Hi all,

You may find this article from today's online issue of The Bookseller interesting:

http://www.thebookseller.com/in-depth/feature/57013-a-right-royal-battle.html

It's mainly about rights issues and the pricing of eBooks, however it also has interesting snippets of information about readers:

"Sony is gearing up to launch its e-Reader in the third quarter of this year. Amazon is understood to be readying its Kindle for a British launch in 2008—or a Kindle II, which may feature both e-book and digital audio downloads. Eindhoven-based Polymer Vision, an offshoot of electronics giant Philips, is releasing its lightweight Readius in mid-2008. It has a five-inch flexible, rollable screen and 30 hours of battery life."

Regards

HTC

Hi all,

"Sony is gearing up to launch its e-Reader in the third quarter of this year.

I'm somewhat puzzled by that one. Sony "released" their eBook reader in the US well over a year ago! Are they talking about releasing it world-wide, perhaps?

I'm somewhat puzzled by that one. Sony "released" their eBook reader in the US well over a year ago! Are they talking about releasing it world-wide, perhaps?

Sorry Harry, I should have made it clear, The Bookseller is a UK trade magazine, so I would guess that this is big news for all us UK-based e-book enthusiasts.

Regards

HTC.

That would be nice if 3rd quarter Sony did release the 505 in the UK.

The article flies in the face of the folks around here that believe eBooks should be substantially cheaper, some say a $1, because they are digital and free to reproduce. To quote from the article:


Producing e-books still has many of the costs associated with print publishing such as advances, editorial, sales, marketing, promotion and publicity. In addition, there are a host of new costs, including converting files to multiple formats, digital warehousing, anti-piracy protection, and content and metadata tracking. The upfront investment is so formidable that Random reckons it may not turn a profit in the US—a far more buoyant e-book market than the UK—until 2013.

Futhermore publishers’ costs may not diminish after their initial investment. Sara Lloyd, Pan Macmillan’s head of digital publishing, writing for The Bookseller Daily at this week’s London Book Fair, said continuing costs would include infrastructure investment, as well as constant updates to software and systems.

Another interesting item is that Author's get a higher percentage of money on eBook sales than they do on book sales. I know I do, by the way.

Dale

—or a Kindle II, which may feature both e-book and digital audio downloads.

Doesn't kindle already support MP3 and Audible books? Or, maybe the are adding the ability to download the Audible books on wispernet?

BOb

That would be nice if 3rd quarter Sony did release the 505 in the UK.While we're dreaming, why not dream of a 510 UK launch? :grin:

I would take some of the references to increased costs due to a multiplicity of file types with a mine of salt.

Fictionwise managed to convert 19,000 titles to a new format in less than a month and managed do do so without worrying about passing the cost to consumers. Baen added LRF without any major concerns for cost either.

Given that Baen can make a profit with sub-paperback prices on eBooks (and higher royalties) I would suspect that Random House is choosing to inflate the costs of their works. I think the highest reasonable cost for an eBook is still roughly the same as that of a paperback (when dealing with fiction).

Given that Baen can make a profit with sub-paperback prices on eBooks (and higher royalties) I would suspect that Random House is choosing to inflate the costs of their works. I think the highest reasonable cost for an eBook is still roughly the same as that of a paperback (when dealing with fiction).
What sort of paperback do you mean? The publishing industry has this NEW paperback format that is taller, thinner and has larger print all so they can make more money on the same content. So are we basing eBooks prices on that sort of paperback or the normal paperback? I refuse to purchase any paperback in this new format. Not only does it feel unnatural in my hand, it's also more expensive. They go from $9.99 on up. That is just a way to get more money from me for the same content that works well in a regular paperback which I will not give in to. I will not get such because I dislike the cost increase and the feel.

In most cases, eBook prices are based on the latest prin edition. So when they go from hardcover to this new paperback, eBooks will still be overpriced. It's not until the print edition makes it to the regular paperpack (if ever these days) that the eBook price might be reasonable.

Very interesting article, yes. thanks for the link.

The article flies in the face of the folks around here that believe eBooks should be substantially cheaper, some say a $1, because they are digital and free to reproduce.

i am one person who thinks that ebooks should be substantially cheaper (although i've never dared to propose 1$). i recognize there are costs associated with producing digital media just as with print media, however i suspect that the publishers may be playing things up just a bit in the quote you included... and apparently i am not the only one : to quote again from the article,

Mark Le Fanu, SoA general secretary, says: “I am not entirely sure the costs will be as great as publishers say. If you look at the audiobooks download market, publishers are selling content through a lot of intermediaries and many of the costs are being carried by third-party distributors such as Audible.”

i think this (third-party distributors lessening the costs for publishers) is an important point which publishers may be neglecting. not to mention the fact that, as you mentioned, once a file is created, it can be sold countless times, whereas each printed copy must be paid for ; and a reprinting can involve starting the layout from the beginning, apparently. surely this is more expensive than converting the kindle edition they've already got to lrf. maybe kovid needs to explain a few things to them. ;)

(should i mention how much money they would save, if they dropped DRM and its associated costs ? :rolleyes: not to mention that they would probably thereby increase sales, effectively getting two hits with the same stone...)

I would take some of the references to increased costs due to a multiplicity of file types with a mine of salt.

Fictionwise managed to convert 19,000 titles to a new format in less than a month and managed do do so without worrying about passing the cost to consumers. Baen added LRF without any major concerns for cost either.

Given that Baen can make a profit with sub-paperback prices on eBooks (and higher royalties) I would suspect that Random House is choosing to inflate the costs of their works. I think the highest reasonable cost for an eBook is still roughly the same as that of a paperback (when dealing with fiction).
right, what he said. :rolleyes:

What sort of paperback do you mean? The publishing industry has this NEW paperback format that is taller, thinner and has larger print all so they can make more money on the same content.That's the Trade Paperback (TPB) you're referring to. It ain't new, by the way, I've got one here that was published in the 1977 (cover price of $4.95, if anyone's interested).

The "normal" paperbacks are called Mass Market Paperbacks (MMPB), if I recall correctly.

All that being said, I share your view that the MMPB is the norm for paperbacks, and I don't usually like the TPB's either, with the occasional rare exception.

Baen's prices are usually $4~$6 (for those who don't know) so they're below the MMPB and way below the TPB prices.

not to mention the fact that, as you mentioned, once a file is created, it can be sold countless times, whereas each printed copy must be paid for ; and a reprinting can involve starting the layout from the beginning, apparently.Also not to mention the fact that a file is usually created as part of the process of creating the print version. :rolleyes:

(should i mention how much money they would save, if they dropped DRM and its associated costs ? :rolleyes: not to mention that they would probably thereby increase sales, effectively getting two hits with the same stone...)

Agreed. I think a few things in the article where more excuses than facts.

For example, the marketing, editing, etc, etc are the same fixed costs for any book... they don't change. For the foreseeable future they are doing those things for every book anyway that they are bring to print.

Also, they talk about file conversion, digital warehousing, etc. Give me a break. Isn't all publishing, layout, done electronically anyway. Are you telling me that publishers don't already have storage facilities for the digital source of their books? Heck, they could use Amazons S3 service with no needed infrastructure and store all they want for $.10 (10 cents) a month per gigabyte. You can store alot of compressed text in a gigabyte.

File conversion? Give me a break. If they used a common source format like .epub which is what they compressed (zip/rar) and stored they could provide that format to printer/retailers etc and the retailers could create the formats that they sell... or even better, .epub could be made avialable directly if only ebook readers would support it. Even if the publisher did the conversions, it takes very little processing power to do this and it could all be automated in a batch when a book is released and then those formats could be stored so the conversion isn't run realtime.

The other cost they talk about such as "infrastructure" is generally borne by the retailer, stuff like web sites, transaction costs, cc processing etc... unless the publisher is going to sell direct.

BOb

Also not to mention the fact that a file is usually created as part of the process of creating the print version. :rolleyes:

That would be nice if it were really true. Fact is that many publisher's don't have source control over their submissions and can't reproduce a full source digital edition of the final document. They produce pages digitally, not documents.

Dale

That's the Trade Paperback (TPB) you're referring to. It ain't new, by the way, I've got one here that was published in the 1977 (cover price of $4.95, if anyone's interested).

The "normal" paperbacks are called Mass Market Paperbacks (MMPB), if I recall correctly.

All that being said, I share your view that the MMPB is the norm for paperbacks, and I don't usually like the TPB's either, with the occasional rare exception.

Baen's prices are usually $4~$6 (for those who don't know) so they're below the MMPB and way below the TPB prices.

JSWolf isn't referring to TPBs, but rather to a new variant on MMPB that started filtering in to the market around 2006 or so. The first one I remember seeing was Stephen King's Cell

They are about the same width and thickness as a standard MMPB but stand an inch and a half to two inches taller, and the prices start at $9.99 US rather than $6.99/$7.99 US for traditional MMPBs. Unlike traditional TPBs they don't have the same aspect ratio as traditional MMPBs or hardcovers.

I think they're an absolute ripoff and should never have been released. Unfortunately they stacked the odds by using the form to initially release major authors and bestsellers only.

(should i mention how much money they would save, if they dropped DRM and its associated costs ? :rolleyes: not to mention that they would probably thereby increase sales, effectively getting two hits with the same stone...)
Yes, I think this is worth mentioning, as I think it's one of the "expenses" they're talking about.

It would seem that Baen has a more modern file management system than other publishers, but I think that would be a one-time cost to convert. It wouldn't be trivial -- changing business processes never are. But I think any publisher that doesn't get their file management under control so they can reformat books and publish electronic editions at will is going to be out of business in 10 years.

Baen's system must be more efficient than what Random House is talking about, seeing as it's almost entirely run by one man.

honestly, some days it just seems like either the publishers are a lot stupider than we give them credit for, or else they think *we* are all idiots. i'm not really sure which one would be worse. :rolleyes:

I think the difference is that Baen is run by someone who wants ebooks to succeed, where the traditional publishers have a working business model and (as we all know) change is bad.

edit: don't forget that all those extra "costs" are internal to the publisher. Every single one is done internally by the publisher and billed to the author, not billed by someone external to the publisher and borne by them. So when they say "digital warehousing" we're not talking $200/TB for disk space and "ls -lR *.lrf", we're talking a full retail service provided by the publisher to their authors with huge markups at every step.

When they say that the author should get 15% of the net sales I would like to see a breakdown of what they're doing for the other 85%. The conversion costs to multiple formats and electronic storage seem trivial compared to the time involved to write the book. I vote for 25%.

What? I don't get a vote? Taxation without representation!

As I remember, most TPB titles are evergreen titles that stay in print year after year. The kind of stuff that they assign in schools. Many of them are public domain or modern classics.

Yes they are somewhat different in shape than the MMPB but the printing, paper, cover, and binding is often higher in quality since they are designed more than one or two quick reads.

When they say that the author should get 15% of the net sales I would like to see a breakdown of what they're doing for the other 85%. The conversion costs to multiple formats and electronic storage seem trivial compared to the time involved to write the book. I vote for 25%.

What? I don't get a vote? Taxation without representation!

Typically the retailer gets about 50%. Amazon may get more.

Dale

As I remember, most TPB titles are evergreen titles that stay in print year after year. The kind of stuff that they assign in schools. Many of them are public domain or modern classics.

Yes they are somewhat different in shape than the MMPB but the printing, paper, cover, and binding is often higher in quality since they are designed more than one or two quick reads.

Putting on my former bookstore manager's hat for the moment; TPBs are definitely a different beast from MMPBs. They're closer in size to a hardcover, and are generally treated the same way by the bookstores. That's to say full book rather than strip cover returns etc. (The name comes because they were distributed to the trade, ie. bookstores, rather than to the mass market of grocery and drug stores like smaller paperbacks.)

But they're not what JSWolf and I were talking about.

Regardless of size, and all three major formats have variations in size, most books maintain similar proportions. These new paperbacks don't. They're about an inch taller than a regular paperback, but the same width. Instead of being roughly 6.4 x4.1 inches they're 7.3 x 4.1 inches. That extra 0.9" of height makes the pages feel out of proportion and increases the price by $2.00.

It's not a good thing.

Conventional TPBs are both taller and wider than MMPBs.

I realise people have already poked a few holes in the publishers arguments, but I thought I'd get my own tuppence in.

"including converting files to multiple formats, digital warehousing, anti-piracy protection, and content and metadata tracking."

Converting files to multiple formats - Assuming I received a formatted document, with cover images it takes minutes. Near zero cost.

Digital warehousing - Throw a buzzword in for a bit of confusion? It's not clear what they mean here. They probably mean (since they don't mention this cost anywhere) the cost of turning books into formatted text. This puzzles me, although Dale has pointed out it's not as simple as it may seem, there isn't a formatted document that gets sent to the printers as one might imagine. Fixed cost.

Anti-piracy protection - DRM. I honestly don't know if Sony and Mobipocket charge a fee to use their DRM. They may charge a one off fee, and or they may charge a per sale fee. Fixed and or marginal cost.

Content and metadata tracking - I'm not aware of this being done, other than at a very basic level. And by that I mean the genre, a few keywords, and some blurb. Zero cost.

Benefits they don't mention

Retailers cuts - Retailers cuts on electronic books have to be lower. It's much cheaper for booksonboard to run a store permanantly in stock of tens of thousands of books available to all of the English speaking world than it is for Waterstones to ensure that everybody has access to a nearby Waterstones store that's fully stocked. Retailers have much lower costs, so they'll get a lower cut. Marginal cost.

Production cost - Doesn't need printed. If there are any DRM costs per copy they are accounted for above. Marginal cost.

----

But do you notice something? There's a lot of fixed costs, few marginal costs, and any benefits are marginal benefits. This means that it's a whole lot cheaper to do electronic books than paper books, so long as you're selling lots of them. With a market of 1% then the fixed costs are much more significant. Perhaps that's why they're telling authors that they can't support a model with 25% royalty as opposed to 15%.

However, there's no reason why this can't be changed. Tell authors that the book has to be formatted in RTF or MS Word, HTML, or ISO document or whatever. Bang goes the fixed costs. The publisher just takes the document, wraps it up in DRM and Mobipocket and Sony format and it's ready to sell.

There's three "real" costs, and no more.

1) Production (I.e. getting the book into a formatted document, what they referred to as Digital Warehousing)
2) Administration (Wrapping it up in the right format, issuing it to retailers, dealing with the author, other administration)
3) DRM

If they can get rid of the production cost, which is very possible, they can get rid of the majority of the costs and leave themselves with the administration and DRM payments. DRM payments would be a percentage of sales, so a very simple factor in the price, and since they're a marginal cost it's a cost that can be largely ignored, because you don't need to project how many you'll sell.

The administration costs are what might cause a change in the industry. Given that the other costs can be negated then if a traditional publishing house can't do the administration and pass on a 25% royalty, then another publishing house will do it. The problem with that is that authors very likely can't turn round and sell the paper rights to one publishing house, and the electronic rights to another. The paper rights are worth far, far more at the moment.

I'd suggest that publishing houses need to get their house in order before the market share on electronic books significantly increases. And I'd also suggest that authors shouldn't worry about getting crap royalties at the moment, since electronic sales mean very little to their pocket, and when they start meaning more to their pocket they can agree new terms, or switch publisher.

It could mean a shake-up in e-book payment, such as rights switching to a subsidiary model (similar to selling books to film producers) rather than royalties on net receipts. It is an important distinction—depending on contracts, authors can get between 30% and 50% on subsidiary deals.

What mean it about a subsidiary model ?

I think the difference is that Baen is run by someone who wants ebooks to succeed, where the traditional publishers have a working business model and (as we all know) change is bad.

I think another big difference is Baen probably doesn't have the kind of corporate political empire-building that goes on in large enterprises. If the exec staff asks CTOs or CIOs in companies like this what it would take to do ebooks, they likely won't go for the cheapest, simplest, least disruptive method. They are likely going to see this as a way to grow their influence, power and relevance in the company. It's going to be intricate and expensive necessitating a powerful organization to run it.

JSWolf isn't referring to TPBs, but rather to a new variant on MMPB that started filtering in to the market around 2006 or so. The first one I remember seeing was Stephen King's Cell

They are about the same width and thickness as a standard MMPB but stand an inch and a half to two inches taller, and the prices start at $9.99 US rather than $6.99/$7.99 US for traditional MMPBs. Unlike traditional TPBs they don't have the same aspect ratio as traditional MMPBs or hardcovers.

I think they're an absolute ripoff and should never have been released. Unfortunately they stacked the odds by using the form to initially release major authors and bestsellers only.

Ugg, I know what you are talking about. My wife picked up a Wilbur Smith book like that. Yeah, that's really going to succeed when people have been designing bookshelves for standard-size paperback for years. I doubt it is going to stick.

Jason

I worked at a second-hand book store for a couple of years. (yeah I know, we're basically stealing from the authors/publishers, because they lose sales because of us...) And those slightly larger paperbacks were such a nuisance. The obvious thing is that nobody really wants them.

People brought them to us, and expected to get a nice price for them, because, well, they certainly paid a high price for them, but after the normal sized paperback came out, nobody would buy the oversized one any more, even second hand. So we would mostly only buy them if the real paperback wasn't released yet, because once the real paperback got released they became a hard sell... obviously because NOBODY wants them, and everybody prefers a real paperback in normal size.

Anyway, the way the publishers talk in that article I get the feeling they're thinking more along the lines of: "well, we have a certain business structure, which does things in a certain way, and we have this many people, that all want to get paid a certain amount, so basically we need to cover those costs, so 15% is still very reasonable..."
Uhm this site is loaded with books that got converted for free. Even having to scan a paperback with a really good scanning machine shouldn't cost much if people at home can do it for nothing.
Infra-structure? Well the people of mobileread certainly have found a way to let people download the books for a nice price. Besides if the darknet can distribute millions of books for free, why should publishers have such gigantic costs?
Seriously, if you were to build from scratch a publisher just for ebooks, surely you could do better than to offer 15% to an author. The author might as well start his own ebook publisher.
Only thing lacking is publicity, but then again, if more and more of the publicity happens on the internet, the publicity of having your book in the bookstore-window might be worth less and less.

I have no problems buying regular paperbacks, standard size trade paperbacks, or hardcovers. Each step upward in price is reflected by an increase in value and I'm fine with that. The tall paperbacks are a step up in price for a step down in usability.

No thanks.