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Old 08-06-2011, 07:02 PM   #1
stonetools
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Publishers dont drive change in the ebook industry: Shatzkin on Apple's move

Mike Shatzkin gives the publisher's eye view of what Apple's move means:

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That will mean that the simplest and most seamless way to buy and read ebooks on the iPad or iPhone will be through Apple’s iBookstore. It will almost certainly mean a growth in iBookstore market share at the expense of all the other ebook retailers. It will also almost certainly mean that a lot of people who read their ebooks on an iOS device (I’m one of them) and prefer to use any of the other ebook retailers (and I’m one of those too) will be inconvenienced and annoyed.

However, it is also true that Apple will benefit from this move that many of their customers will resent.
Read the whole thing. Its a great analysis of how the ebook industry changed in recent years from publisher/bookseller viewpoint. His argument is that the changes in the ebook industry were driven not by the publishers , but by technological change wrought by others . His conclusion:

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We note that all these changes in the marketplace were created by others, not by publishers. That’s not necessarily a bad thing, or even a new thing. Publishers also didn’t spring for the investment that created superstores and then Amazon in the 1990s, all of which increased their sales. A publisher’s role is to use the channels that are available to get books into the hands of readers.

From most publishers’ perspectives, this change might have very little impact. Any iPad or iPhone reader who wants a book can still find and buy one. If the Apple store is strengthened at the expense of Kindle and Nook, that constitutes marketplace diversification that is good for them. (If the impact somehow fell disproportionately on Nook, though, that might not be.)

But the happy symbiosis between the ebook retailers and Apple, by which the retailers got access to customers they would not otherwise have had and Apple was able to readily deliver their customers content they hadn’t otherwise aggregated, appears to have come to an end. And the iBookstore, which had been fighting others for the scraps after Amazon took half or more of the US ebook market and B&N took much more than half the rest, is about to be a much more significant competitor.
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Old 08-06-2011, 07:55 PM   #2
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However, it is also true that Apple will benefit from this move that many of their customers will resent.

No argument here
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Old 08-06-2011, 10:25 PM   #3
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The point is that all of the players are acting in their self interest . Amazon didn't establish the ebook market through it's benevolence to folks on the forum, much as they would like to believe that. I sometimes marvel at people who believe that Amazon " should have " created an open Kindle or adopted ePub , because it's the " right format" as if Amazon were some sort of nonprofit organization dedicated to achieving the dreams of technogeeks. What's the business case for that?

In the same way, there really was no business case for Apple allowing booksellers to sell millions of dollars worth of books free of cost on their platform. After all, let's face it, none of those retailers allow Apple or any other retailer to sell on their platforms. Apple was always likely to try to get a cut of that revenue that was coming from the market they created. When that didn't work, they settled for giving their bookstore an advantage. In the end, that was the least inconvenient outcome. We will have to settle for that, but hey, it could have been worse.
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Old 08-07-2011, 06:12 AM   #4
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I wonder if anyone can bring a lawsuit against Apple for this?

For years, Microsoft had to deal with a multi-million dollar case against them in the EU, because it was claimed that their bundling of Media Player and Internet Explorer with Windows was 'anti-competitive' as they were taking advantage of the fact that their OS was the dominant market player.

Could someone bring a similar case against Apple and the iOS?
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Old 08-07-2011, 08:03 AM   #5
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I wonder if anyone can bring a lawsuit against Apple for this?

For years, Microsoft had to deal with a multi-million dollar case against them in the EU, because it was claimed that their bundling of Media Player and Internet Explorer with Windows was 'anti-competitive' as they were taking advantage of the fact that their OS was the dominant market player.

Could someone bring a similar case against Apple and the iOS?
Yes, of course they can... because there are no other tablets, operating systems for tablets and content sources other than Apple and nobody can put anything on Apple equipment but Apple either...

My Android tablet won't work now Apple have setup their software etc...

What is it with "can I bring a Lawsuit" all the time, do you just like making lawyers rich... does anybody make you have an iPad??? Is it unknown that Apple like to control their brand and its functionality???
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Old 08-07-2011, 09:18 AM   #6
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Actually, anybody (who owns an iPad) can sue.
Doesn't mean the suit will go anywhere, though.

On antitrust grounds it won't go far, though:
- Apple's 19% share of the smartphone market is hardly the stuff of monopolies.
- On the tablet side it is much too early to crown anybody, much less Apple. Their 60% market share is only going down as competitors get ther act together and the buying public gets a feel for what pads and tablets can and (especially) can't do.

Restraint of trade? Yes, that could fly and not depend on market share.
But it would have to be Amazon or B&N that sues and they actually benefit from the policy, or Kobo or the smaller ebookstores that are actually damaged by the Apple policy. However, the fact that Apple "merely" changed the interpretation of the rules makes success there far from likely.

Actual owners of iOS devices are the biggest losers and could sue for loss of functionality/value, in a class action suit (preferably in east texas) but that nobody has done so tells you Apple owners are not that upset. The Apple kool-aid is mighty powerful stuff.

That leaves governmental action and setting aside the number of politicians that Apple may or not have bought, governmental action is slow and by the time they act the small independent ebookstores most impacted will be dead and gone and the big guys will be using HTML5 applets and Apple will be looking at ways to block that off, probably through Safari blacklisting, because no matter what they try, iBooks is not going to get far in this business anytime soon. A turkey is a turkey even if you paint its feathers and call it a peacock.

The ebook business as of now is past the point where any single player, be it publisher, retailer or intermediator can control it; the barriers to entry are low, the number of significant players high, and the overall market fragmented at every level of the supply chain.

The only player that had even a prayer at a monopoly was Adobe, with their well-timed hijacking of ePub, trying to turn ADEPT DRM into an industry chokehold and it failed. Just as Apple has failed, first by convincing the Price Fix Six to adopt their "Agency Pricing" scheme, now by trying to restrict competitor access to their customers.

ebooks aren't like music or video where a handful of distributors control the majority of the content; even the Price Fix Six combined don't get to half of the market supply and that aggregate share is dropping by the minute.

In ebooks the market power resides with the consumers, as an aggregate, not the intermediaries or even the creators. Which means nobody is in real control. Everybody now has to sing for their supper.

The djinn is out of the bottle and getting it back in is not going to happen any tme soon, if ever.
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Old 08-07-2011, 10:39 AM   #7
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It will also almost certainly mean that a lot of people who read their ebooks on an iOS device (I’m one of them) and prefer to use any of the other ebook retailers (and I’m one of those too) will be inconvenienced and annoyed.
Status: Fixed
Solution: Don't read books on an iOS device
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Old 08-07-2011, 10:47 AM   #8
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Originally Posted by stonetools View Post
The point is that all of the players are acting in their self interest . Amazon didn't establish the ebook market through it's benevolence to folks on the forum, much as they would like to believe that. I sometimes marvel at people who believe that Amazon " should have " created an open Kindle or adopted ePub , because it's the " right format" as if Amazon were some sort of nonprofit organization dedicated to achieving the dreams of technogeeks. What's the business case for that?

In the same way, there really was no business case for Apple allowing booksellers to sell millions of dollars worth of books free of cost on their platform. After all, let's face it, none of those retailers allow Apple or any other retailer to sell on their platforms. Apple was always likely to try to get a cut of that revenue that was coming from the market they created. When that didn't work, they settled for giving their bookstore an advantage. In the end, that was the least inconvenient outcome. We will have to settle for that, but hey, it could have been worse.

I disagree strongly - what if Microsoft started charging 30% for everything bought through a PC? *Everyone* would be screaming bloody murder.

Why is the iPad different? It's just a flat computer. Just because a company makes a device doesn't mean it gets to control what I can do with it.

Why does Apple always get excuses made for it?
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Old 08-07-2011, 11:06 AM   #9
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Well, Apple owners aren't too bothered by this because the Apple platform remains the most open and versatile in terms of content, including reading content. There are still apps for every major bookstore on the IOS platform, along with independent ebook reader apps like Bluefire and Txtr. All that has happened is it has been more inconvenient for Apple customers to buy ebooks. If we look at access to magazines, there is FAR more content available on iOS than any other platform, and there is likely to be even more when Apple rolls out it's Newsstand feature with iOS 5 in a couple months.
As for iBooks , Apple certainly has the money and engineers to make iBooks a worthy competitor to Amazon and B&N. I'm hoping that they will eventually do so, maybe as early as with the iOS 5 upgrade ( that famous one thing more). Realistically, though, they are right now more focused on rolling out features like Newsstand and iCloud, so iBooks will continue to be second tier for a while longer, IMO.
This isn't a problem for me or more techie consumers, but will be a problem for those iOS consumers who really only interact with their devices through apps. They will tend to go to iBooks , which means fewer sales for other booksellers and worse choices for those consumers.
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Old 08-07-2011, 11:22 AM   #10
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I disagree strongly - what if Microsoft started charging 30% for everything bought through a PC? *Everyone* would be screaming bloody murder.

Why is the iPad different? It's just a flat computer. Just because a company makes a device doesn't mean it gets to control what I can do with it.

Why does Apple always get excuses made for it?
Exactly... my satellite TV box won't do what I want for free either... I have to PAY the company that supplies it... and they won't let me use it for cable just because it's a satellite TV box... not fair...
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Old 08-07-2011, 11:27 AM   #11
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I disagree strongly - what if Microsoft started charging 30% for everything bought through a PC? *Everyone* would be screaming bloody murder.

Why is the iPad different? It's just a flat computer. Just because a company makes a device doesn't mean it gets to control what I can do with it.

Why does Apple always get excuses made for it?

Different platform, different type of computing devices. We have gone past the point of saying that all these devices are computers, and pretending that PCs, game consoles, smart phones, ereaders, and tablets are all the same thing. They aren't.
The iPad, like smartphones, are really closer to game consoles than to PCs. Game consoles are closed platforms that typically run no third party apps. Until Apple opened up the IPhone, no smartphone platform ran third party apps. Ereaders rarely run third party apps.
The iOS platform is different from the windows platform and it doesn't make sense to compare the two. It's not a matter of making excuses: it's a matter of facing reality.
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Old 08-07-2011, 12:11 PM   #12
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Different platform, different type of computing devices. We have gone past the point of saying that all these devices are computers, and pretending that PCs, game consoles, smart phones, ereaders, and tablets are all the same thing. They aren't.
The iPad, like smartphones, are really closer to game consoles than to PCs. Game consoles are closed platforms that typically run no third party apps. Until Apple opened up the IPhone, no smartphone platform ran third party apps. Ereaders rarely run third party apps.
The iOS platform is different from the windows platform and it doesn't make sense to compare the two. It's not a matter of making excuses: it's a matter of facing reality.
My HTC wizard was running third party windows mobile apps in 2005.
Which model iPhone was Apple peddling then?
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Old 08-07-2011, 12:30 PM   #13
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Actual owners of iOS devices are the biggest losers and could sue for loss of functionality/value, in a class action suit (preferably in east texas) but that nobody has done so tells you Apple owners are not that upset. The Apple kool-aid is mighty powerful stuff.
The functionality of clicking a 'Store' button rather than opening Safari yourself? How what sort of financial recompense do you think that massive loss of functionality is worth?
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Old 08-07-2011, 01:28 PM   #14
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My HTC wizard was running third party windows mobile apps in 2005.
Which model iPhone was Apple peddling then?
And Handspring Treos were available from 2002, running third party Palm OS apps. They caused a fair bit of interest at the time. Certainly enough to come to the notice of the product developers at Apple.

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Old 08-07-2011, 01:30 PM   #15
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As for iBooks , Apple certainly has the money and engineers to make iBooks a worthy competitor to Amazon and B&N.
Maybe.
Probably not.
Think about it, would Apple have courted all this bad press with such a blantantly anti-competitive move if *they* thought they could make iBooks competitive by just throwing money at it?
Remember, they didn't just force Kobo to remove the book-buying link, they force removal of everything that might tell users of the app that Kobo sells books at all. They want to ensure/pretend that iBooks is the only way iOS users can buy ebooks. Most users will know better, some will not, and iBooks share of the iOS based ebook market will depend on them for most of its future growth. I may be wrong, but counting on the uninformed as your primary market for books, of all things, is not a prescription for massive growth.

The core problems with iBooks can't be solved by throwing money or software engineers at it because the problem isn't the app but the catalog and the business model. And the problem with the catalog can only be fixed by ditching Apple's business model, their insistence on Agency pricing, etc.

The problem with platform is deeper because as long as Apple sells DRM'ed ebooks, those books can only be read on iOS. Right there, they give away 80% of the ebook-on-cellphone market. They give away the entire eink reader market. They give away 40% (and growing) of the webpad/media pad market. By tying iBooks to iOS, Apple is handicapping iBooks' reach, which in turn limits its value to content providers and ensures the catalog will remain smaller and less attractive to consumers.

Apple likes lock-in.
And they really, really like hardware-based lock-in.
Unfortunately for them, in *this* market they're not competing against open standards, but against other purveyors of lock-in who got to the game earlier, established their name, walled-off major chunks of the market, and--worst of all for Apple--established the expectation that content be transportable.

Whether it be Amazon, Nook, Kobo, or worst of all, Google, *all other* ebookstores promise crossplatform content transportability. The market grudgingly tolerates DRM but only to the extent that the DRM does not bar transportability.

As long as iBooks is tied to iOS it cannot grow to compete with the big boys; it is simply giving away too much market to the other camps. No amount of money, no fancy software feature can counter that fact. Apple likes to make up its own rules as it goes along but that is not working in ebooks and it is not going to work any time soon. So far, every move they've made has only strengthened the opposition and weakened their own hand. They need to grow iBooks beyond iOS and that is just not going to happen in time to help.

The ebook market is now past the point where any player, no matter how rich or competent, can dictate new terms of engagement. That is a sign of a maturing market. And a very good thing for consumers. Expect massive growth for most players and quiet exits for a few.
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