Why The Commercial E-Book Market Is Broken

[wgrimm]

Read an interesting article with the above title at http://www.antipope.org/charlie/blog...ook_marke.html.

Here are Charlie's conclusions:

"So, it's time for me to advance some tentative conclusions about why the commercial ebook market is broken:

Most current ebooks are grossly overpriced relative to their utility to the reader. eBooks are actually disposable literature, like mass-market paperbacks only more so.
We are not going to see cheap ebook readers any time soon because publishers need them, but consumer electronics manufacturers don't.
Readers won't buy expensive ebook readers because they're reluctant to pay over $25 for a novel at the best of times. Only bundling a metric shitload of high-value content with a reader will make it attractive.
Insofar as there are no lending libraries or second-hand bookstores for ebooks, ebook piracy is the equivalent niche to those traditionally tolerated outlets.
Historically, only 25% of readers paid into the authors revenue stream. A 75% piracy rate may therefore be seen as a continuation of business as usual.
The pirates are not motivated by profit but by a poorly-understood social phenomenon connected to status in a gift-giving forum.
We do not know what ebooks are worth to readers, but the relative lack of Baen product in the usual places suggests that if unencrypted ebooks are readily available at an affordable price (i.e. less than an MMPB) then demand for the pirate edition will be reduced."



I agree, and still believe that some adventurous publishers should start marketing their backlists in non-DRM'd format, with buyers given online space for their libraries in case they need to re-download. And price the ebooks at 5 bucks or so. DRM sucks, but readers might even accept DRM of the sort that ereader.com has, as long as switching from device to different device is supported.

[VillageReader]

I'm not certain where the author lives, and what he says may be true for his area, but many libraries do offer loans on e-books. In the Cleveland area both the Cleveland Public Library and the Cuyahoga County Library (which use the same card) offer e-books in both pdf and Mobipocket formats. At last check there are about 5,000 books available for download, and that doesn't include the audiobooks.

The last several books I bought at Fictionwise (with the exception of a couple that have been just released) are cheaper than mass market paperbacks.

To me, at least, this makes the credibility of the rest of his arguments questionable.

[Jeff Duntemann]

I think Charlie is bang-on in a lot of respects, and he provides one huge smack-to-the-side-of-the-head insight here: Most ebook pirates (both givers and receivers) are collectors rather than readers.

I must be getting senile, as I had forgotten that I saw this happen at the very dawn of the personal computer era, when CP/M ruled and 8" floppies were still mainstream. (I'm guessing 1978.) I knew a guy who bragged a lot about all the software he had. He showed it to me, and he really did have everything of any consequence, such that there was in the 70s. They were all bootlegs, of course, but that didn't matter. He had it all.

Why was this peculiar? His computer was broken. I'm far from sure it ever really completely worked. (He had soldered it together--chips-and-boards kits were common then.) He didn't run software. He connived copies from people, and let people copy from his collection, but he didn't run the software itself. He never even stuck it in his own disk drives. It was totally surreal.

I think the Usenet pirate groups are like that. The copies are often terrible, un-proofed OCRs. Many of the technical titles don't have all the technical figures and photos. I've seen copies of my own company's pbooks there and found that the copies were generally so painful that they were a sort of inadvertent advertising.

One point not made in the article is that there is no single place to look up or buy ebooks, like Amazon. I'd buy more ebooks than I do now if I could just find them, and most of the time they don't exist. It's true that most people won't buy ebooks that cost more than five or six bucks. The kicker is that probably half the ebooks I want to read are backlist or out-of-print stuff that will never see a legitimate ebook edition and thus can't be had at any price. And that's a terrible drag on the emerging ebook industry.

Overall, a superb article that everyone here should read.

[JSWolf]

The reason a lot of people go looking for illegal ebooks is because the books they want are not available or not available in a format they can read. I cannot read eReader format on my PRS500. Nor can I break the DRM to be able to convert. So if I see a book I want in eReader only format, I either read it on my computer or I get it in pbook format. But if I know where to look, I go have a look and see if I can find an electronic copy I can convert and read. This babel of ebook formats is hurting the ebook market. It's not helping.

Lets say I bought an ebook from Amazon when they sold them. 2 years later I want to reread this. But I no longer have the device I had back then. The PID(s) for MobiPocket no longer match the devices I have. I'm screwed. Amazon won't let me get a copy I can read. So what do I do? I dgo looking for a copy I can read. Ok, I find one, but I also find other books I may want to read. So, I download them too and read them. I'm not paying for DRM content I cannot break the DRM from and someday end up with books I never can read again. I paid good money for this book that is 100% useless to me now.

See how DRM can cause MORE piracy then it prevents. In fact, if someone has a bad experience with DRM, then that person may never buy another ebook with DRM that s/he cannot break.

It's just stupid to expect me to pay for something that sometime down the road, I cannot use because of DRM. I know people that by books in a series and when the new book comes out, go back and reread the series from the start to freshen up their recollection. That's not unheard of. I went and reread the Lord of the Rings trilogy before seeing the movies.

Give us DRM and we will give you piracy in return. Take away the DRM and you'll find ebook piracy dropping.

[Jeff Duntemann]

Yes. DRM, incompatible file formats, and simple publisher reluctance to make e-editions available at all force people to decide whether or not to be pirates, and that's a decision authors and publishers should not force on their readers. I went into this in some detail in my blog on International Talk Like a Pirate Day a week or so ago.

[JSWolf]

And the fact that you want say a MobilPocket version and all there is available is an eReader version. That doesn't help at all. If we didn't have DRM, we'd have the tools to take that eReader edition and convert it to MobiPocket. Whereas a sale is made becuase there was no DRM.

[andym]

Originally Posted by JSWolf

Lets say I bought an ebook from Amazon when they sold them. 2 years later I want to reread this. But I no longer have the device I had back then. The PID(s) for MobiPocket no longer match the devices I have. I'm screwed.

Eh? Why can't you just register your new devices?

[JSWolf]

Originally Posted by andym

Eh? Why can't you just register your new devices?

Because Amazon only kept your ebooks available for download for one year. After that, they were no longer available to download. So after one year is up, what you have is what you have. DRM screws you over once again.

[Steven Lyle Jordan]

I think Charlie, like a lot of people, may be attaching too much significance to the dedicated e-book reader in this equation. As someone else in these forums pointed out, dedicated readers are essentially a luxury item... they are not required to read an e-book, and plenty of e-books were read before they were created. E-books have enough things going for them, and won't be hindered by the lack of a cheap dedicated reader.

I largely agree, finding the proper selling model and accepting an amount of inevitable piracy/theft/loss, instead of futile attempts to lock e-books down at hardback prices, is paramount.

Personally, I wouldn't call them disposable, any more than I'd call a paperback disposable... a good book is a good book, whatever the medium, and worth keeping. But I suppose if all you want to do is read it and delete it, at least you're not filling up the landfills...

[JSWolf]

I disagree. Let's say I bought ebooks in eReader format which I cannot break the DRM on as of yet because I was planning to get a PDA to read them on. Then I see the Sony or Cybook or iLiad and want one of those. All my eReader format books are USELESS! Because of the DRM, I cannot convert them to a format I could then use. I'm either stuck reading on the computer or I buy them again in a different format. This tower of ebabel and DRM are causing the slow sales of ebooks. If I could purchase device X from vendor Y and read ebook A on it and if I decided to get device Q from vendor W and still read ebook A without having to buy a device that is compatible with ebook A, then we'd all win.

Ebook piracy comes about because you have a book in a format your new device cannot read or you cannit read it because of the DRM. So you go looking for it cracked. Then you find outher books cracked, so you download those too. Also, because publishers do not release as many ebooks as they should, we get piracy due to the fact that people want their books in eform and cannot get them.

[cstross]

I'm British. British libraries do not -- as far as I am aware -- have ebook lending programs.

[DaleDe]

Originally Posted by cstross

I'm British. British libraries do not -- as far as I am aware -- have ebook lending programs.

That is too bad. They work pretty well over here. Lot's of libraries have them and they use DRM in most cases. They buy a quantity of licenses and have expiring checkout licenses on a book when you check it out. They will not simultaneously checkout more books than they have licenses for. You can check a book back in or let it expire.

The libraries require a local library card for identification so you must be a local. But after that you can check out a book from your own home without visiting the physical library. Otherwise the ebook library works exactly the same as the physical library except no late charges.

Dale

[BooksForABuck]

I'm curious about the 25% number you mention in the original post. It may be true for some publishers who stress the library market, but I have a hard time believing it's true overall.

I agree that the market for $25 fiction is pretty specialized. Hardback pricing does target library use, setting a (relatively) high royalty and price relative to cost to recognise that many of the books will be re-used. Of course, the pricing also recognizes that many of us are getting old enough that our eyes struggle with the font size in mass market paperback.

I'll certainly go along with any horror stories about DRM, and recognize that there is such a thing as collectors. Still, there are a lot of authors out there who can't even make a couple of thousand bucks on a good book they spent thousands of hours on. When we see our books being traded around the Internet and when they hear people talking about how sharing doesn't hurt anyone, it does get on our nerves. At least that's my experience.

If we can agree that the eBook market is broken, maybe we can segue into what we can do to fix it. Losing DRM might be part of the answer, and aggressive pricing may be part of the answer too. I don't believe the combination solves things, though, and I do believe that eBooks are the way to read.

Rob Preece
Publisher, www.BooksForABuck.com

[delphidb96]

Originally Posted by Steve Jordan

I think Charlie, like a lot of people, may be attaching too much significance to the dedicated e-book reader in this equation. As someone else in these forums pointed out, dedicated readers are essentially a luxury item... they are not required to read an e-book, and plenty of e-books were read before they were created. E-books have enough things going for them, and won't be hindered by the lack of a cheap dedicated reader.

I largely agree, finding the proper selling model and accepting an amount of inevitable piracy/theft/loss, instead of futile attempts to lock e-books down at hardback prices, is paramount.

Personally, I wouldn't call them disposable, any more than I'd call a paperback disposable... a good book is a good book, whatever the medium, and worth keeping. But I suppose if all you want to do is read it and delete it, at least you're not filling up the landfills...

I'm not so sure that the initial hardware cost is all that relevant. Oh sure, it *seems* to be an excessive investment, but let's assume you're shelling out $7.99 for those MMPBs. If you read 40 or so books per year, that's a hefty $320 just for the books, not to mention bookshelves to store them in. But not quite enough of an expense to warrant a $300 investment in a dedicated ebook reader.

However, if you read more than that, given that so many ebooks can be had for around $5-$6, the initial investment becomes a bargain. I'm reading about 200 books per year, but I know I'm a 'special' case. The savings on 200 ebooks vs 200 MMPBs makes having a Sony or Bookeen a necessity instead of a luxury - and I can store them all on DVD-ROMs for later perusal.

But publishers can't seem to 'get' it and that's what drives people to the underground sites.

JMO

Derek

[Darqref]

Originally Posted by wgrimm

I agree, and still believe that some adventurous publishers should start marketing their backlists in non-DRM'd format, with buyers given online space for their libraries in case they need to re-download. And price the ebooks at 5 bucks or so. DRM sucks, but readers might even accept DRM of the sort that ereader.com has, as long as switching from device to different device is supported.

Producing backlist books may be harder than it sounds. At Baen, there are lots of books for which it's easy to reprint, but much harder to release electronically. They exist as film, which can be sent to the printers, but must be scanned and OCR'd before electronic copies are available. Baen uses them for filling months with duplicate books, but they have to pay someone to do the scanning.

You're much more likely to see a back-list electronic release if there is a new edition, not just a reprint. For ex, Baen has been releasing compilations of 2 or 3 older books under one cover, with new art.

But even with this added cost, it still should be cheaper than most

Roger