Joe Wikert's Publishing 2020 Blog

Is the eReader Financial Model Upside Down?

I finally started listening to the free audio version of Chris Anderson's latest book, Free.  I'm only a couple of chapters in and it's interesting so far but since I downloaded it months ago it (once again) shows just how much I tend to ignore all the free stuff I'm hoarding, especially iPhone apps.

That's probably a worthwhile subject for a future post...  For this post, I'd rather think out loud about altering the pricing models for e-reading devices and e-content.

I won't buy a Kindle edition of a book that's more than $9.99.  Why?  Besides the fact that I'm a cheapskate, I guess I'm still bitter about paying almost $300 for an original Kindle, so I expect to "make it up" with cheaper content.  I wonder how many others like me are out there.

I'd say quite a few.  Look at the Kindle book bestseller list.  Even though there are plenty of Kindle editions priced above $9.99 they rarely make the bestseller list.  In fact, as I type these words 14 of the top 25 have a price of $0.00, one is $0.01 and the rest are at or below $9.99.  I only found three books in the top 100 priced above $9.99.  Three.

Why can't a device vendor go with more of a cell phone model, where the low price of the device is subsidized by the longer-term commitment to buying content?  How many Kindles do you suppose Amazon could sell if they priced it at $99, or $49?  The device costs more than that to make, not to mention the cellular charges they pay Sprint, so why would Amazon price device so low?  Hoping that they "make it up in volume" won't help...they'll just lose that much more money in total.

But what if all the ebook editions Amazon sells for the Kindle weren't $9.99 but something much closer to the print book's price on Amazon?  So a $30 book at 33% off would be $20 for the Kindle edition (as opposed to $9.99 currently), pretty much the same as what you'd pay for the print version.  Now there's a bigger margin left over for Amazon to keep part of (to cover the loss on the sale of the device), share some with the publisher/author and even pay Sprint.  And oh, btw, we'd put an end to the model where some publishers are delaying the e-version so as not to cannibalize the print version's sales.  Publishers would be indifferent, if not prefer the e-version since there's no cost for manufacturing, inventory or returns.  Hallelujah!

Additionally, in order to qualify for that low price on the device, the customer would have to commit to a minimum volume of econtent purchases over the next 2 years.  Opt out early and pay a penalty.  It's sounding more and more like a cell phone plan, isn't it?

What's not to like about this model?  The first vendor to adopt it would likely sell a boatload of devices, maybe more than they could manufacture.  It would also protect the value of the intellectual property.  Amazon's $9.99 price on Kindle editions is really cheapening the value of the content.  I used to think it was OK because you can't share an ebook with a friend, but B&N is about to address that problem with the Nook (sort of).  I still think we publishers need to figure out how to add value to ebooks and not just live by quickie p-to-e-conversions, but that was the subject of at least one earlier post.

What do you think?  Is this in the cards?  Will a hardware vendor go this route?  I sure hope so.

B&N's Nook...and Beyond

The big news in e-readers last week was B&N's announcement of their upcoming Nook device.  My first reaction was "meh", but the more I think about it, the more potential I see...not necessarily for the Nook, but rather for the e-reader space.

Let's start with the Nook features I find interesting:

3G Wireless and Wifi -- I blogged about this long ago and have often wondered why Amazon didn't bother offering wifi with the Kindle.  Some said it would be redundant with Whispernet.  I say nonsense, particularly since I use wifi every day with my iPhone 3GS.

Exclusive In-Store Content -- Another smart move, and a way for B&N to encourage Nook owners into their brick-and-mortar outlets.  I'm not sure how successful this will be but it's something Amazon simply can't do.  And if it words, an increase in in-store foot traffic is always a good thing.

eBook Sharing -- Also known as the "LendMe" feature, it's far from perfect but at least it's a first step towards one of the chief complaints about ebooks.

SD Slot -- I have a first-gen Kindle with an SD slot and I use the card all the time.  I still don't understand why Amazon dumped it with Kindle 2.  I ran out of device memory long ago on my Kindle 1 and if you own a Kindle 2 you will too at some point.

Free eBook with Pre-order -- Sometimes it's the little things that matter.  In this case, B&N gives you a copy of Malcolm Gladwell's The Tipping Point when you pre-order a Nook.  Won't that be nice knowing that your device will show up with a great book already on it?  And from the publisher's point of view, if you haven't already read The Tipping Point, it will be an introduction to the genius of Gladwell and a chance that you'll want to buy one of his other books.

You may have noticed that I didn't mention the color navigation touch-screen at the bottom of the Nook.  How could I overlook that?  Well, it seems like a bit of a gimmick, but this is the feature that got me thinking.

Without access to an actual Nook (they don't ship till later next month) it's impossible for me to say what this color touchscreen will allow you to do (other than browse a virtual bookshelf).  I'd like to think B&N has additional plans for this area, but we'll have to see.  For example, will B&N open the device up to third-party developers, just like Apple has with the iPhone (and Amazon hasn't with the Kindle)?  Think of all the types of apps that could be developed for this display, not to mention the eInk display itself.  Some would also say they don't need apps for their reader, that they bought it for reading and nothing else.  Gee, before the iPhone we were all pretty content making calls and sending text messages.  It's funny how sometimes you don't know what you want till it's invented.  (It also reminds me of Henry Ford's famous quote about how if he would have asked people what they wanted they would have said "faster horses.")

That would be cool, but let's take that idea one step further.  Why doesn't someone come out with a stripped-down eInk display device with a slot for iPhone connection?  The eInk display wouldn't need 3G/wifi or some of the other features the Kindle, Sony, etc., have.  Make it bare-bones so that it can be sold for under $100.  Then either include a collapsible slot where an iPhone can slide in or just connect it via USB or Bluetooth.  Then you'd use the iPhone for all your purchases/downloads with no connectivity required from the reading device itself.

I've been wanting to have my cake and eat it too with an e-reader.  The combination of a stripped-down eInk device and my iPhone would be perfect.  I'd get the apps, extensibility and connectivity of the iPhone along with the easy-on-the-eyes and insanely long battery life features of eInk.  And, if the eInk device could really be priced below $100 it would make the Kindle sales total look like a rounding error!

Google Editions Should be a Game-Changer

I spent last week in Frankfurt at the book fair and our inaugural Tools of Change (TOC) conference there.  TOC was terrific, but one session in particular grabbed my attention.  Amanda Edmonds, Director of Strategic Partnerships at Google gave a presentation on the much-anticipated Google Editions program.

Google Editions is ebooks, done right.  When it launches you'll be able to buy ebooks in (almost) every format for (almost) every device.  Why "almost"?  According to Amanda, the Kindle will be excluded.

So how can a new service be successful when it ignores the market leading device?  It sounds crazy but my money is on Google.  Customers don't want to be locked into a single format or device.  And while Amazon offers an app so you can read Kindle books on your iPhone, Google Editions will enable much broader access, not just for Kindle and iPhone.

Google Editions will be wildly successful...if it ever materializes.  The service has been rumored for a couple of years now and availability always seems to be "a few months away."  I hope the actual launch happens soon, and I can't wait to see how Amazon responds to it.

How the Kindle Prevents eContent from Evolving

Perhaps I shouldn't single out the Kindle on this one.  What I'm about to say is true for the entire current generation of dedicated e-reader devices, not just the Kindle.  But the Kindle leads the way, so it gets the headline.

The problem with these devices is that they encourage quick print-to-e content conversion and nothing more.  In fact, they even discourage some of the simplest ways of enhancing print-to-e conversions.  Embedded links are a great example.  If you're a Kindle owner how often do you click on those links?  More specifically, how often do you groan as you click on those links, knowing that the browsing experience ahead is painful at best?  The irony is that although the Kindle was the first to include wireless functionality, that feature is really only good for one thing: buying content from Amazon.  Every other time I've used the "experimental" browser I've been disappointed.  That's because, at its heart, the Kindle is a reader and it doesn't encourage any other use.

If you love your Kindle you'd probably say, "so what?...it does what I need it to do."  My point is that as long as we're willing to accept this extremely limited functionality, and not ask for more, there's no incentive for Amazon to enhance it and there's no incentive for publishers to build richer content.

Are you really thrilled with the content that's available on today's dedicated e-readers?  I'm not.  And it's not just color and video that I crave.  I want to see a major leap forward, like when entertainment went from radio to TV, for example.

Transportation is another great analogy.  Years ago, trains were not only a great way to travel, they often represented the only way to get from point A to point B.  Then cars came along and totally changed the transportation industry.  It didn't happen overnight, but think about how much you take for granted now that you're not limited by train schedules, tracks that only go certain places, etc.

Trains still exist today, of course, and they serve an important need.  One-trick dedicated e-readers will probably exist for a long time too, but we desperately need the flexibility of something more than dedicated devices.  Smart phones and netbooks are nice too, but the form factors aren't perfect and battery life is often an issue.

The consumer experience could be greatly improved by a multi-function device with rich content options.  If you're a publisher and you're worried about the race to lower prices for quick print-to-e conversions you too should want more powerful devices since they'll allow you to charge more for the additional functionality of your content.

Have You Registered for this Week's Online TOC Conference?

This is just a friendly reminder that it's not too late to register for the first online extension of O'Reilly's popular Tools of Change conference.  The event takes place this Thursday from 12-3:30 ET and features 3 sessions of panel discussion.  I'm moderating the ebook pricing panel which consists of Hugh McGuire (from LibriVox.org/BookOven.com), Neelan Choksi (from Lexcycle),  Trip Adler (from Scribd) and Michael Tamblyn (from Shortcovers).

The panel and I have been working on the right set of questions for the session and we're just about finished.  If you have a question or two you'd like this panel to discuss please send them to me today or tomorrow via email at jwikert[at]oreilly.com.

"The New How": My Letter to Reviewers

We recently sent the following letter to reviewers of a remarkable book that's due to be published later this year.  The book is called The New How and the author is Nilofer Merchant.  If you're curious and would like to start reading the book now, visit this link to the Rough Cuts version of it at Safari Books Online.  You can also follow Nilofer on Twitter; she's @nilofer there, or just follow this link.

Here's what I said to reviewers -- I hope you'll consider how this applies to your own organization:

Dear Reader,

As a publisher I’m almost ashamed to admit that I was a voracious business and strategy book reader but I abandoned the category a year ago.  Why?  I felt most of the products I came across were either restating the obvious or 10 pages of content puffed up to a 300-page book.

You can probably imagine the mixed emotions I had when I sat down to read the manuscript for Nilofer Merchant’s "The New How."  I’m glad I did though.  Reading this book gave me a renewed hope that authors who are passionate and thoroughly know their topic still have plenty of valuable wisdom to share.

I found myself immediately relating to the notion of an “air sandwich” and how strategy is often pushed from the top, with no consideration given to organization-wide buy-in.  No wonder so many strategies fail.

I also love how Nilofer provides excellent, prescriptive advice on sitting at the collaboration table including the fact that ideas don’t have to be fully baked at the earliest stages.  And as Nilofer puts it, “organizations collaborate best when rewards are based on organizational success and less on individual accomplishments.” Amen!

Here’s another one of my favorite quotes from the book: Regarding whether to speak up or not, or to ask a “dumb” question, “It’s better to look dumb and learn than to keep quiet and stay uninformed.”

The chapter on Murderboarding outlines how organizations can, and must, kill off some ideas so that others can thrive. This helps organizations focus on the big, important initiatives.

I know you’re extremely busy and your reading stack is already pretty high.  Mine is too, but I’m glad I took the time to read this terrific book.  I was hooked after the first chapter.  I encourage you to start reading it now and see if you agree.

Thanks in advance,

Joe Wikert
General Manager & Publisher,
O’Reilly Media, Inc.

Publishing Business Virtual Conference & Expo

Book Business magazine is hosting a terrific-looking FREE online conference next month.  The event is called Publishing Business Virtual Conference & Expo and it takes place on October 29th from 10 AM to 5:30 PM (ET).  The agenda (PDF) features a number of noteworty speakers including O'Reilly's very own e-content guru, Andrew Savikas.

Given the current state of the economy and the challenge in adding to existing travel plans, I love the idea of a virtual conference like this.  My only concern is being able to spend 7-1/2 hours online and dedicate my undivided attention to it.

Being there is one thing.  Being virtual means I'll be distracted by lots of other things.  With that in mind I hope the conference organizers record the event so that I can go back later and catch the pieces I'm highly likely to miss.

Either way, you owe it to yourself to register now.  After all, the price is unbeatable! :-)

More Ebook Survey Results

My apologies for not following-up on the promise I made in this earlier post to provide more information in a subsequent post.  I got distracted on a few other things but I finally managed to spend some time with the detailed results spreadsheet.  Here's what I found...

Which ebook format do you prefer?
PDF rules the day.  It wins out for a variety of reasons including portability, how it renders and even the fact that it's so mature.  Epub was probably second on this list, but it was a distant second at best.  And out of the 2K+ responses I only noticed a few references to "Kindle" or "mobi".

What other publishers are doing innovative things with ebooks?
Both Pragmatic and Manning were cited frequently in response to this question.  A number of responses also noted O'Reilly's "liberal and useful ebook policy" though, so our DRM-free approach definitely resonates with this crowd.  I say that mostly because other publishers were criticized in responses here for their use of DRM.  Btw, Pragmatic and Manning mostly got kudos here for their respective "beta book" programs where you get access to the content before the book goes to press.  We offer the same feature through our Rough Cuts program but we apparently haven't communicated it as effectively as we could, at least according to these survey results!

What can we do to improve your experience with O'Reilly's ebooks?
Price was a common theme here.  Customers definitely want to see the prices remain low, but I think that's largely because the products are mostly quick conversions from print format.  I still believe there's an opportunity to increase prices, but only if there's added value to what exists today.  Another popular answer here was the ability to share notes with others.  I'm still blown away by the fact that Amazon built wireless functionality into the Kindle but didn't offer this sort of collaboration option.

What features should the next generation of ebooks include?
Just to show how simplistic today's ebook offerings are, some of the most common responses here were simple things like including links and adding video.  Not exactly rocket science but these are also things that are currently missing in ebooks.  I also liked the suggestion of improving the errata process in books, mostly through automatic updates and/or overlays that show what's changed from one version to the next.  Think of it as version control brought to books.  Again, not revolutionary but it's not something you typically find in most ebooks right now.

One Author's Pre-Publication "Lending Library" Experience

I just read this terrific post by Stephen Elliott, author of The Adderall Diaries.  His summary should be required reading for every author and publisher who wants to learn more about building buzz.

Elliott's story hits on a number of important points.  First, author platform isn't just about who the author knows, it's who those people know, and in turn who the next level of people know, etc.

Second, I love it that the only requirement to participate in his pre-pub lending library was that you had to agree to read the book and pass it along to someone else.  That's it.  I would suggest taking it one step further and asking everyone who reads it to also post a review of it.  That's not asking much given that they just got to read a book for free.

Third, how about the total cost of the promotion?  It was $800 plus the cost of the free copies.  Talk about ROI! How many PR campaigns cost 10 times that or more and don't produce anywhere near the same results?!

Finally, I love it that the author took such an active role in this.  He tracked the books and did the in-home tours.  (Speaking of which, this Tupperware Party-like approach is still as effective today as it was 40 years ago.)

Kudos, Mr. Elliott.  I hope your book becomes a bestseller!

Smashwords Expands Distribution, by Anthony Policastro

By Anthony S. Policastro If you thought the eBook market was hot before, it just went super nova with Smashwords newest distribution to "major online retailers, the first of which is Barnes & Noble and their various properties including Barnesandnoble.com, Fictionwise, and their eReader app." Like the other 2,600 authors on Smashwords, I received an email recently from Smashwords owner and creator, Mark Coker announcing the new distribution arrangement:

To put everything in perspective, we're developing a process that will enable your books to receive widespread retail distribution within days or weeks of publishing on Smashwords. Some of what we're doing here has never been done before, so like I said above, please be patient as we work together to pioneer the brave new world of ebook distribution.

In addition, Barnes & Noble just ramped up its eBook efforts and currently has more than 700,000 eBook titles listed on its site and it hopes to surpass one million books within the next year. The book retailer will also be the exclusive eBook provider to Plastic Logic's upcoming eReader device - an eight and a half by eleven inch device with a touch screen and wireless capabilities for downloading content. AT&T will be the wireless carrier for the reader and this means users in Europe and parts of Asia will be able to download content. The Kindle's wireless feature works only the United States. All of these developments could be a paradigm shift in the eBook market because Barnes and Noble is opening its arms and accepting the work posted on other commercial eBook sites. They are clearly scooping up as much market share as possible to compete against the Amazon Kindle. (See the related article below in The New York Times.) Even their pricing model is similar to Amazon's with major titles selling for $9.99 - the same price as the Kindle. Dan Brown's The Lost Symbol is featured on Barnes and Noble eBook site as a preorder for $9.99. What's more significant is that you can download a book from Barnes and Noble and read it on your iPhone, iTouch, Blackberry or PC or Macintosh by simply downloading the B&N eReader software for the particular device. And they announced they will be adding additional devices. Kindle books cannot be read on the Blackberry or on a PC or Macintosh. This move could pull market share from the Kindle. It will be interesting to see how the eBook market evolves in the next few months or years with these two titans battling for the same market share on an equal playing field. If Barnes and Noble keeps its pricing in line or lower than Amazon and stays a step ahead of the technology, they could be the winner.

Smashwords photo is the official logo of Smashwords.com. The photo of Plastic Logic's new eReader is from Plastic Logic's website.

TOC Goes Online

Our Tools of Change (TOC) conference is a popular destination for publishing professionals but it only takes place once a year.  What's a publisher, author, agent, etc., supposed to do in between conferences?

We're answering that question by adding an online extension to the TOC experience.  The first TOC Online event is scheduled for October 8th from noon to 3:30 ET.  It consists of two separate panel discussions on ebook pricing (I'm moderating this one, btw) and what readers want as well as a presentation on the future of electronic reading.

The registration fee for this online conference is $149 but all TOC alumni are eligible for a 50% discount and all online attendees are eligible for a 20% discount on the TOC in-person event next February (see instructions under "Discounts" on this page).  I hope you'll join us for what promises to be an engaging and insightful session next month.

Ebook Survey Results

Last week we sent a short survey out to customers who had previously bought an ebook from us at O'Reilly.  We gathered more than 2,000 responses in just a few days.  Our goal was to learn more about the buying habits and preferences of customers who are interested in econtent.

The survey featured several multiple-choice and open-ended questions.  I've only had a chance to review the multiple-choice responses, so I'll comment on them below and will follow-up with excerpts and summaries of the open-ended questions later in the week.

1. How often do you read ebooks?
The most popular answer, which about 50% of the respondents selected, was "several times a week."  30% said "daily" and 19% said "rarely".

2. Where are you on the ebook adoption cycle?
The top answer, chosen by a third of the respondents was, "I love ebooks and I'll never go back to print."  The second most popular answer was "I'll love them more when the devices for reading them get better" (24%).

3. Do you buy print and ebooks, or have you made the transition to electronic only?
75% said "print and ebooks", leaving only 25% for e-only.

4. Select the ebook features that matter most to you.
Respondents could make multiple selections on this, but the #1 feature was "portability" (80%) followed by "usability for search/linking" (71%) and "price" (60%).  So despite everyone's fixation on sub-$10 Kindle books and sub-$5 iPhone book apps, price isn't the #1 "feature" for this crowd.  Of course, what people say and how they act are often two different things (see "New Coke").

5. On what device(s) have you read O'Reilly ebooks?
Again, multiple answers could be selected here, but not surprisingly laptops (81%) and desktop computers (60%) were the top two choices.  And although the Kindle often gets a lot of attention as a dedicated econtent device, it's interesting to see that only 14% checked it off here whereas iPhone and iPod Touch were checked by 29% and 12%, respectively.  Ah, the benefits of an enormous installed base!  The Sony Reader was selected almost as often (11%) as the Kindle, btw.  (Note: We sell ebooks as bundles, so in one transaction a customer gets PDF, epub and mobi for the Kindle.)

6. If you chose "iPhone" for #5, how are you reading those ebooks?
Stanza leads the way here at 62% and the Kindle app is a distant #2 at only 16%.  (I'm kind of surprised that so many people own both devices.  I'll bet most are like me and bought the Kindle before the iPhone.  Now that I have the latter I don't use the former quite as much.)

7. Are you committed to the device and platform you're using now, or are you waiting for something better?
One third said they love their reader but the other two-thirds are hoping for something better (do you hear that, Mr. Jobs?).

8. Whenever possible, O'Reilly provides you with three DRM-free electronic formats of each ebook--.PDF, epub, and mobi. Which formats have you used?
Consistent with the earlier point about using the content mostly on a computer, PDF is by far the #1 choice here at 94%.  Again, multiple answers were allowed but epub and mobi are only used by 34% and 20% of respondents.  So although many of us like to focus on the newer devices and formats it's still an Adobe world...for now.

Some of the open-ended questions were "which format do you prefer and why?", "what other publishers are doing innovative work with ebooks?", "what can we do to improve your experience with O'Reilly ebooks","what features should the next generation of ebooks include?" and "based on your experience with O'Reilly ebooks, how do you feel about the price you paid?".

As you can see, those are some pretty meaty questions and most of the 2K+ respondents offered their thoughts, so it's going to take me awhile to read through all of them.  Stay tuned for summary follow-up posts on these...

Retail Channel Evolution (and a Plug for SXSW)

The September issue of Book Business magazine arrived the other day and it features a terrific article by Michael Norris called Minding the Store that caught my eye.  I agree with about 95% of what Norris says.  Here are a few excerpts and my comments, including the piece I'm not so sure about:

If there's one thing publishers need to understand, it is that most book buyers are disengaged and only buy one to five books a year.  This means there is a massive number of adults out there who read intermittently and probably don't care about loyalty programs, author websites or three-for-the-price-of-two sales.

Boy, that last part really hurts, but it makes sense.  If there's no way to change this behavior with print books, perhaps we have to focus our efforts on how to address it with econtent. Can customers become more engaged if the content is richer and, dare I say it, shorter, as in "more to the point and less about puffing the book up for spine width"?

...under-performing superstores do close as well: Barnes & Noble, Books-A-Million and Borders Group closed more than 500 locations in the past six years.  Meanwhile, Walmart and Target locations (as well as other non-bookstore entities) have been multiplying.  On a very basic level, these stores are a lot more convenient for the disengaged customer who only buys a book once in a while.

Terrific observations.  Are the B&N and Borders superstores becoming the new independents?  They're not going away, and neither did the independents (entirely), but it's interesting to watch the superstores being forced to evolve by mass outlets.

When a book from a popular author is sold everywhere, it behaves like a commodity when it really isn't.  If you go into a Walmart and ask an employee for "Hatchet" by Gary Paulsen, you'll be lucky if that person points you to the camping aisle and mumbles something about having one from Coleman.

OK, this is that 5% of the article that I don't agree with.  I get Norris' point, sort of, but I don't buy into the notion that "channel-stuffing of blockbuster books is cheapening what should be the most expensive product," as he states a bit earlier in the column.  To use a different product analogy, this is why I sometimes buy auto parts (e.g., oil and filters) at Walmart and for other items I go to AutoZone, where I know I'll get the personal assistance I need.  I'm typically buying commodities in both places, btw.  For me it's all about convenience rather than commodities; I'm in Walmart several times a week, so as a supplier if I can get my products stocked there I'd gladly eat a few extra discount points for all the extra foot traffic!

P.S. -- I'm part of a Book Publishing panel that's been pitched for SXSW.  The fabulous Kat Meyer is also on the panel (along with several other terrific industry experts) and provides more of the details here.  Speaking for the entire panel, we'd greatly appreciate it if you'd cast your vote supporting our session here.

Speak Your Mind at the Next Tools of Change (TOC) Conference

The next Tools of Change (TOC) Conference is scheduled for February 22-24 in New York.  That may seem like a long way off but now is the time to submit a speaking proposal because the call for participation is only open till September 1st.

I just submitted a proposal for a session I'd like to give called "Looking Beyond the $9.99 Ebook."  Here's the abstract:

The publishing industry is currently caught up in the $9.99 ebook model popularized by Amazon's Kindle. It's time to quit whining about "the cheapening of our IP" and start thinking about new models with added value and larger revenue opportunities.

There are a number of key points I want to make and I plan to add to that list in the coming months.  This is an area I'm extremely passionate about (as you've no doubt seen in earlier Publishing 2020 posts!).

How about you?  What are you passionate about?  Why not write up a summary and submit it for TOC consideration?

What if Amazon Got it Wrong?

When Jeff Bezos introduced the original Kindle almost 2 years ago he talked about how long-form reading was on the decline.  He also noted how the Kindle would reverse that trend because it will now be more convenient to take all your books with you and read them wherever you are.

Bezos used the phrase "info-snacking" and how the web encouraged all of us to read shorter bits of content, not long-form works.  His core assumption was that lots of people would love to read more books and that they just need a new delivery platform to quench their thirst.

What if Amazon's assumption was wrong?  What if short-form content that's all over the web is really the preferred format? It's still very enjoyable to read a Harry Potter book or something in the Twilight series, but what if most people looking for business advice or how-to info prefer to get in and get out as quickly as possible?  What if, outside of novels, the added value here is convenience and time-savings?

If the Kindle is the answer to long-form content could the Apple Mediapad/Tablet/iPad be the answer to short-form content?  Sure, you could read a book on an "iPad" if you want to, but what if the rumored device focused primarily on delivering an "insanely great" experience for short-form content instead?

While Amazon waits for eInk's full-color display technology Apple simply features a good old backlit one.  Again, not ideal for reading a hundred pages of a book in one sitting but perfect for magazines, blogs and other short-form content.

I've been a Kindle owner for well over a year now and I'm doing even more short-form reading than ever.  I'm also using workarounds and hacks to do some of that on the Kindle, so I'd welcome a device like the iPad that's better suited for it thanks to full color, wifi, a real browser (not an experimental one), etc.  How about you?

PopSci Genius Guide: Next Gen Magazine? Sort of.

I was all excited when I read this terrific article about Popular Science's venture into what they're calling "the next generation of digital magazines."  Then I checked out the product and was extremely disappointed.

Here are some of the article excerpts that got my attention:

And make no mistake -- this isn't your typical "interactive" digital magazine with an animation here or a video there.

PopSci has effectively demonstrated the ability to create a multilayered (emphasis mine), interactive experience for readers without overwhelming them.

Readers choose which aspects they want to activate and when.

Our goal was not to create a web site with the Genius Guide, and not to re-create Popular Science magazine with it...but to create a totally new product...that engages and enthralls the reader.

How much can I pay to get this outstanding product?  Sign me up!

OK, now take a look at the product the interview describes.  I found it to be ho-hum and pretty much what they say it's not (your typical interactive digital magazine with an animation here and a video there).  To be fair, I remember seeing a couple of animations but no videos.

I couldn't help think the PopSci Genius Guide was built by a team with a magazine mentality.  Why do they feel compelled to render the product using the virtual dimensions of a print magazine?  That results in so much wasted space, leaving my screen mostly blank when I'm flipping through it.  Why not think about the user experience and fully utilize the available surface area rather than limit yourself by forcing the product to look and feel like a print magazine on a computer screen?  Btw, if you follow this advice you wind up with something that looks more like a web page than a print magazine page, and that's OK!

Why does every "digital magazine" designer feel compelled to animate the page-turning process?!  Who cares?  That's not a critical element of the print magazine user experience that absolutely must be preserved in the digital product.

Also, while they're rethinking and better utilizing the available space on the computer screen, how about considering the small screen as well?  I'm talking specifically about the iPhone.  I looked and there's no Popular Science iPhone app.  Talk about a missed opportunity.

I recently signed up for a deeply discounted print subscription to Popular Science ($6 for 12 issues via Amazon) and I'm hooked.  If they offer me an iPhone app subscription at 99-cents/month I'll send them more money.  That's not much but it's a lot more than I'd be willing to pay for the current implementation of the PopSci Genius Guides.

You, The iPhone App

Life seemed much simpler in the pre-Twitter days. You found a blogger you liked and you grabbed their RSS feed.  These days, if I want to follow someone I still do that but I also need to keep an eye on their tweets, their Facebook updates as well as a host of other specialty networks they might be part of.  To tell you the truth, the more social networking evolves the more distant I feel from the people I (try to) follow.

That's why I look forward to the day when we'll be able to say, stealing Apple's catchphrase, "yeah, there's an app for that."

I read a great quote by Albert Einstein recently that applies here:

The secret to creativity is knowing how to hide your sources.

The source for this idea was an ad I saw in the latest issue of Wired.  The ad is for an iPhone app I was previously unaware of...then again, thanks to the ongoing discoverability issue with the App Store, this isn't exactly surprising.  The ad's headline is "Our Killer App" and it promotes the All Things Digital app, featuring Walt Mossberg and Kara Swisher.  I immediately downloaded the free app and I love it.  I've always enjoyed reading Mossberg and now I have a single place where I can quickly and easily keep up with him; no more hunting through countless feeds.

So what does this have to do with publishing?  If you're an author looking to build your platform I'd argue you should consider creating an iPhone app that's all about you, your work, your observations, etc.  Why not give your readers a single tool they can use to keep up with everything you have to say, show and report?

Publishers should have their own iPhone apps as well.  We've released several books as iPhone apps at O'Reilly but we haven't created a single "O'Reilly iPhone App."  I think we should though and it ought to contain a number of different elements including new release summaries, excerpts, articles, industry information and more.  The base app could be free but there could be a paid subscription option as well that offers much more premium content.

What would a typical author's iPhone app look like?  It too could have multiple levels with the free version including the type of information currently shared via blogs, Twitter, etc.  The paid version might have more content and a chance for readers to speak directly to you from time to time, for example.  I'd pay for one of these from Thomas Friedman or Nassim Nicholas Taleb, for example.  These are just a couple of authors I frequently read but they probably get swamped with reader emails.  Imagine a premium iPhone app by either one that gives you direct access to them, sort of like when they speak at a smaller corporate function.  How cool is that?  Every author can't command this sort of model but the big ones certainly could and the next tier could do the same but at a lower price point.

You know how all those industry pundits say that the publishing industry needs to learn from the music business and figure out how to monetize something other than the book (like they're doing with concerts, t-shirts, etc.)?  Maybe this app model is a step in that direction.

Let's not stop with authors and publishers though.  How about conferences?  Shouldn't there be an iPhone app for every conference and trade show?  I recently attended OSCON and I could see where an iPhone app for that show would help "keep the fire burning", as my O'Reilly colleague Allen Noren likes to say.  The same goes for pretty much every other conference out there.  Why limit the event to a once-a-year activity when an iPhone app could make it year-round and encourage even more participation (as well as drive more revenue)?

The iPhone app dev world is still in a gold rush mentality.  It's a seller's market as good developers are hard to find and even harder to negotiate with.  The apps I'm describing don't all have to be different though.  They could use the same common framework, levels of functionality and be easily skinned to meet individual branding and look-and-feel requirements.  It seems like a terrific opportunity for a smart iPhone app developer to step in and corner the market with something that's both powerful and flexible.

I can think of several individual, corporate and conference-based iPhone apps I'd immediately download, several of which I'd be willing to pay an annual subscription for.  How about you?

P.S. -- I recently read that Bill Simmons, aka "The Sports Guy", is retiring from his ESPN The Mag column.  I'd buy an iPhone app featuring Simmons.  The same goes for Steve Rushin.

Computer Book Market Midyear Report

O'Reilly colleague Mike Hendrickson recently posted this summary of the computer book market at the midyear point.  The overall results are disappointing though hardly surprising.  The image below pretty much sums things up...if you click on it you'll see the red line is 2009 to date and sits below every other year on the grid.

Although the first six months have been rough I'm optimistic about the prospects for the rest of the year, particularly for O'Reilly.  We've had a number of new hits recently including The Geek Atlas, The Twitter Book and Cloud Application Architectures.  We also continue to experiment regularly on non-print platforms, especially the iPhone (note the previous link is to iTunes).  One of our goals is to make sure our content is available in whatever format the customer needs it in.  That's why we offer our products in DRM-free ebook bundles off our website, for example.

Then there's the ongoing diversification of O'Reilly into areas like conferences and webcasts, just a couple of the areas our competitors typically don't venture into.  In fact, I recently returned from OSCON 2009 and was blown away by the scope of topics covered and the quality of the presentations, many of which were made by O'Reilly authors.

So while the information Mike presents in that post is sobering, it's important to keep an eye on the future.  We've got a terrific list of publications coming through the balance of 2009 and are also well-positioned for the economic recovery everyone is talking about in 2010.

Slate on Book Industry Napsterization

Slate's Jack Shafer suggests publishers will bring about a Napster effect if they force Amazon to raise ebook prices.  I found myself agreeing with Shafer on some aspects of his article while totally disagreeing with him on others, so let's look at it piece by piece.

He starts off by making it sound as though all publishers oppose Amazon's typical $9.99 Kindle book price.  We don't, or at least I don't.  There's no question that if $9.99 is the new pricing ceiling for ebooks it will have a profound impact on the industry, but that could be a very good thing.  As I've said many times before, quickie conversions of print content to econtent isn't the model of the future.  That's not adding value.  That's simply squeezing every last penny out of the intellectual property.  And as long as DRM is part of the formula customers may feel the e-version has even fewer benefits than the print version.

The cannibalization issue is real in some publisher's minds and it can't be ignored.  That's why I was disappointed but not surprised by Sourcebooks recent decision to delay the ebook version of one of their upcoming titles.  It's an interesting contrast though: Here I am trying to find new and innovative ways to use e-platforms to get content out before the print product and Sourcebooks is doing the opposite.

I wonder if Sourcebooks has ever thought about the Kindle customer.  I haven't bought a single print book since I got my Kindle over a year ago.  I refuse to buy print books for myself, mostly because I want to get the most out of my $360 device investment.  Every Kindle owner isn't as rigid as I am on this but I wonder how many are.  I'm the type of customer Sourcebooks is at best delaying income from and at worst walking away from.

Shafer is right to note that gadgets are the key reason book publishing hasn't been Napsterized yet.  Sure, there's been plenty of piracy in our industry for many, many years, but it's never rivaled the music industry's problem.  I'd also argue that the 3rd-generation Kindle, the DX model, still isn't even as sexy as the original iPod.  It will be interesting to see if Apple ever comes out with that "media pad" device, also known as the "iPad", which could completely change the playing field.

Many of us try to pinpoint where the publishing industry is on the iPod timeline, but Shafer makes a good point with this statement: "the electronic-book market finds itself roughly in the same place the market for MP3s was in 1999, the year after the release of the first portable MP3 player."  So for the ebook world, 2009 is really 2 B.i. (Before iPod), but imagine what the world might look like when we get to 5 or 10 A.i.

The quote by Forrester Research analyst Sarah Rotman Epps is painfully true: "Publishers are in denial about the economics of digital content."  The $20 or $25 hardcover novel is likely to face a $9.99 ebook pricing ceiling going forward.  Deal with it.  Figure out ways to build franchises around these products so that the book sale is not the only income stream.  At the same time, start thinking about how the book needs to evolve.  Ebooks don't have the same constraints as print books.  Publishers and authors, what value can be added to your products in e-format that you've been unable to add in print format?

Cheap Copies of the Original

That's what most content on my Kindle feels like today...cheap copies of the original.  Quite a few books look like the print to e- conversion was done so haphazardly that nobody ever bothered to look at the finished product.  As publishers we fret about the prospects of $9.99 price ceilings for ebooks and yet we treat that rapidly growing sector as a quick-and-dirty way to make an extra buck or two.  Where's the R&D, the investment in future platforms and products?  Btw, Walt Shiel recently wrote a great blog post related to this called Kindle Errors and Typos.

Walt is right that many of the problems we see today are the result of corners being cut and the e-opportunity viewed as nothing more than a way to squeeze a few more dollars out of the investment we already made in the print product.  That's OK to a certain extent, but for some publishers that's their entire e-strategy.

Here's the fundamental problem I have with this: As long as customers view these products as cheap copies of the originals they'll never even achieve the same value as the originals.  So if that's your strategy, get used to the $9.99 ceiling because it's not going up.

Cleaning up the conversion process is important but it's not going to change the $9.99 ceiling either.  What's really needed here is a fresh look at the way content is designed, acquired, developed and produced in the e-world.  And as a visitor wisely commented recently elsewhere on my blog, this issue will become even more important as ebooks become a larger percentage of the overall book market.  All that overhead and fixed costs found throughout large publishing houses simply can't be supported if the industry switches to a $9.99 model.

Ebooks won't become 50% of the market overnight, but the percentage is growing and isn't likely to stop.  There are a couple of options here.  Publishers can get leaner and meaner as they adjust to the new model or they'll choose to invest in the future and start building more compelling eproducts and eplatforms.  The ultimate winners will attack both of those fronts.