Ebook taxes called unfair by publishers

[fjtorres]

Originally Posted by HarryT

Pretty often, actually. The British government has always strongly supported the idea that books should be zero-rated for VAT.

The US Congress continually refuses to tax internet activity in order to foster more innovation in uses of online connectivity for commercial purposes. It is a zero out-of-pocket investment in the future.
Once in a blue moon politicians respond to the right lobbyists.

[pwalker8]

Originally Posted by HarryT

That's because you're looking at it from the POV of the customer, not the author. It makes a great deal of sense from the author's perspective. The majority of books don't pay more than their initial up-front royalty payment. By selling country-specific or regional rights to multiple publishers, the author receives multiple royalty payments, and hence makes more money. The business model is designed (absolutely rightly) to give the maximum benefit to the author, not to you, the customer.

I think you confuse royalty (i.e. payment for what was sold) with the advance. I think that authors get advances from the initial publisher of the work, not from subsequent geographical publishers. Obviously I could be wrong, but from what I read, that's normally the way it works. The royalty payments (i.e. how much the author gets per sale) probably does vary based on publisher.

My second point is that the geographical restriction model came about because in older times, publishers were smaller and not world wide. Plus it really didn't make a lot of sense to ship a lot of books from London to the US, or from the US to Australia. It was much more cost effective to actually print the books in the country where it was being published. While I suspect that in modern times, it's true that sometimes an author can get a better deal especially on a book that did well initially, for most authors, foreign publishing rights doesn't really move the needle since they might sale less than a thousand. Thus it's simply a business model that has continued by inertia rather than anything else.

[pwalker8]

Originally Posted by fjtorres

Encarta provided MS will a billion-dollars a year of business for a decade. Then it provided traffic to MSN for another 5 years. That is 15 years longer than most of the other encyclopedia vendors.
....

Do you have a reference for that figure? Because it's very hard for me to believe.

For reference purposes, Encarta was launched in 1993 for $395. That price quickly dropped to $99 and was often bundled as free software as part of a new computer purchase. Encarta became available for free on the web in 2000 and was eventually taken over from Microsoft in 2006.

[HarryT]

Originally Posted by pwalker8

I think you confuse royalty (i.e. payment for what was sold) with the advance. I think that authors get advances from the initial publisher of the work, not from subsequent geographical publishers. Obviously I could be wrong, but from what I read, that's normally the way it works. The royalty payments (i.e. how much the author gets per sale) probably does vary based on publisher.

Sorry, I did indeed mean advances. Two different publishing contracts means two advances. This is why authors benefit from limited publishing contracts.

[murg]

Originally Posted by SteveEisenberg

What business plan would have worked?

In the encyclopedia wars, even Microsoft, with or without Funk & Wagnalls, failed. Moving to digital earlier or later made little difference.

Microsoft succeeded. There's was a CD reader in pretty much every computer manufactured after that decision, up until online downloading became feasible (ie, CDs were no longer necessary).

And they made a several tons of money getting other people to put a CD reader in every computer.

[murg]

Originally Posted by pwalker8

That's of course the point that is ignored. Encarta really didn't last very long as a viable product. It wasn't so much that Microsoft made such a wonderful marketing move that those hide bound encyclopedia makers ignored, it was that the paper version encyclopedia business was going the way of the buggy whip makers. Encyclopedias and dictionaries now exist as websites, rather than as the must have volumes sitting on the book self for any parent with school age kids. While you can still buy 20 volumes of the Oxford English Dictionary, most get an online subscription.

Encarta was a means to another end. That end was satisfied in Microsoft's business plan when CD readers in computers became ubiquitous. And Microsoft made billions of a side-effect of their business plan.

[tompe]

Originally Posted by HarryT

Can't be done. The copyright holder has the absolute right to grant the right to copy to whomsoever, and with whatever restrictions, they wish. If they decide to grant me the right to only sell their book to people called "Smith", then that is absolutely their right. It's completely irrelevant whether or not you, me, or anyone else agrees with their decision or thinks that they're completely nuts.

Of course it can be done. The publisher just decide to buy only world rights. So all books going via a publisher will have no restrictions depending on region.

[fjtorres]

Originally Posted by murg

Encarta was a means to another end. That end was satisfied in Microsoft's business plan when CD readers in computers became ubiquitous. And Microsoft made billions of a side-effect of their business plan.

The lessons of Encarta are twofold: when technology enables a new product line/business model, embracing it will be more profitable than actively resisting it; and when technology obsoletes your product line/business model, it is more profitable to let it go (the cold won't bother them anyway) instead of fighting to prop up the fading business.

The international publishers are wise to be looking for ways to grow their native market ebook business; Smartphones and tablets are not going away anytime soon so they might as well take advantage of them.

[pwalker8]

Originally Posted by murg

Encarta was a means to another end. That end was satisfied in Microsoft's business plan when CD readers in computers became ubiquitous. And Microsoft made billions of a side-effect of their business plan.

Once again, I question the idea that Microsoft made billions on Encarta.

[pwalker8]

Originally Posted by HarryT

Sorry, I did indeed mean advances. Two different publishing contracts means two advances. This is why authors benefit from limited publishing contracts.

Does it? I was under the impression that an author is only paid an advance by the initial primary publishing company. I can't recall seeing an author talk about getting multiple advances for a single book.

[SteveEisenberg]

Originally Posted by fjtorres

Look to Microsoft and all the times they have reinvented themselves in the past four decades:
- they started as a vendor of programming languages for multiple operating systems for hobbyist computers . . .

This exaggerates the reinventions. They are still mostly an X86 architecture software company, with a smaller computer hardware business. The company name, Microsoft, is still on target to describe what they do.

Originally Posted by fjtorres

IBM used to be about tabulator punch cards, then typewriters, then mainframes, then PCs, now it is about corporate consulting and computing services.

At one point in the 1990's, they were in crisis with the employee count was down by about half.

I will give you that they have made several successful transitions. However, they were never primarily a typewriter company, or a microcomputer company. And what might seem at first glance the biggest plunge -- into the computer biz-- didn't change their customer base, sales approach, or even the focus on punch cards. Early IBM computers were improved IBM electronic accounting machines.

Originally Posted by fjtorres

Apple used to be about hobbyist computers, then business and educational computers, then about content creation computers, then about digital music, and now they are all about luxury phones and jewelry.

This is a company renowned, probably more than any other, for reinventing itself. And yet -- these Apple devices you mention all are microcomputers. And Apple has always been, primarily, a consumer products company. The changes you mention are not on the same order as Britannica switching from door to door sales to become a software company. That's a better explanation for the Britannica's fate than lack of agility.

Radically reinventing established firms doesn't work, as every buggy whip company which moved into making auto parts found. While stagnation is bad, so is switching to a business model in which you have no expertise.

[MikeB1972]

Originally Posted by pwalker8

Does it? I was under the impression that an author is only paid an advance by the initial primary publishing company. I can't recall seeing an author talk about getting multiple advances for a single book.

Charles Stross did a blog on it some time ago. You get an advance with each publisher you sign a contract with, he stated that he got about twice as much selling the foreign rights himself than if he sold global rights to one publisher.

[HarryT]

Originally Posted by SteveEisenberg

Radically reinventing established firms doesn't work, as every buggy whip company which moved into making auto parts found.

But some made the transition successfully. Eg Karl Benz went from running a bicycle repair shop to successfully manufacturing motor cars.

[HarryT]

Originally Posted by MikeB1972

Charles Stross did a blog on it some time ago. You get an advance with each publisher you sign a contract with, he stated that he got about twice as much selling the foreign rights himself than if he sold global rights to one publisher.

Yes, authors typically get a separate advance with each separate regional publishing contract, which is precisely why it's to an author's advantage to sell rights to different publishers in different countries, rather than world-wide rights to a single publishers. That's why so many books have different UK and US publishers, for example.

[JSWolf]

eBook taxes are called unfair by consumers as well as publishers.