DRM bad, Piracy Good

[mr ploppy]

Originally Posted by leebase

Yes, I'm an Eric Flint fan because of his free books. And David Weber. And John Ringo. Yes, sometimes I have disposable income that I'm inclined to spend on books. And yes, those three are now authors I could choose to spend that money on. But not if they always give their books away free. Then I start to wonder why I should spend my limited money buying their book, when I can buy a Tor or Ace book that I also want to read, and then read the Baen book a month or two from now -- for free?


Lee

While there is a small overlap in the middle, people who buy ebooks and people who download them for free are two entirely separate markets. Just like people who buy new hardbacks and people who buy second hand paperbacks. If people who want the free ones couldn't get them directly from the publisher they would get them somewhere else instead. Getting them direct from the publisher allows the publisher to advertise products to them that aren't free (either on the site or within the free product). By having them on the publisher site they are also a lot less likely to appear on torrent sites because there would be less prestige in pirating something that was already free (though I'm sure they are).

[leebase]

Originally Posted by mr ploppy

If people who want the free ones couldn't get them directly from the publisher they would get them somewhere else instead.

I hear you. It makes sense. However, I also think there is a difference between accepting a free ebook the publisher provides and getting a pirated copy of the book.

If I take a book from the darknet, I do not necessarily represent a lost sale. And there is benefit to the author in having a fan who might pay in the future, plus whoever he may tell about the author. I totally get why piracy isn't defacto in the worst interest of a publisher. And I'll just ignore the moral question for this discussion.

A publisher who offers a free version of the book doesn't exactly have the same dynamic working for them. It's more like putting a sticker on books in a book store that say "pay for this book if you want, or just take it for free". I really think there's a completely different dynamic under that scenario.

Lee

[mr ploppy]

Originally Posted by leebase

A publisher who offers a free version of the book doesn't exactly have the same dynamic working for them. It's more like putting a sticker on books in a book store that say "pay for this book if you want, or just take it for free". I really think there's a completely different dynamic under that scenario.

Not really. My local supermarket has a table full of second hand books and a bucket to put money in if you want to, but nobody chases you if you just walk out with a book. The bucket always has money in it.

Are the free ebooks and the paid for ebooks exactly the same, or do the free ones have extra in-house adverts?

[leebase]

Originally Posted by mr ploppy

Are the free ebooks and the paid for ebooks exactly the same, or do the free ones have extra in-house adverts?

Baen's free ebooks are the exact same as their paid ones. No ads. No commercials. And some of the authors, put out free versions fairly soon after the book is available for sale. THAT's what I think is the crazy practice.

Lee

[thrawn_aj]

Originally Posted by leebase

Baen's free ebooks are the exact same as their paid ones. No ads. No commercials. And some of the authors, put out free versions fairly soon after the book is available for sale. THAT's what I think is the crazy practice.

Lee

I've said this before - the bagel-man theory explains Baen's success quite easily (and it is a well-documented phenomenon).

Sure, it's crazy. The thing is, I can see precisely what Baen has done (in the grand scheme of things).

1. They took a business model that on the face of it doesn't guarantee huge sales but also doesn't bother to waste resources trying to suppress piracy (instead, it short-circuits piracy by making it unnecessary).

2. The people in charge there had a hypothesis N years ago (N being a respectably large number) about what it would mean for long-term profits if the model were adopted.

3. They adopted the model and stuck with it for N years, with the option (since it's a privately held company and therefore eminently flexible) to make any changes needed to the model if things didn't work out.

4. They observed the real-world results (profits) and decided to stick with the model.

In other words, they decided to go with a pragmatic, empirical approach rather than looking for market theory guarantees or by trying to control the market with an iron fist against every possible eventuality (in a market that is extremely volatile at the moment).

You see, the recurrent refrain in all your posts is "why would I do XYZ?". The empirical result of their experiment is that the model works so in a sense, we know that XYZ is being done, regardless of the reason.

Now, one may of course ask the (largely academic) question of why it works (which is what I think you're doing). And the zero-order answer would be that enough consumers think long-term than not (in the sense that they pay for the privilege of having Baen continue to exist as a viable source of free or low-price and DRM-free ebooks in the future) - and this is why the model works. Perhaps if most retailers sold cheap, DRM-free ebooks, consumers wouldn't care so much to preserve Baen and their business model would start becoming nonviable.

This goes back to your thread about non-hardcover buyers not counting in the big publishers' calculations. You see, in the case of Baen, they truly don't care about the pirates or the freeloaders, because they have established a successful business model that works because there are enough patrons who pay. They do nothing to combat piracy because it really doesn't affect their business model (while big publishers spend tons of money trying to play the DRM arms race or influence laws through lobbying [those politicians aren't cheap to buy or even rent] or influence public opinion about these things through anti-piracy advertising). They're not trying to be the policemen of the copyright world - they're just trying to be a profitable publishing firm. And they succeed because the big publishers don't do this.

I'm starting to think that Baen's success is surprising to so many people for the simple reason that the currently accepted template of a successful business model is far too bloated and unworkable (but it is currently accepted). It's like someone used to the bulky Internet Explorer wondering why the extremely lightweight Firefox can do all the same things without hogging the same level of resources (when I first started using it, it was 3Mb compared to ~20Mb for IE).

It would appear that Baen is being more intelligent about things by limiting their costs to such an extent (by not wasting their resources on unprofitable things like armies of lawyers, lobbyists, publicists, etc.) that it turns out not to require a very large number of paying customers to cover their costs and obtain a tidy profit in the process.

A pragmatist doesn't worry about fairness in the abstract sense - just whether unfair people will hurt his goals more than fair people will help it (based on the currently observed ratios of fair/unfair people in the relevant sample space).

[GA Russell]

thrawn, that's a great story about the bagel man. Thanks for posting that link!