Archive for April, 2006

Coming Soon (Finally): A Critical Mass of eBook Content

A commenter on a recent post takes publishers to task on suspicion that they “really don’t want eBooks to succeed, and may very well be deliberately pricing them just above what a thriving or even sustainable market will bear.”
Well, I feel that eBook pricing at close to parity with print editions has been understandable given the very small sales volumes, which have led to eBooks being treated by publishers as just another niche revenue “adder” along the lines of a large-print edition. Rights-clearing hassles and high creation and support costs of creating digital editions for the plethora of eBook content formats and DRM systems haven’t helped the case for lower prices either. No publisher conspiracy theory needed. But, “Andre” makes an excellent point in noting that:

Even if publishers preserve their margins and authors their royalties with half-price books carrying virtually no overhead, what really terrifies them is the perception of value being lost. If E Ink devices succeed beyond expectations, then deep discounts would erode the public’s willingness to pay $30 for the next Harry Potter hardcover.

You bet this possibility terrifies publishers! In the hierarchy of text-based content, books are at the top, in terms of carrying a “premium” value, undiluted with advertising. The costs of book creation, in authorial time, editorial attention and marketing are correspondingly higher (as are the risks of print runs – but that doesn’t apply to eBooks, and less so overall given print-on-demand). Disintermediation – authors going direct to consumers – is a related fear, as is the concept of any kind of national or universal digital library.
While I agree that lower eBook prices are both feasible and would stimulate adoption, which publishers may not have been overly eager to have happen, I believe the key way publishers have hamstrung eBook adoption is by limiting supply. Any new format needs a critical mass of content to succeed, and that’s not a paltry 5% of annual new titles. Certainly during the last eBook hype boom (circa 1998-2002) publishers weren’t rushing to make all their content available.
However, a sea-change is clearly under way. Google and Amazon are scanning books and making page-images available. Pirate eBooks are circulating, sometimes within hours of being published in print form. A new “digital generation” is clearly going to expect the option to read on screens. Other parts of the print publishing industry have moved more rapidly: Elsevier now makes over 50% of their academic journal revenue from digital subscriptions, and the trend to what they call “E-Only” subscriptions is growing sharply, and in the tech sphere O’Reilly Safari appears to be doing quite well. Libraries are also acting as change agents, since digital distribution yields immense gains in efficiency and patron access; publishers realize that it’s unreasonable to expect to hold libraries back from going digital.
As a result book publishers – across all segments – feel their hands are being forced and are preparing to make all of their content available digitally. They are absolutely afraid that their business models, indeed the whole industry, may well change in fundamentally disruptive ways, but it’s clear that the book business, like Hollywood, has collectively decided not to sit on the sidelines while Amazon, Google, piracy, and the Web do the disrupting. Their intentions are laid out in recent initiatives announced by Random House and HarperCollins, among others.
Sure, there are still barriers. I believe other industry participants, including Adobe, need to step up to the challenge of delivering technologies, tools, and compelling services that will enable this to happen cost-effectively and with high user satisfaction. We still need better devices for e-Reading. And, yes, I believe eBook prices need to come down. But, regardless, the floodgates of book content in digital form are opening and I believe this will itself be a key part of stimulating all of the above.

eBooks Entering the Mainstream

The WSJ yesterday published a fascinating article by Jane Spencer on The Blackberry Squint: PDA Use Triggers Eyestrain [subscription required]. There was a nice mention and photo of the Sony Reader device, whose reflective E-Ink display I personally much prefer to light-emitting LCDs. Eyestrain associated with LCD displays is a real concern – albeit not well-supported by research findings, as evidenced by the Journal’s including anecedotal quotes from a couple of optometrists, rather than referencing any studies. But the real “ah hah” for me was the subhead and lead paragraph:

Gadget Makers Offer Features to Improve ‘Readability’; ‘The Da Vinci Code’ on a Treo
Chris Kwak, a 31-year-old financial analyst, spends hours a day glued to the tiny screen of his Palm Treo hand-held computer. He fires off emails, check stock prices – and recently plowed through the novel ‘The Da Vinci Code’.

So here we have reading an eBook matter-of-factly included, along with emailing and information retrieval, as a basic user behavior (!). While this surely doesn’t track to typical current usage, it’s yet another signal that eReading is, directionally, becoming a mainstream activity. Treo users are clearly still somewhat early adopters, especially in the “over 30″ set, but there’s a generation coming up that’s used to consuming all their content digitally. Elizabeth Mackay, GM of eReader.com, quipped last week that “if you’re not on their screen, you’re not in their world”. Publishers have clearly gotten that message too, and the coming flood of digital content will be a further impetus to broader adoption of eReading.

“Open Container Format” Spec Published

IDPF today released the first working draft of a specification for the Open Container Format , which defines a single-file package for OEBPS XHTML-based content and related resources. The publication of this draft by the IDPF Container Format Working Group is a significant milestone in advancing open ePublishing standards. I encourage those interested in industry-wide standards to review and provide feedback on this proposal, which has implications beyond eBooks and OEBPS. To quote from the draft:

As a general container technology, OCF collects a related set of files into a single-file container. OCF can be used as a container technology for various document formats and some classes of applications. The single-file container enables easy transport of, management of, and random access to, the collection.
OCF defines the rules for how to represent an abstract collection of files (the “abstract container”) into physical representation within a ZIP archive (the “physical container”). The rules for ZIP containers build upon and are backward compatible with the ZIP technologies used by Open Document Format (ODF) 1.0.

That it’s taken just two months from publishing requirements for a container format to releasing a detailed and nearly complete formal specification is a credit to hard work and a can-do attitude on the part of the Working Group leadership and technical contributors. I’ve only been a kibbitzer in this but I’ve been very impressed with the contributions from multiple publishers, technologists, and system vendors. Of course one reason for the speed is that this proposal represents a generalization of the ODF approach, but successfully avoiding reinventing the wheel is also commendable (and rare) in a standards body. Coordination with other relevant standards groups, including OASIS and DAISY, is also underway.
It’s clear that the IDPF process is working, and I hope that those who have been advocating splinter approaches are ready to put their egos aside and really put their wood behind this arrow, so we can end the “Tower of eBabel” of multiple incompatible eBook formats.

For Earth Day: E-Reading Without Apologies

April 22 is a day dedicated to giving something back to the planet we share. While it gets me no spousal credit wrt the scheduled park-cleanup and preschool-repainting chores, I believe that broader adoption of e-Reading can make a huge difference. The compelling environmental and social benefits of e-Reading is something I feel we often lose sight of amongst the bright shiny objects of new technology, the need to create profitable businesses, and especially the cultural gravitas and “pride of place” associated with paper books and traditional publishing.
This last I believe is something those of us working in ePublishing should address head-on, without apologies. For all their many merits, paper books are an artifact of the economic elite; arguably, no other industry segment places more environmental burden on the planet than paper-based publishing. As a result of these costs and attendant distribution inequities “haves” are sharply separated from “have-nots” in regard to access to books (whose prices have risen faster than inflation).
It may be too soon in the evolution of e-Reading to argue convincingly that e-Books will substantially replace p-Books, but we need make no apologies for this possibility. Rather, we should stimulate adoption by working to capture the cost savings and increased distribution opportunities inherent in digital content, and then ensure that most of these savings are passed on to consumers. In the near term, still feeling the hangover from the burst of the eBook hype bubble of the early 2000s, it’s going to remain tough sledding. But the lesson of the digital photography industry shows us how quickly this sentiment can flip.
In the mid-1990s there was a lot of talk about the magical qualities of film photography and photo artifacts. Photo albums are treasured, totemic family mementos, something people risk their lives to save from burning houses. The professional, SLR photo hobbyist, and the casual photo memory sharer alike have all been accustomed, for generations, to film and photo labs. That most of these users would “convert” to digital? Unthinkable! “Single-use digital cameras”: a laugh line at PMA 1998. Yet less than 8 years later, it is obvious that digital is replacing film across the board.
One major reason for this is cost: it is simply expensive to create, distribute, and process film. And a key component of this cost is environmental: Kodak was as recently as 2003 still one of the largest carcinogen producers in the United States. But as digital takes over, the environment impact of photography is diminishing. Consumers didn’t adopt digital photography to “save the planet” or “enable 3rd-world access to photography” – they adopted because of price and convenience.
Of course this also required something that’s not quite there yet in ePublishing: good enough devices. But the dramatic change in digital cameras in the last decade shows how rapidly Moore’s Law and the competitive market can evolve toys into professional tools. In 2006 the Sony Reader, Tablet PCs, and Treo-type convergence devices show that we’re getting closer to “good enough”, but well before 2016 we will have low-cost reading-optimized devices that are almost unimaginably superior, and that truly deliver “better than paper” experiences.
Back to print publishing and the environment. The current environmental impact is not just the stereotypical “tree cutting”. A single family’s annual use of paper is not only several trees’ worth of wood, but also significant amounts of energy, greenhouse gases and other pollutants, solid waste, chlorine and other toxins, and water consumption. The transportation of that paper to the home and then back out again (10% of landfill space is consumed by newsprint) consumes yet more energy and produces yet more pollutants. And in much of the world, lacking superhighways and massive warehouses, it is simply infeasible to distribute information this way.
Digital photography passed on its cost savings to consumers very directly: capturing and digital viewing of pictures has become effectively free, with on-demand printing of photos a secondary behavior. Digital publishing is far trickier. Books have a user-perceived value that authors and publishers want very much to preserve. But this user value is not set in stone at $14.99 for a trade paperback. New business models, such as subscriptions, will play key roles and in many segments of the publishing market the Web is fundamentally changing what publishing is all about.
But even withiin the current single-copy-sale business model, digital distribution should enable e-books at half the price of p-books, giving publishers and authors equivalent margins and a superior return on investment. This will only be true if we lower the costs of creating and supporting eBooks, and create a significantly larger base of user adoption. So we still have our work cut out for us.
Meanwhile, the trash clean-up beckons… Happy Earth Day!

Engadget: Time to Switch On eBooks

Interesting ideas here in Ross Rubin’s weekly column.

Lightning Source 1, Patent Trolls 0

A long-brewing battle that involved Amazon and leading print-on-demand vendor Lighting Source (a unit of massive wholesaler Ingram Industries) vs. an apparent patent troll, seems to have been settled with the U.S. District Court completely reversing on appeal a 2004 infringement judgement.
I have not read the patent in question, nor do I know the specific facts of the case. But it seems obvious that business-process patents (such as patenting the process of creating a single copy of a book to fill an individual order) are a significant drag on innovation. I think such business processes should be unpatentable, as they have been until quite recently, and that the requirement that an invention must be non-obvious should also be beefed up (it has been weakened by a number of court rulings during the 1980s).
I label “On Demand Machine Corporation” a troll as they appear to have built no products and operated no services, and have a web site that seems to primarily contain recitations of their patent specifications. The original “inventor” is deceased. I don’t think business-process patents should be allowed at all, but at least folks like Amazon patent actual working services that deliver some value to consumers. So I thank Lightning Source for fighting this appeal.
Hopefully clearing up this patent confusion will stimulate new offerings in the print-on-demand segment. While I”ll wager that reading on paper will be a minority behavior 20 years from now, there’s clearly going to be a long transitional period – and I admit I may be off by a decade or two. So long as paper remains a preferred medium, combining digital distribution with the option for instant creation of high-quality printed publications is a great way to deliver higher-value solutions.