In short, by being worried about 'piracy' of ebooks, and insisting on DRM 'solutions', they have wasted an enormous amount of capital up-front, and are wasting large amounts of money on an ongoing basis.
Sigh... The music industry has finally wised up, after having their arms twisted by Apple to do away with DRM on music over the past six or seven years.
Amazon seem to be entirely uninterested in twisting publishers arms over DRM, and publishers seem to be too stupid to discard it on their own at the moment.
Perhaps in another five years, publishers will finally wake up to what a disaster DRM is for the ebook industry, and since that's the long-term future of publishing, for them too.
It took Apple only five years to go from selling 25 million songs in 2003 to selling over 1 billion songs in just the last half of 2008 -- and one eighth of all music sold in the US.
Also, consider that Apple pass on around 70% of the price of the music sold to the music publishers. Amazon passes on just 35%, although that is of the list, not actual sale price. I suspect publishers would be a lot happier with 70% of actual sale price!
Quote:
Originally Posted by cstross
My understanding is that Hachette spent something like EUR 16 million on their ebook virtual warehouse infrastructure.
Because they treat vendors like Fictionwise as virtual wholesale customers, and have to handle accounting for ebook sales exactly the same way they would handle dead tree sales, and in turn allocate royalty payments accordingly. And stick DRM checksums on each outgoing ebook copy; sell 5000 copies, ship 5000 files (which each have to be generated separately on an encryption server).
They've done their best to port their existing business model to the electronic world, because nobody has the authority to say "this business model is obsolete -- here's a completely new one" (not merely because it would screw their career if they made a wrong call, but because there's internal corporate resistance to it: lots of people will lose their jobs if the old business model is junked).
|