Wednesday, December 31, 2008

More stuff to do on a Mobile?

We read this week in Ecommerce Times of new Android application which makes the G1 phone work as a credit card. It provides an instant credit card update on transactions and works as a credit card with wireless payment systems in stores.

The application today is free and only available to Chase bank customers in the US and Visa is just one of several companies that have been testing technology payments. More than 30,000 retailers across the US have contactless readers installed at the checkout lines.

The application uses NFC (near-field communication) technology, offering the user full security because device never leaves their control and an alert system which can update cardholders, alert them to fraud allowing them to set alert thresholds. The user merely taps or waves a phone on a store checkout reader to make a payment.
The GSM Association, the global trade group for the mobile industry, has called for mobiles to pre loaded with NFC chips by mid-2009.

Tuesday, December 30, 2008

Our 2009 Predictions

2009 beckons and as we celebrate the end of what for many was truly an unpredictable year we look forward to what we may expect in the next 12 months. We will all be heavily influenced by the economy and its impact on consumer confidence and spending no more so than new initiatives within digital publishing. The unthinkable question is not what will happen, but who will survive 2009? The physical market is still the dominate one for all and is unlikely to be a smooth ride for anyone, with authors being placed on hold, agents having to battle to get to the front of what will be a big queue, publisher reining in the bets and looking for the safest route and retailers watching the credit and cash flow.

At times of austerity some will spend their way out, hoping that by being brave they will be rewarded, others will batten down the hatches and hibernate, waiting and hoping for Spring. What is obvious, to all but the die hard, is that there likely to be fewer ‘passengers’ at the Book Fairs this year and conferences will become a luxury?

We still find ourselves trying to create an ebook market in a vacuum and although the device is less of an issue, consumers want a ‘safe buy’ that has legs, or a price that makes the purchase a ‘no brainer’. Today the price is not right, the format not clear, the model is lost trying to live off the printed one and the content itself is just a carbon copy of the printed book and not special or a must buy.

So against this bleak winter what do we predict for 2009?

1. Content
The volume of digital titles will continue to grow but in tens of thousands not hundreds of thousands and the dominant format will remain PDF and Adobe eBook. The industry ePub format will grow in popularity for those who choose the detailed XML route but for many it will remain a cost too much.

2. Context
In a tight market, marketing is going to have to be on top form. That little extra effort could make the difference between an also ran and a hit. We must remember digital context sells both digital and more importantly physical books.
We envisage widgets will become smarter and offer a lot more that just the plain look inside the book. Digital renditions will be increasingly given away to promote physical sales. Authors should come to the front with podcasts, videos, blogs and web sites to promote them and their titles and the interesting question is whether they will do it themselves, be aided by their agents, leave it to the publisher, or look to others?

Finally the academic market will see the emergence of the digital inspection copy being used to sell adoptions and maybe create an academic social network environment. The trade on the other hand will miss the opportunity to digitise their review copies, or at best do it as an afterthought and believe that physical review copies are still a cheap run on option.

3. Rights
The introduction of the ‘Google’ Rights registry in the US is certainly going to focus the thinking. We believe that it will raise many of the challenges that have long been bubbling under the surface and many question are likely to be raised on the specification and scope of the work. Why the bibliographic agencies or the authors bodies stand up and do this is another question.
The whole spectrum of rights will continue to be questioned as POD is used to grab more orphans and retain rights in perpetuity. Permission rights will start to become more visible and an issue as ‘chunking’ will become more common together with the sale of digital fragments.

4. Digital Platforms
We stand by our vision of the mobile and the notebook still being the real platforms. There will be more ereader devices based on eink and expect a price battle but we still can’t see them becoming a must have device. We also see a shift towards online and rentals and away from download purchases. We believe that if Flash 10 makes it successfully put onto the mobile chip then mobiles devices will move forward and start to dominate the market.

5. Market Sectors
The educational, professional and academic sectors will continue to lead the way in digital both in publisher commitment and sales. One to watch in 2009 – religion. Trade will be more hype than substance but with a clear emphasis on digital marketing. The other sector we expect to raise its digital head is the public library market where the interesting question of its conflicting business model with trade (free to rent versus pay to buy) will remain unsolved.

6. Omnivores and New Entrants
The three main players will continue to steal the show, Amazon with its comprehensive covering of all bases, Google with the help it got buying the trade for ‘chump change’ and Adobe quietly plugging away on many fronts in the background.

7. Editorial / Production Content Development
We envisage that more and more publishers will review their antiquated development process and realise the opportunity benefits to be taken from digitising this. The key to success will be down to the implementation approach and managing the change programme. The old adage, ‘if a customer service clerk doesn’t like the system, you sack the clerk, but if and editor doesn’t like the system you sack the system,’ will still apply. Another important opportunity will be to pull the publishing business (content, context and rights) under one single digital process.

The Long and Short of It

The Times Online had an interesting article which questioned the theory of Chris Anderson’s ‘long tail’ economics. Its conclusions are based on a new study by Will Page, chief economist of the MCPS-PRS Alliance, the not-for-profit royalty collection society. Page finds that more than 10 million of the 13 million tracks available on the internet failed to find a single buyer last year. 80 % of all revenue came from around 52,000 tracks and of the 1.23 million albums available, only 173,000 were ever bought, meaning 85 per cent did not sell a single copy all year. This would support the old 80/20 rule that states 80% of inventory only returns 20% of profit whilst 20% will return 80%. The conclusion long established in inventory and production management that you cut the 80% and focus on the 20% that makes money.

Chris Anderson in his book The Long Tail predicted that the internet economy would shift from a relatively small number of “hits” at the head of the market, toward a “huge number of niches in the tail” and in doing so question the 80/20 rule.

The issue is not who is right and who is wrong. as history will always be rewritten to fit the facts. The explosion of digital material is now skewing the debate. Once material is digitally available the operational cost is relatively small, but the value of the collection as a source of search, discovery and purchase, is huge. Would you buy from Amazon or ABE if they didn’t have the depth and range of titles available and all that differentiated them was price? Service also adds a value factor, but the range and availability of ‘stuff’ is often the initial draw. Why do people use Google search?

We would also suggest that the long tail may be cyclic in its appeal. As we replaced our CDs with MP3 and went to storing our collections digitally, we obviously trawled the tail and bought from it. However, when we have consolidated our collection, we revert back to more current material, which is bound to skew towards the old 80/20 rule. So we offer that there is an added dimension of time that needs to be considered and we would not expect that last year was one where the emphasis was on rebuilding the collection. If we are correct in our thinking then the real value of the tail may be seen as we shift from owning collections to now paying to play them by renting them online. This model has not happened yet, but we would expect a shift to occur more in the book world than the heavily converted music world as people realise that owning ebooks may not be as wise as renting them on demand.

Phones Are Just About to GET SMARTER

We all saw the gadgettery in Bond and Get Smart, we wrote in September about the smart clothing with chips,well LG is now going to try to sell a 3G moble watch next year. The LG-GD910 builds on a prototype first shown at last year’s CES fair is planned to launch first in Europe.

The LG-GD910 has a 1.4-inch touchscreen display that is used as the keypad when making a call, it also has additional buttons down the side of the phone's body, supports 7.2Mbps HSDPA (high-speed downlink packet access) data system making downloads very fast and even has a camera above the top right corner of the screen enabling video calls! They didn’t stop there and have included Bluetooth, an MP3 player, a speakerphone and a text-to-speech function and just to top the lot and make Bond’s ‘Q’really proud the handset is also waterproof.
The sheer novelty makes this a must have not just for geeks and kids but we even want one. Can you imagine the security checks at airports now will have to ask you to remove your computer from your wrist!

We can’t wait to see what is unveiled at this year’s CES in January.

Sunday, December 28, 2008

Cartoonist Free Themselves From the Printed Page

When we think of newsprint challenges, we automatically think of the revenue streams and impact of digitisation on advertising income. However newsprint employs or contracts journalists, photographers and people we often forget - cartoonists.

Cartoonists have long enjoyed being seen and getting their reputations built on the back of their daily strips, but as times get tighter and business models change, what happens to the strip we all know, read and often take for granted?

Stephan Pastis whose daily US strip, “Pearls Before Swine,” appears in more than 500 newspapers is reported in the New York Times, “for a syndicated cartoonist, that’s like finally making it to the major leagues and being told the stadiums are all closing, so there’s no place to play.”What do you do when the distribution channel you have long enjoyed starts to disappear?

United Feature Syndicate, which distributes 50 comics, including “Peanuts,” “Dilbert” and “Get Fuzzy,” in November made all its archived and current content, freely available on and allowed users to have their comics sent to them via e-mail and RSS feed. Previously the content that was available free was restricted to 30 days with access to older material only available on subscription. The change has seen a 48% user increase to over 500,000 unique visitors in November. This in turn is attracting the very people that forced the change – the advertisers. It is now also clearly building a fan base that is independent of the newspapers.

Uclick, the digital arm of Andrews McMeel Universal, which distributes “Garfield,” “Calvin and Hobbes” and “Doonesbury,” are looking at mobiles and the iPhone as the next comic platform. Uclick already sells comics-themed wallpaper and animations for mobiles and now has started selling graphic novels on iTunes.

Many new cartoonists are making their own digital plans, posting to free sites like Comic Genesis and Webcomics Nation and hoping to be spotted by the syndicates.
Interestingly, many cartoonists are now experimenting with colour, animation and sound. They are no longer straight-jacketed by the printed page, the column size or even greyscale.

The new world offers much to the creative artists, writer, storyteller, comedian that they never had before. Last month, we saw UK comic Adam Buxton, of the UK 'Adam and Joe Show' at the South Bank. His act used film, animation, stand-up, music and he was clearly equally at home with all and used all to express his humour. He has a thriving YouTube site, and communicates with his fans over the Net.

The question is whether authors can or should also cross the boundaries in how they write and tell their stories and engage with their community?

Saturday, December 27, 2008

Review of our 2008 Predictions - 10. Waste

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Finally we review the opportunity to remove waste in 2008.

10. Waste – we envisage new opportunities from the digitisation process that will not only increase productivity and depth of by-product but will also start to change inefficiency within the supply chain that only is possible with digital content and context.

Strangely so much happened in 2008 that the eyes appeared to be taken cleanly off the waste ball. The supply chain to many was as efficient as it could go and although industry ‘ticks’ were still being awarded their significance was hardly noted or reported.e4Books came and went and is now e4libraries but where did we start and what did we achieve and more importantly who noticed?

The standards bodies continued to look at digital opportunities but it was if the rules were being written outside of their relatively small world. The biggest opportunity to collate works and get a standard that is some 10 years plus in the making to the masses continued to be missed. The International Standard Text Code (ISTC)offers so much when it was first conceived but today may be seen by many as too late and too little. In fact we had to hunt it down on both the UK and US industry web sites. We must learn as an industry how to fast track initiatives, set up licensing arrangements and both educate and implement these quickly within the market. Some would say that the old control and command approach is no longer appropriate and best practice will no longer be determined by the major players.

Interestingly publishing digital focused started to move upstream and past the conversion of physical product. Digitising first and changing the staid linear and analogue development process became a topic. Mike Shatzkin started his ‘Start with XML First’ and we spoke in Frankfurt about the logic of moving the digital agenda upstream. However many still see content and context and even rights as being separate development streams and thereby continue to create waste and miss opportunities.

We knew this would be a hard mountain but believe 5 out of ten are appropriate.


We used to talk fondly about Sony Walkman tapes, eight track tapes and the Betamax format. Now the eject button is being finally applied to the VHS tape that spawned the likes of Blockbuster. After some 30 years of service those black boxes are finally ending in the technology graveyard that beckons all in time. The video tape heralded a new era where Hollywood classics and latest releases could be rented and watched at home. It didn’t destroy but stimulated cinema and the movie market and in 2006 the last major Hollywood movie "A History of Violence" was released on VHS.

Not only did VHS transform movies enabling fast forward, pause and instant replay it also was the first real TV recorder enabling everyone to not miss that must see program.

VHS has now been taken over by the smaller and tidier DVD and recently this too has been threatened by the new upstart, Blu-ray. VHS rentals were overtaken by DVD in 2003 and by the end of 2005, DVD sales were over $22 billion whilst VHS had slumped to $1.5 billion. Kugler was the last major supplier who still managed to sell some 4 million VHS tapes over the last two years but finally called it a day in October this year. Many predict that the DVD will be obsolete in 3 years but the life expectancy of the Blu-ray is still in question.

So as owners slowly convert their libraries to new formats or buy again we witness once again the ridiculous library model that we have all grow up with. It doesn’t make sense in today’s high bandwidth, permanently logged on world to have to own media but we still do it. Why do we need to own ebooks, video tapes, music CDs and other media? Why not just rent on demand it would make a lot more sense.

Magazine Publishers Experiment with Ad Selling Strategies.

Digital magazine editions are set to be more commonplace with both direct to consumer as well as business to business offers. However what rate card will publishers charge? Will it be based on impressions or merely a flat rate, or remain tethered to the print copy?

A number of specialist niche magazines demonstrate that there is no current standard approach and that many models are being tried.

Item Publications produces digital editions of its Interface Technology magazine charging 12% of the equivalent ad in the print edition and has achieved a 66% penetration of print customers also buying into the digital edition. Hi-Torque Publications, who publish specialist bike magazines such as Road Bike Action, Mountain Bike Action and Dirt Wheels magazines just charge the print edition and today the advertises get the digital advert as a value added benefit. Sporting News Today, is a "digital only" daily publication using inserted adverts and adserver networks for revenue. eWeek who produce a different "digital version" to their print edition are audited by BPA Worldwide and charge each independently. Others have given the print edition away and charged just for the digital advertising based on known subscribers.

All that is known in the physical world is that an individual subscribed and received a copy. Reality is that no one knows if the physical magazine was even opened! Tracking the digital copy should be easier in that every digital page impression can be monitored and even tracked to the subscription. But if the page isn’t opened why would an advertiser pay? It raises the question of whether digital adverts should be charged retrospectively based on performance and not upfront based on subscribers.

Digital isn’t just about taking the physical copy and converting it to digital. The business models have to change to reflect usage and access and no one wants to pay when they aren’t being viewed.

Review of our 2008 Predictions - 9. Gorillas

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Today we review the gorillas that entered the back yard in 2008.

9. Gorillas – Google, Microsoft, Apple, Sony, Amazon, Nokia etc. take your pick as they will all dictate how they see the world.
The Gorillas are now in the back yard in the form of say Amazon and on the front porch in the form of Google!

We were shocked but not surprised to see Microsoft pack up their bags and leave. They failed to deliver a model and some would say were merely following Google in search of the ad dollars. When Yahoo fell through they cut their losses and walked. It was fun to watch their non both at BEA and the queue of publishers ushered in one by one on strict appointment. Noah was certainly missing but the disastrous flood came later in the form of the court a settlement in the US.

We have written much and long on the Great Book Bank Robbery and Orphan works. It is often hard to understand why so many have stood back and failed to even voice a real opinion, but is a shame that the industry has been given away so cheaply. The one thing you think twice about is fighting a Gorilla.

Amazon meanwhile just went about their usual business consolidating Booksurge, Mobibook, Kindle, Search Inside and Audible into one comprehensive offer that now covers virtually all the basis.

We think 10 out of 10 for spotting the omnivores.

Friday, December 26, 2008

Review of our 2008 Predictions - 8.Readers

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Today we review the readers.

8. Readers – an upgraded Sony, Kindle and the introduction of the Apple offer. The key is not the reader but the content but what is becoming crystal clear is that platform convergence onto the mobile and its network is certain.

We recognised the limitations of the current eink device offer and that a single dimensional device offer was not going to fly. True the Kindle started to raise the market awareness and demand but even with the Oprah endorsement it isn’t going to dominate anything except the eink segment. Sony claimed 300,000 units and 3 millions downloads in 2 years but when compared to the sales of iPhones alone this was a mere blip on the market.

Sony tried to create suspense in the UK market with a Waterstones exclusive launch. It achieved its ‘15 minutes’ of news but was soon usurped by the release of their bigger and better model only two weeks later, (how to endear oneself to those who had just bought the original model). We had the introduction and announcement of more and more readers - the same technology in different industrial units, but all lacking any WOW factor. We now have a number of A4 sized readers and also a new breed of larger eink screens aimed at the newsprint and professional markets. The issue is not the size but minor detail like no colour, graphics or video. Some would say that they merely converted text from paper to screen and at a heavy price.

We have long championed the mobile platform as the natural mobile device alongside its bigger notebook brother. Convergence continued at a pace and we saw some exciting iPhone applications start to appear in 2008. We now have Symbian/ Nokia, Blackberry/ RIM, Android / Google and of course iPhone / Apple all poised and ready to move in 2009.

We must also congratulate Nintendo for their entry which on reflection offers more that the eInk crowd.

We believe that 10 out of 10 is justified.

Review of our 2008 Predictions - 7. Standards

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Today we review the standards.

7. Standards – the only standards that matter now are the consumer ones. Adoption of simplified DRM, user interfaces and maybe a continued migration towards ‘508 compliance’. Digital drop ship communications standards are the exception and need to be developed and adopted.

The market became epub vocal and industry bodies adopted it as the standard.
Adobe launched ACS4 as the successor to the old ACS3 but had to change the file construct to accommodate new ‘best practices’ is issue they forgot to tell everyone the reconversion implications of this and just added more cost. Sony were the beneficiary as Amazon kept themselves to themselves and this in turn created a two camp approach based mainly on DRM and devices as under the hood they had much the same technology. What a waste of effort.

However the one standard that continued to be dominant was PDF. True PDF is not one standard but often many interpretations of the same base but whether we are talking, print ready, web ready, text under or over image, searchable, we are talking about PDF. The issue that starts to change this is re-flowable text and devices such as the mobile that have small screens in which to display fixed pages. However the new breed of mobiles appears to be addressing this so reflow may not be the big issue we all thought.

DRM continues to dominate but many have started to experiment with DRM free or limited DRM. Creative Commons Licences have started to gather momentum and perhaps this expression of rights is the sensible approach moving forward.
The University of Georgia started to provide a logical way forward on 508.
Finally BISG launched Drop Book and although it wasn’t a full drop ship standards vision it was a step towards it.

We think a restrained 5 out of 10

Wednesday, December 24, 2008

Review of our 2008 Predictions - 6. Audio

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Today we review the audiobook market.

6. Audio – the death of DRM is inevitable and closely linked to music and in its wake what will happen to Audible and its monopoly? Consumers will vote with their clicks and the book club model is unlikely to succeed. The use of Watermarking technology will grow.

What a weird sector this is? It should be the most advanced digital sector and be creating significant growth for all. After all you need to do is download the file the rest is exactly the same!

Audible continue to dominate and some would say restrict the market to their exclusive DRM and business model. Publishers say they will go MP3 but then have a problem delivering it. In some cases it’s like the old typesetters’ print files, they failed to pick them up. In some cases it’s down to rights contracts and restrictions on non DRM protection.

Whatever the answer the fact is that the market is failing to grasp the full potential and what is being grasped is in Amazon / Audible.

Music discovered that MP3 may not be the best technology and may be ‘open’ but it has all the players, the audience and its often better to get a small piece of a huge pie than a big piece of a small one.

We feel Audio stood still and stalled yet again, 2 of 10.

Tuesday, December 23, 2008

eBooks are Added Value

It amazing how in such a relatively small time the ebook market is flipping from the ‘traditional’ ereaders and moving towards the iPhome and mobile market. To us its both logically and enivitable and something we have been predicting for as long as we remember. Sure Kindle is sold out, Sony have sold 300,000 units but both these are a blip on the number of iPhones being sold and other 3G smartphones out there. Rwemeber that other great culture changer from what seems a long time ago – the Sony Walkman? Any device that has market resonance and arrives at the right time will change the market. Walkman, iPod, iPhone, Flip all have that magic to change and make the incombants lok tired, clunky and so what.

An article in Wired eludes to something else which is quite interesting. Chris Snyder wrote an interesting piece on ScrollMotion, a New York mobile application development for the iPhone which he believes will be the next ereader. ScrollMotion have reportedly concluded deals with a number of major publishing houses, Houghton Mifflin, Simon & Schuster, Random House, Hachette and Penguin Group USA and is in talks with several others.

The claim that they are dealing with front list titles such as Stephenie Meyer's "Twilight," Philip Pullman's "The Golden Compass" wrapped only in the FairPlay iTunes DRM and this differentiates it from the others such as Stanza. They don’t apply reflow keeping each title to the same pagination as the print book, while using the Iphone’s features to zoom in and scroll.

ScrollMotion also intend to roll out the applications on both the Android and Blackberry platforms.

So what caught our eye was not the article as much as the comments posted against it. Already folk are picking their favourites and backing the IPhone applications in a way we never really saw on the ereaders. The enthusiasm and language is different and it makes one think that one side has clearly connected with the street. This next year is going to be exciting as more and more iPhone and 3G users look to get more out of their devices and discover ebooks not as the primary reason they bought them but as added value in their devices.

Review of our 2008 Predictions - 5. Publishers

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Today we review the publisher response.

5. Publishers – more digital directors, more conversions and much activity. Some true small innovators are likely to rise to the occasion.

The Digital Director became the new hot job in publishing. One major trade house went through them rather rapidly but there again it’s a new job, new scope and casualties are bound to happen. Where do you get a publishing digital director from is a difficult question. Some choose music, after all they have lived through it, although some may point out not very well. Some may choose technology and particularly the web, but again is the job about selling, or the total digital impact on the business. Some may choose production as the closest in-house fit, but again it’s a different world and not like the production we knew. Some saw it as the publishing hub of the future and created a new commercial/ publishing role. What fits in one organisation may not fit in another, but what we believe we saw in 2008 was a clear maturing of the role and a move away from the previous marketing / web / technology and media candidate cv.

A wise move we think as more realise that digital publishing is publishing. Even if 90% of the sold product remains physical digital publishing should impact all business processes and activities and will require focus not just a new web site.

Conversion programmes were announced with great vigour with major houses tripping over themselves to announce anything with the word ‘digital’ in it, or the letter ‘e’ at the front of it. Some were mere noise, which the press gave unworthy column inches too, others were genuine and significant steps forward. Sorting the news from the noise continued to often be the greatest challenge.

However the trade started to move digital and US houses certainly lead the way. It will now be interesting to watch as times become tighter whether this commitment holds, but for those who have grasp the issues we don’t envisage a change of course.
Experiments continued on the marketing front with social network sites being the goal of many, direct sales the target and the giving away of whole titles as digital loss leaders potentially becoming standard practice for some.

We think a modest 6 out of 10 unless you think differently.

Monday, December 22, 2008

LG to Announce a Brighter New Year

Digital Arts report that LG Display has developed LCD screen that it says looks as good outdoors in sunlight as indoors. It plans to unveil it CES in January in Las Vegas. The 14.1-inch display is aimed at the laptop market and has a switch to enable users to flip between the modes according to the light.

Panels in most televisions and laptops are illuminated from a backlight panel behind the screen. This is great indoors but isn’t bright enough outdoors but LG now use reflective panels, a mirror behind the screen, to reflect ambient light for a brighter outdoor image and increasing the contrast ratio from 3:1 to 9:1. The technology also provides extra battery life when in reflective and the backlight is switched off. There is are also transreflective panels that have both a mirror and backlight behind the panel and offer a compromise between the two displays but like must compromises, fall down the middle, neither good enough for one or the other extreme.

The display is still a prototype and there are no immediate plans to put it into production but unlike the eink world we hear so much about today it supports colour, video and everything we enjoy on a laptop /notebook.

Do We Believe In Magic?

We read today the brave words and intent from the new owner of Book Club Associates. They intend to hit the business with a multi tasked hit squad to get it back on target. Reading the report in the Bookseller was like watching an old Sir John Harvey Jones’ ‘Troubleshooter’ programme without the logic and panache. It mentions cutting back on catalogues and more direct targeting and the thought that there are ‘enough areas in which the company could make cost savings without resorting to job cuts’. The basic problems aren’t the costs it’s the outdated model.

We wish them well, but maybe it will be a sad fare-well more than a successful one. Others book clubs of their era have found the transformation too much, too late, too far. The hit squad reminds us of the saying regarding cooks and broth and no matter how many are deployed it’s the focus and mandate that counts.

The BCA model lost its way many years ago and never adapted to the changing consumer and Internet. To day it stand like a dinosaur in the mists of technology, thrashing around and still believing that ‘book of the month’ is a good thing, twigging categories till they become meaningless is wise and introductory offers will always pull them in.

The fact is that the best book club today is Amazon. No book of the month, to remember to return or face an argument over. No twigging, but instead a huge integrated catalogue and clear understanding that heavy readers are by their nature eclectic and always have been. All this and more, and that is without Booksurge and Audible and of course the Kindle.Where there was a gap other capable players such as The Book People have stepped up and stolewn it.

So what’s BCA going to do to compete? The BCA model is built on print punts and buy ins which work on a buoyant market but tend to fall flat and add even more excess in today’s tight market. It is difficult to see the appeal as a generalist and also as a specialist and unless there is a mass closure of bookstores it hard to see it working on the old posted catalogue.

We wait and hope that one of the hit squad can bring some sanity to the exercise.

Warner Switch Off the Music

Warner Music Group has demanded that thousands of its videos be removed from YouTube. The battle is once again media companies, which expect to be paid for their online content and Google who have not matched the valuation sought by the likes of Warner and although all the major labels reached agreement some 2 years ago with YouTube on a per view fee and advertising revenue share. The debate is now about whether the labels should be paid in advance or after the videos are viewed and as the old agreement has expired, the renegotiation of a new licence.

Music videos current experience billions of hits on the service and 6 of the 10 most popular videos of all time are music. TubeMogul says musicians and record labels are responsible for over 8 billion views on YouTube. Warner reported $639 million in digital revenue for the last fiscal year but has expressed that YouTube only contribute less than 1% of this. This is obviously a problem that Warner has to solve as physical music sales continue to drop through the floor both in volume and revenues.

Digital content pricing is a difficult one to price today as tomorrow the value and price model is likely to change. The obvious key is to keep to licensing on relatively short term times and remain flexible on the model but as this also has to be acceptable to the licensee that can become a challenge as they don’t want to have to dramatically revisit costs as the service grows.

The one thing that is clearly coming home is that the old adage that the Internet is free is certainly changing at the point of consumption and that it may be free to use but you may be paying via a different business model moving forward. The big issue on advertising models is that aggregation will count and therefore players such as Google will have to upper hand as they will control the money.

Review of our 2008 Predictions - 4. Retailers

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Today we review the retail response.

4. Retailers – will come out of the background and start to take control of the channel again. The chains will expand their digital metadata repositories and do much scanning and collection of rich material. Following Amazon and Dymocks others are likely to endorse their own eRoutes.

Retailers are under more pressure than any time we can remember. Many are committed to digital but are totally dependant on aggregators to deliver the infrastructure and the content. The infrastructure is coming but these players too have been deflected to fight economic flash fires and physical sales discount wars.

Waterstones finally turned from chrysalis to butterfly, but what we expected to be a large beautiful butterfly was a bit more disappointing and we didn’t know whether it was a moth or a butterfly. Some would say that ‘exclusive’ deals and device releases don’t engage consumers, just confuses them. Then again some would say that Sony’s release of their latest model, just two weeks after the Waterstones’ fanfare, was a kick in the teeth for those who had just bought ‘the latest technology.’

Amazon continued to show what a dominate force they truly are consolidating their offer across print on demand, audio and all books, only to be outmanoeuvred by Google and its legal war chest.

If as predicted the ebook market shifts firmly to the mobile platform and notebooks and away from single device players how will retailers respond. If the model moves from outright purchase to rental with the retailers stick to what they know. or adapt? In a world which can react in a heartbeat, it raises the question whether the retailer’s often cumbersome and slow to react web offers can keep up.

A disappointing 4 out of 10. Someone once said that ‘its easy to teach someone how to swim but it doesn’t mean you can stop them from drowning.’

Sunday, December 21, 2008

Review of our 2008 Predictions - 3. Rights

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately. Today we review the core of publishing and media – rights.

3. Rights – permissions and licensing will grow in importance and will someone step up to provide that elusive clearing house once promised prematurely by the likes of Yankee Book Pedler and

Who would have guessed the answer? Who would have envisaged Google putting down the money to make tit happen. Who would have envisaged the Great Book Bank Robbery? It took someone from outside to put the money to build what the industry so sorely needed a rights database. It was a pity that the industry will pay such a heavy price for its inability to do itself.

The other major focus areas were creative commons licence which is often as clear as mud to many but starts to address usage and permissions in a logical way. What it will mean to permissions, fair use and some publisher models will be interesting to watch.

Finally we had Orphan Acts and a potential land-grab of these in copyright but out of print lost titles. But here Google has been given one rule whilst the rest have to adhere to another.

A safe 10 out of 10 do you agree?

Saturday, December 20, 2008

Review of our 2008 Predictions - 2. Context

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately.

2. Context – widgets , widgets everywhere. The effect will be similar to when book jackets were first developed in mid 90s and the impact will be as great. Rich metadata will be the order of the day. Bowker and Nielson will have to respond but may find the world has moved on again.

Well widgets did start to appear in the many forms. Some looked smart and clean others not so tidy. The major aggregators all declared and started deliver and of course Amazon and Google just moved their agendas forward with purpose. Did the Bibliographic agents respond – we think not?

We think the widget as we knew it as a cheap and cheerful ‘look inside the book’ has happened but has failed to fully live up to the marketing potential. Rich metadata however has exploded with major houses investing in many digital experiments to promote books. The experiments have often been so disjointed it leads us to question whether any dots have been joined?

The big question is how we now harness what is clearly an opportunity to sell not just digital but physical books and make book buying more fun.

We think a disappointing 5 out of 10, do you agree?

Copyright Conundrum

Suing individuals for suspected illegal downloading of music via peer to peer is a bit like King Canute trying to hold back the incoming tide. Now 5 years and 35,000 cases later the Recording Industry Association of America (RIAA) has apparently conceded and decided to stop suing individuals. It now has reportedly reached agreements with several Internet service providers to intervene on their behalf.

So they now shift from a lost public relations battle which had targeted individuals, included elderly couples, children, single mothers and in one instance a dead person, to one focused to look a better focused legal actions.

The RIAA will continue to monitor networks for illegal action and notify the ISPs on any findings asking them either to warn consumers or, in the case of repeat offenders, to deny access or service. The outcome is not clear today as the ISPs themselves are now starting to change their models and align closer to the content but it only takes one ISP to say no and a potentially and costly battle starts.

In January the UK’s Publishers Association is to launch a copyright infringement portal allowing publishers to pool information and identify repeat infringers. The site has been funded by a number of leading publishers and allows members will be able to log infringements which will be automatically sent to the ISP. Obviously as the content is unique then it’s the identification of repeated infringement that is key along with the visibility of the community to potential infringers. The site will obviously assist in gathering evidence for any resultant legal action.

Copyright infringement is not going away, has always existed but is now getting easier. Locking down the digital copy and preventing its abuse doesn’t stop the dedicated thief who is often willing to copy the physical and convert it. Digital watermarking is an obvious route to help deter digital piracy and monitoring but again doesn’t prevent the physical copy being used.

So where does the buck stop? Is at the individual who buys it, the seller or provider, the ISP who enables it to happen, the search engine who indexes it and enables people to find it, or all the above? There maybe a clear legal answer but even the RIAA appear to have realised that the need to be more selective and go for the point of consolidation. However the ISP may plug one hole to find another popping open next to it.

Beating up ISPs after the event is not necessarily productive and maybe the problem is that we haven’t helped bodies such as ISPs and search engines determine who owns what? Perhaps expressing the rights as we do is not enough and we now need to couple it with an individual watermarked licence to use which can be proactively detected but there again this hasn’t stopped software and games being infringed.

Friday, December 19, 2008

Review of our 2008 Predictions - 1. Content

At the end of 2007 we made 10 predictions for 2008. Many predictions made have now been conveniently forgotten but we stand by our thinking at the time and believe it appropriate we openly review these individually and see what we think happened and assess them appropriately.

1. Content –
a significant rise in volume as more publishers realise that this is not a ‘wait and see’ game. PDF will be dominant over XML and we may well see the epub standard start to become a real consumer format standard and be fully adopted by ereaders. The publishers with established digital programmes will start to digitise their development process based on XML.

Well PDF has certainly dominated over XML as many continue to watch the market. We have seen the predictable industry endorsement of epub and although there is much support and noise behind it there is a reluctance to fully embrace it today. We have yet to see the industry bodies embark of a comprehensive education programme of best practice and much is still based on the good old follow the leader approach and publishing house class system.

In 2008 Adobe released its ACS4 sever and this will obviously further push both PDF and epub, but epub is far from winning the race. Perhaps the key is the mobile platform and the whole issue of reflow and perhaps that is why Adobe backed ACS4.

Publishers are starting to look seriously at digitising their development process and this is becoming a hot area of focus which is aided by Mike Shatkin’s ‘Start with XML First’ research and conference programme.

A safe 9 out of 10 do you agree?

Is it

So yet another pretender hits the streets and we have a new eSlick ebook reader. The press appears to be focused on the cost comparison and the belief that this will promote sales and could start price drops across the market.

Foxit Software’s price of its new ereader will certainly raise eyebrows and at a special promotional price of $229 (around half the cost of some of its competitors) is an indication of the inevitable – a price war. We believe the cost is still prohibitive and needs to drop significantly. Blink and you will not see a great difference between all the current beauty contest of readers and the consumers will probably see even less and so price has to drop further. In fact reading the data sheet on the new reader sent us to sleep and we forgot which reader we were reading about. They all lack design and usability and as the cost of notebooks falls they clearly are priced wrong.

The big problem is that ereaders are in danger of becoming commodity priced before the content and market demand has been established. The readers will not drive digital adoption that will be driven by a mix of content, usability, design and price. We would predict that the market will probably see more wanabees and further price drops, after all they are basically the same technology wrapped into different dull boxes and serving up the same text as is available in print. The difference may be when the supermarkets decide the price point and reality pricing is achieved.

We have all seen the buzz around the mobile platform, iPhone reader applications and consumer interest in something new and cool. Its interesting that even with Oprah endorsement, Sony marketing spend and lots of noise these players look tired and unsexy and the biggest buyers are no doubt publishers, journalists and industry folk.

Consumer perception is 90% of the game and these grayscale, eink industrial looking devices devices have failed to deliver the WOW factor, have not created a channel proposition and unlike mobiles do not have an inherent churn that will refresh then over a short period.

What’s next the Wal Mart, Auldi, Tesco reader at under $100. Maybe that might help increase the life expectancy of these ‘me too’ devices a little longer.

Thursday, December 18, 2008

The Great Book Bank Robbery - Europe Says NoN!

It may have started with a few questioning comments but now the questions aren’t going away. The days when a few would brow beat the rest into submission are going.
The Bookseller has reported that the French bookseller French booksellers associations Association des Librairies Informatisées & Utilisatrices de Réseaux Electroniques, (ALIRE) and the Syndicat de la Librairie Française, (SLF) have joined French publishers association Syndicat national de l’Édition, (SNE), the Federation of European Publishers (FPE) and European Booksellers Federation (EBF) and the UK Booksellers Association raising their disapproval over Google’s $125m land grab of digital content in their agreement with the Association of American Publishers and the US Authors Guild.

Concerns about the virtual monopoly, the fact that Google wants to be ‘the digital bookstore’, the change to rental models, the opt out not opt in land grab by default, the impact on out of print but in copyright works both on the author’s rights to revert and on orphan works being ‘stolen’ and the whole question of how a deal in the US is confinded to the US and doesn’t by default become global and much more.

We stand by our position in stating that we believe this a ‘bad deal for publishers, authors, booksellers and copyright, creating one rule for Google and another for the rest.

It now makes one ask where the American Booksellers Association stand and why they appear to be silent on the issue. Surely if other booksellers can see the nonsense it can’t make booksense to any bookseller?

iTunes Tax

According to the Christian Science Monitor, New York is the latest state considering imposing a so called “iTunes tax.” Currently, 17 states and Washington D.C. have imposed similar taxes with several others, including Wyoming, Washington and Massachusetts, considering it.Online US retailers aren't required to collect sales taxes from customers in states where the retailers don't have a physical presence. Critics of the proposal are warning that such a tax would increase illegal downloads.

Under the New York plan, a 4% tax would be imposed on music and movies downloaded in the state of New York. The tax would obviously effect iTunes, Amazon and downloaded games.

Is the income destined to artists –No.? State budgets have been hit hard by the current recession with revenues falling. A $15.4 billion budget gap is expected in New York alone which obviously fuels the need to raise taxes and fees. 88 tax and fee rises are being planned including raising taxes on clothing, taxis, movie tickets, as well as “digitally delivered entertainment services.”

When we look at taxation on content be it physical , digital or any combination thereof we see a inconsistent application across the globe. We see some wanting to introduce new taxes on the devices that render digital content, the digital content itself and the services that deliver it. In the current economic climate we must expect any governing body to view digital as a soft target in the same way that cars, fuel, and roads became one in the last century. The problem may become one of maintaining the logic that physical books are different.

Wednesday, December 17, 2008

Merry Christmas 2008

Last we sent many friends this video and try as we might we can't find any better so here is our seasonal fun and greetings to all our readers.

Network Neutrality Responses

Earlier this week we wrote about the reports in the Wall Street Journal on Google’s apparent quest to seek fast track service from the ISPs and the whole issue of network neutrality.

Having received several responses and seen several comments on the net it would only be fair to let you judge for yourselves where the lay of the land is today and moving forward. What remains clear is that changes on network service are being planned but what is unclear is where everyone now stands and what the potential outcome will be.

For further reading:

The made-up dramas of the Wall Street Journal
Net neutrality and the benefits of caching

Interesting Rumours...

Today we stumbled upon a rumour posted on the Teleread site earlier this week. We read it with interest as it described a potential new device to be rumoured to be unveiled next month:

• “Two models: 16 GB and 32 GB
• 3-inch touchscreen OLED display with a 10,000:1 contrast ratio (est)
• WQVGA resolution
• Wi-Fi connectivity
• Onboard music purchase support via Amazon
• Integrated FM radio
• S-Master digital amplifier and digital noise cancelling solution
• Web browser
• Dedicated YouTube interface”

Guess who is the manufacturer? For the answer click here
Interesting times!

Tuesday, December 16, 2008

A Flexible Screen Entrance

HP and the Flexible Display Center (FDC) at Arizona State University have teamed up to demonstrate a plastic a new reading display using self-aligned imprint lithography (SAIL) technology invented in HP Labs.

Flexible displays are paper-like computer displays made almost entirely of plastic. This technology enables displays to become easily portable and consumes less power than today’s computer displays and also 90% less materials by volume. The first practical demonstration of the new flexible display involved FDC, HP others including DuPont Teijin Films and E Ink. Flexible displays could create a new generation of portable devices, such as e-readers.

The FDC is a US government–industry–academia partnership advancing full-color flexible display technology.

The question is where the technology now gets taken up and how long it takes to make its commercial entrance.

In Search of Middle Earth

Today HarperCollins launched and the official J.R.R. Tolkien online bookstore which brings together for the first time all of the books published by him. Here you can buy exclusive signed and limited editions of Tolkien's books.

With exclusive titles such as Tales from the Perilous Realm at £60 and The Children of Hurin at £350 one would expect more than a mean jacket and short blurb. The site may be a must visits for all Tolkien addicts but it some how looks dry short of fizz and doesn’t even offer a look inside these exclusive editions. Some would suggest that here the publisher ahs the opportunity to create and nurture a community based on a clear common interest. One would expect video clips, detail biography notes on the author and the ability for fans to participate and build a community.

Alan Lee, the illustrator that brought so much to life is conspicuous by his absence and one would expect some of his illustrations to be available to view.

The most interesting experience was clicking on the hobbit to go straight to a map of middle earth or try to work out what ‘ The LORT’ was about.

Major publishers such as HarperCollins can always command trade coverage and press for every turn but is this example of good practice? Some may say an opportunity lost others that perhaps this demonstrates the gap between publishing and retail.

Joining the Dots

This week we commented on Fileby the new venture to list and promote authors. It would be remise not to also mention other initiatives of a similar vein.

The UK’s Countrybookshop has always had a high internet profile and it has a strong record of pushing the book market boundaries with their work in supporting authors and festivals. They have now launched Booksconnect, is attempting to do what so many have tried before to do and connect the dots between writers and readers within an online network. It supports all the expected features for published authors including adding and updating their profiles, blogs and articles and book extracts, reading guides, news and discussions. Authors can also promote their unpublished works to the book community which involves editors, agents, publicists, publishers, librarians, booksellers and readers and in doing so support a new an interesting form of dating agency.

Unlike ill constructed ventures such as Book Rabbit these both appear to have many of the expected boxes ticked but will and why will either succeed and in fact how would either measure success?

We welcome these new initiatives along with the many others we don’t hear about. The challenge is to create the glue that effectively binds all the various interests together from the author to the reader. Perhaps that may be a challenge too far in that the physical and digital worlds are so different in their respective value chains. Yesterday information about authors was so scarce it was truly valued and sought. Today we are one click away from an author’s web site, their blog, their facebook page, their myspace page, their you tube video, their iTunes podcast, online reviews of their books, the publisher’s web site, their Wikipedia page, etc.

We now have an information omnivore in Google geared up to be a bookseller.

The question we find ourselves asking is - where’s the money?

Monday, December 15, 2008

Google Want to Go First Class

The Wall Street Journal reports that Google has approached major service providers with the proposal to create a preferred fast service for their content. Google's proposed arrangement with network providers, would site Google servers within the service provider’s network.

To date the principle of network neutrality has been applied enabling all traffic the same service, so what has changed and is this a wise move? The concept of network neutrality originated with the phone business where they were prohibited from giving any public phone call preference in how quickly it was connected.

Service providers see a surge in demand driven by online video and other resource hungry applications and are now looking at how they can boost revenue and upgrade their networks. The major US phone companies have announced they intended to create new fast lanes on the Internet and charge content companies a toll to use it. They claimed Internet companies had been getting a free ride.

Charging for first class is one option and network neutrality which was once so fervently defended by the likes of Google, Microsoft and Yahoo seems to have quietly slipped of their agendas. Both Microsoft and Yahoo have withdrawn from a coalition formed two years ago to protect network neutrality. They now line up with others such as Amazon and like those who expect first class travel do not want to queue with the rest.

If Google and the other omnivores succeed in negotiating preferential service then we would enter into a new paradigm – internet class wars and the principles of equal rights for all will have been quietly bought treatment, the Internet could become a place where wealthy companies get fast out. So the consumer will get clear differential of service and response based on that paid for. New entrants will be effectively strangled at birth and strong established players such as those mentioned will buy a free rein.

Interestingly Barack Obama has pledged a commitment to network neutrality. "The Internet is perhaps the most open network in history, and we have to keep it that way," he told Google employees a year ago. "I will take a back seat to no one in my commitment to network neutrality." "Once providers start to give privilege to some Web sites and applications over others, then the smaller voices get squeezed out and then we all lose."

However Lawrence Lessig, who is tipped to head the Federal Communications Commission, which regulates the telecommunications industry, is for a tiered approached to service. "There are good reasons to be able to prioritize traffic. If everyone had to pay the same rates for postal service, than you wouldn't be able to differentiate between sending a greeting card to your grandma versus sending an overnight letter to your lawyer."

Finally it may not be just the obvious major content players who would win but also the service providers who will also be able to enjoy a ‘free ride’ or upgrade to first class.

Sunday, December 14, 2008

Compare ebooks

A simple and comparison on the eink players.

Click here

It's interesting to read and although basic raises many questions.

Pity they only reviewed eink ebook readers as these may only have a short life as we know them today

Filed by Author...

In a clever move, our old friends Peter Clifton and Mike Shatzkin have created http//

Today it is a database of information filed by authors and has obviously taken a major aggregation which includes some 1.2 million authors and dusted it down and created a page per author web site. Author’s registrar, claim their page, validate themselves and then populate their details adding, pictures, podcasts, videos etc. As this is merely a database ‘filed by author’ all the book details are already there tagged to the author. Today it deals with the US and Canada tomorrow the world. Today the books are listed tomorrow linked.

So where does this go and where is the money?

In some respect it’s a pity that the Author’s guild or copyright agency hadn’t thought this out and done it first. Another likely candidate would have been the bibliographic agencies who already have the information but can only often see it ‘filed by books’ or even ‘filed by ISBN’.

So the obvious revenue is in linked sales and no doubt author’s will be able to choose where their sales go on a cascading system or at least opt out of suppliers. The list management value grows with adoption and added information so sales of the list will make money as many list opt outs are often missed in the small print.
The big question is where it will sit with the new Google built and funded rights database and whether it will compete with, or feed the beast?

But we take our hats off for them getting first past the post. We imagine we will soon get filed by genre, filed by ebook, filed by whatever.

Thursday, December 11, 2008

What's the Odds on a White Christmas?

So winter is here and the publishing marketplace is, as many guessed not immune to hard times. We now read daily of pay freezes, sales drops, bleak forecasts and profit warnings. There is a growing clampdown on acquisition of new content. How bleak will winter be depends a lot on those sackfull’s of returns which allows follow and the level of adjustment that has to be absorbed.

It is difficult to turn off the tap in publishing and many have said it’s like gambling in the nature of the spread betting and risk involved. When the chips have been placed and the Christmas wheel is in spin, it’s often too late to change the wager and we find everyone mesmerised by the bouncing ball, slowing wheel and on the lucky number and colour. A publisher only yesterday remarked he had to quickly get back to make a decision on a reprint of a title that was selling well so he could get more into the stores for Christmas. Gambling can be addictive!

What is certain this year, is that winnings and winners will be reduced.

Publishing is a long term investment where the monies are not recouped until many months after the investment , so stopping acquisitions just means that there could be a hole in the future, slowing down the schedule just means it takes longer to recoup the money and reducing the marketing spend can result in lack of visibility and impact on sales.
So where can monies be effectively saved? Converting fixed costs to variable costs and then focusing on their reduction and management makes sense, but the fixed costs are often just that and variable costs are often already tight. Much has been outsourced and shedding cost or turning off the tap is not easy. Royalties have to be paid and contracts honoured and encouraging more authors to find their own route may come home to bite.

Does digitisation have anything to offer other than more cost? Clearly the market is still very immature and sensitive and there are little sales revenues of substance for the vast majority of the market. Digital marketing offers much for all titles but requires additional investment. As governments have recently found out, the time to invest and fix the roof is not when it’s not raining.

There is one area where significant cost reduction can be achieved but it means changing the heart of publishing – the editorial and development process. This not only saves cost today but removes future costs, facilitates greater and cheaper exploitation of assets and could generate sales and revenues.

On the other hand many will believe that everything will soon be back to normal and this may just be one bad winter. So what are the odds on a white Christmas?

4G is Coming Closer

The world of 4G mobile services stepped a little closer with LG successfully testing the world’s first Long Term Evolution (LTE) cell phone chip. The integrated circuit achieved data speeds of 60Mbps. LTE networks plan to compete head-to-head with wired broadband, offering a efficiency, lowering costs, and providing for better integration with open standards. This bandwidth offers much but needs to be fed the appropriate content, applications and consumer demand.

It is easy to now envisage a full online world with cloud computing and this further marginalizes today’s download models and even DRM as we know it today.

Newsprint and Magazines Under Threat

So we read this week of major shifts in the world of Newsprint and magazines which by themselves may not mean much but collectively show a potential big problem for those reliant on advertising spend. Today all sectors that are reliant on a shrinking and fickle spend which is being spread across an increasing number of media. Television is already reeling from decreasing spend which effects production and investment, which in turn impacts viewing figures, which results in reduced advertising revenues. A cruel and clear circle.

The big news was obviously the filing of bankruptcy of the Tribune Group which includes those iconic brands Chicago Tribune and Los Angeles Tribune. US advertising revenues are expected to fall by some 5.7% and the tribune group are not the only newsprint group feeling the pinch. The New York Times is considering potential asset sales and is in discussions with lenders. Its New England newspapers – including the Boston Globe and its 17 per cent stake in the Boston Red Sox baseball team are potential sales.

Newsquest, the UK regional news group and UK arm of US publisher Gannett plans to close 11 newspapers in the north-west of England in the face of declining revenues.
The magazine market is also in deep trouble as they not only depend on advertising but its recent growth has been fueled by a greater percentage of ‘non-renewable circulation’ than previous and this now combined with reduced reader demand has impacted circulation profitability. The advertising decline and increase in paper and postal costs exposes the whole magazine model.

Reed Elsevier can’t sell its business magazines division which includes Publishers Weekly and Variety. Such is the scale of the issue Newsweek is considering cutting 1.6 million copies from it’s current 2.6 million rate base. The newsstand sales of Newsweek and Time have fallen some 40% in the last four years.

American Media, the publisher of Star magazine and the National Enquirer moved a step closer to filing for bankruptcy when it failed to meet it deadline on interest payments. Cutbacks at Condé Nast Publications have been announced.

But against all this doom and gloom comes the New York Times ‘ TimesWidgets’ , a new service that lets you make embeddable widgets for your iGoogle homepage, blog, etc., of New York Times homepage headlines, blog posts, movie reviews, and more than 10,000 topics. We doubt it will stave off the debt knocking on their door but it keeps the technicians busy and doesn’t even carry advertising today!
Just when you thought that should cover it we read that Google Book Search now archives millions of pages of magazines from the likes of New York Magazine and Ebony to Popular Mechanics.

You can browse different covers of a magazine, select a specific issue search it or turn the pages complete with the original adverts, zooming in and out and even subscribing to the magazine. Google Map has been integrated to show all the places mentioned in various issues, with links to the pages where those places are mentioned.

So we are seeing the demise of newsprint and magazines as we knew them and the changing spend in advertising. We are also seeing the rise of the omnivore across all media sucking in content in its attempt to dominate all. The big question all the archival quest leaves us to raise is one of who will create the future articles, features, pictures, books when they have the destroyed the ecosystem that creates them today, or do they want that as well?

Monday, December 08, 2008

A Random iPhone Giveaway

Random House Publishing Group is the latest to catch the iPhone fever and have teamed up with Lexcycle, to make full-length books available for free on iPhone through Lexcycle’s popular Stanza reader. Works by authors such as Alan Furst, Julie Garwood, Charlie Huston, David Liss, Laurie Notaro, Arthur Phillips and Simon Rich will be available via the platform . Initially the service will feature titles from each author's backlist and will include excerpts for any new 2009 titles. Random House is also providing links to Amazon, Barnes and,, and to encourage readers to purchase more books by these authors.

We should be careful for what we wish for. We are starting to offer backlists as a free incentive for front list, but what if the front list doesn’t sell and people are happy with the backlist they get for free on a relatively unsecure platform? Do the authors earn on the titles that are given away?

We ask whether this is

So we have a free reader, free backlist and we expect readers to pay to by new titles at what price? This free offer is the ultimate discount and could create a mindset value proposition in the market of free ebooks. This is likely to be compounded by others such as Google Book Search.

Have the children finally taken over the choclate factory?

Whats Next in Text?

Despite the talk of publishers battening down the hatches and containing costs the major publishing houses have certainly stepped up a digital gear.

Today HarperCollins announced its adoption of the Nintendo DS ebook application to sell a cartridge of some 100 classics. As we said in our post this offers a new and interesting diversion from the normal platform and one which is both logical and could offer a quick return as it has a ready built audience.

Penguin Group USA today launched Penguin 2.0 which is a platform aimed at connecting readers to Penguin and also group their many digital initiatives. Today Penguin 2.0 offers Penguin Personalized and Penguin Mobile.

Penguin Personalized will enable readers to insert personal dedications directly into select Penguin Group titles and starts with the obviously seasonal Charles Dickens classic, ‘A Christmas Carol and Other Christmas Writings.’ We thought that Dickens’s ‘Hard Times’ may also have been timely today.

Penguin Mobile, is yet another iPhone application which is available for free from the iTunes store. It is good that publishers have started to embrace the mobile platform as it again offers both a readymade audience and the potential of greater return. It appears that Penguin mobile will be marketing focused today enabling readers to access to the Penguin blog, podcast and to browse new titles and exclusive excerpts.

Much of the Penguin site is clearly a ‘work in progress’, but in launching it they are clearly laying down the gauntlet for their competitors. However is this the template for all the new publisher’s marketing web sites, or fall by the wayside and be usurped by others? It is difficult for publishers not to chase the marketing rabbits and experiment but the problem in hard financial times is often always about return and focus.

Sunday, December 07, 2008

The Price is Right?

It appears that Christmas has certainly come early. This weekend UK TV adverts featured a 75% off the recommended retail price (RRP) of some front list titles by W H Smiths. Shop windows are plastered with sales signs and 50% off offers are commonplace. Last week Amazon launched their MP3 music downloads at an amazing £3 an album and 59p a track offer and track which many believe is unsustainable or being used as a loss leader.

Since the demise of the NBA (national Net Book Agreement) the UK retailers have certainly used their new freedom to such an extent that leads some to question whether this has been to the detriment of the industry. In some cases the term ‘dump bin’ has never been truer. So today when we want to genuinely discount to stimulate demand we have a problem and consumer value perception goes into meltdown.

Publisher have controlled RRP and used it to manage their margin and facilitate deep discounting. The result is often a RRP that matches many of the titles – fiction. Those who opposed the removal of the RRP from the jacket now have to consider if keeping it is now merely fueling the spiral of madness. Authors now see special sales, book club deals and three for two as good for selling volume and questionable in terms of earnings.

In the 80s UK major DIY retailer B&Q found itself threatened by a new challenge – a discount war with its competitor Texas Homecare. In these days a 20% discount was unheard of, but in response we raised the bar. One weekend many parts of the country were literally brought to a standstill when we gave 25% discount. The objective was to stop the discount war, not fuel it. The following Monday the desired outcome was achieved when the board meeting was interrupted by a call requesting a stop to deep discounting. The exercise taught us that only some 200 of our lines had any consumer price point recognition and that there was little sensitivity to the remaining 50,000 SKUs. As a result we adopted a strategy based on ‘everyday low pricing across all lines’.

Today book pricing has many challenges not just discounting. The lack of price points makes it hard for consumers to understand value but the greater the discounting the more the RRP becomes a joke and unbelievable to the consumer. ‘Three for two’ and ‘buy one get one at 50%’ may look good and sell books but devalue books and raise the consumer expectation of a discount. Today we also have the fledgling ebook and an even greater challenge of aligning prices between physical and digital formats, plus the tax is only allied to the digital rendition. In the eyes of the consumer digital means cheaper if not free. Look at music, look at the new Google offer on public domain, and look at the questionable madness of the in copyright but out of print algorithm - ‘using original price, page count, pub date, category or genre, and possibly other data. Pricing bands will be tested to maximize the income for different kinds of books, and adjustments will be made accordingly to these "default" prices. The Registry will consult on these algorithms and oversee categorical pricing changes.

So do we price ebooks at discount below a meaningless price that has been artificially inflated to accommodate physical pricing? How do we price ebooks rentals?

The one thing we must recognize is that the consumer is not dumb. No inventory, no postage, no print production has to be cheaper that physical. To say that digitization cost huge sums and has to be funded by higher prices doesn’t wash. After all ,Google is doing it for free on public domain, Amazon has a ebook price point and perhaps publishers should have fixed the roof when the sun was shinning not waited until it rained.

Insights into UK Digital Library Demand

Two interesting library insights into digital books in libraries have been recently published.

Major digital aggregator NetLibrary, has performed a survey involving around 300 UK libraries on the acquisition of eBooks by academic and public libraries.

Today the UK public library sector is just starting to grapple with ebooks and not unsurprisingly, some 85% indicated that they wanted to develop fiction eBook collections. This again raises the issue that we continue to ignore, on how these will compete against retail, when one is effectively free the rent and the other is a purchase only model. The music standardization on the open MP3 format and the wide availability of devices is further fueling library interest in the development of their eAudiobook collections. Leaving the commercial issues aside, we still have a stated principle from many publishers to adopt MP3, but for a host of reasons, a continuation with DRM restricted material, a near monopoly position with Audible and a market clearly not rising to its full potential. Some 65% of public libraries responded positively to developing their collections.

Of the academic libraries who responded to the survey, half indicated that their use of eBooks was to support their core reading lists in various subject areas – the main ones being Business / Management (13%), Medicine / Health (9%) Education (6%) and Engineering (5%). At a recent regional JISC event on ‘Exploring e-books’ for library, information professionals and technical experts there were was a sharing of experience and research with a view to maximising the benefits of e-books for users and for institutions. The advantages of ebooks were found to be: online access, search ability, cost savings, portability, convenience, eco-friendly, storage, easy to navigate, multiple users, easy to locate . The top ten drivers for a national ebooks project to ensure all had equal access to collections were: Interoperability and better technology , student expectations, publisher buy-in, updated teaching styles, standard policy and adoption, author buy-in, budgets, space, new business models, open access.

By themselves these insights tell us little we probably didn’t know but what they are clearly intimating is that there is a gathering pace of enlightenment within all libraries both intuitional and public to digital content, its potent and importantly their thirst to get it.

Click here to listen to the podcast of the JISC event.

Another Android has landed

A second Android phone has landed and is making its debut in Australia. It is from Kogan and comes as two models, the Agora Pro and Agora which retail at approximately $256 US and $192 US respectively. Unlike the Pro version the vanilla Agora won't include a camera, Wi-Fi, or GPS. Both have a 624 MHz processor, 128 MB RAM, a microSD slot, 3G network, a touch-sensitive 320×240 2.5" screen, Bluetooth, central navigation key, and a backlit full QWERTY keyboard.

So it offers the Blackberry look and feel and the iPhone application promise and is yet another player in this crowed space. The big question is not its appeal to Blackberry users but what it offers over the new Blackberry’s who have already moved into this centre ground?

What it does do however is give Google another vehicle to push in the application wars but with all due respect, Australia is hardly today’s mobile battleground!

Saturday, December 06, 2008

Is Publishing Game For Something Different?

So in a week that there has been much industry debate about the Stanza, Fictionwise hook up on the iPhone we saw a far more interesting move that received scant coverage. Games giant Nintendo is to release a cartridge containing one hundred out-of-copyright book titles including works by Shakespeare, Dickens, Bronte and Dumas. These will be able to be read on its portable games console and offer yet another digital alternative.

Nintendo say that their devices, which have two screens, can be held as a book with the stylus being used to turn and bookmark pages, search for texts and zoom.

The cartridge will be priced at £17.99 in the UK and offers a clear price shift from the expensive ereaders on the market today. Nintendo intimate that further titles will be available for download using the console’s WiFi connection and appear to be serious in their offer to their considerable user base.

Forget whether the books are the right ones, forget whether the screen offers the best reading, even forget who is the biggest games player, the point is that this move signals that convergence is rife. Games consoles could offer a safer bet than the eink readers and at a cheaper price point. They clearly offer an established community and the opportunity for existing users to merely extend their cartridges. The games environment could offer some interesting opportunities to mix text, manga and games.

Many say they want to increase the number of people reading and capture the young who they believe are being pulled towards online and games but how many will see this as an opportunity and how many dismiss it out of pure snobbery. We only hope that the venture moves forward, publishers embrace it as an opportunity to experiment and other players such as Sony and Microsoft follow.

Interesting times!

So Which Browser Do You Use?

Having just experienced replacing our hard drive on the laptop we understand technology pain and frustration. We also understand the opportunity to declutter and delete those files and applications that just grow like fungus on your computer. So we went from having four browsers to two.

So it was interesting to hear that the browser wars are getting warmer with the news that Microsoft's Internet Explorer (IE) market share dropped under the 70% last month for the first time since Net Applications started monitoring market share. IE is now down 7.6% points in the last year.

Rival browsers from Mozilla, Apple and Google are benefiting with Mozilla's Firefox, next most popular with some 20%, Apple next with 7.1% and the new Chrome offer from Google slowly bring up the rear. The change appears to be the shift from corporate to home users who obviously prefer Firfefox and Safari and Net Applications state that Firefox and Safari usage climbs on weekends and after work hours.

Microsoft have said that it will launch IE8 in 2009, but as more users shift to the home market it could be continued bad news for the giant Microsoft.

The Future is Not Binary - Building Choice and Diversity

Delivering digital publishing is frustrating, not because we all clearly see it and share the vision but because we clearly don’t have a shared vision or even shared principles on which to build the vision. It’s complex, will have a constant stream of market and technology surprises and just when we are sitting comfortably, something will change. Is this any different from any other environment?

The challenges in publishing is that it’s not just the technology that is changing, its the creation of the content, the rights associated with it, the development of these, the market and sales channel, the sell able product itself, the consumer and how they use it and even the life expectancy of the rights and content themselves. Is there anything to be left unchanged? Even the physical book itself will be changed by the process. We often hear people saying that digitisation is the biggest change since Gutenberg. Well we would say that Gutenberg was a relatively small change in comparison and the rate of change now is also significantly faster.

So will we all be reading ebooks on ereaders, online via notebooks, on mobile phones? Will we be buying books as outright purchases as we do today, or as chapters, or collections? Will we be renting books for downloading to our devices or online access? Will we be given free access to all content on a different business model such as advertising paid or continue to buy to read? Will the library versus retail model collide or live in harmony? Will publishers and booksellers survive?
We can’t predict the future only prepare for it.

We have written much about the ever elusive word collaboration. It is difficult to envisage any sector so complex, diverse and competitive. We only need to open any industry newsletter to see that collaboration is often a bridge too far and although it may be practiced by a few, it is all too often a no go area for many.

So what about that other word interoperability? Can we envisage a world where technology will enable us to share by default rather than by design? The current DRM offers are clearly counterproductive and promote the vision of monopoly silos and a clear ambition by some even outside of today’s landscape to dominate. Often the process of dealing with digital files is user unfriendly, complex and too restrictive and today we would suggest is the biggest consumer turn off.

Today we see the start of the consumer demand for mobile content, online content and a potential shift from the old ‘my library’ to ‘my virtual library’. We hear the start of the debate about whether ebook readers as we know them today are mere transient technology that will inevitable end up just as others on the forgotten piles of scrap. The challenge moving forward is to offer choice of what, when and how we read and the associated flexible rights management to achieve this. The challenge today is to start share that vision and to build choice.

Wednesday, December 03, 2008

Thoughts From India

As we sit in Bangalore in the India IT capital, surrounded by technology, some of the brightest technology minds and a hive of activity, we are still aware that outside the door on the street there is the stark reality of the disparity of wealth and culture that is and has always been India. The lights flicker and the generator kicks in. Last night we sat in a restaurant that clearly had a problem switch over to their generator and were repeatedly plunged into darkness. Yesterday in Pune was no different and one office we visited even said their biggest headache was the shared generator they had with the rest of the building. Some of the things many of us take for granted shouldn’t always be so.

Bangalore suffers like many cities in this area from a shortfall of power to demand. Without generators offices would suffer power outages on a daily basis. The vast majority of offices, hotels etc. have their own generators and diesel.

The interesting point to consider is if all the generators and diesel and investment in assuring continuity of supply were to be fully exploited (it is often used for water) this would even offset a sizable amount of the environmental issues, but this is India and it isn’t going to happen in the way we would expect.
Collaboration and co-operation in any environment as diverse and complex as a city is difficult. That’s why we have utility companies to do it for us. In the emerging markets and third world these often fail to deliver for a variety of reasons but the main one is that everyone has to fend for themselves and can’t always rely on the municipal and service provision we expect.

So what has this to do with publishing and technology within publishing?
Publishing is as diverse and complex a market sector as any. We and others have long argued that it is not one, but several sectors that were merely joined together by a common format, the book, but that digitization accentuates these and creates divergence.

Collaboration is a word often used and rarely practiced. This is understandable given the sheer numbers of organizations involved and the huge range in the size of these. We have industry bodies that do sterling work but are often lead by those who can afford the time and perhaps this is all we can expect.

Don’t forget to switch off the lights when you leave.

Monday, December 01, 2008

The Future is Not Binary - Do we really know the Consumer?

Publishing has in the main been a mass market sector. However the digital age has turned many conventional marketing demographics and mass market views on their head. Wealth, lifestyle, age have all come under increasing scrutiny as marketers continue to try and typecast us into these boxes. The reality is that the digital explosion is acting as a great social leveller. The internet is creating vertical communities of interest that do not replace the horizontal mass market ones we know today but are often in addition to them.

Who, how and what we will read is almost impossible to predict. Ask any major media organisation if their demographics are what they expected and the answer is often no. Obviously if the content is aimed at a specific group then it is easier, but when we talk mass market material the results get more fuzzy.

So will the young be the ebook readers, whilst the older population stick to paper? Age is but a number and is a fact often ignored by marketers who often more than most from ageism. Take the recent debate on age grading children’s books. Ask who wanted it and who opposed it and why in this age it was ever conceived as wise? We all assumed that the young would inherit the Internet but consider the ‘grey army’ who today have the time, money and equal ability to master technology and are signing up and using it in their droves.

The challenge is similar to that in the late twentieth century which saw mass literacy explode into tabloid newsprint and the office automation through the typewriter. Today mass connectivity and technology familiarity is now fuelling mass change. Who doesn’t have a mobile? Who isn’t using 3G smartphones? Who doesn’t have email? Who now watches TV offline? Which house doesn’t have a computer? Who doesn’t have broadband access? The point is that we are changing our social culture, how we communicate, what we communicate, how we access and acquire knowledge, information and entertainment and how we consume or use it.

This doesn’t mean the book is dead, it merely means that some books have to change and others now need to compete differently.

One of the greatest challenges the book faces today is the sound bite, the précis, the completion for time. It always has faced the challenge but it’s now got tougher. The second challenge is the screen. Consumer’s resistance to reading on screen is eroding fast and although many still print and read, reading online be it on a PC, laptop, notebook, mobile is becoming a social norm.

The third social change is the demand for ‘my world’ and ‘my say’. This shift from mass market to a market of one is not always about content, but the access to it and its presentation. Merely replicating the printed book online, or as an ebook, could be viewed as ignoring the individual at a time when they are increasingly demanding to be recognised. People want to be individuals and seen as such. The extension of this is clearly seen today in the blogging and feedback culture. People wish to express their views on everything and nothing and not in a straight jacketed into yesterday’s marketing response forms. Wikipedia was built by one way communication but by collaboration. Amazon reader’s reviews may seem that they are often written by the publisher or author but are more than ever written by readers. This significant democratisation is captured in Charles Leadbeatter’s book ‘We Think’.

The future isn’t the same for all publishers and the greatest challenge will remain about giving the customer what they want.