The Good, the Bad and the Ugly of the eBook Revolution

It seems like you couldn’t look at a book blog the past week without seeing a post on Amazon’s recent press release, noting that they’re now selling more Kindle books than print books. From their  May 19, 2011 press release:

  • Since April 1, for every 100 print books Amazon.com has sold, it has sold 105 Kindle books. This includes sales of hardcover and paperback books by Amazon where there is no Kindle edition. Free Kindle books are excluded and if included would make the number even higher.
  • So far in 2011, the tremendous growth of Kindle book sales, combined with the continued growth in Amazon’s print book sales, have resulted in the fastest year-over-year growth rate for Amazon’s U.S. books business, in both units and dollars, in over 10 years. This includes books in all formats, print and digital. Free books are excluded in the calculation of growth rates.
  • In the five weeks since its introduction, Kindle with Special Offers for only $114 is already the bestselling member of the Kindle family in the U.S.
  • Amazon sold more than 3x as many Kindle books so far in 2011 as it did during the same period in 2010.
  • Less than one year after introducing the UK Kindle Store, Amazon.co.uk is now selling more Kindle books than hardcover books, even as hardcover sales continue to grow. Since April 1, Amazon.co.uk customers are purchasing Kindle books over hardcover books at a rate of more than 2 to 1.

Pretty amazing, considering the Kindle has only been around since 2007.  Revolutionary even.  Of course, every revolution has its casualties and the eBook revolution looks to continue that trend.  There will be repercussions for the publishing industry, retailers, and eventually the consumer.  Let’s explore the good, the bad, and the ugly of the rise of the ebook.

The Good:

  • Ebooks look like they’re here to stay, either in physical format (Kindle, Nook, Kobo et al) or as apps on other platforms such as the Apple iPad or Blackberry Playbook.  Great news for those of us who jumped on the bandwagon early.  No more worries about “niche” markets or disappearing fads.
  • Now that eBooks are no longer unproven technology to publishers, maybe they’ll take a look through the back catalogs and transfer some if not all of their out of print titles to digital format.  It’s always frustrating to hear of a good book only to find that you’ll have to pay through the nose to acquire a rare copy or to find that only selected books in a series have been translated to digital format.  Just recently I was looking for Flashman by George MacDonald Frasier and discovered that the original is not available on Kindle but Flashman and the Tiger is.  (Book eleven?  Really?!)
  • eBooks are discounted in comparison to physical print.  Generally, a new release hardcover costs the same as a pocket novel when bought in eBook format.  The consumer gets a break, and the publisher certainly doesn’t have the overhead that they would with print and shipping costs.
  • It’s much easier for anyone to publish a book.  No more book agents, rejection letters, etc.  Simply write your book, pay your fees to have it digitized, set your price and go.  eBooks could lead to greater variety at lower prices.

The Bad:

  • It’s much easier for anyone to publish a book.  Think about that for a second.  Bad writing, bad or nonexistent editing, spelling errors–publishers have editors work with aspiring and established writers for a reason.  Sifting through a lot of crap to find that rare gem is not something to look forward to.
  •  How is this going to affect editors, literary agents and publishers as a whole?  They’ll still be working with authors to bring product to market, but many authors will forgo their services and self publish in hope of garnering a greater return.  After all, why take a percentage when you can take the whole thing (minus your own minimal costs)?  Furthermore, will literary agents become redundant?  Remember, it was only a few years ago that travel agents were a real thing. (Okay, technically they’re still around.  Used one lately?)

The Ugly:

  • Now that retailers such as Amazon have a foothold on the market, will they (and the publishers) still feel the need to sell eBooks at a reduced price?  One of the biggest draws of eBooks (for me) is their affordability, but as eBooks proliferate the market, what’s to stop the prices from slowly increasing until they are comparable to physical print?
  • Physical print–with the increased pressure of eBook sales and diminished interest in a physical product–will book prices increase?  Will print runs become shorter (and therefore more expensive) due to reduced demand?  Who’s going to pick up that greater expense?
  • What of brick and mortar book stores?  Are they going to go the route of the video store?
  • Technically, you don’t own an eBook, you lease it.  Libraries have already run into problems with publishers who want them to pay up again (re-“lease” their titles) after a certain number of reads.
  • Finally, how long will retailers maintain your eBook catalog?  Say Amazon has a couple of bad years and ends up in bankruptcy.  Then what?

This is all conjecture for the moment.  The industry is too new and the numbers too fluid to make anything but predictions, however, just like any revolution, the eBook revolution will radically transform the publishing industry in a very short period of time. 

 *For further reading on the subject, try John Steele Gordon’s article, ” The End of the Book?”  at the American or a really interesting article by Narasu Rebbapragada at PC World entitled, “E-Book Prices Fuel Outrage–and Innovation.”

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Kobo Ereader gets a Touch of Fidelity

Kobo eReader Touch

Awhile back I read through Kevin Maney’s Trade-Off: Why Some Things Catch On, and Others Don’t, an interesting discussion of the conflicting forces that either spell success or failure of a new product or service.  It all comes down to the battle between fidelity (the quality of a consumer’s experience) and convenience (ease of use and price point).  With Kobo’s launch of their new Kobo eReader Touch, they look to be attempting both an eReader  that surpasses the Amazon Kindle in fidelity,or “coolness factor,” while retaining a convenient price point.  Engadget has a nice little review here.

So, advantage Kobo, right?

Well, hang on a second.  You wouldn’t assume the people at Amazon are snoozing at the wheel, would you?  Rumours persist that Amazon is poised to launch their own nifty new touch screen device in the form of a Tablet later this year.   Technology Review has some neat talking points about what the screen might be like and Daemon’s Books has a brief post on how they might market it. 

Getting back to the fidelity vs. convenience argument, the question remains, will Amazon try to trump Kobo (and hey, maybe take a run at the Blackberry Playbook and Apple iPad?) or create a touch screen just slightly cooler than Kobo’s at a similar price with maybe an App or two thrown in?

Psst….I think you should take this call…it’s the President!

“I really think you should take this call.”

And the controversy over ebook lending continues:

 
In another article on the subject of HarperCollins new restrictions on ebook licensing (specifically targeting library lending), Library Journal columnist Michael Kelley recounts Roberta Stevens (American Library Association president) criticisms of the new policy.  From the ALA’s statement regarding HarperCollins decision to limit licenses to 26 viewings before renewal:
 
     “Libraries have a long history of providing access to knowledge, information and the creative written works of authors…We are committed to equal and free access for the millions of people who depend on their library’s resources every day. While demand has surged, financial support has decreased. The announcement, at a time when libraries are struggling to remain open and staffed, is of grave concern. This new limitation means that fewer people will have access to an increasingly important format for delivering information.”
 
She furthermore vowed to work closely with publishers:
 
     “Crafting 21st century solutions for equitable access to information while ensuring authors and publishers have a fair return on their investments is our common goal. The transition to the e-book format should not result in less availability…The marketplace for e-books is changing rapidly. We encourage publishers to look to libraries as a vehicle to reach and grow diverse audiences.”
 
As of this posting, HarperCollins has not changed their position regarding ebook licensing, namely that they’re acting in the interests of the authors and that ebook licensing in perpetuity will result in a reduced profit stream for both publishing houses and authors.  They maintain that the “26 and out” policy is the most equitable way of solving the problem.
 
Frequent readers of this blog (btw, Thanks Mom!) may be wondering by now why I keep coming back to this issue.  After all, I’m not a librarian, and frankly, the last time I was in a library was to rent a movie. (psst…you can rent them all you want)   So, why should this issue matter to you, or me, or any ebook reader that doesn’t use the library?
 
Simply put…look to the future!
 
I don’t know about you, but I don’t want to wake up five years from now, pull out my Kindle 5.0 (Now with Holographic display!) and find that half my digital books are no longer there because all the while some virtual doomsday clock is counting down the seconds until my licenses are considered “expired.”  Furthermore, with the advent of such policies as Amazon Kindle’s new lending feature, who’s to say that publishers won’t institute a similar policy for the general public?
 
To quote a hackneyed phrase, “It’s in Revelation, people!”

Brother can you spare a dime (novel)?

“Hey guy, can I borrow your copy of The Girl with the Dragon Tattoo?”

“Um, no.  I bought it for the Kindle.”

“How about…”

“Nope. Kindle.”

“Well then, what about…?”

“Kindle!”

“Alright, I’ll be at the Library talking to that cute girl.”

I’ve had a Kindle for about eight months now.  I love it, it’s handy, and certainly saves a lot of space around the home office.  However, something has always annoyed me about their product.  You see, I love reading, talking about what I’ve read, and loaning out my favourite books to friends so they can enjoy them too.  Hard to do with a Kindle though.  At least ’til now.

Amazon has finally jumped on the bandwagon and relaxed their proprietary rules (somewhat).  Was it pressure from Google books?  Are they feeling the heat from Sony’s eReader?  Honestly, who cares?  It’s just nice to know that Kindle readers can now share content with their friends. As an aside, it’s also a great marketing tool for Amazon!

For their part, Amazon has made lending an book very similar to the library experience.  The lender can send an eBook to a friend for a period of two weeks, after which the recipient can no longer access the book.  Also, the lender of an eBook cannot access that book on their Kindle during the same time frame, just as if you were to physically loan out a book to a friend.

How does the recipient access their friend’s book?  Just download the Kindle app to your digital product of choice, whether iPad, iPhone, Android, Blackberry or PC/Mac.  The lender goes through a relatively simple process on their Kindle, and voila, they’ve loaned a book.

There are a couple of caveats:

  • Not all books are eligible to be loaned.  Amazon has left it up to the individual publishers to decide whether their material can be lent.
  • To read a loaned book, you must have the Kindle app.  (However, since it’s free, it shouldn’t be a big deal to download to whatever device you choose).
  • As of right now (January 2011), the lending option is only available in the United States. 

 Apparently the rest of the World will have to wait a bit longer.  Hmmph!

Chapters/Indigo gets serious about e-reader competition

Way back in July of 2010, Kobo Inc., a subsidiary of Indigo Books and Music, introduced the Kobo eReader as an inexpensive alternative to pricier eReaders such as Amazon’s Kindle.  Their thought process: that people would embrace a low-cost eReader even if it meant fewer features like WiFi.

Three months ago that must have seemed like a great idea.  What would happen though, if say, Kindle prices dropped to an equivalent level or they created a bare bones version that still contained WiFi?  Oh wait, they did.  Awkward.

So, after what must have been a panicked boardroom meeting, Kobo is releasing a wireless version of their eReader on November 1st, retailing at $149 Cdn.  However, big brother’s new Kindle retails for $139 Cdn.  Also awkward.

(note: Marketing Magazine’s article on the Kobo lists the retail price as $139 Cdn. but the Kobo website lists it at $149 as of this writing)

Stop The Presses!

Print is dead.

…well, maybe not just yet.

A recent article in the Wall Street Journal (WSJ.com) cites sales figures by Amazon.com claiming that in the past quarter (April-June 2010) they sold more e-books than hardbacks  (by hardbacks they mean hardcovers rather than mass market paperbacks). In the month of June, 2010, Amazon sold 180 Kindle books for every 100 hardcover books, leading us to pose several questions:

  • Are people converting to e-readers in significant numbers? 
  • Is this actual growth in the industry (ie. more literature consumed) or simply a dog eat dog world where revenue gained by e-readers is revenue lost by real world publishers with a zero sum total? 
  • Finally, are we witnessing a paradigm shift away from physical books to digital content, much like the C.D. made tapes, records and 8 tracks irrelevant, or is it simply a parallel venue by which the reader can get his or her fix?

Everyone quoted in the article seems to agree that it’s too early in the game and that only time will tell.  While still considered a “niche product”, the growth of e-reader sales has made booksellers take a serious look at this new technology    Heather Reisman,  CEO of Indigo Books and Music Inc. isn’t taking any chances that digital reading might be a flash in the pan. 

Another article (also at WSJ.com) by Geoffrey A. Fowler and Marie C. Baca attempts to analyze the reading habits of people who buy e-readers and what impact they will have on traditional print.

Some statistics cited:

  • By September 2010, 11 million Americans are expected to own at least one digital reading gadget (Forrester Research)
  • U.S. e-book sales grew 183% when comparing the first half of 2010 to the corresponding time period last year and there was a 176% increase in U.S. electronic book sales in 2009.  (Association of American Publishers)
  • 52% of e-books (according to the study) were purchased while 48% of their e-books were free.  (Side note…just got a free copy of Pride and Prejudice downloaded on my Kindle.  The same book in paperback costs $11)
  • 66% of American libraries offer e-book loans; in 2005 it was only 38% (American Library Association)

The article goes on to explore the habits of e-reader readers and their reasons for making the switch or complimenting their regular reading habits with a bit of new technology.  The best answer seems to be portability.  Why carry around ten books when you can carry around a compact device that can hold thousands?

So, back to the questions.

Are people converting to e-readers in significant numbers? 

  • 11 million Americans is certainly a significant number…and growing.

Is this actual growth in the industry?

  •   Too soon to tell, but my opinion is that eventually a balance will be found between digital and physical forms of reading. 

Are we witnessing a paradigm shift away from physical books to digital content? 

  • Maybe?

People are always going to want to hold physical copies of their favourite reads.  Much has been made of e-readers and their effect on hardcover sales, but there will always be that dedicated fan of an author or series who will want to display their works as a point of pride.  However, I would not recommend apprenticing to be a Pressman anytime soon.