MobiPocket Shut Down!?

[Cimmerian]

Hi, guys.
I've read this discussion and just wanted to add my couple of cents to it.
Actually, just wanted to remind that there 2 Mobipocket DRM servers, one is native Mobipocket and another one MIDAS (am I correct that Serguey Brin of Google has been developing that one before turning to Google completely?).
As I understand Mobipocket's part is down, but MIDAS belongs to a different identity and it is up, which enables Fictionwise and other bookstores to sell Mobipocket e-books acquired through that.
Actually, when Mobipocket was bought by Amazon, all things went messed up in a way. At least I liked their individual operations better.

Someone was asking about e-books economics here. It's quite simle - you need to find such a price for a book that will still be making sales and will not require huge processing efforts. So when you sell for 3 bucks, you sell a lot, but total is much less then if you sell few same copies for 40 bucks, and you put a lot more efforts in processing transactions for smaller amounts. If you put a book for 40, you will have fewer sales, but also fewer transactions. The trick is to find such an equilibrum that will mximize profits with minimum efforts.
In addition to this, distribution takes AT LEAST 55%, so if you buy a book for 12.95, publiesher gets less then 6 dollars (or an auther if he sells himself) - so the money from the sales are about equal to suggested to 5-6 dollars. This is when the price is 12.95.
This is without promotional expenses.
In my personal opininon an e-book can not possibly cost less then 12.95, otherwise it will be a loss for publisher, and such publisher will have to go out of business very fast because of never getting invested money back.

[Robert Marquard]

The trick with non-DRM books is that you can do the distribution yourself. This increases your profits considerably. No DRM server to pay for, no helpdesk to pay for also.
Baen sells its ebooks for 3$ to 5$ and in the first year made more money from ebooks than from selling paper books to Canada. In the next years it increased tenfold.

[nekokami]

Cimmerian, if you're right, then ebooks are doomed, because I just don't see many people willing to pay US$12.95 for an ebook, especially if the paper copy is available for substantially less than that.

As it happens, Baen seems to disagree with you, and they've been in the business for quite a while. Perhaps they're giving less over to "distribution."

[Snas]

Do you think Mobipocket be going to recover from this crash ?

[Robert Marquard]

I hope so. The Mobipocket format may have its drawbacks, but if they die i fear that they do not open source it (their custom compression and some format details, the DRM is not that interesting).
It is definitely a blow against DRM so we should enjoy.

[JSWolf]

Originally Posted by Robert Marquard

Mobipocket has just been bought by Amazon. They are still located in France and their staff is small. I would not expect money to be the problem.

Could it be an issue with someone having hacked into the DRM server and they are trying to fix the hole(s)?

[HarryT]

Originally Posted by Snas

Do you think Mobipocket be going to recover from this crash ?

It was you who told us that you had a MobiPocket contact who told you that the site would be back yesterday! What does your contact say?

[Snas]

Our contact said yesterday that he was going to get married tomorrow
xD

[JSWolf]

Lets say MobiPocket goes under and we lose most of the books in that fomat, what then? Does this mean that Sony is now the #1 in eink and eReader #1 in PDA/cell?

This would definitely be a big blow for the Cybook Gen3 for sure. What would they offer instead of MobiPocket support?

[nekokami]

Talk about borrowing trouble! But even without Mobipocket, I think you're leaving out .LIT.

[JSWolf]

Originally Posted by nekokami

Talk about borrowing trouble! But even without Mobipocket, I think you're leaving out .LIT.

I didn't include LIT specifically because the devices it runs with are not all that portable overall. There are more devices that can run eReader then MS Reader. Use, I know Windows Mobile devices can run MS Reader.

But yes, you are right, that would make MS Reader format a bigger player in the ebook game.

[NETLOLA]

Originally Posted by imaredr

I have the Q1B. I love it for reading!. My only regret is that I didn't get one that has a media slot.

Ellen

Yep, is it not just the best! And the fact that it runs Windows XP (no Vista for me right now), allows it to be a truly multi-format ebook device. I am still very anxious about Mobipocket though, because most of my ebooks are in that format.

The latest version of Mobi is just so highly configurable, and reading in full screen mode is just fantastic. It definitely has FAR more features than eReader, Ubook and Microsoft Reader, even though the latter is now UMPC friendly.

Argh!! Keep checking but tje sight is just down. I shudder to think of the revemue loss for all those eBook stores since Aug 15th, and with the imminent release of the latest Cybook........ not good.

By the way, a USB thumbdrive works just as great as the CF slot I have.

[nekokami]

I suppose you did specify eink and pda/cell.

It would be hard luck for Bookeen and the iLiad both. eReader has already said they have no plans for a Linux or Java port and I presume MS doesn't, either. I think talking about Mobi going under completely is a bit premature, though.

There is an Acrobat Reader 7 for Linux that could probably be ported to the Bookeen or iLiad units, and might even be reasonable to use on the iLiad, as it has mouse equivalent functionality in the stylus. It might be too slow and memory-hungry, though. I don't think it would work at all on the Bookeen.

[RWood]

Given the stories that have circulated about Amazon bring out their own eink reader, I don't think there is any question that MobiPocket will emerge from the current crisis and in the future be a bigger player than they ever were before.

Common wisdom says that ebooks are the future. If they are right for once then Amazon wants to be the dominant player in that market (as they are now in pbook sales.)

The current problems will be quickly forgotten after they are back up and most of the new people Amazon will attract to ebooks will never have heard of the DRM outage.

A sad side note in all this is that unless you already had the MobiPocket reader installed before the servers went down, you cannot install it now as all sites offering MobiPocket point to the MobiPocket site for the free reader software.

[DMcCunney]

Originally Posted by Cimmerian

Someone was asking about e-books economics here. It's quite simle - you need to find such a price for a book that will still be making sales and will not require huge processing efforts. So when you sell for 3 bucks, you sell a lot, but total is much less then if you sell few same copies for 40 bucks, and you put a lot more efforts in processing transactions for smaller amounts. If you put a book for 40, you will have fewer sales, but also fewer transactions. The trick is to find such an equilibrum that will mximize profits with minimum efforts.

In addition to this, distribution takes AT LEAST 55%, so if you buy a book for 12.95, publiesher gets less then 6 dollars (or an auther if he sells himself) - so the money from the sales are about equal to suggested to 5-6 dollars. This is when the price is 12.95.

You are conflating two different business models, and it doesn't work that way.

You have several costs: the cost of acquisition (IE, the advance payed to the author), the cost of preparation (line editing, copy editing, proofreading, and typesetting), the cost of manufacture, the cost of warehousing, and the cost of distribution.

Acquisition and preparation will be there regardless, and creation of an ebook edition in addition to the electronic format sent to a printer will be negligeable.

Cost of manufacture and cost of warehousing essentially don't exist for ebooks. You have a master copy of the electronic book, sitting on a server. the server will have a cost, but the share of that cost born by any individual ebook will be miniscule.

Cost of distribution will be the cost of the server, electronic payment setup, and bandwidth. Tiny for any individual book.

The standard discount to retailer for "dead tree" editions is 40% (but publishers are beginning to experiment with higher discounts, in exchange for less returns). With ebooks, the publisher deals direct with the customer. There normally isn't a retailer in the middle getting a cut.

This is without promotional expenses.

Most books don't have promotional expenses. Publishers reserve promotion for established best sellers and new books the publisher hopes might become a best seller.

In my personal opininon an e-book can not possibly cost less then 12.95, otherwise it will be a loss for publisher, and such publisher will have to go out of business very fast because of never getting invested money back.

You haven't thought it through.

At present, and for the foreseeable future, ebooks are simply a variant edition, offered in addition to the dead tree edition. When Baen began the Baen Free Library, it was intended specifically as promotion for their paper editions (and succeeded very well). Jim Baen stated in an email that he did not see electronic publishing as a source of profit at the time. The Webscriptions program has subsequently done nicely, but I suspect it's still a small fraction of Baen's total revenue.

But meanwhile, take manufacturing, warehouising, and distribution costs out of your model, and see if you still hit a minimum $12.95 price.
______
Dennis