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Old 03-20-2010, 07:56 AM   #1
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The future of publishing: Why ebooks failed in 2000, and what that means for 2010

A lengthy article from Michael Mace.

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It's a great time for ebooks. There are at least six ebook reader devices on the market or in preparation. A major business magazine predicts that up to seven million of these devices will be sold next year. A major consulting firm says ebook sales will account for ten percent of the publishing market in five years. And an executive at the leading computing firm predicts that 90 percent of all publishing will switch to electronic form in just 20 years.

But the year isn't 2010 -- it's 2000, and the ebook market is about to go into hibernation for a decade. What went wrong, and what can the failure tell us about the prospects for ebooks in 2010?

I had a front row seat for the last generation of ebooks: In 1999 I was at Softbook (one of the early ebook reader companies), and later I interacted with the folks at Peanut Press (an ebook publisher) after they were bought by Palm. My short summary of the lessons I learned: Although some of the barriers that stopped ebooks in 2000 have been reduced, most of them are still in place. So I think the market isn't likely to grow as quickly as many optimists are predicting. However, the economics of traditional publishing are very vulnerable to a paradigm change. That change is likely to happen later than most people expect, but once it happens it'll probably move very quickly indeed. So stay out of the avalanche zone.

Here are the details on why, and how to avoid the avalanche when it does happen.
Full article: http://mobileopportunity.blogspot.co...ks-failed.html
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Old 03-20-2010, 08:33 AM   #2
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Interesting article. One point that he doesn't mention is the fact that ebooks are often available somewhere to some people, but are not available everywhere on all devices. So, DRM and Geo restrictions are also a blocker to adoption - perhaps as a further cause of the availability issue mentioned.

Someone suggested to me that they felt that the avalanche would come when a device broke the £100/$100 barrier, which the PRS300, for example, is close to doing. At this price point, it becomes a popular gift, and usage would take off.
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Old 03-20-2010, 11:57 AM   #3
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Quote:
Originally Posted by Ben Thornton View Post
Interesting article. One point that he doesn't mention is the fact that ebooks are often available somewhere to some people, but are not available everywhere on all devices. So, DRM and Geo restrictions are also a blocker to adoption - perhaps as a further cause of the availability issue mentioned.
Format is still an issue too. I doubt ebooks will really take off until the industry settles on a standard format (ePub, most likely).


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Originally Posted by Ben Thornton View Post
Someone suggested to me that they felt that the avalanche would come when a device broke the £100/$100 barrier, which the PRS300, for example, is close to doing. At this price point, it becomes a popular gift, and usage would take off.
I won't gift an ereader, regardless of price, until I can also gift ebooks. There are very few places I've found that allow ebook gifting, so that's an issue.


from the article:
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In my opinion, the right way to create a technology product is to identify a group of customers who have a major problem, and to solve that problem decisively. It's not clear that ebooks, especially as they are constituted today, do that. Paper books simply aren't broken, from the perspective of most users.
I disagree with this. Well, maybe "most" users don't see a benefit, but the avid readers, the ones who are/were early adopters of ereader technology, certainly see benefits: better availability of some books (I've found several ebooks that I can't find in print), free public domain books, ease of carrying many books with me, storing my library on a small device. I can fit my ereader in my purse and take it with me! Try doing that with the latest 1,000-pager King novel! No more cramming 8 books into my luggage when I travel!

Even my parents, avid readers but somewhat technophobes, have ereaders because of the ease of use.

Last edited by queentess; 03-20-2010 at 12:12 PM.
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Old 03-20-2010, 01:29 PM   #4
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I wouldn't say it went into hibernation, although it might have been sleeping at times.

As far as price point for readers go, newegg has sale on for today for Jetbook lite readers at 112.99 with free shipping.

Thats getting pretty reasonable.
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Old 03-20-2010, 07:09 PM   #5
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Interesting article. Of course, the biggest issue is content. Most here are ebook readers and I suspect that most here get frustrated by favored books not being available. I suspect that the ebook market will eventual standardize on one or two formats that most devices will be able to display as well as a disappearance of DRM, much like the music industry. There will, of course, have to be changes in the business models, both for the publishing industry as well as the authors.

Many established authors are use to getting a steady income for re-releasing older works, much like the movie industry cycled older movies on TV for years. I've read one author call his back catalog his 401-K. They fear that ebooks will cut into that income stream and that as soon as a book is released as an ebook, they will sale 1 copy and then that copy will be pirated by everyone else. My answer is that with scanner technology as it is, if their books aren't already out there on the dark net, it just means no one wants to read them, so they really have nothing to lose at this point. As Eric Flint has said, the thing that most authors should fear is obscurity, not piracy.

Publishers see their business models crumble and most don't have a clue about how to react, much like the music and movie industry.

In the ebook industry, I see a number of opportunities out there for people willing to seize the chance. I suspect that rather than huge publishing firms, we will see a lot more of the smaller publisher, such as Baen who put out perhaps 3 or 4 books a month. The big thing that Baen provides for the authors in the ebook market is editorial services and an established market. For readers, it provides a certain known product. If you, the reader, like the type of books that Baen publishes, then it's a one stop shop where you don't have to wade through a bunch of drek to find books you want to read. I suspect that we will see a lot more niche publishers like Baen in the future.

I also think that we will see a lot more web pages, rss feeds and the like for readers to use to find books they want. Right now, I have to scroll through page after page after page of self published books and PD books just to find a couple of new ebooks that I might be interested in on Amazon. Personally, I find it a miserable experience and that is the big reason my ebook buying has slowed down. My current solution is to go buy my local Barnes and Noble, scan through the just published shelves and write down the name of books and authors that look interesting. Then I look them up on Amazon. I'm actually more likely to buy from Sony than Amazon, simply because it's easier for me to browse and find books that I'm interested in.

Last, I can see ebook stores having lots of room to improve the shopping experience for customers. Let me set up a list of authors that I like and send me an email whenever a new book buy one of those authors is available. Give me recommendations based on what I buy, but let me fine tune those recommendations. Amazon does this, but it needs more fine tuning.
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Old 03-20-2010, 10:28 PM   #6
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But the year isn't 2010 -- it's 2000, and the ebook market is about to go into hibernation for a decade. What went wrong, and what can the failure tell us about the prospects for ebooks in 2010?
SHORT VERSION:

I think that the “failure”, if there is one, comes from commentators not fully understanding what is actually happening - which is a major re-definition of what the role of a “book” now is.

The real change is that the Internet now functions much like one large 'E-book' that can provide a substantial part of our reading needs, both for reference and for enjoyment. That's where most of the E-reading action of the last decade has really taken place (and it's how you're reading this right now...)
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Old 03-20-2010, 10:29 PM   #7
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LONGER VERSION:


When I was young, printed material such as books and newspapers were major sources of information (including education, news, reference and so on) and entertainment (fiction, gossip, comics or whatever). Those needs still remain, but what has changed dramatically since then is that a physical book or newspaper is no longer either the dominant delivery method, and - for many consumers - no longer even necessary. Not because of “E-books” in the narrow sense, but because of the massive increase in electronically delivered material right across the board.


For some people the TV has long been their main source of allegedly ‘factual’ information as well as fiction style entertainment. But the other big change in the role of books has been the Internet - which now functions much like one vast ever-changing book. I am a keen reader - with 2000+ printed books in my house and around 60 years of reading experience, but I have shifted inexorably over the past decade towards getting both information and entertainment via the computer. I’d suggest that, as you are reading this right now, then you probably have too.

In computer terms, 2000 - 2010 has been described as the “Google Decade”, because of the massive take up of the internet both for reference and for pleasure. What this appears to be saying is that the relevance of a traditional “book” is shifting rapidly and that the real change isn’t a battle between printed pages and E-pages but between the whole structure, length and format of how we read. There’s no longer any need to package things in familiar chunks of so many pages, or in traditional shapes, sizes or price points. Via the internet we can read not just a restricted monologue on a specific topic, but a continuing dialogue that we can even be part of ourselves. And we can consume our written material in anything from tiny bites to massive lengths with an almost endless array of choices in between.


Regardless of what we might personally think of Apple or Microsoft I believe that anybody who dismisses iPad style gear as pointless gimmicks is being massively short sighted. What that whole new generation of pad/slate type devices are seeking to provide is a way of bringing the complete modern reading experience to one conveniently portable device. That doesn’t just mean novels it includes forums, blogs, social networking, news, reference material, and anything else that can be communicated by print, pictures, sound in any combination you can think of.

E-books - in the form of electronic shadows of print books - are just one small part of an expanding picture. Things are not just getting ready to change - the main event already has moved on. It’s a done deal.

In my E-pinion....

Last edited by ChrisC333; 03-20-2010 at 10:32 PM. Reason: typos
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Old 03-20-2010, 10:44 PM   #8
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I agree, and another point about the printed material - my local newspaper, for the last few years, has tilted to the viewpoint of the right-wingers, and I wasn't hearing the viewpoint of the other side. Not only was the news not timely, but major items would be omitted or changed to fit their viewpoint. I HAD to resort to the internet to get timely and unbiased viewpoints. People can control the printed material to fit their own agenda, and make it appear to be the news, but it's hard to do that with the open internet (the government of China, and WSJ are points in mind).
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Old 03-21-2010, 08:16 AM   #9
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Apologies in advance for the selective excerpts:

Quote:
Originally Posted by pwalker8 View Post

Many established authors are use to getting a steady income for re-releasing older works, much like the movie industry cycled older movies on TV for years. I've read one author call his back catalog his 401-K. They fear that ebooks will cut into that income stream and that as soon as a book is released as an ebook, they will sale 1 copy and then that copy will be pirated by everyone else. My answer is that with scanner technology as it is, if their books aren't already out there on the dark net, it just means no one wants to read them, so they really have nothing to lose at this point. As Eric Flint has said, the thing that most authors should fear is obscurity, not piracy.

In the ebook industry, I see a number of opportunities out there for people willing to seize the chance. I suspect that rather than huge publishing firms, we will see a lot more of the smaller publisher, such as Baen who put out perhaps 3 or 4 books a month. The big thing that Baen provides for the authors in the ebook market is editorial services and an established market. For readers, it provides a certain known product. If you, the reader, like the type of books that Baen publishes, then it's a one stop shop where you don't have to wade through a bunch of drek to find books you want to read. I suspect that we will see a lot more niche publishers like Baen in the future.

I also think that we will see a lot more web pages, rss feeds and the like for readers to use to find books they want. Right now, I have to scroll through page after page after page of self published books and PD books just to find a couple of new ebooks that I might be interested in on Amazon. Personally, I find it a miserable experience and that is the big reason my ebook buying has slowed down.

Last, I can see ebook stores having lots of room to improve the shopping experience for customers. Let me set up a list of authors that I like and send me an email whenever a new book buy one of those authors is available. Give me recommendations based on what I buy, but let me fine tune those recommendations. Amazon does this, but it needs more fine tuning.
Complete agreement on the above points:

1) Authors will make more on their backlist. Right now, so many authors lose money because their backlist goes out of print and honestly, I go buy used because it makes more sense.

Cheap, DRM-free, open format ebooks at $1-5 would be my preferred choice if they were available...the author gets a lot more money (since they get none from used sales) and as a reader I have the convenience of instant access to the entire backlist of an author or publisher.

I was thinking about this yesterday: as a kid, I used to buy 20-30 comic books a month (back when they were 75 cents each). Now, comics are $3 an issue and I buy NONE (I go to Borders, grab an overpriced coffee drink and skim the latest issues) ... but if I could buy comics at $1 an issue (ZIP/HTML or PDF with no DRM), I would immediately go back to buying 40-50 titles a month.

I know I'm not alone...circulation for the X-Men has gone from about 250,000 copies an issue (in the early 80s) to less than 50,000 an issue, as per the audit reports printed in the books.

I think traditional books would be in the same boat...massive opportunity for volume sales at a lower price point, much more profit since you save the cost of printing, shipping, returns...and no, having worked in publishing, I KNOW that printing, shipping and returns is a LARGE percentage of costs (or so management always insisted when the issue of salaries and budget for editorial content came up )

2) Absolutely, I see the spread of niche publishers cutting into the pie of dominant publishers being inevitable. The barrier for entry is so much lower now. Major publishers will need more imprints (like Del Rey, Tor, etc.) to distinguish their genres to stand out.

In the past, to be a publisher, warehouse space mattered. Lots of cash needed for printing, warehousing (money invested in inventory that might take a year or more to recoup), shipping, absorbing returns...sales reps to get you into bookstores and cut deals with distributors...waiting months for money from retailers and distributors while salaries still need to be paid and printers need to be paid for new product...all of those were very real expenses.

Now, your expenses are editorial: author, artist, editor, a little for formating. Sell either through your own dedicated ecommerce site or through Amazon, Smashwords, etc. Printing can easily be POD to your out of pocket costs low...the ebook serves the function of the cheap paperback, the POD is the premium version for the "super fan."

Yeah, the fragmenting of the industry appears, to me at least, to be all but inevitable.

3) The biggest problem: How to connect readers to authors.

I think the missing component is a few "hub" websites that serve this fuction -- I see the key ingredient being a site that combines editorial/reviews and news, voting by members, social networking...a Slashdot/Digg/Reddit for books...probably several sites by genre.

Once that one dedicated site or network is in place, I think the ebook industry could explode. (I still maintain that DRM-free, open formats like HTML, PDF, etc. are the way to go...I think if the industry went in that direction, the migration to a mature ebook industry will be much faster...and I'm sure a lot of the scruffy little upstart publishers will realize this and move to that model more quickly since they have less to lose and a lot more to gain.)
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Old 03-21-2010, 07:30 PM   #10
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The short version imo is the measures (Geo-restrictions and DRM) and pricing which publishers demand are holding back mainstream adoption of reading devices.

They have a chance to 're-popularize' reading with the young mainstream and gain millions of new consumers, but instead, in their fervor to stick with the old ways they are making the transition to electronic slow and painful for consumers.

the number of people reading has been in steady decline in recent years, left for science fiction geeks, nerds, oldies, middle ages women and intellectuals to do while most young people were satisfied with facebook, blogs and itunes. Now with these new exciting devices (nook, kindle, iPad + more) there is a real chance to vastly increase reader numbers but first the more knowledgeable hardware/software makers and e-book sellers (Apple, Google, B&N, Sony, Amazon) have to do battle with the publishing industry.

New devices like the iPad let the primary usage of the device be video/internet/games and the user can easily expand into e-books and start reading again, many potentially new and returning customers for publishers. That's not even considering the new possibilities for new media including interactive kids books, interactive encyclopedias, magazines and so on. A massive opportunity and publishers are still busy squandering it by restricting e-book uptake with DRM/Poor Pricing/Geo-restrictions.
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Old 03-21-2010, 07:53 PM   #11
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Apologies in advance for the selective excerpts:

...
Once that one dedicated site or network is in place, I think the ebook industry could explode. (I still maintain that DRM-free, open formats like HTML, PDF, etc. are the way to go...I think if the industry went in that direction, the migration to a mature ebook industry will be much faster...and I'm sure a lot of the scruffy little upstart publishers will realize this and move to that model more quickly since they have less to lose and a lot more to gain.)
Oh, I agree. I like several different genre's, I can imagine a SF site that has things like newly available books, web boards, facebook pages, reviews, interview with authors. Baen already has quite a bit of that sort of thing, and has built up a very faithful following because of it over the last 15 years or so. Jim Butcher has his own web site that is very active and I'm sure other authors have the same. It's just a case of putting it all together for the convenience of the customers.
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Old 03-21-2010, 08:03 PM   #12
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the number of people reading has been in steady decline in recent years, left for science fiction geeks, nerds, oldies, middle ages women and intellectuals to do while most young people were satisfied with facebook, blogs and itunes.
Is this true? This report, for example, shows book sales slowly but steadily increasing in the UK. From what I could tell from a quick look at the national statistics site, literacy is looking pretty solid.

I'm not convinced that young people are not reading. There are lots of things competing for their time, but I think that the lack of physical exercise is more worrying than the lack of mental exercise.
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Old 03-21-2010, 11:33 PM   #13
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This economic turmoil is making drastic changes in the printing industry......in a few years when alls settled the printing industry will be quite different
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Old 03-22-2010, 01:31 AM   #14
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From what I could tell from a quick look at the national statistics site, literacy is looking pretty solid.

I'm not convinced that young people are not reading. There are lots of things competing for their time, but I think that the lack of physical exercise is more worrying than the lack of mental exercise.

I'm not sure that book sales figures on their own tell the full story. If a recent visit to a local bookshop is any guide, few of the books they stock now would be likely to attract a big audience among many young people. The biggest categories seemed to be Cookbooks, Gardening, Self Help, Romances, Sword and Sorcery, Murder Mysteries, Thrillers, Personal Tell-Alls etc. In many sections, some kind of celebrity tie-in seemed almost a required feature, to the extent that parts were starting to look surprisingly like a somewhat up-market version of the supermarket magazine racks.

A recent TV show suggested that the biggest market for e-book was middle aged women, and that would seem to line up with what I've seen locally. All the local bookshops in my area are owned and/or staffed by middle aged women. The members of the local social book discussion groups are overwhelmingly middle aged women. Among my friends who read it's mostly the women who plough through books by the kilo rather than spend weeks pondering single volumes. Then they swap them amongst themselves, by the bag-full.

Of course, there is another category that is still flourishing and that is illustrated children's books. There was a very impressive selection at the bookshop (many written and illustrated by extremely talented women.... of a certain age...). And guess who was buying them for their children and grandchildren.....

There's always Harry Potter of course, and lots of teens apparently read that - as soon Mum's finished reading the copy that she bought....

A big thank you to all the women on the forum - you seem to be keeping the book trade alive.

Cheers,

Chris
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Old 03-22-2010, 01:48 AM   #15
Elfwreck
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Location: SF Bay Area, California, USA
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Quote:
Originally Posted by queentess View Post
I won't gift an ereader, regardless of price, until I can also gift ebooks. There are very few places I've found that allow ebook gifting, so that's an issue.
This, I think, is crucial. Right now, you can give your spouse/parent/teenage nephew an ebook reader, but you can't send them a small cluster of ebooks every month to keep them interested in it. (Except for public domain freebies. Which they'll have to figure out how to install on it, because many of the ebook readers make downloading from their store easy, and installing from the computer annoying and troublesome for non-techie users.)

Until gift ebooks are easy, the steep learning curve is going to keep the ebook market isolated to devoted techno-geeks and fanatic readers--neither of whom is the backbone of the print book market.
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