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Old 03-05-2010, 10:09 AM   #31
KevinH
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> • Because the cost is not zero. It can cost quite a bit of money
> to convert a book into epub, mobi or other formats.

I simply do not believe this is true if any electronic version of the book exists. With the right tools, you can do Word to RTF to xhtml and keep most if not all of the styles. If I start with an electronic version it should not take even 1 full person day (at full costing say $100/hr) to convert an electronic version of the book to an ebook.

> • Because ebooks, for all the hype, still constitute 3-5% of
> sales (possibly less, internationally)

So then why the need to even worry about geo restrictions at all. I can drive to the Buffalo in under 3 hours from my house and buy books (hardbound) until my heart is content. The bulk of the population of Canada could claim the same thing (within about 100 miles of the US border). This is allowed and I am sure would be welcomed by every book store near the border in the US. I just can't buy them online.

> • Because rights over electronic editions are not always
> clear-cut. It's explicitly addressed in more recent contracts,
> but not always in older agreements.

So authors are not required to assign copyright when they get published? Even so, I can not believe that offered a reasonable piece of the pie, all authors would choose to NOT have their paperback and out of print books available for sale worldwide.

> • In the US alone, around 250k new books are published
> each year; somewhere around 45k of those are fiction. If
> the publishers wanted to just convert all new fiction books
> from the last 10 years, that alone hits close to half a million
> books. And obviously, priority is going to the new books,
> which have much stronger sales than back catalog titles.

Again, in the academic journal business they have been asking for electronic versions for over the last 15 years or so. If an electronic version exists, then the costs to translate them (especially when handled in bulk) is not that large.

As an alternative, simply ask the authors themselves to create an ebook for any of their titles they would like to have for-sale that is 5 years or older or out of print. My guess is they would welcome the chance to get these books out their in e-book form as long as they receive the a decent percentage from every book sold.

> That's relatively rare. Also, it really doesn't cost a lot less to
> make a paper edition than an ebook edition -- maybe 15%.

That is bull. Simply look at the fully loaded supply chain costs including the bricks and mortar required, vehicles, the number of people it takes to handle and stock books on shelves, count them, audit them, display them, move them, sell them, order them, track them, plus all of the material costs and the entire carbon footprint of the printing operations. Even divided by the total number of titles available in any one year, this is not 15% of an paperback book's price. Simply grab your companies books and look only at the cogs, depreciation of property, plant, and equipment. Even per book, that is more than 15%.

Your idea of costing just looks at editing and author fees and tries to keep the exact same paradigm making none of the supply chain related costs variable in any way. The entire way business is done needs to change and then the costs of selling e-books can go way down.

> Again, your frustration is understandable, but you really
> ought to calm down. Ebooks are just getting started, and
> there are millions upon millions of books that need to be
> converted, lots of legal issues to be sorted out, and both
> publisher and author resources are finite. Contracts,
> international law, authors, publishers, retailers, and
> society at large do not perform 180º turns the second
> you bought your ebook reader.

Nor do I expect them to. I do expect them to act intelligently for their shareholders and to listen to their customers, to be forward looking, and understand that a completely new selling paradigm is needed (and will come) and that they need to be at the vanguard and not fight tooth and nail to prevent it from coming.

"Making it next to impossible to buy an e-book" is not something that in any way shows they deserve to remain as top management for any of the firms involved.

As I said, there is a real opportunity for an international e-book store who understands these things and are willing to make an end-run around the publishers to get things done, directly with the authors if need be.
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Old 03-05-2010, 12:38 PM   #32
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If you want to look on the bright side, I suppose we could say that Geographic Restrictions save us money, they have definitely saved me hundreds of pounds on ebooks I would have bought if only I didn't live in the pesky UK, with its behind the times (or couldn't be bothered) publishers. It's one thing to say 'you can't sell that ebook here because i'm selling that ebook here' it is totally another to say 'you can't sell that ebook here but we won't sell it here either'

I am also in the camp publish the ebook at the same time as the hardback book but make it the same price, then at least we have the choice.
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Old 03-05-2010, 01:06 PM   #33
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Originally Posted by KevinH View Post
Then the publishing world is way behind the times.
Why, because they haven't spent considerable sums of money on unpredictable future infrastructures over the past 5 or 10 years, to cater to a nearly non-existent market...?


Quote:
Originally Posted by KevinH
In academic journal publishing, they have been asking for electronic copies (not pdfs) for journal articles and figures, tables, etc, for more than than the last 15 years.
Sure, but academic journals (and other periodicals) have used electronic distribution for a long time. 15 years ago, the ebook market was beyond non-existent.

Even if the publishers had stipulated a format that 15 years ago, chances are it would still require work to convert into a viable ebook format.


Quote:
Originally Posted by KevinH
Even if that cost is $800 per book (one full person day fully costed at $100/hr) it is insignificant when split over the number of units sold.
Keep in mind, though, that around 45,000 new new fiction books are released each year. At $800 per book, that is $36,000,000. For one year. If it takes 30 minutes to do each one, that's 22,500 hours of work.

I concur that the costs are generally quite low, and as more conversions happen the cost will go down. But they can't just snap their fingers and convert every single book in the back catalog overnight.


Quote:
Originally Posted by KevinH
It is funny how all publishers want to talk price and not cost, isn't it.
Actually they discuss cost every now and then, as indicated by a recent NYT article which listed many of the costs. People just don't want to hear the counter-intuitive idea that paper costs are far, far lower than they believe.
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Old 03-05-2010, 01:35 PM   #34
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Originally Posted by Kali Yuga View Post
Keep in mind, though, that around 45,000 new new fiction books are released each year. At $800 per book, that is $36,000,000. For one year. If it takes 30 minutes to do each one, that's 22,500 hours of work.
Are you trying to say that publishers do not already have a digital copy of a book? And they would have to spend the same amount every time they wanted to publish a new book? Seriously?

I really need to donate a bucket of money to Kovid for Calibre. He's saving me millions.
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Old 03-05-2010, 01:50 PM   #35
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> • Because the cost is not zero. It can cost quite a bit of money
> to convert a book into epub, mobi or other formats.

I simply do not believe this is true if any electronic version of the book exists.
Oh, really? Try converting a Revit document into InDesign. Let me know how that works out for you.

Digital conversions are not magic, especially when dealing with TOC's, footnotes, variable formatting, tables, illustrations, and at least two major -- and very different -- ebook formats (ePub and mobi). Heck, from what I understand, just performing basic edits in ePub can be rather time-consuming.


Quote:
Originally Posted by KevinH
So then why the need to even worry about geo restrictions at all.
Because companies cannot violate contracts at their convenience, or for the convenience of their international customers.

Also, if you physically drive across a border, issues like sales tax, royalty rates, and abiding to local laws are taken care of. That's not the case if your computer is in Canada and the online bookseller is in the US.


Quote:
Originally Posted by KevinH
So authors are not required to assign copyright when they get published?
Sort of.

The author completes the book (technically, it is in a "fixed form") and it is automatically copyrighted. The author and his/her agent then negotiates with the publisher; e.g. "we will publish 3 books by you at these royalty rates in the US. When it's hardcover you get 15%, trade paper 10%, mass market paperback 8%."

I don't recall when, but either in the early 80s or 90s the publishers started requesting electronic rights on books. So you have decades of contracts, and millions of books, where the issue of electronic rights is not specifically referenced in the contract. The status of ebooks for those contracts is not yet resolved, and will likely depend on the language in those specific contracts as well as agreements reached between various publishers and the authors.

Some authors also refuse to allow their books to be digitally distributed, notably JK Rowling. It's inconvenient for the ebook owners, but the publisher's hands are tied. And yes, she would definitely protest if they went ahead with an ebook version anyway....


Quote:
Originally Posted by KevinH
>Also, it really doesn't cost a lot less to
> make a paper edition than an ebook edition -- maybe 15%.
That is bull. Simply look at the fully loaded supply chain costs including the bricks and mortar required (etc etc)
I have. It's not bull. It's economics.

Paper is cheap; inventory and shipping costs are spread out along the supply chain; and the retailer is going to take a cut regardless of whether it's paper or electronic.


Quote:
Originally Posted by KevinH
Your idea of costing just looks at editing and author fees and tries to keep the exact same paradigm making none of the supply chain related costs variable in any way.
Incorrect.

The costs involved do include author's advances and royalties, editing and proofreading. It also includes taxes, legal fees, marketing, PR, cover art, market research, the retailer's cut and general overhead. Of equal importance for a publisher is covering the costs of books that do not break even -- which is, in fact, the majority of titles.

I'm sorry to burst your bubble, but yes, the costs associated with paper just are not that big. Neither are publisher's profit margins; they tend to range from 8-15%. And most authors still won't be willing or able to do all the tasks performed by publishers and retailers, so those roles won't change nearly as much as many people believe. There will be changes in the supply chain, but the real losers will be the middle-man distributors like Ingram, who will basically get knocked out. But that'll be invisible to most consumers anyway.


Quote:
Originally Posted by KevinH
I do expect them to act intelligently for their shareholders and to listen to their customers, to be forward looking, and understand that a completely new selling paradigm is needed (and will come) and that they need to be at the vanguard and not fight tooth and nail to prevent it from coming.
That's fine, but they can't spend millions of dollars performing conversions overnight. Nor can they trample on international laws and contracts at will, no matter how valid a consumer's desire to buy X can be.


Quote:
Originally Posted by KevinH
As I said, there is a real opportunity for an international e-book store who understands these things and are willing to make an end-run around the publishers to get things done, directly with the authors if need be.
Retailers also cannot trample on international laws and contracts. Sorry, dude.

Since such actions would be largely illegal (except for new books with a contract that explicitly grants one company world-wide rights), I'm not really sure I'd want to give that type of store my credit card number.
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Old 03-05-2010, 03:39 PM   #36
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Are you trying to say that publishers do not already have a digital copy of a book? And they would have to spend the same amount every time they wanted to publish a new book? Seriously?
From what I understand, they sometimes have PDF's or other formats that are not easy to convert into HTML, ePub, mobi and so forth. Especially things like TOC's and tables are rather fussy. It's complex enough that commercial services are available for the conversion; and at least one MR poster (I forget who) does it for a living.

More importantly, there are millions of backlist titles that don't have an electronic format at all -- e.g. anything written before, say, 1990. In which case, you need to find a completed copy, OCR it, fix the OCR, and format it.

Publishers don't always do a good job with their conversions, but for commercial purposes you often need to do a little more than just run it through Calibre.
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Old 03-05-2010, 03:39 PM   #37
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Thats fine with me as long as we are talking about a localized language conversion. But there is no reason why I as a German reader am not allowed to buy an English edition from a US-publisher.
Localization based on language rather than location, eh? That might just work for a lot of the world. It doesn't solve the US/Canada, UK and Aussie problem though. The three locations are too spread out for a publisher to easliy distribute physical copies, so you wind up back with the problem of offering physical rights only to two out of the three while not making any extra money off the English language ebook rights to the first, who now tack two more regions on to their sales.
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Old 03-05-2010, 04:14 PM   #38
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Hi,

I guess you an I will just have to agree to disagree.

Converting books is simply not that hard. The bulk of the process can be automated. Epub is nothing more than html 4/xhtml, and mobi is nothing much more than html 3.2 with a couple of specific mobi tags. Converting books from almost any electronic format to something xhtml based is simply not that hard. As worst, a custom script (python or perl) can be written and used. I have done it many times and ended up with better formatted books than the originals.

So we are not talking about millions of dollars ... and we are talking about something that many authors would do themselves given the right incentive structures.

Also it is not international law, it is contract law we are talking about. Sales taxes and things like that are only an issue if you have operations in that country. Individuals can already file tax forms for sales tax on things they buy overseas (or they are supposed to!)

Your "economics" are again all based on purchasing from upstream supply chain partners and your margins on top of what you pay and again are not reflecting the changes that a new selling model would bring. So I disagree completely with your 15% margin and your "economics" model because it is based on assumptions that all other costs and therefore your basis remains the same.

Assuming you can not get an e-book in some country, then another international seller could easily go directly to the authors in question for their back catalogs and could bring them to market and not "wait" for the old school publishers to see the light.

I think you are defending an old model that even current publishers know is going away but their admitted plan is to make it rough enough and slow enough so that their operations and book stores do not suffer.

This is a bad strategic decision. They should in fact cannibalize their own sales to be the first to move to the model and then take advantage of being first.

So my guess is we will continue to disagree on most of this.

Oh well, what fun would the world be if everybody agreed on everything!!
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Old 03-05-2010, 06:47 PM   #39
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Localization based on language rather than location, eh? That might just work for a lot of the world. It doesn't solve the US/Canada, UK and Aussie problem though. The three locations are too spread out for a publisher to easliy distribute physical copies, so you wind up back with the problem of offering physical rights only to two out of the three while not making any extra money off the English language ebook rights to the first, who now tack two more regions on to their sales.
Australia? You call that English?
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Old 03-05-2010, 06:56 PM   #40
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Assuming you can not get an e-book in some country, then another international seller could easily go directly to the authors in question for their back catalogs and could bring them to market and not "wait" for the old school publishers to see the light.
Since you cannot be persuaded by our arguments: So why don't you just go ahead and open an online store and take advantage of this tremendous business opportunity?
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Old 03-05-2010, 07:02 PM   #41
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Australia? You call that English?
Well we do put "u" in colour
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Old 03-05-2010, 07:14 PM   #42
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and the "i" in ate.
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Old 03-05-2010, 09:52 PM   #43
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Since you cannot be persuaded by our arguments: So why don't you just go ahead and open an online store and take advantage of this tremendous business opportunity?
Unfortunately, as a business school prof, I do not have the financial resources, time, or even energy at my age, to undertake this myself. If I did, I would certainly look at it. The timing could not be much better and the competition more screwed up.

Needless to say, I am strongly encouraging my MBA students to think of this way of doing business as a "strategic blunder" by the publishers and ebook stores, and as an opportunity for newcomers to the business.

There is plenty of material here for a "classic" case to be written. I will try and point one of my PhD students toward writing one.

Take care,

KevinH
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Old 03-05-2010, 10:29 PM   #44
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Unfortunately, as a business school prof, I do not have the financial resources, time, or even energy at my age, to undertake this myself. If I did, I would certainly look at it. The timing could not be much better and the competition more screwed up.

Needless to say, I am strongly encouraging my MBA students to think of this way of doing business as a "strategic blunder" by the publishers and ebook stores, and as an opportunity for newcomers to the business.

There is plenty of material here for a "classic" case to be written. I will try and point one of my PhD students toward writing one.

Take care,

KevinH
There is a nice class project -- setting up and running an ebook website!
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Old 03-06-2010, 11:03 AM   #45
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Just get a website in a "rogue" country where the politicians can be cheaply bought and have them pass copyright laws favorable to your new enterprise. Then setup your online digital media superstore. Make this your official headquarters - even though it is just a bunch of servers and a post office box. What law changes would you need?
- 7 year copyright foreign and domestic
- any work available on physical media, but not available electronically for 6 months can be format shifted and sold with a standard royalty payment
- all "out of print" books, music, and videos revert to Public Domain
- exclusive assignment of copyright is not honored - the creator never loses the rights to their creation

Isn't that what the industry did in reverse in the USA? Buy politicians and make their wildest dreams law?
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