Disney shows how to tear down walled gardens

Tired of dealing with the fragmented mobile marketplace that iOS and Android represent? The imagineers at Disney have come up with a terrific way to address that problem. It’s both a much-needed solution for consumers and also a clever way for Disney to maintain a direct relationship with consumers who buy indirectly.

I’m referring to the Disney Movies Anywhere initiative, which lets you buy a movie on one platform and watch it on either platform. Imagine a world where all those ebooks you bought on the Kindle platform could also be read now on the Nook platform, and vice versa. You’d be free to choose the lowest price, no longer worrying about ebook library lock-in, where you’ve bought so many titles you can’t imagine abandoning that retailer.

Sounds like a nightmare for the big retailers but a huge win for consumers and publishers.

Of course, how many publishers have the Disney muscle to force retailers into such a model? Very few.

But wouldn’t it be cool if one or more of the Big Five book publishers pushed for something just like this? The first thing a reader would see when they open that ebook from Amazon, B&N, or anywhere else is a message from the publisher thanking them for their purchase and showing the steps necessary to register the purchase with the publisher so the book can be read on any ebook platform.

The publisher not only does the reader a service, they also establish a direct link to all their customers. That leads to a better understanding of customer interests and trends as well as the opportunity to upsell other products directly.

Every retailer except the largest should support this concept as well. If you’re the distant #2 or #3 ebook retailer, you should totally embrace the opportunity to level the playing field with this; you’ll suddenly gain more relevance as all those books bought on the #1 retailer’s platform could now be read on yours.

Here’s another interesting byproduct: How long would the #1 retailer continue selling ebooks at a loss when every sale no longer reinforces consumer lock-in and, in fact, becomes yet another ebook the consumer can read on competitor platforms?


Global Ebook Market Report

TOC is dead but I'm glad to see some elements of it live on. A couple of years ago the TOC team launched the Global Ebook Market Report with Ruediger Wischenbart. Ruediger updated the report once or twice a year and we typically released a major update each October for the Frankfurt Book Fair.

The book fair opens this week and I was delighted to see that Ruediger and his team did yet another thorough update to the report for 2013. You'll find all the various formats of it here.

If you're looking for the latest data on ebook momentum by geographic region you'll find all the details in this update. If you want to read what's happening globally regarding popular formats, piracy and pretty much everything else related to ebooks you'll also find it in this report. The best news though is that the Global Ebook Market Report has always been and continues to be free. No cost, no registration, nada.

Do do yourself a favor, download this report right now and start reading. You won't regret it and you'll quickly become an expert on the global ebook marketplace.


A Band-Aid for B&N's gunshot wound

JIIt's been a rough week for Barnes & Noble. And month. And year. And it may get worse before (if) it gets better. For those of you who have been in cryogenic sleep the last few weeks, here is a brief recap:

Barnes & Noble reported a fiscal fourth quarter loss of $188.6 million, over double what it was the same quarter a year ago, a feat accomplished by only a few other greats like MySpace, Enron, and the MC Hammer farewell tour. The Nook tablet was asked what it would like for its last meal, and William Lynch "voluntarily" removed himself from both the CEO post and the B&N Christmas Card list. Oh, and they are still planning on closing at least a third of their stores over the next decade. (Place your bets in Vegas on the over/under on the timing and number of stores.)

That's what happened. But what's even more troubling is what is buried in the fine print. William Lynch is being replaced by Michael Huseby, who was the company's CFO and who will report directly to Len Riggio, the B&N executive chairman and largest stockholder. I'm sure Mr. Huseby is great with numbers and has a solid golf game, but CFO's are not traditionally known for having strategic minds. And B&N desperately needs a plan.

If we surveyed multiple astronomers on planet alignment, they may concur that B&N is preparing itself not to try and save the Nook Media, but to spin-in off, sell it, prepare for crash landing, etc. This speculation is supported when you take into account that the Nook tablets are going to be put to rest, and despite what the public is being told, these devices had to bring in a significant portion of the declining revenue stream. Underneath all of this, there has been a quiet exodus of talent from B&N over the last few months which is a huge red flag.

The biggest problem that Barnes & Noble has right now is time. Time is not its friend. It has a gunshot wound and the band-aids that have been applied will not save it, but will only slow its death. It is bleeding cash and without a decisive plan and talented people, even more things will begin to unravel.

So, now what? There is value in the Nook Media infrastructure, but transformative, strategic decisions will have to be made to turn this around. Here are a few ideas for Barnes & Noble (or whoever owns the Nook Media assets in the near future):

  1. Stop Trying to be Amazon - The "us too" and "strong number two" approach has to be ditched and replaced with a new strategic vision. In a street fight, don't ever go blow-for-blow with a bigger, stronger opponent in their own backyard. B&N needs to do what Amazon won't do, and most of it is related to their closed ecosystem. B&N needs to create an open ecosystem, which allows independent bookstores and anyone who wants to sell books to build into their infrastructure, via APIs, iframes, and other tools. Instead of asking publishers for money, build closer partnerships with them to help them build audiences, capture metadata, and establish new sales channels like corporate and special sales. Imagine IBM having an internal ebook library which leverages B&N books, a white-labeled reader and app, and community aspects. What if every author could leverage their own networks to drive sales and then gather data and users on their sales? In other words, B&N has to be willing to shoot any sacred cows and approach the digital world with a vision of supporting authors, partnering with publishers, and doing things Amazon is unwilling to do.
  2. Be Radical and Transparent - Anyone who is not playing in oncoming traffic on a daily basis knows that B&N is in trouble. Yes, there are those pot-smoking optimists who can't fathom B&N going the way of horse-drawn carriages, 8-track tapes, and VCRs, but the transition is already happening. Atari used to be a powerhouse. MCI Worldcom a behemoth. Lehman Brothers and Bear Sterns were household names. Barnes & Noble doesn't have to have its brand disappear, but they do have to start making some radical changes and being transparent about them. As good strength coaches will tell you, go two steps beyond what is comfortable. Instead of closing one third of the stores in ten years, close them this year. Tactically sift through your staff, cut all B and C level players, which may be half the company, and empower your A-level team to be decision makers. Anything that is dead-weight needs to be discarded, sold, or ignored. By making radical changes upfront, the market will adjust to all the news at one time, and new optimism can be injected with a fresh vision and leadership.
  3. Look Outside for Innovation - All great executives and entrepreneurs I know have adopted the mantra of "not invented here." Instead of trying to come up with every great idea and plan, they are constantly looking for talented individuals, great technology, and new ideas that can be mapped into their company. With all of the changes in publishing, there is more unencumbered strategic and technical talent floating around than ever before. Stealing a page from the Google playbook, they need to do acqui-hires, plan joint ventures, recruit entrepreneurs-in-residence (EIRs), and seed book ecosystems. They have been staring at the trees for too long and need to take a step back and look at the forest. Other companies and individuals who envision the same type of book future can help.

Nearly everyone I know in publishing is cheering for Barnes & Noble. But the clock is ticking. As a publishing and reading community, we need to realize that Barnes & Noble is not the answer for the future of books, but they can be a catalyst and significant player if their next steps are decisive and well played. Let's hope they are.

This article was written by contributor Jason Illian and was previously published by Publishers Weekly. It has been re-published here with the author's and PW's permission.

Jason is the Founder and CEO of BookShout!, an innovative reading platform that empowers publishers/authors and builds community around books.  BookShout! is working closely with publishers and authors to re-imagine the future of books.


Best of TOC

Best of tocIt's challenging keeping up with publishing industry news and analysis. I have way too many content feeds to monitor and I'm sure you do too. We do our best to highlight the most important developments on the TOC website but you're forgiven if you fall behind or miss an article every so often.

Most of analysis on the TOC site is somewhat timeless but the blog format might not make it feel that way. That's why we gathered the best of the best articles and assembled them for you in a handy, to-go version. It's called Best of TOC: Analysis and Ideas about the Future of Publishing. More than 60 of the most thought-provoking articles from the TOC team and community are featured and it's available in EPUB, mobi and PDF formats. Best of all, it's completely free.

If you need to catch up on your TOC reading you no longer have an excuse. Download your copy today and tell us what you think.


What devices and formats do your customers prefer?

Most publishers create ebooks in all formats figuring it doesn't matter whether mobi is more important than EPUB or if the content is read on an iPad more frequently than on a mobile phone. That approach means these publishers have no idea how their content is being consumed. It also means they probably don't have a direct channel to their customers or some other way of polling them on their preferences.

At O'Reilly we like to stay on top of our customer reading habits and preferences. We monitor device and format trends through surveys and download statistics (from our direct sales channel). For example, here's a chart showing which primary and additional devices our customers read our books on:

Devices

As you can see, a computer is the O'Reilly customer's preferred reading device and the Kindle family is a distant second. What I find interesting here is the fact that Android tablets are much more popular reading devices for O'Reilly content than an iPad is. In fact, for our customers the small-screen iPhone/iPod combo is also a much more popular reading device than the iPad. Another interesting tidbit is that the iPad's popularity is almost exclusively as a second option, not the primary reading device.

Now let's look at preferred formats:

Formats

Here we see PDF still dominates; we learned long ago that most of the reading taking place on the computer is with PDFs, not EPUB or mobi files. This is a trend we've seen for years now and PDF doesn't seem to be any closer to relinquishing its format leadership status now than it was back in 2009, for example. And despite the Kindle's popularity EPUB is preferred much more so than mobi.

That begs the question: If the Kindle is such an important device for O'Reilly customers (see first chart), why is mobi a distant 3rd in format popularity? Is it possible our customers are loading their Kindles with PDFs? Sounds like a great question we need to add to our survey...

These charts reflect the preferences of the O'Reilly customer. Unless you also happen to publish technology books I'm pretty sure your results will look different from ours. But are you even taking the time to ask your customers these questions?


Reverse showrooming

This past weekend a friend asked me to pick up a couple of books for them. Print books, btw, and they needed them later that day. That meant it was time to head to a local bookstore, something I'm doing less and less of these days.

B&N was the closest and when I walked in I immediately realized why online shopping sometimes offers such a better experience than in-person. My local B&N moved all their categories around from the last time I was there and I must have circled the entire store three or four times just to find the two books I needed.

Then there's the reviews and top-seller lists I'm so used to seeing online. They don't exist in the brick-and-mortar world, so I decided it was time to do some reverse showrooming.

I chose the Amazon app on my Android phone, mostly because I know Amazon tends to have far more customer reviews than B&N. So I found myself flipping through the Amazon app while standing in the middle of a B&N store. I kept waiting for a store employee to walk past and make me feel guilty, thinking I was just buying the books from Amazon instead, but that never happened.

The whole experience made me realize, once again, that a chain like B&N needs to build a mobile app to make the in-store experience more pleasant and, dare I say it, rewarding.

The only mobile app B&N has is for the Nook. They offer nothing to help you navigate your local superstore. How about simple store maps so I can find the sections I'm looking for without walking all over the place? Yes, I know this has to be done store-by-store and updated regularly. And yes, I'm sure they like it that we're all walking through the store since maybe that means we'll stumble across something we weren't even looking for. I wasn't interested in serendipity on this visit though. I was on a mission and pressed for time.

Once they create this in-store app, how about adding some other features like deals-of-the-day? Base them on my purchasing habits. Make me a deal I can't resist and customize it for me. Feel free to mix the offers between print deals and ebook deals. Let me know about upcoming events and anything else I might be interested in, especially if it ties in with my buying habits.

All I'm asking is that they give me a reason to come back. Without any of this it will probably be a few months before I return. And when I do, the experience is likely to be as frustrating as this last visit. If Mr. Riggio is serious about buying the brick-and-mortar part of the business you'd think he'd want to implement something like this to improve the shopping experience.


Automated ebook summaries

Yesterday I wrote about the opportunity to rethink the used book in the digital world. One option I suggested is for the community to create summaries of ebooks and sell them as bundles with the original work. Now I'm thinking about how the summary process could be automated and built into the ereader app.

I recently discovered a Chrome plug-in called CruxLight which highlights the key elements of a web page. If you're pressed for time and just want to quickly scan the page CruxLight helps you out by highlighting the important pieces and providing a list of keywords.

Is the technology perfect? Of course not. Will it improve over time? Absolutely, whether it's CruxLight or some other service. And if this works for web pages why can't it be a viable option for longer works, like ebooks?

This is exactly the type of functionality someone like B&N should look to integrate with their Nook devices and apps. It's a way of distinguishing themselves from Amazon and everyone else. I can see the headline:

Nook, now with automatic ebook summaries to shorten your reading time

Customers who don't want to use it can easily turn it off. But those who warm up to it are likely to buy and read more ebooks faster than they ever have before. Sounds like a win-win to me.


Why B&N should abandon hardware

The ebook retailing business consists of three elements: hardware, content, and selling model. Dedicated e-readers (think eInk devices) are losing momentum to tablets. Content is mostly quick-and-dirty print-to-e conversions, or "paper under glass", if you will. The typical selling model is to buy one ebook at a time. Pretty simple. And not a whole lot of innovation happening in any of the three areas by the major players.

Recently there's been speculation that B&N is about to ditch the hardware part of their Nook business and focus instead on content and licensing. If true, that's probably the wisest thing I've heard from Riggio & Co. in a long time. Hardware has been, and will increasingly become more of, a fool's game for B&N.

They can't possibly steal Apple's mojo, so why try? I'll bet more people are reading B&N ebooks on an iPad or iPhone than they are on the Nook tablets.

On the Amazon side, B&N simply doesn't have deep enough pockets to lose money on both hardware and ebooks as long as Bezos can, so it's time to cut bait. Plus, Amazon's goal is to turn the Kindle Fire into a gateway for purchasing much, much more than ebooks. Amazon has a significantly larger product catalog outside of books, so Amazon can afford to lose money on the device if they make it up on the sale of electronics and other goods B&N doesn't sell.

So if B&N completely gets out of the hardware business what can they do to compete in the ebook world? Think app functionality, reader experience, and content sales model.

Today's e-reader apps have pretty much the same functionality as yesterday's. There's basically no innovation happening with the user experience in any of these apps, whether they come from Amazon, B&N, Kobo, etc.

Now is the time for B&N to shift all those resources they have in hardware onto the team that develops their Nook apps. What features are customers asking for? More importantly, what features have readers never even envisioned but would love to have? Channel Steve Jobs. We were all pretty content with our MP3 players back in 2000 and then in 2001 the iPod hit the scene. What a game-changer. What will be the "iPod moment" for e-reading apps?

And while they're working on that, be bold and work with publishers to develop some genre-specific, all-you-can-eat, ebook subscription programs. Romance is a good place to start but look at other verticals as well. What kind of package would compel customers to pay a subscription rate of $5 or $10 per month? They'll need to find the publishers who are willing to experiment here but that's why you focus on just one genre to start and build a success story to create others down the road.

At the end of the day B&N should continue to let Apple, Google, et al, distribute their Nook apps. They don't need to lose any more money selling devices that are viewed as commodities. They should instead focus on dramatically changing the reading experience and content acquisition model. After all, once hardware is eliminated, those are the only two other elements of ebook retailing that matter.


TOC’s Global Ebook Market report

One year ago we published the first edition of our Global Ebook Market report. We focused on the major English language territories but also featured coverage of several other popular languages as well.

A lot has changed in the past year so we recently published a completely revised edition of the report. You’ll find it here. The good news it’s totally free, both in terms of cost and DRM. :-) It’s also available in all the popular formats (PDF, EPUB, and mobi), so you’ll be able to read it on any device you own.

Read more...

Wikipedia’s EPUB export feature

I recently watched a couple of episodes of The Men Who Built America on The History Channel. Although I learned a lot about John D. Rockefeller, for example, I wanted more. I thought about looking for a good ebook about Rockefeller but decided instead to head over to the Wikipedia.

Like most historical icons, Rockefeller’s Wikipedia page is fairly extensive. It offered more than I was able to read at that moment and there were other people in the series I wanted information on as well. That’s where the Wikipedia’s EPUB export feature came into play. If you haven’t heard about this it’s probably because it didn’t generate a lot of buzz when it launched a couple of months ago. I think it’s one of the most under-appreciated features of the Wikipedia and offers plenty of lessons for all content producers and distributors.

Read more...