Charles Pillsbury III

Geek. Dad. Writer?

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Archive for July, 2009

Further Thoughts on the Kindle & eBooks

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Disclaimer: I’m largely going to discuss logistics of the eBook from an industry perspective and not a discussion of their validity as a replacement for the dead tree book on an emotional level. Too many of the complaints I’ve seen about eBook adoption relate to “oh I’d miss the smell of paper” and such. I enjoy listening to music on vinyl records still, but I recognize that it isn’t the most practical format to take with me to work, or on vacation. Likewise I’ll never get rid of every “normal” book in my house, but there are some scenarios in which I can see the eBook being a practical option. As the title of the old Wordtrip podcast pointed out: “It’s the Story Stupid”.

Disclaimer 2: I wrote most of this around the time the Kindle 2 came out which means some of it may be dated.

Before I start to talk (yet again) about the Kindle and the eBook industry, I want to do what everybody else has done, talk about iTunes and the music industry. This is obviously a flawed metaphor for comparison with the book industry, but it may be the best we can do. Back in 1999 Napster had owned the market, such as it was, on digital music delivery. If you wanted to hear a song all you needed to do was search Napster and it was there. Napster was a thing of consumer beauty. What it wasn’t, was a means of supporting the artists. Napster was free, and the service was free, and nobody was really getting paid for any of it (including, and especially, the artists). Some artists realized that this helped their market overall and contributed to their fan base, some artists realized it was stealing, and Napster realized that it wouldn’t be able to do things that way for much longer. The story goes that Napster went to the music industry execs and said essentially “we’ll pay you to legitimize this, what should we charge the users and what cut do we give you?” and the music industry decided it was too much of a threat to their existing business model and rather than help the consumer get what they wanted (music, ubiquitous can-find-whatever-I-want-easily-at-a-reasonable-price music) they shut down Napster.

While other peer-to-peer technologies arose, none gained the level of ubiquity that Napster had in its heyday, and nobody made “pay for digital music” mainstream until Apple introduced the iTunes music store to go with its already-successful iPod. There were a few subscription based music services which hadn’t taken off (commonly believed to have been largely due to the controls put on the music making it less useful for the consumer), and a few other pay for tracks & albums stores around, eMusic did it wonderfully for independent artists, but it was iTunes that really made it so all the kids could buy their pop songs on-line, feed them into their iPods, and allow the artists, producers, and Apple, to make money. Apple did this by doing something fundamentally less-good for the consumer, applying DRM to the iTunes song files, that convinced the music industry it was “OK” and people weren’t just going to be stealing the content. This gave Apple leverage to maintain the pricing structure they wanted and sell billions of songs. Eventually the music industry realized they had ceded more control than they wanted to Apple, and that the consumer would still (even prefer to) pay for cheap and easy-to-get songs without the DRM and everybody could still make money. The music industry decided to allow other digital music stores to sell their products without DRM before they would allow Apple to drop the DRM from their own, supposedly in hopes of wresting some of that control back from Apple. Probably the biggest of these other stores is the Amazon mp3 store where you can buy music for comparable prices to iTunes, in a high quality format, and have it auto-populate into iTunes for syncing with an iPod.

Apple still has the largest market in the digital music space, and even though they’ve dropped DRM they’re still using a proprietary format that primarily works in only their players (though now without DRM it is apparently trivial to convert those files into something that will play on any mp3 player). Many people think this has given them a monopoly in their market, because they’ve essentially locked the consumer into playing their music on Apple products. However I think one of the main reasons the iPod rose to success was because it not only allowed people to easily obtain music from the iTunes store, but because it always had the capability to play standard MP3s which people already had in their collection (some had Napster provided libraries, but many had also converted their CD collections into a digital format). It remains to be seen whether or not they’ll be able to maintain their hardware and/or software dominance now that the users can buy music in multiple places and for many other devices. This being locked in by the content they sold was much of the complaint pointed in their direction because it was less than ideal for the consumer (it has been argued well and many times by Cory Doctorow, see resource section for links).

All the blathering above is an attempt to lay the groundwork for discussion on the Kindle and ebooks. Now I want to speak to some of the pros and cons of the Kindle, and how it can succeed, how it might fail, and what it (and ebooks in general) might mean for the future of publishing. I’ll largely be ignoring the textbook and “assigned reading” market for the time being, not because they’re insignificant, but because they’re such a different beast (though I may touch on them later in the discussion).

Like music, ebooks have been around in multiple formats for many years. Like music, the publishing industry is concerned about the ability of the consumer to digitally copy a file they haven’t paid for instead of purchasing their own. Like music, the publishing industry is also worried about losing control as the gatekeepers of content to the general public. Unlike music however, no ubiquitous free means of sharing ebooks has cropped up (no ebook Napster). As with the iPod before it, the Kindle has come into a space where there exists other options for the consumer, some arguably better for the reading experience, or better for the end user options. There are other places selling ebooks besides, but, as with iTunes before it, the Kindle is the first to do a reasonably good job of making it easy for the consumer to purchase digital content in a relatively seamless way. Also like the iPod before it the hardware provider has a product which is not on the low end of the price spectrum, and the content distribution method has some pricing controls put in place that allow the distributor (Apple with iTunes, Amazon with Kindle) to set pricing structure to suit their needs.

While few people will argue that books are an industry which makes a significant amount of money, the purchasing habits of the book buying audience are vastly different than that of the music industry. The music industry is largely, if not primarily, driven by a young pre-teen through college age consumer who spends a not insignificant percentage of their disposable income on music. The book buying consumer base is broader and older. (I would insert real statistics here if I had them) My estimation is that in the US there are 10-20 million consumers of 10-20 new CDs each year, but for books the number of consumers who buy 10-20 new books a year of their own choosing is probably closer to the 1-2 million. Aside from the airline customer, generally a book purchase isn’t an impulse driven one. Many of us buy CDs, discover we only like half the tracks, and are OK with that. Rarely would we be happy enough to go back to an author if we only liked half of a book. So, in addition to the relatively obvious lack of a 99 cent book “section” corollary to a song, you have the vastly different purchasing trends that make digital distribution of books a different, and less easily adopted, market.

The cost issue is another one which complicates the ebook market. With music there is the obvious option of selling individual songs in addition to complete albums. With books it hasn’t been a viable option to sell individual chapters or serialized installments thus far. The closest corollary to a “song” is a short story, but the short story market has dried up a good bit (yes, you can still find/buy/sell short stories, but the market is one vastly different than that in which writers thirty years ago participated). Seemingly more people looking for that sort of short term entertainment have turned to television, and there is a whole discussion to be had about that at some point. Serialization would be a possible option (Stephen King tried this a few years back), but unlike a song, most serials aren’t usable without the rest of the “album”.

I know some have argued that ebooks are so much cheaper than dead tree books, but for the most part the discounted price on ebooks comes from the unknown independent artist, small press, or subsidized cost (as with the Kindle). As iTunes indicated, it wasn’t the indies who drove the market to a digital distribution (otherwise eMusic would’ve won that market), it was when you could get the very popular mass market artists available for download that digital distribution took off. Likewise, with literature it’s the Steven King, JK Rowling, Dan Brown, and Michael Crichton’s of the market who will drive enough people to ebooks and ebook readers.

One problem with a musical analogy is that most musical artists don’t make the bulk of their money from the production and sale of records, but from their live performances. As with Radio, a musician can almost give away their “product” and it not hurt their bottom line. Writer’s don’t have that one off performance based income. While you can take a segment of the retail cost out of the equation by not having to produce a physical book, the writer has a much more vested interest in getting paid for the consumption of his work in book form than a musician does in recorded form.

There are alternatives to the Kindle that each have their own strengths and weaknesses. The Cool-er eBook reader being one that got a bit of press recently and seems to answer some of the flaws in the Kindle; cheaper hardware, expandable, etc. Though the Cool-er and Sony both lack the killer function the Kindle nailed in revision one: “free” wireless access to download books almost anywhere and anytime. One can argue that the access isn’t free because of the price of the hardware, but it is functionally free to the user who purchases a Kindle.

The Amazon Kindle is sucking the air out of the room for other ebook readers on the market because, like iTunes and the iPod it has the integrated distribution system which makes it convenient for the consumer and comes from the largest on-line book seller. Also, like iTunes, it allows people to use at least some of their existing ebook formats. Unfortunately, also like iTunes/iPod, it uses a custom DRM. The competing DRM options may cause adoption issues from a user standpoint. If I purchase a book from Sony, or Amazon, I can’t read that on another reader. Amazon seems to be making an effort to mitigate this by developing Kindle apps for other devices (though currently it is only available for the iPhone). The main thing Amazon needs to do for their own sake is drive the market for long enough so people have enough Kindle format books in their “library” so that switching to another format would be costly or troublesome. This may not be best for the user, but if Amazon begins to license ability to read Kindle format books on competing hardware it may be enough of an incentive to push further adoption.

One of the keys to the adoption of the iPod/iTunes model was that people were able to use their existing library of songs, and the Kindle DX with its PDF support has made some steps in the right direction for those who already had e-books in that format. Though most people don’t have all that many ebooks in their collection, so one way to increase adoption rapidly would be to offer an “upgrade to ebook” where any book you’ve purchased from Amazon in dead tree format in the past could be purchased for your Kindle for $1-3. The publisher has already been paid for it, and the cost would mitigate the loss they may experience by you selling your original copy into the used book realm.

Kindle may be sucking the air out of the room right now, but if publishers want to keep Amazon from having the stranglehold on them that Apple has (or had) on the music industry it would behoove them to work out a format of their own with some sort of “upgrade to ebook” path that could be sold with the books and/or through retailers. Barnes & Noble would seem a good partner from a publishing standpoint where anybody could bring in their copy of a book, have the barcode scanned and covered with an “ebook right sold” sticker of some form and get that book automagically added to their master on-line ebook library accessible from any computer or wireless ebook reader. This could even be set up as a kiosk that could be installed in your local Starbucks where they could also have readers available to borrow while you’re having your cup of joe. You’d just need to sign-on to your account and have instant access to your library anywhere.

I don’t think ebooks will entirely replace dead tree books for quite a long time, if ever, but there are many places and uses where an ebook reader could be a much more practical than dead tree books. The ebook reader will almost never have the romance of dead tree books, but for textbooks books that would need updating (a part of your tuition could go to your annual textbook subscription), or technical books (with a baseline book cost and an upgrade fee each time the software/language/operating system was updated), or even summer “beach book” titles at a handy discount to reflect lowered production costs.

There are a few other ideas (probably much better than mine) in some of the articles listed in the resource section at the bottom of this post. I’d love to hear your thoughts on eBooks and how you think the market will shape up in the future.


Notes: Articles on the Kindle, eBooks, and publishing which wereused/read in preparation for writing the above piece:


Written by cpillsbury

July 12th, 2009 at 8:41 am

Posted in Blog Entry, Misc