. This is not to say that publishing will lose, but that the dynamics will shift. Right now, the consumer base in the digital marketplace is far more sophisticated than the publishing industry. To my mind, that’s not good.

    I do hope you continue to engage and explore. You are not wrong. There are no right answers in a time when everyone is feeling their way. There are maps and trails, and the people who have challenged you here are the smart ones. I certainly look to them for advice.

  • L // Oct 27, 2009 at 10:29 am

    Kassia, in regards to the debate going on here in the comments, I have to wonder two things:

    1) Why is the argument always that e-books should be released at the same time as hardcover, with no mention of paperback formats? Why should fans of that format be forced to wait? Why can’t all formats be released at one time, thus appeasing all readers, and boosting total sales? Because to argue that an e-reader would never buy a hardcover anyway I would think, based on my own experience and opinion, applies to paperback fans as well. I love trade paperback best; I never buy hardcover.

    2) You advocate for smarter business models, and seem to think e-books play a key role in “rescuing the bottom line” for lack of better terminology. But in light of the e-book price wars going on right now, I’m not clear on how you think e-books are going to positively affect the business model. If nothing else, they are in danger of toppling the whole system, because $5 books simply cannot generate the kind of profits needed to sustain book production of any kind. E-books may be cheaper to produce, but not THAT much cheaper. Yet, they are inherently worth far less than an actual book, due to their lack of ownership/transferability/etc. So where is/should/will the difference be made up, do you think?

  • Kassia Krozser // Oct 27, 2009 at 11:33 am

    @L — You’re asking good questions. Since I have no idea if you’re coming from the perspective of the reader or a publisher or an author, I’m going to answer generally.

    1. Formats. I agree with you that format windows are becoming increasingly irrelevant. Of course, especially after a conversation yesterday with an irate reader who was furious that her $22.95 book was so thin on story, I think far too many books are sold as hardcover for the wrong reasons (this leads to reader drop-off).

    Authors like the hardcover window because of status and higher royalty rates. Publishers generally see a higher return on hardcover. The mass market (versus trade paperback) margins are lower (generally), and the parties involved aren’t likely to buy into true day-and-date release patterns (world and format). The argument for ebooks being released at the same time as hardcover stems from the fact that adopters represent a mix of former hardcover customers (potential lost sales due to lack of ongoing marketing support to keep these readers in the loop — it’s the publisher responsibility, not the reader responsibility, to maintain this market awareness, and publishers do a really bad job of this…and if you consider the workload, it’s understandable) and converted mass market/trade customers and trade customers — people who wouldn’t buy at hardcover prices but will invest in a book if the price point is just below $10.

    In this current publishing economic climate, it’s the new customers (former mass market) who will contribute to recouping various costs faster. The former hardcover customers are shifting formats, and while the costs are certainly lower, they are not growing the existing market. If ebooks can bring in even more new customers or increase sales due to price and convenience, then that will also help recoup those costs. This only works if the market can meet the needs of those reades.

    2. There is a school of thought that believes ebooks cost nothing to produce. Those people are wrong. As you note, many costs remain: editorial/acquisition, production, distribution, marketing, various types of overhead. However, once publishers shift to a true digital workflow — most remain in the mindset of producing for print first, then going back and creating a digital version of the book…a more costly approach — savings from editorial down the chain will be realized. Distribution costs will be sliced. Marketing costs, alas, will remain as robust as ever, though we are seeing marketing campaigns that leverage lower cost word-of-mouth channels with good results.

    Ebooks are worth less to the customer than print books — and this is a disparity publishers have not acknowledged. Add to that the fact that, right now, pricing is insane, and I mean that sincerely. There are publishers who are setting prices with no basis in reality, and it’s creating a lot of bad will on the part of readers. Readers are happy to invest in books, but they need to know that the publishers understand the rights being relinquished and, frankly, the fact that these readers are investing in their infrastructure, suffering poor quality during this transition. From my perspective, the only way to truly realize cost savings is to rethink the publishing business model. There are successful publishers doing this.

    It’s not a given that $5 books cannot sustain the kind of profits needed to sustain publishing. Harlequin does very well at lower price points (though they also have lines that are higher priced). Others do as well. There is a market for higher priced ebooks as well, but publishers need to understand the true idea of value in ebooks, not a perceived or arbitrary value (above the de facto price being set by Amazon and others — this is not a price point publishers will be able to “educate” readers away from, at least as far as narrative fiction is concerned). I’m not alone in seeing a very near future where retailers put increasing pressure on publishers to lower the price of ebooks. Right now, Amazon and others are, when it comes to the $9.99 price point, subsidizing the difference between the wholesale cost and the selling price. That cannot hold. Once there is a solid market share (right now ebooks are a low percentage), publishers will need to re-evaluate their approach. My thinking is to move to what’s called a net pricing structure — similar to every other business, where the retailer purchases a product at a wholesale price and marks it up for sale based on business needs.

  • Brian O'Leary // Oct 27, 2009 at 1:52 pm

    I guess pricing and availability were the big issues, after all.

  • KatG // Oct 27, 2009 at 7:37 pm

    Oh wow, the price wars item is giving me flashbacks to the 1980’s when the warehouse stores got going (which included WalMart’s Sam’s Club stores.) The warehouses insisted on near remainder price discounts for high end bestsellers, causing publishers to reduce authors’ royalties on those sales and try to make money off of selling to the warehouses in large bulk with an expansion of the market. The same fears were expressed by booksellers, publishers, readers, media, etc., that because the selling prices for warehouse books were so low, soon those would be the only books sold, that bookstores would collapse, that people would only read bestsellers, etc.

    Of course, that didn’t happen. What did happen is that the book market expanded thanks to the warehouse sales, and this attracted new investment, the chain superstores opened with much larger inventories than the warehouse stores, and booksellers and publishers had to drop their prices a bit, at least of hardcovers.

    This is of course relevant to the e-book issues. A basic problem in book and other publishing is a belief that a potentially large new audience will somehow ruin the industry and kill all the current businesses off. The media loves this idea and it’s one of the few ways that the publishing industry gets media attention, which is one of the reasons it remains prevalent.

    Nonetheless, there are additional, complicated factors with e-books, primarily money and technology ones. Publishers can’t afford to hire tech people, they can’t create technological infrastructure and they feel at a loss, especially dealing with electronics giants like Microsoft and Sony. The market needs to become established first, and book publishers won’t be the ones to establish it. (Magazine publishers, on the other hand…)

    While I know that the e-book industry has been around awhile, in terms of public consciousness, it’s only been around since the launch of the Kindle. B&N may not be a flashy new entry, but that they are entering the ring, that Google is entering the ring, Apple, etc., that means the market will become more and more established to the general public. And with that market established, bulk sales will increase, and as they do, publishers will drop prices. They’ll do it with moaning and wringing of hands and the media will wonder if change will equal death, but they’ll do it. King is wrong, but then he’s been trying to help the independents for a long time now, and the independent bookstores will largely be at a loss in the e-book market, at least in the beginning.

    But the renewed interest in selling and above all promoting books by the department stores, the idea in the media that books are a lucrative product, and the entering of more and more major electronics and retail players into the e-publishing market are largely good things and will cause changes in pricing, formatting, etc.

  • Melissa // Nov 2, 2009 at 1:23 pm

    Hi Kassia,

    You have quite the debate in comments on this point, but I wanted to ask if you’d looked into the Entourage Edge yet. It’s a bit pricey at $490 but it includes a built in netbook. I love the dual book feature and it promises to be very useful for writers – you can write, research and read all on one device! Anyway, would love your opinion.

    http://www.entourageedge.com/

    I’ll probably wait to see if the price drops a little and wait for the wifi feature to be announced (they promise it’s coming) before buying, but I think it’s a promising reader – although I am hesitant about them selling primarily from “their” ebook store….

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