Current Developments in Digital Rights Management (DRM) and Digital Loss Prevention Technology

Presently, there seems to be a split opinion on the value of DRM - especially in the eBook/book publishing sector.

Some feel DRM inhibits folks from finding new authors through eBooks that are able to be lent to them by friends (or given to them by said friends). Some group surveys have revealed that most of them had discovered their favorite authors, not by buying their books, but because someone had either lent them a book or given them one written by the author. People of this persuasion feel that DRM is rather stupid and some authors say that by giving away some books (especially the first book in a series, for instance), or even having them pirated in other countries, actually increase later sales; but, DRM prevents this 'stealth marketing' from occurring.

Others feel that intellectual property (IP) should be protected at all costs and that it is growing to the point that the pirated work represents a greater loss in sales than any offsetting gain in sales through the author's rise in popularity through pirated works.

'Rightscorp has developed digital loss prevention technology that tracks copyright infringement and ensures that owners and creators are rightfully paid for their IP. They developed extensive tracking analytics that allows them to see what content is being distributed through Bittorrent and file sharing sites and then goes after the people involved. In April 2014 they made the company decision to market their services to the publishing industry and actively go after eBook pirates.'

Tonight's research/resource article dives into the latest business figures and technology shaping the DRM and digital loss prevention arena.

Key excerpts:

- 'Business is booming for Rightscorp right now. The company has just announced that it has closed over 170,000 cases of copyright infringement to date, up 40,000 since November 2014, representing an approximate 30% growth within a 2 month period. They have received settlement payments from subscribers of more than 200 ISPs and has approval to collect on over 1.5 million copyrights.'

- 'Overall, the publishing industry is not really concerned with eBook piracy. Many of the top companies such as HarperCollins, Hachette, S&S and Penguin have told me that piracy is a minor blip on the radar and does not hamper sales to any discernible degree. They all admit it is an extreme minority of tech savvy individuals and statistically people who pirate eBooks tend to be the biggest purchasers of digital content. There has even been some notable authors such as Tim Ferris that harnessed the power of Bitorrent to promote his book, the 4 Hour Chef. He recently said “Torrent conversion is NUTS. Of 210,000 downloads earlier this week, more than 85,000 clicked through “Support the Author” to the book’s Amazon page. We all had to triple and quadruple check that to believe it.'

- 'PricewaterhouseCoopers estimates “consumer eBooks will drive $8.2 billion in sales by 2017, surpassing projected print book sales, which it thinks will shrink by more than half during that period.' 

Now, this insight by Michael Kozlowski in the Good E Reader:

There will be 700 Million Pirated e-Books in 2018

Many publishers often think their current Digital Rights Management solutions are enough to combat e-book piracy. This is why the vast majority end up using Digital Watermarks or Adobe DRM in order to make it hard to upload material you have purchased to file sharing websites. Rightscorp, likely the biggest anti-piracy player in movies, music and television shows told Good e-Reader that “we estimate that there were 500 million e-Books distributed in the United States on peer-to-peer networks in 2013 and this will grow to 700 million by 2018.”

Rightscorp has developed digital loss prevention technology that tracks copyright infringement and ensures that owners and creators are rightfully paid for their IP. They developed extensive tracking analytics that allows them to see what content is being distributed through Bittorrent and file sharing sites and then goes after the people involved. In April 2014 they made the company decision to market their services to the publishing industry and actively go after eBook pirates.

Business is booming for Rightscorp right now. The company has just announced that it has closed over 170,000 cases of copyright infringement to date, up 40,000 since November 2014, representing an approximate 30% growth within a 2 month period. They have received settlement payments from subscribers of more than 200 ISPs and has approval to collect on over 1.5 million copyrights.

We are firing on all cylinders and have been able to consistently generate growth on many of our operational metrics,” said Christopher Sabec, CEO of Rightscorp. “The latest count includes more than 1,000 cases closed on the Comcast and Google Fiber networks, which control the largest markets in the U.S. It seems clear that the entire industry is now beginning to recognize our solution as the most effective in preserving the rights of copyright holders – artists and content owners. We will continue to work hard to protect those who create and own intellectual property.”

Overall, the publishing industry is not really concerned with eBook piracy. Many of the top companies such as HarperCollins, Hachette, S&S and Penguin have told me that piracy is a minor blip on the radar and does not hamper sales to any discernible degree. They all admit it is an extreme minority of tech savvy individuals and statistically people who pirate eBooks tend to be the biggest purchasers of digital content. There has even been some notable authors such as Tim Ferris that harnessed the power of Bitorrent to promote his book, the 4 Hour Chef. He recently said “Torrent conversion is NUTS. Of 210,000 downloads earlier this week, more than 85,000 clicked through “Support the Author” to the book’s Amazon page. We all had to triple and quadruple check that to believe it.

Sales of eBooks reached $3 billion at the end of 2012, up from $68 million in 2008 according to a recent article posted onYahoo! Finance. The article also cited that Jeff Bezos, Founder and CEO of Amazon, said that “Kindle owners buy more books now than they did before they owned an e-Reader”. PricewaterhouseCoopers estimates “consumer eBooks will drive $8.2 billion in sales by 2017, surpassing projected print book sales, which it thinks will shrink by more than half during that period.”

Rightscorp has not seen the traction in the Booke- space as they have with other media. The company has told me that “While Rightscorp has closed some cases with e-Books, we do not yet have large catalogs of e-Books like we have with movies, television and music.”

This goes to show that publishers believe in the power of DRM to such a large degree that they don’t really care to go after e-book pirates at this stage in the game.  They are more concerned with Amazon having too much power in e-book sales and distribution and trying to find alternative avenues to generate revenue, such as  e-Book subscription websites like Scribd and Oyster.

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Future Publishing Growth Depends On Pricing And Sourcing Of Subscription Models

Faisal Galaria: 'The digitisation of books should not be
seen as a threat for publishers, rather a new way forward.

Subscription models? How in the hell do they figure into future publishing growth? Well, let's see if we can figure it out.

To start, picture the current publishing landscape as a sort of post-apocalyptic publishing scene; where old publishing models and formats have been devastated by some dastardly digital interruptive menace. 

Things are in disarray - and although old forms are still commanding majority bucks - the old form tail is slowly eating its own head and the incoming bucks, while not diminishing rapidly, have flattened and steadily losing growth.

Meanwhile, over in the digital camp, their new form champion is pulling record increases in rates of unit sales. Increasing to the point where digital books represent 10 to 20 percent of total book sales (depending on the data source).

Now, let's bring in a little reminder of what happened to the music industry when it went digital. In the name of convenience, aggregation and immediacy Napster, iTunes and Torrents blew up the inner core of the music industry and the iPod finally caused the decline of the CD business. But, after a long period of revenue losses, the music industry eventually figured out just how to properly price and source the new streaming music format that would provide an unlimited source of music for a subscription fee. This injected growth back into the music industry (e.g. Subscription and ad-supported streaming services accounted for $1.2bn of the global music industry revenues in 2012, up from $700m in 2011).           

The publishing industry's equivalent to the music industry's Napster, iTunes and iPod are the tablets and e-readers. These will eventually do the same to the publishing industry as the iPod did to the music industry, providing readers with aggregation, convenience, social discovery and immediacy.

There are signs that the way in which books are consumed could be going the same way; that is, in a convenient streaming format available to the consumer for a subscription fee.

'Scribd, Oyster and 24Symbols are all services that provide access to ebooks in return for a monthly payment, much in the same way that music and film streaming services operate.'

More details provided in The Guardian by Faisal Galaria, senior director at Alvarez & Marsal:

Publishing crisis? Time to create a Spotify for books

Publishers must learn the lessons from music streaming services around pricing and sourcing for their subscription models to work

Dark clouds appear to be looming over the publishing industry. Figures released last week by accountants Wilkins Kennedy revealed that 98 UK publishers went bust over the last year, a rise of 42% on the previous year. Though this figure is stark, there's evidence elsewhere to believe that all is not necessarily lost for the publishing industry.

While print sales of books stayed fairly static in 2012, falling just 1% to £2.9bn, the real success story was the ebook, rising 134% to £216m,according to the UK Publishers Association. The huge rise can be explained by a low base, but the reality is that ebooks now represent nearly 10% of book publishers' total sales.

Publishers have been hit by the rise of the second-hand book market, but the fact that print sales have remained steady shows the opportunity in the sector. Along with the rise in ebooks, the signs actually look positive.

Not everyone has taken to ebooks. They don't feel the same as books, nor do they look like books. Essentially, to some people, they simply do not provide the same satisfaction as a printed volume.

There are parallels with the music industry, where a similar argument was made for vinyl rather than the compact discs which followed in the 1980s. And it could actually be argued that the critics had more of a point - vinyl was widely accepted to be of much better quality than its successors.

But that didn't stop the rise of digital music.

Indeed there are lessons to be learned from the disruption witnessed in the music industry. Napster, iTunes and torrents all shook the inner core of the music industry, but it was eventually the iPod that caused the decline of the CD business.

Continued

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E-Books or Physical Books? Do We Get the Same Reading Experience? (they do coexist, you know?)

King: A book is 'an object with a nice cover.
You can swat flies with it.'

One of the interesting things I’ve discovered since blogging about things digital and print Re their interfacing in the changing publishing industry: the belief that they are mutually exclusive and are at odds with each other.

And this belief is held NOT ONLY by non-professionals that were just raised in a certain era and refuse to change --- BUT, ALSO by some supposedly educated, publishing professionals (that were just raised in a certain era and refuse to change).

I’ve received comments from literary agents, editors, booksellers, distributors and various publishers that consistently and aggressively argue, or try to argue, that print has not been changed but a wee bit due to digital tech and that it will always be as dominant as in the past!

Of course, you have to consider the source for these comments coming from pipe dreams of ones who have lost positions/money or are deathly afraid of its coming inevitability (unless they adapt,  change and grow).  

Let’s get a couple of things straight --- print IS still the dominate format in publishing and, I suspect, will be for the near future --- But, print’s dominance is being gobbled up at a light speed rate considering digital and e-books nanosecond existence compared to print’s 573 year existence (German inventor Johannes Gutenberg invented a printing press process in 1440).

Also, the print (traditional) publishing industry is, and has been for some time, shrinking down and adjusting through mergers and acquisitions, staff/structural and contract changes to tighten up, fit in and be more competitive in the new changing publishing environment --- where digital and print will be more sharing dance partners rather than adversaries.

Now for an outlook by famous author Stephen King in an interview with Jeffrey A. Trachtenberg:

Why E-Books Aren't Scary

Stephen King has filled HIS share of printed pages: Since "Carrie" was accepted for publication in the spring of 1973, he has written more than 40 books and countless short stories. His latest work, coming Nov. 9, is a collection of four stories titled "Full Dark, No Stars." In an author's afterword, Mr. King notes that he wrote one of them, "A Good Marriage," after reading a piece about Dennis Rader, the "BTK Killer" (for "bind, torture and kill") who murdered 10 people in Kansas between 1974 and 1991. He wondered what would happen if a "wife suddenly found out about her husband's awful hobby."

Mr. King is realistic about where books are headed. In digital publishing, as a writer, he's what might be called an "early adopter." Back in March 2000, Simon & Schuster Inc. issued Mr. King's story "Riding the Bullet" as an e-book that was downloaded from the Web onto hand-held devices or computers.

More recently, Mr. King's novella "Ur" was written exclusively for Amazon's Kindle e-reader when the second generation of that device went on sale in February 2009. In the interview below, Mr. King discusses his thoughts on the future of digital reading and publishing:

The Wall Street Journal: Do we get the same reading experience with e-books?

Stephen King: I don't know. I think it changes the reading experience, that it's a little more ephemeral. And it's tougher if you misplace a character. But I downloaded one 700-page book onto my Kindle that I was using for research. It didn't have an index, but I was able to search by key words. And that's something no physical book can do.

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Ebook Growth Down in 2012 - What Does It Mean for Publishing? - Inside the Numbers

Do you know what the hell
is going on with ebooks?

The Association of American Publishers (AAP), who has been tracking ebooks since 2002, reported the dip in 2012 ebook growth. Growth in 2012 fell to 41% --- You don’t say? Well damn, whoopee do, what’s the big deal?

The big deal is ebook growth for the past three years has been in the triple digits!

Now, a 41% growth in any other industry would be astronomical--- but, not in ebooks with three years of sustained triple digit jumps. So, what does this mean for the publishing industry as a whole?

An interesting question with some even more interesting forecasts and analytical numbers --- which tonight’s post will get into with this insight from Jeremy Greenfield reported in Forbes:

Ebook Growth Slows in 2012 to ‘Only’ 41%; What Does It Mean for the Publishing Industry?

According to the latest numbers from the Association of American Publishers,revenue for ebooks for some of the biggest categories grew by 41% in 2012. Ebooks now account for 23% of trade publishing revenues.

In any other industry for any other business, this would be eye-popping growth. For the world of ebooks, it represents a significant slowdown from years past.

The AAP has been tracking ebooks since 2002. That year, ebooks represented 0.05% of all trade publishing revenues. To get to the current 23% number, the biggest gains were made in 2009, 2010 and 2011, the years immediately following the 2007 launch of the Kindle. In 2008, ebooks were 1% of publisher revenue. In 2011, they were 17%. Those were the years of triple-digit growth numbers, a trend publishers thought would continue until ebooks were at 50% of revenue or more.

But in 2012, according to these new numbers, growth in ebooks has hit an inflection point in the U.S. Of course, that’s on a larger base. Adult fiction and nonfiction, children’s and young adult and religious ebooks raked in more than $1.5 billion in revenue last year. That number is sure to increase in 2013, but by how much?

The growth rate of ebooks between 2011 and 2010 was a bit over 100%. If the growth rate in 2013 is similarly cut down to size as it was in 2012, my guess is that it will be in the 18% to 20% range*. If that happens, we’ll be looking at a $1.8 billion industry next year.

Regardless of how much ebooks grow this year, the fact is they probably will grow, but slower than last year. So, what does that mean for the publishing industry?

Read and learn more

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A Legal Used Ebook Market? Who Would This Screw the Most?

Used ebooks may
be a coming

Who do you think would get screwed over the most if the powers that be navigated the legal maze, ironed out the fine points and actually established a used ebook market?

Make no mistake about it, selling used digital books commercially is not legal now.

Contracts, copyrights, digital rights, royalty splits, etc. have not been worked out yet --- Hell, these documents and agreements are barely in place for new digital content.

Readers (consumers), publishers, authors, retailers, etc. would all be affected --- but, who would probably take it on the chin the most?

You might be surprised. Maybe no one if they get the right negotiated clauses established.

Let's get into some scenarios and numbers with Jeremy Greenfield of Forbes:


What Happens to Publishers and Authors If a Used Ebook Market Becomes Legal?

Amazon has a patent to develop a market for used digital content. Apple has filed for a similar patent and ReDigi, a self-styled marketplace for used digital content, is currently embroiled in a legal battle with Capitol Records over the resale of digital music files.

Basically, it looks like a used ebook marketplace might become a reality.

For consumers, this could be very good news indeed. Imagine seeing on an ebook’s Kindle page a link that will take you to a sell page for the exact same product for half the price. Same ebook, same user experience, even lower cost.

For publishers, this would undoubtedly be very bad news.

Put simply, “This will wreak havoc with the business model,” said New York-based copyright lawyer Lloyd Jassin, adding, “this shows just how creaky the publishing business model is.”

The publishing business model is predicated in part on copyright law, which gives publishers the ability to control the scarcity of a piece of content, according to Jassin. Basically, by buying the right to produce and distribute a work, a publisher can control the number of copies out in the marketplace and monetize them accordingly. Under the doctrine of first sale, once a publisher sells that copy, it is relinquishing its rights to sell that copy again and whoever bought it can do so. That’s how it’s possible (and legal) to sell used copies of physical books.

In this scenario, the publisher (and author) get no compensation. If the same were true for the resale of digital goods, it could be devastating for publishers.

However, Apple‘s ebook patent and ReDigi’s business model, for instance, factor in these fears. Under their systems, publishers (and, perhaps, by extension authors) would get a piece of the resale.

“If the publisher can’t control the resale of a book but they get compensated, perhaps that’s good enough,” said Jassin.

But what about the authors?

There are often provisions in publishing agreements which provide for a split of proceeds resulting in fees from licensing or from any other profits associated with the work, a lawyer who specializes in ebook contracts who did not want to be named, told me.

“There are potentially catchall licensing agreements in publishing contracts that might apply to a resale,” the lawyer said, adding that if not, “authors may now want to negotiate a provision for that purpose.”

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The Book Industry Is Not Only Surviving - But Surviving Well

Simply Two Book Formats

"For all the complexities that publishing faces, the notion that books are somehow less of a factor in the cultural or information ecosystem of our time doesn't hold up to the evidence."  Peter Osnos


I wrote a post Saving The Publishing Industry? two weeks ago. Today's post is another take and expansion on the health/condition of the book publishing industry --- with some neat insights many of us might not have previously considered.

This from The Atlantic by Peter Osnos:

Numbers show that the publishing industry is handling the rise of e-readers better than what folk knowledge might suggest.

The fall publishing season is in full swing. There can hardly have been a year with more luminaries atop both the fiction and nonfiction bestseller lists; J. K. Rowling, Michael Chabon, Ken Follett, Junot Diaz, among others, represent literary acclaim and commercial appeal. Diaz (This Is How You Lose Her) is having an especially good run: He is both a National Book Award finalist and a recipient of a MacArthur "Genius" prize. Stephen Colbert, Arnold Schwarzenegger, Neil Young, Bob Woodward, and Salman Rushdie are just a sampling of the nonfiction bestsellers. (For the full array, check out the New York Times's copious five pages of print and e-book listings in the book review , which are supplemented online with "expanded rankings" featuring "more titles, more rankings and a full explanation of our methodology.") Whatever else may be happening in this tumultuous period of transition in how books are produced and distributed, the sheer range and quality of so many titles is indisputable proof that our marketplace has writers and readers in impressive numbers.


For all the complexities that publishing faces, the notion that books are somehow less of a factor in the cultural or information ecosystem of our time doesn't hold up to the evidence.

Recently, Colin Robinson, a respected founder of a New York-based independent publisher, OR Books, wrote an essay for The Guardian entitled "Ten Ways to Save the Publishing Industry." The summary paragraph was grim: "Book sales are stagnating, profit margins are being squeezed by higher discounts and falling prices and the distribution of book buyers is being ever more polarized between record-shattering bestsellers and an ocean of titles with tiny readerships." For the most part, Robinson's recommendations are common sense: an emphasis on selection, pricing, effective use of the Internet, and a focus on readers by devoting more effort to reaching them directly through social media. Jeremy Greenfield, editorial director of Digital Book World, in a response to Robinson's manifesto makes a strong case with observations that I generally share: "The publishing industry isn't a monolithic thing: some publishers are doing well and others are not. ... I don't see an industry that's flailing—I see one that's managing a complicated transition much better than would be expected."

The available numbers seem to support this view. In the first six months of 2012, according to Publishers Weekly, drawing on data from 1,186 companies, the Association of American Publishers reported that trade sales increased 13.1 percent, to $2.33 billion. The most important indicator is the continuing boost in e-book sales, up 34.4 percent, to $621.3 million, which makes it competitive with the totals for hardcover print sales. When you consider that it was only with the appearance of Amazon's first Kindle reader in 2007 that e-book sales took off, the pace of change is stunning. I still own an original Kindle, and picked up an iPad when it was released (these early models serve my simple purposes), but there are so many more advanced versions of these readers that consumers now have choices galore that are far more extensive, for example, than are provided by televisions, which most people judge simply by the size of their screens or the quality of the picture.

For those of us who remember a relatively genteel era, as recently as the 1980s and early 1990s, when books were shipped for sale mainly to classy "carriage trade" independents, several national chains (that have since gone under), and the enduring but embattled Barnes & Noble enterprises, there is a frenetic feeling about the push for visibility in the digital age.

Read and learn more

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Amazon Overtaxing? Screwing With Publishers?



Amazon:
Business Shark

 Amazon has a base in Luxembourg which requires that Amazon only has to pay a 3% VAT (Value Added Tax) to the government for UK ebook sales.

So why is Amazon making British publishers pay 20% VAT on ebook sales? And is this even legal? Seems to me no private company can be a taxing authority. Right or wrong?

Every time I get HALFway convinced that Amazon is really not all that bad and just employs aggressive (but hopefully legal) business practices, they do something devoid of good ethics.

On top of abusing the VAT subsidy, Amazon is always negotiating other discounts that often result in publishers/writers receiving less than 10% of the ebook price.

Amazon is just NOT a friend of publishers/writers --- Yet, many believe they are the best thing next to sex. I just don't get it.

More details provided by Telegraph.co.uk, the online daily:

Amazon forces ebook VAT on publishers

The online retailer Amazon charges publishers a UK tax rate despite having a tax dispensation because it is based in Luxembourg.

Amazon is making British publishers pay 20 per cent VAT on ebook sales, despite their true VAT cost for UK ebook sales being closer to 3 per cent.
From 2006, the online retailer has been based in Luxembourg, where the company only has to pass 3 per cent VAT to the government for UK ebook sales. (There is no VAT on printed books in this country.) Despite this, Amazon starts negotiations with UK publishers on the basis that the UK VAT rate of 20 per cent must be lifted from the cost price.

The difference between the UK VAT levy imposed on publishers and the actual 3 per cent that Amazon pays amounts to an extra £1.38 of profit every time it sells a £10 ebook in the UK.

The company negotiates further discounts on top of the VAT subsidy, which in some cases can result in publishers receiving less than 10 per cent of the price paid by the online customer.

Richard Murphy, founder of the Tax Justice Network, told Sky News Luxembourg's 3 per cent tax rate on ebooks is being taken advantage of by Amazon.

Read and learn more 

Total 2011 Book Sales = $27.2 Billion -- A Breakdown of All the Numbers

Book sales for 2011
all the numbers

Interesting numbers for the four major segments measured by BookStats: k–12, higher education, professional/scholarly and  trade (trade includes fiction & nonfiction).

Which categories are up, down or flat? The reasons why, etc., etc.

How did digital and print books fare? How did one affect the other?

Jim Milliot of Publishers Weekly provides these analytics:

Industry Sales Pegged At $27.2 Billion

With print declines offsetting digital gains, total sales slipped in 2011




Total book sales fell 2.5% in 2011, to $27.2 billion, according to the latest figures released by BookStats. Revenue was down in three of the four major segments measured by BookStats—k–12, higher education, and professional/scholarly—and up slightly in trade.
Within the trade category, the juvenile fiction segment had the strongest performance in 2011, with sales up 11.9%, to $2.78 billion. The increase was led by a huge jump in e-book sales, which rose 378.3%, to $220.3 million, and a solid performance in the hardcover format, where sales rose 14.8%, to $1.29 billion. Sales in juvenile nonfiction fell 2.1% in the year as a 223.9% increase in e-book sales was offset by a 3.3% drop in trade paperback sales. Still, the combination of fiction and nonfiction sales made the juvenile category the fastest-growing segment last year with total sales up 9.4%, to $3.30 billion.

Total adult sales fell 2.6% in the year, to $9.21 billion. Sales of fiction declined the most, off 6.1% in the year, to $4.29 billion, while nonfiction sales dipped 0.6%, to $4.92 billion. Although sales of fiction e-books soared in 2011 to just under $1.3 billion, sales in the print segments declined, with mass market paperbacks and hardcovers particularly hard hit, with sales off 31.8% and 23.1%, respectively. The decline in fiction was due to higher sales of lower-priced e-books, as well as a drop in units, which fell 6.5% in the year. The less severe decline in nonfiction sales was due in part to a drop of less than 1% in units, and while e-book sales rose 136.4%, to $468.2 million, the declines in the major print formats were much smaller compared to fiction: hardcover sales fell 5.9%, and trade paperback sales were off 3.8%.

The religion segment, which BookStats classifies as trade, had a good 2011, with total sales up 7.3%, to $1.45 billion. The segment benefited from a 136% increase in e-book sales as well as a 14.5% increase in hardcover sales. Unit sales in the segment jumped 37%, helped by the huge success of Heaven Is for Real.

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E-Books Are Alive ! And Posing As 'Big Brother'



We Know What You Read     

 Whether the ability of digital books to "drill down" analyze how a reader reads a book is good or bad (I'm sure it's great for marketing strategy) --- I am uneasy with a 'Big Brother' reading me as I'm reading something --- Scary as shit, know what I mean?

Privacy is a wondrous thing, and, I'm afraid, taken way too much for granted. We're losing it big time --- Actually, we're throwing it away in our pursuit of the glitter of new gadgets offering immediate gratification and convenience.

Damn if I want someone or something analyzing what I highlight in a book or how I mark it up or notes I make in the margin.

Give me the good old privacy of a printed book or should I say 'print privacy'.

In fact, in the future, this just might be one of the things that will reinvigorate the relevance of the printed word.

Alexandra Alter writes this insight in the WSJ:

Your E-Book Is Reading You

It takes the average reader just seven hours to read the final book in Suzanne Collins's "Hunger Games" trilogy on the Kobo e-reader—about 57 pages an hour. Nearly 18,000 Kindle readers have highlighted the same line from the second book in the series: "Because sometimes things happen to people and they're not equipped to deal with them." And on Barnes & Noble's Nook, the first thing that most readers do upon finishing the first "Hunger Games" book is to download the next one.

In the past, publishers and authors had no way of knowing what happens when a reader sits down with a book. Does the reader quit after three pages, or finish it in a single sitting? Do most readers skip over the introduction, or read it closely, underlining passages and scrawling notes in the margins? Now, e-books are providing a glimpse into the story behind the sales figures, revealing not only how many people buy particular books, but how intensely they read them.

For centuries, reading has largely been a solitary and private act, an intimate exchange between the reader and the words on the page. But the rise of digital books has prompted a profound shift in the way we read, transforming the activity into something measurable and quasi-public.

The major new players in e-book publishing—Amazon, Apple and Google—can easily track how far readers are getting in books, how long they spend reading them and which search terms they use to find books. Book apps for tablets like the iPad, Kindle Fire and Nook record how many times readers open the app and how much time they spend reading. Retailers and some publishers are beginning to sift through the data, gaining unprecedented insight into how people engage with books.

Publishing has lagged far behind the rest of the entertainment industry when it comes to measuring consumers' tastes and habits. TV producers relentlessly test new shows through focus groups; movie studios run films through a battery of tests and retool them based on viewers' reactions. But in publishing, reader satisfaction has largely been gauged by sales data and reviews—metrics that offer a postmortem measure of success but can't shape or predict a hit. That's beginning to change as publishers and booksellers start to embrace big data, and more tech companies turn their sights on publishing.

Barnes & Noble, which accounts for 25% to 30% of the e-book market through its Nook e-reader, has recently started studying customers' digital reading behavior. Data collected from Nooks reveals, for example, how far readers get in particular books, how quickly they read and how readers of particular genres engage with books. Jim Hilt, the company's vice president of e-books, says the company is starting to share their insights with publishers to help them create books that better hold people's attention.
The stakes are high for the company as it seeks a greater share of the e-book market. Sales of Nook devices rose 45% this past fiscal year, and e-book sales for the Nook rose 119%. Overall, Nook devices and e-books generated $1.3 billion, compared to $880 million the previous year. Microsoft recently invested $300 million for a 17.6% stake of the Nook.

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Famous Holdout Authors are Finally Agreeing to Digital Formatting

Some of the most famous and complex writers have resisted the ebook medium.

One of them, Thomas Pynchon [writer of V. (1963), The Crying of Lot 49 (1966), Gravity's Rainbow (1973), and Mason & Dixon (1997)], has finally relented.

His motivation ? The same as most intelligent authors when they think it through --- readership and lots of it. Aside from all else, writers want their work read by as many people as possible.

Something to do with strengthening and ensuring their legacy, I'm sure.

Julie Bosman reports details, along with interesting insights into Mr. Pynchon, in the New York Times:

After Long Resistance, Pynchon Allows Novels to Be Sold as E-Books

Thomas Pynchon was one of the last great holdouts: the rare writer who had refused to allow his work to be sold in e-book format.

Now he’s changed his mind.

Mr. Pynchon, the author of “The Crying of Lot 49,” “Gravity’s Rainbow” and “V.,” has struck a deal with the Penguin Press to publish his entire backlist in digital form.

The announcement is another step toward the ubiquity of the e-book, even for authors who stubbornly resisted.

A few years ago, e-book sales were tiny when compared with print sales, but in the last six months, it has not been uncommon for a new novel to sell more e-book copies than print ones. Authors whose work is not for sale in that format risk missing a large and growing segment of the reading population.

Older titles have been especially tantalizing for publishers, who have turned them into e-books and made easy sales.

Mr. Pynchon has avoided the press for most of his life and, characteristically, declined to speak about his decision. But Ann Godoff, the president and editor in chief of the Penguin Press, said in an interview that Mr. Pynchon had agreed that it was time to get on board.

“It wasn’t exactly the elephant in the drawing room, but we just felt that the moment was right,” Ms. Godoff said. “There has been a great desire to have all of Tom’s books in digital format now, for many years. He didn’t want to not be part of that.”

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American Book Industry Growing Overseas (Print & Digital)

American Books Export Growth

TV shows and Hollywood blockbusters have always been good American cultural exports --- But, guess what? American books have joined the "great American cultural exports" group.

The Association of American Publishers, tracking book exports for the first time, have found some interesting facts about why non-English speaking countries are now seeking American English titles.

And, AAP offers some good statistical growth figures over the past couple of years.

More details by Matthew Flamm, in Crain's New York Business:

New York books find foreign audience

Sales of American-published authors rose 7% in 2011 thanks to a 333% spike in e-book sales, report says. Young readers overseas want to learn English.

TV shows and Hollywood blockbusters aren't America's only cultural exports. The book industry is also expanding overseas, according to a report released Friday by the Association of American Publishers that looks at book exports for the first time.

Exports by U.S. publishers, which are dominated by the big six New York houses, rose 7% in 2011 over the prior year to $357 million. That included $22 million in e-books purchased overseas—a 333% spike—and $336 million in print books, a bump of 2%.

Continental Europe made up the biggest market, with sales of $83 million, up 15%. The United Kingdom was second, with $64 million in sales, up 23%, followed by Latin America, which was up 15% to $17 million.

The report attributed the growth to the spread of online booksellers and the international emergence of e-books in 2009. Historically, foreign distributors, particularly in non-English language countries, offered only 5% to 10% of U.S. publishers' English-language titles.

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Futureproofing Publishing

First, a definition (as I think it applies to this post) of futureproofing (or future-proofing):

A slang term used to describe any technology that will not become outdated any time in the near future --- Webopedia

OR

Futureproof is a collection of articles, experiments, and tools that enrich your life by helping you develop a more sophisticated relationship with technology.


We explore the larger personal and interpersonal implications of technology use through research and philosophy. Based on this research and philosophy, we design interactive experiments to help you discover how technology use affects you. We also create tools that help you use technology better–by mitigating the bad effects and nurturing the good. In other words, we think deeply about technology use and well-being, and we create tools to make them complementary.


Our ambition is to create a new understanding of what it means to use technology well. This new understanding evaluates technology by referring to human needs and values, rather than by comparing technology to itself. With this human-centric perspective, our conception of skillful technology use shifts focus from technical proficiency, to using technology in ways that promote health, happiness, and compassion --- I Am Futureproof

Pottermore, JK Rowling’s online ebookstore, has presented a model/platform that has had an immediate impact on the publishing industry and will have, if developed properly, a more intense and substantial impact in the future.

Key to the Pottermore ebookstore's game changing concept is forcing Amazon to send buyers of its books, showcased on Amazon, to its own ebook site for purchase (Amazon gets a finder's fee). This gives Pottermore direct access to end user data and control over the selling price :)

More info provided by Suw Charman-Anderson in Forbes:

Pottermore: Developing A Blueprint For Futureproof Publishing

Matteo Berlucchi has written a great piece on Pottermore and its potential impact on the publishing industry over at FutureBook. In it, Berlucchi suggests that Pottermore, JK Rowling’s online ebookstore, is an “extremely important” precedent which shows publishers that it is possible to rework their relationship with Amazon in a way that forges stronger ties between publisher and reader.

“Pottermore transformed Amazon from a fierce ebook retailer into a tame ebook shop window. Pottermore uses Amazon (and all other ebook retailers online) as an affiliate which attracts customers to their ebook store in exchange for a finder’s fee. Thus, Pottermore gains direct access to the end user details (alongside Amazon as both companies know that the user has purchased the ebook).

In this model, says Berlucchi, publishers get control over the cost of ebooks and how much retailers earn in ‘introduction fees’. They also benefit from the creation of a direct relationship between publisher and reader, invaluable for marketing and market research, and unprecedented access to user data.

Berlucchi’s right, but the industry needs to take the Pottermore idea several steps further if they are to reap all the rewards it has to offer. There is a window of opportunity now to expand upon the concept of a publisher-centric ebook hub, to take Pottermore’s partial blueprint and use it to futureproof publishing.

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