Month: August 2009

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Author & Publisher Strategies The Reading World

Smashwords opens B&N channel for self-publishers

Late Friday, Mark Coker of Smashwords sent the following via email:

Smashwords has signed an agreement with Barnes & Noble to distribute Smashwords
ebook titles, all of which are self-published or from small independent presses.
As you might imagine, we’re thrilled.  Until today, it was difficult if not impossible
for independent authors and publishers to gain such mainstream digital distibution.
Now with Smashwords, virtually any author, anywhere in the world, can receive
broad distribution for their ebook. Additional distribution relationships are
forthcoming.
The Smashwords service is completely free.  We pay the author 85% of the net
proceeds and we take 15%.
We originally hoped to do a formal press release on this news rather than release
it late on a Friday afternoon, but we needed to give our 1,200+ authors and publishers
advance notice so they can prepare their titles for distribution.  It’s tough
to ask 1,200 people to keep such an exciting secret a secret, thus the preempted
press release and my email to you.  We currently publish about 2,600 titles,
double the number from just four months ago.  The books should be listed at B&N
properties within the next 30 days or so.
We posted a link here to inform our authors about next steps:  http://www.smashwords.com/distribution

Smashwords has signed an agreement with Barnes & Noble to distribute Smashwords ebook titles, all of which are self-published or from small independent presses.

As you might imagine, we’re thrilled.  Until today, it was difficult if not impossible for independent authors and publishers to gain such mainstream digital distibution. Now with Smashwords, virtually any author, anywhere in the world, can receive broad distribution for their ebook. Additional distribution relationships are forthcoming.

The Smashwords service is completely free.  We pay the author 85% of the net proceeds and we take 15%.

We originally hoped to do a formal press release on this news rather than release it late on a Friday afternoon, but we needed to give our 1,200+ authors and publishers advance notice so they can prepare their titles for distribution.  It’s tough to ask 1,200 people to keep such an exciting secret a secret, thus the preempted press release and my email to you.  We currently publish about 2,600 titles, double the number from just four months ago.  The books should be listed at B&N properties within the next 30 days or so.

We posted a link here to inform our authors about next steps:  http://www.smashwords.com/distribution

This is a very significant turn, though one that I suspect will be followed by more Smashwords partnerships. The simple fact is that self-publishers are as much a part of the mainstream publishing market as any small house. The barriers have fallen and many authors will test the market without a deal with a publisher upfront. Smashwords makes the market entry very easy and preserves 85 percent of after-retail revenue for the author.

It’s another inventory that, at least now, BN.com and associated readers (Plastic Logic and iRex) can offer directly to readers. It seems certain that Smashwords titles will be available soon in other major online bookstores.

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Book and Reading News

Sony Reader goes “Daily” with Kindle competitor

During its previously scheduled product launch of the Sony Reader Pocket ($199) and Touch ($299) Editions today, Sony dropped its would-be Kindle-killer on the market, a $399 AT&T 3G-enabled Reader called “Daily Edition” that will ship in time for Christmas, if an e-book reader is on your last-minute shopping list. This Christmas, it may very well be.

Does 7-inch Daily Edition, which sells for $100 more than the 6-inch Kindle 2, bring enough oomph to the market to make it a must-have for the holidays? The answer will depend entirely upon whether Sony’s move to ePub format and close embrace of Google Books, which can be downloaded free through its online bookstore, will tip the buyer’s decision in favor of Sony. While it is a 3G-enabled reader, comparable to the Kindle and its WhisperNet service provided by Sprint, the Sony Daily Edition will not allow Web browsing, which the Kindle does, according to various sources, notably Publishers Weekly.

The Sony press release suggests that there might be an upgrade path to full Web connectivity: “There are no monthly fees or transaction charges for the basic wireless connectivity and users still have the option to side load personal documents or content from other compatible sites via USB.” I have queried Sony PR about what “basic wireless connectivity” means and whether there will be options for additional service. It isn’t entirely clear that Google Books will be downloadable over the air or only via PC download—since there is no revenue to support 3G downloads, this needs to be clarified.

Unlike the Kindle, the Sony Daily Edition offers handwritten note entry (stylus included with the system) and built-in links to local libraries, which can “loan” electronic copies for up to 28 days through the Overdrive.com library collections service. A social network for discussing literary. And the devices will be available at physical retail outlets, including Best Buy and WalMart, making it easier to try than the Kindle.

Amazon is prepared to counter the perceived accessibility of Sony’s ePub strategy by both opening the Kindle readers to ePub and making its proprietary format readable on a wider range of devices. Sony may have the cheapest e-reader with the $199 Pocket Edition (sans wireless connectivity), but this still looks like a fight that is going to be waged on Amazon’s terms.

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The Reading World

B&N will offer iRex device, too

Dropping in from a flu-induced respite to say: Barnes & Noble is trying too hard. According to The Wall Street Journal‘s Peter Kafka, BN.com, in addition to teaming with Plastic Logic to sell ebooks, now plans to partner with iRex, maker of an upcoming iLiad device the features 3G connectivity and an 8.1-inch screen, described here. BN.com will be the e-book store for both devices.

We get the “we’re more open” argument already, even though every e-book format comes with DRM and compatibility baggage, but the challenge is not merely to sell books but to establish a platform customers can rely on. That comprehensive experience of reading goodness doesn’t come from a shallow focus across many devices, but deep focus on the reader’s experience with an e-book.

It would be a better use of Barnes & Noble’s modest marketplace goodwill to focus on making one device a stellar experience while supplementing that experience withiPhone and other smartphone e-reader applications than to try to sell and support e-books across a growing inventory of devices. Individually, any one device will require a substantial amount of BN customer support, which they are not well placed to provide, and as a group of devices that still are incompatible with half of the e-books or more sold, they increase the complexity of the customer’s choice. So, if BN.com fails to support the devices, even if it is the manufacturer’s problem, they will lose a customer. If their books don’t work with a device, it’s BN’s problem.

Now is the time for focused investment in a pleasing end-to-end shopping and reading experience. Amazon is already poised to compete with compatibility, so Barnes and Noble has nothing to win by spreading its bets. Factor in the Apple tablet-of-destiny (the Journal also reports today Steve Jobs is all over that tablet), which will run all sorts of e-reader apps at launch, and BN’s strategy looks very dangerous. It could be overwhelmed on the customer experience front, the e-book choice front and in terms of its relationships with marginally committed partners—in exchange for a largely undifferentiated (“we’re as open as anyone”) win if they execute perfectly.

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Book and Reading News

The Lost Symbol will be a dollar sign

The Da Vinci Code sold more than 81 million copies worldwide. Dan Brown’s new book, The Lost Symbol, will be released simultaneously in hardcover ($16.17 at Amazon, a 46 percent discount) and for Kindle ($9.99) on September 15th. Five million paper copies of the book will be printed, one digital copy will be encrypted several million times. Likewise, Sony is certain to offer the book at the same price or lower in its e-book store, taking its losses on The Lost Symbol to drive sales of its Reader devices.

What we will witness is a test of how far hardware vendors will go to increase unit sales of their respective devices. Since Random House will collect between $12 and $13 per copy from digital channels, the hit to Sony and Amazon’s top-lines will be substantial. Each will pay millions to keep The Lost Symbol at the top of their device’s bestseller list. The symbol lost in all this hoopla will certainly be a dollar sign, but it may result in greater uptake in e-book formats generally and, perhaps, a “winner” among the current dedicated e-book readers.

The Lost Symbol is the title that could make or break the current generation of e-reader devices, firming up reader’s investment in the platform and format in which they read digital books. I don’t think that Dan Brown’s latest will sell millions of Kindles on its own, but it will be the title that converts some readers to Kindle or Sony Reader. Both Sony and Amazon see royalties paid on this book as a sunk cost they expect to recoup from hardware sold. If the hardware revenues don’t follow, this book may convince one or both of them that dedicated e-readers aren’t the best business.

If there are approximately 3 million Kindle-compatible devices (Kindle hardware and iPhones running Kindle for iPhone) and some 500,000 other dedicated e-reader devices, as well as perhaps six million other software-only readers installed, electronic sales of The Lost Symbol could account for up to five million copies, matching the first print run. That will be a huge accomplishment.

However, because e-reader hardware is still too expensive for most consumers, e-book sales will likely be slower than print sales after the initial release, especially when paperback editions appear. The key market to watch then will be e-reader application installs on smartphones and computers. Since e-book applications that run on phones and PCs carry little migration cost, we can expect to see an explosion in sampling of reader apps if digital copies of The Lost Symbol are going to pace paperback sales. The only possible channel through which The Lost Symbol could continue to sell 50 percent of total copies sold in digital format is e-readers on phones and PCs.

In the long run, the economics of reading will drive adoption of common formats not incompatible e-reader hardware. I’d be very surprised if Dan Brown’s next book isn’t offered in a single digital format—most likely ePub—that can be read on any device or in any e-reader application. By then, Kindle will be compatible with ePub, because Amazon’s goal is to grow share of books sold, not just to be a e-reader hardware vendor.

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The Reading World

Gathering knowledge: Esoteric e-book formatting thought problems apropos of something

Last week’s announcement that the IDPF (International Digital Publishing Forum) has opened its ePub maintenance process is tremendously important to the future of books and publishing, regardless of whether you believe books, the artifact made with ink and paper, or publishing, the process of assembling, producing and distributing books for a profit, have bright futures or are destined for the trash heap. Everyone concerned about books and e-books should be paying close attention to the evolution of ePub, because it represents the current best effort at an open standard for the display of text and other information across a variety of e-reader devices.

I’ve spent the past few days studying the existing ePub components to prepare some suggestions for the IDPF. ePub is made up of three components, the Open Publication Structure 2.0, Open Packaging Format 2.0, and Open Container Format 1.0, and is deeply related to related metadata and publishing standards initiatives such as the Dublin Core Metadata Element Set 1.1 and DAISY (Digital Accessible Information System) Consortium standards. The result is a series of postings to follow which will offer thought problems that explore the nature of thought, reading, authoring, references, citation and conversation.

Making books useful and accessible to all, including the visual and hearing disabled, is a complex technical undertaking. The ePub and related standards efforts are predicated on the existence of texts which must be delivered to readers, which is precisely the problem one would address if distribution were still the key challenge. Unfortunately, distribution is the easy part of publishing today. In the networked world, ideas arrive in bits and pieces instead of whole units between the covers of a book or in an article from the newspaper. Words are quoted or paraphrased and the enterprising reader can explore the sources to discover what credit to give the fragments of knowledge they find assembled by writers, bloggers, news aggregators and in short messages. Therefore, citable information and the ability to assess ideas in relation to events and previous expressed ideas—in short, whether a newly published adds to or merely repeats previously expressed ideas—are the new hallmarks of value.

In the print era, when moving books, magazines and newspapers around in a timely fashion created value, the reader couldn’t participate, unless

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Book and Reading News

ePub format wins critical victory—will it help Sony compete?

Sony Readers will offer only ePub-formatted books through its eBook online store and devices, dumping its BBeB proprietary format, according to The New York Times. This is an important step toward compatibility between e-reader devices, one that will challenge Amazon’s dominance in e-books to date, because Kindle will soon be markedly separate from Sony, Plastic Logic and other devices that support ePub. HarperCollins and Random House have signed on to the Sony ePub initiative. HarperCollins already offers ePub books.

ePub isn’t the ultimate solution to the question of an e-book standard, but it does solve the basic problem of making books readable across multiple devices. As Gartner analyst Allen Wiener told the Times: “If you see some Adobe executive up on stage with Steve Jobs when they announce the tablet, at that point Amazon has a lot to worry about.” Adobe Systems developed ePub as an “open” alternative to other e-book formats, however it is also pushing its PDF format as a solution for presenting formatted documents—Amazon promotes PDF formatted books for the Kindle DX. There’s no absence of a relationship between the two companies. ePub can still be made into a proprietary format by developers who add, for example, a proprietary DRM (in contrast to its built-in DRM) or display extensions to the basic text display capabilities of ePub.

Amazon can solve this problem by updating its existing Kindles and adding ePub support to new units, something I believe is already on the calendar. Jeff Bezos only has to make an announcement that Kindle supports ePub, which he has foreshadowed, to prevent a user migration. Amazon can retain its lead by adding ePub versions to its store, allowing buyers to download ePub versions.

So, while it is to Sony’s credit that it is leading the way toward document portability, the initiative still lies with Amazon.

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The Reading World

Smartphones could be e-readers of choice

Flurry_JulyPulse_eBookActiveUsers-resized-600Flurry, a San Francisco-based mobile applications market research firm, reports a break-out increase in e-book application use on smartphones, particularly Apple’s iPhone. According to this blog posting, Flurry is tracking user sessions (privacy questions about in that statement) and found a 300 percent increase in e-book application use between April and July. The company suggests that translates into 3 million active e-book readers during July.

The methodology isn’t explained, but the firm points to another research group, Apptism, to back up its claim, albeit tangentially, saying that e-book application sales had a 14 percent share of sales in Apple’s AppStore, second only to Games sales, which were 19 percent. There is, however, no explanation about how sales are tracked and reported, something Apple has been disinclined to do in detail.

A little context, if these numbers are valid, which I think remains unproven. They suggest that smartphones are convergence devices that will contest with specialized e-readers, such as the Amazon Kindle and others. If so, the real question to look into is sales per instance of application installed. Here, I think, Kindle would wipe the floor with iPhone e-reader applications. Why? Well, sampling of applications is a typical feature of iPhone and smartphone usage. People buy phones and install lots of apps, but seldom stick with them, either uninstalling them (which is not tracked by anyone) or simply ignoring them. Also, because book titles are usually embedded in an application on smartphone platforms, at least until recently, each book purchased may be counted as an application installation, which skews the real number of installed applications.

I don’t doubt that devices that include e-reader features could easily outsell dedicated e-readers. These numbers don’t support the argument that smartphones will overwhelm e-reader devices, yet. We need per-device or per-application counts of titles sold to determine what’s really going on.

Via GalleyCat

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Book and Reading News

Still waiting for the hockey stick: IDPF Q2 e-book numbers show growth accelerating

IDPF final Q2Following up on Monday’s analysis of the growth of sales in e-books, the IDPF has released final Q2 e-book sales figures, which totaled $37.6 million. It shows accelerated, not exponential growth. That makes the resolution of early problems with e-book publishing, such as providing customers assurance their e-book files will be readable across devices over time all the more important, because any backlash now will cut off growth. It will be interesting to see if the Amazon 1984 event will stunt growth in sales.

Growth year-over-year reached 224.14 percent in Q2, slightly above the estimate provided here. More encouraging is the quarter-to-quarter growth of 45.75 percent, which is only a slight decline compared to Q1 growth of 53.57 percent. In previous years, the second quarter’s growth has fallen off more steeply from Q2, so the numbers suggest that growth is established based on the wider adoption of devices.

Nevertheless, the e-book market growth remains well below the exponential increases everyone would like to see. It’s a delicate time for this market.

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Author & Publisher Strategies The Reading World

Premature evolution: E-book standards alone won’t solve the publishing problem

Peter Osnos, writing at The Atlantic, reiterates PC World‘s Tony Bradley in calling for a standard e-book format, writing that “it is a good place to start.” His article, however, suggests that the reproduction of reading is also the end of the road:

“As readers become increasingly familiar and comfortable with reading and listening devices and the machinery for producing books on what are essentially a new generation of copiers, books can be instantly available. If readers come to believe they can get Good Books. Any Way You Want Them. Now, and publishers can provide them without the waste, inefficiency, and consumer frustration that comes from scrambling to put out the right number of printed copies, I believe that books will hold their own–and maybe more so.”

Osnos has been working with the Caravan project, whence his Good Books slogan comes, with The Century Foundation for some time, commenting occasionally on the progress. A key idea in his posting today is that e-book reader devices (hardware and/or software) are a “new generation of copiers” and that distribution is the challenge “for books.” As I wrote last week, responding to Bradley’s article, getting words on the digital page is only a small fraction of the challenge ahead, and that any standards should not prevent the development of enhanced reading experiences that transcend the printed book, which is solely a delivery platform, not a networked environment comparable to the Web. It’s my opinion, but it bears repeating as often as we hear the argument that words on a page make a book.

Distribution is the challenge for publishers, not the form we know as the book. Books are packages, which have been applied successfully to moving thousands of words from printing facility to the public for centuries, distribution is the key to making money as a publisher. Books are changing, just as the products produced by every other industry has been transformed in whole or part by digitization. Yet,

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Book and Reading News

Have e-book sales gone exponential?

Trade Stats_09_03The trend line for e-book sales has hit an inflection point, a glance at the IDPF graphic (right) and other data at the IDPF site suggests. The graph represents wholesale e-book revenue by quarter and, as you can see, Q1 sales leaped substantially beyond earlier quarters. Bookselling has always been extremely seasonal, with most revenue falling in the last half of the year, so the rest of the year may, if the increase continues, represent the beginning of a steep rise in revenue for e-books.

A certain perspective is needed with these numbers, however. They represent “wholesale” sales, rather than retail sales. For example, if you add up the 2008 sales by quarter provided here ($53.5 million) and compare them against the annual sales reported by the Association of American Publishers, which were $113 million in 2008, these figures only represent 47 percent of the total revenue from e-books reported. Moreover, they are slightly counter-cyclical, with later quarters in the year growing less than Q1 and Q2. In fact, these numbers are only U.S. e-book revenues for a small sample of “wholesale channels.”

I think, because of the absence of inventories with e-books, that a different word than “wholesale” is needed. It’s a small but useful sample that can be helpful in understanding sales.

In any case, the question still remains, does Q1 2009 represent an inflection point at which sales will increase on an exponential curve, the

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