Dell's MePhone to Challenge IPhone and the Rest?

Dell is expected to announce two iPhone and Blackberry competitors sometime next month. Code-named MePhone, the phones will run on Google Android and Microsoft Windows Mobile respectively.

The Wall Street Journal has revealed that in February Dell will introduce two new mobile phones at the Mobile World Conference in Barcelona. This puts the direct market PC manufacturer head to head with market leaders Apple, Research, Nokia, Palm, and the many others scrambling for the smartphone market.

One of the phones will be touchscreen-only while the other will be similar to the TMobile G1 with a slide-out keyboard. One will feature Windows Mobile the other Android but little else is confirmed today. Dell's "MePhone" is also reported to not go on sale until September.

The one interesting aspect of Dell’s operation is its ability to shift boxes off the Internet and promote and manage this operation minimising inventory, maximising the relationship build with the customer and importantly making higher margin or being able to sell at lower cost. Will Dell’s business model work better than the high cost operations of its new competitors? Will it be able to cross subsidise and leverage their existing customer base?

It certainly interesting times when technology companies shift their markets.

Where's the Digital Content?

We have often argued that consumer digital book demand today is a demand operating in a vacuum. Compare just the titles in print or the titles published in print this year to the total number of ebooks available. There is still a clear dearth of digital content today. Waterstones last week asked publishers to stand up and grasp the opportunity and were clearly stating the obvious – you can’t get consumer attention if you could find what you want. Today we read the same from the US in the Christian Monitor. These voices aren’t alone nor are they asking for something that is unreasonable. The ebook, the digital debate, the introduction of Digital directors aren’t new. So what are the issues and why isn’t there a digital edition of every book in print?

The publishers have rights issues to be cleared and investments to make but this isn’t new nor is going to happen without the commitment. Some say that the cost is prohibitive for the likely return but how will that logic ever change? Device manufacturers, digital companies and now channels, libraries and retailers are stepping up but the word ‘cautious’ best describes the market.

Can we remember the early Internet days or the first ebook pre dot com crash digital gold rush? Some we are still today suffering from the burnt fingers and mistakes made then. However today is very different and there are many positive signs that this digital move will survive the recession. Some will say that it has to survive the recession and may be the way forward.

Some would say that the biggest mistake being made today is view digital as an add on, something you do after you have published the physical book, an afterthought, something you do if you have some spare cash to gamble. The reality is that the digital rendition is just that a rendition and should be created as part of the development process. This means changing not just what we produce but how and what is acquired, how its edited and developed, marketed and promoted and sold.

Digital content, rights management and digital context (metadata and bibliographic) are all corporate assets. So wouldn’t make sense to develop them and manage them digitally? Publishing visionary Mike Shatzkin’s research and conference ‘Start with XML’ has raised the agenda, but although it may have touched some, in reality it missed many. If publishers are to participate in the digital world they must look at their total process from manuscript to consumer and manage this with today’s processes and tools.

Is it Wise.Com - newprint on demand?

Imagine going into your local newspaper shop and being offered 890 newspapers from around the world, some 81 different countries and 38 languages. Today’s cosmopolitan society can read their own paper, not a day later, or shrunk to a foreign edition, but today and in full.



Sheth, manager of Zyn s News & Cigar on Greenwich Ave. Connecticut has embarked on this interesting print on demand venture last spring. NewspaperDirect, a Canadian company headquartered in Vancouver, puts the papers on its Internet system and then sends them to dealers such as Zyn’s.

Sheth's printer cost $30,000 to $40,000. A printout of a weekday newspaper costs approximately $3.50 to $6, while the charge for a weekend paper ranges from $7 to $10 and are based on the number of pages printed. It takes up to 15 minutes to print copies on both sides and to the paper’s format.

Customers can subscribe, call ahead, request colour and request back as far back as one year.

Given the technology investment and the low cost of the newsprint the capacity constraints and also community demand it makes us wonder at the wisdom of the approach.

Death of the Independent Book Review?

This week news broke that The Washington Post’s ‘Book World’ will stop as a stand alone printed entity on 15th February. Its printed reviews will be accommodated elsewhere and it will still be available online. The news has raised much twittering in the book world and together with the dire state of US newsprint, has led many to question where they would get their literary fix and steer from.

In the Uk we are awash with reviews but are they the same and do we understand the difference?

In the US reviews are totally independent of sales. There is a conscious policy to ensure that there is clear water between editorial and business. The NY Times’s staff reviewer will not even review a book by a Times employee.

Some will say this is a far cry from the often muddy waters in the UK where editorial column inches in book reviews, not only review the book but offer it often through a ‘pseudo bookclub’ at discount. Why isn’t the word advertisement stated on the top of the page as some would argue that this is what it is, a catalogue hiding under editorial inches. There are also often special book offers under the brand name of the paper, but are picked packed and distributed by book wholesalers and others. UK newsprint has long leveraged its brands but some would say at the cost of their impartiality. However, some say that when shelf space is bought on the high Street the question of where payola starts and finishes is a debatable point.

So where do you get you review fix and are all vested interests declared?

Keitai Lessons in Writing for Mobiles

We have written several times about the Japanese ‘keitai’ mobile phone books and how the writers are adapting to this new format and reaching this new audience.

The western world continues to kick-start the appeal for reading, but continues to do so using the format and presentation that worked yesterday. We still take finished books and shoehorn them into ebooks and think that they are different and will somehow transform the unread into the well read and the paper and card libraries, into digital ones. We see the attraction that the iPhone book has generated, but continue as before pushing the ‘looky-likey’ book eink readers.

Japan has cultural difference and similarities with the western world and understanding these may offer a way forward. Almost every Japanese adult has a at least one mobile and 31.3% of elementary school students and 57.6% of middle school students have mobiles. Net Asia says that as many as 22.3% self-identify as mobile phone addicts. According to a recent Mainichi Shinbum newspaper survey, 86% of high school, 75% of middle school and 23% of grade school girls read cell phone novels. Talking on the phone in many places is frowned upon, so people tend to text message, which is also cheaper than voice services. As a result people are used to reading on mobiles much as many are on their Blackberry today.

Commuting in crowded trains is where the Keitai novel works best, with works published in 70-word instalments, or abbreviated into chapters that are the ideal length to be read between stops. This means that, despite small cell phone screens, lots of white space is left for ease of reading. Not surprisingly the appearance is often similar to manga with multiple short lines of compressed sentences, fragmentary dialogue, with mobile symbols.

Interestingly when we look at the instalment offer here we see books often written for a different age and to be read as page turners or at leisure being chunked into frustrating reading instalments. DailyLit.com try’s hard to provide the experience, but misses not in its execution, but in its content.

In August 2007 we wrote about Yoshi’s ‘Deep Love’, a story which now has sold some 2.7 million copies and spawned a TV series, movie and manga. The popularity of the genre is spreading, 10 of the bestselling printed novels in Japan in 2007 were based on mobile novels, and each selling around 400,000 copies. The sales were strongest for costly hardcover, where readers had already experienced the work on their mobiles.

However the Keitai novels are not being taken up by adults, who often criticise the lack of diverse vocabulary and a general dumbing-down of traditional literary approaches. Some call cell phone novel enthusiasts ‘yutori,’ slang for those who cannot properly read, write or think. Keitai novels do not go through the editorial selection process; they are first Keitai then are turned into books once popular. It’s like creating a novel based on a film.

Perhaps we have the opportunity to create a new genre, spawn new writers and engage with a new audience. However to do so we may have to let them self publish, experiment and promote organic growth.

February 9th - Kindle 2 Day?

So what do; the Beatles and The Ed Sullivan Show, American combat troops and Vietnam, Lithuanian democracy, Carole King and Mia Farrow and Amazon, all have in common?

Amazon has announced a press conference at New York's Morgan Library & Museum, scheduled for Monday, February 9th and hosted by Jeff Bezos himself. As you can see the day is not one of the biggest event days in history, but are Amazon planning on changing all that? The Internet is now rife with speculation that the book giant is planning to launch its long overdue Kindle 2 and a library would appear to be the perfect venue.

The speculation of what it would look like has started. Will it have a bigger screen, more feminine rounded corners, be thinner, rounded buttons, smaller side buttons and come in designer colour packages? Will it have faster screen loading, using the Broadsheet chip used in the Sony 700? Some may say that these are fairy safe guesses, but what may be the surprise, or has it again taken so long to get to this stage that there is very little surprise?

Whatever lands on the street on the 9th it is clear is that Amazon has some catching up to do in the market if it is to regain the initiative it created with the K1. Irrespective of how many of the K1 boxes were shifted, the spotlight has clearly moved from the eink grayscale readers to the full colour and ubiquitous iPhone and mobile platform. It will take more than a quick dust down, lick of paint, rounding of the edges and an Oprah stardust endorsement to get the K2 back to pole position. Sony has consistently plugged away and with its epub credentials and its educational moves and its availability and is starting to make the eink running. We have consistently stated that we believe that the end game is between the shrinking notebook/lapotop and the mobile smartphone, between download and online, between restrictive DRM and DRM free and more likely OLED than eink . It is unlikely that Mr Bezos is going to move any of these goalposts next month.

We now wait, speculate and listen to the noise, but just in case you are curious what some believe will pop out of the box next month here is a ‘leaked’ photograph from the gadget site Boy Genuis Report.

MSN Loose the Music Plot

Many have long thought that Microsoft had lost the plot and yesterday some will have thought they definitely had when they launched MSN Mobile Music Service and a return to music DRM. So what do Microsoft know that Amazon and Apple and practically everyone standing don’t ?

MSN Mobile locks tracks to the mobile handset they are downloaded to it doesn’t even transfer files between the handset and a PC so you have to carry everything around on the handset. It gets even better! A track costs £1.50 as opposed to iTunes 79p and Amazon is even lower. So MSN believe that a restrictive service that is physically restricted to a handset and that cuts twice the market leader is going to fly! Some would say that the only people flying are MSN! So what happens when I upgrade my handset?

Some argue that MSN believe that they have a loyal customer base that will take whatever they throw at them and in this case that theory may well be tested.

Amazon Take Off their eBook Format Gloves

Publishers Weekly today announced that Amazon.com has notified its publisher and author clients that it plans to cease offering e-books in the Microsoft Reader and Adobe e-book formats.

What does this mean? Is it like their declaration that they made on POD via Booksurge? As with Booksurge Amazon own Mobibook and if that’s they way they wish to do business then who will say no?. They store, they have the content, they deliver the content via their own wireless network connection, they own the store, they own the reader - so why not own the format? Although they accept epub files these are converted these to their own format. Some may say that by playing the format card they in fact strengthen their hand and make it Kindle independent. So the publisher may be happy but the problem remains.

Mobibook remains probably the dominant ebook format alongside Adobe and epub. If plays on as many as any other format and isn't dependant on Adobe to apply DRM. So if you view Sony as the main competitor to Amazon then you start to see a clear division of ebook camps. Adobe remains in the picture with their new ACS4 DRM, without which the Sony can’t use epub and are left with their own overlooked format and poorly represented format. We have reported on the Fictionwise and Follett ‘own brand’ formats and can only see more as the battle hots up.

Some may envisage that Amazon and Mobi will try to cut off old DRM versions the same way that Adobe did in their move from ACS3 to ACS4. Some may also see the move as a swift response to the high profile ereader format and iPhone applications. Whatever the game plan its obvious that Amazon wants to challenge the Adobe ebook format which is the cheapest route for many publishers and push the market towards a richer tagged format.

This format warring is inappropriate as retailers and publishers start to see the shoots of a digital business. However, we now have a confusing consumer offer. The publishers may back epub but the consumer is the person who matters and if Amazon want an Amazon only world we are in for potentially trying times.

We still believe that the ultimate platforms will be online and split between the mobile and the notebook /laptop world and if we are right the current format tiffs are not so important.

Google Delivers $5.7bn in Q4

Some sobering figures were revealed by Media Week last week. Google's ad revenues are bucking the industry trend and are still rising. Google's global advertising revenue jumped by 15%, year on year in Q4 2008, to deliver $5.5bn with overall revenues up 18% to $5.7bn. During the quarter year on year ad revenues from its own websites rose $600 million and through AdSense programs, $100 million.

Although UK operations fell 2% year on year they still delivered $685m. The biggest rise came from outside the US, which represented 50% of all revenues in Q4, up from 48% and totalling some $2.8bn.

Some may wonder whether they missed the ‘chump change’ they paid for the book business?

OLPC Continues

We have long supported the One Laptop Per Child (OLPC) project, which develops low-cost education-oriented mobile computers to sell to governments in developing countries. Today the organisation through the United Nations Relief Workers Agency (UNRWA) has donated 5,000 units of its flagship XO laptop to Palestinian children in the Gaza strip.

The One Laptop Per Child (OLPC) project, which developed the low-cost XO education laptop for developing countries, has already revealed plans for its next-generation mobile computing device. The clamshell design of the new laptop is modelled after a book and the new system is to sell for $75 per unit and will be available in 2010. It is planned that the system will be smaller and lighter than the XO and can also be opened up completely flat to provide a single continuous touch-screen surface Like the XO, it will use unique dual-mode display which is readable under direct sunlight.

However, OLPC is experiencing difficulties and founder Nicholas Negroponte has revealed that the organization cutting half of its staff and significantly scaling back its software development efforts. The organization is said to have experienced significant internal disputes which have led to the departure of several participants and there are now questions being raised whether even the organization will last long enough to deliver the new system.

Whatever the outcome OLPC has pushed many boundaries and demonstrated that costs can still be cut without sacrificing innovation. We hope that the programme moves forward.

Digital Changes Driven By Hard Times

In tough times people take different choices and are often more discretionary in their spending. Do you buy a new laptop with full-features, or a basic no frills notebook, such as the Asus EeePC ? The economic reality of hard choices brings with it potential shifts in technology and offers and can also ultimately change consumer behaviour itself.

It seems only a short time since we were being told that ebook readers were affordable devices and we saw laptops replace cheaper desktop furniture, everyone had expensive office software and we were all going broadband and wifi. Ok which would you sacrifice when times get hard; the all singing and dancing latest laptop, the standard but top price software, the broadband connection or the wifi? Sense would suggest that the infrastructure is more valuable that the device and in some cases commodity office applications.

However as prudence plays its hand, do we also now have to question the consumption of media itself? We have seen the disappointing migration to Blu-Ray as the consumer settled for second best. We have seen the significant rise in open source operating systems and applications. Do we now potentially see a shift in media ownership?
We have previously questioned why we need to buy and own all of our music, films, TV shows and build libraries that have to be replaced when the next technology supersedes it. We started with vinyl, then replaced it with cassettes, some with eight track, then CDs and now with digital files. Potentially how many formats of the same music have we bought? The same applied to video, with the infamous Betamax VHS wars, moving onto the DVD and now Blu-Ray. To date, the humble book hasn’t suffered the same repetitive library syndrome, perhaps because the best reader is still the physical book itself but change will happen and with ebook manufacturers and gurus all talking about the number of books that can be stored on a device on automatically sees the usual library writing on the wall.

We can envisage a shift towards cheap devices that can be permanently logged on to rent, or even get free access to commodity applications, use open source software, access content online and avoid the restrictions of DRM and costs of dedicated devices. Why not share our library with the universe, play what we want when we want it at a price we want to pay and importantly achieve all this at a lower price?
Hard times sometimes shake the tree and what follows are different attitudes and choices that were not relevant before.

Child Safe Books

We all sucked books when we were young and the most damage they could do was when a hardcover was thrown at another child in anger.

Last week we were alerted, by our good friend Donna Ballman from Litopia, to the Consumer Product Safety Improvement Act (CPSIA) passed in the US last August 2008 as a response to the high-profile recalls of toys containing lead and that comes into effect on 10th February. We asked why would an act targeted at toys would be of interest to book publishers. The answer is both surprising and potentially alarming.

The law appears to have been somewhat rushed through and the impact on books is vague in that it covers not just toys but all consumer products intended for use by children 12 and under. That includes books and audiobooks irrespective of where they are manufactured and the fact that most books have lead levels that are well below the safety standards. The US industry is trying to ensure that most books exempted by the time the Act kicks in on February 10.

The Act demands that each item, shipped as of February 10, must have been tested by a third-party lab to ensure that lead levels are below 600 parts per million and some books must also be tested for phthalates, an acid used to soften plastic. A Certificate of Conformity must be posted and the product must be labelled appropriately. Testing itself is estimated to cost up to $1,500 per item for lead and more for phthalates. In addition there appears to be only two or three third-party testing facilities, which test products in all categories which could add weeks to production schedules. Even if traditional book formats are exempted, novelty books which include soft plastic books, titles with toys and anything with soldered components will continue to be included under the Act.

The clock ticks ever closer to the February deadline as the American Booksellers Association, Children’s Book Council, publishers’ legal offices and other associations are taking actions to try and get an exemption on print-on-paper and print-on-board books and gain definitive guidelines and interpretation of the act. The impact is not just on the shelf items themselves but also on catalogues and marketing materials that have been produced to stimulate sales into the channel.

For the latest updates and clarifications, go to www.cpsc.gov/about/Cpsia/cpsia.html.

We sat back to check that it wasn’t 1st April and then to pondered what the act thought of digital books and content presented via even the ordinary ebook reader. Are we exposing children to repetitive eye syndrome, radiation, and other long term injuries? Some may say that some ebook readers suck, but not that you should suck on an ebook reader.

Sangria Red and Red - Spot the Difference

Sony and Harlequin last year celebrated Valentine's Day with a limited-edition pink eReader that came preloaded with 14 Harlequin love stories.

This year they have gone one better with a Sony PRS-505 in Sangria Red. The Limited Edition 60th Anniversary Harlequin reader comes now preloaded with 16 Anniversary Harlequin titles and a free copy of Secret Fantasy by Carly Phillips plus an embossed cover all for $300.

Some on the UK may think the ‘limited edition’ looks familiar. So we also show the ‘exclusive to John Lewis’ red edition. Some may say that it difficult to see the difference between Sangria red and red from the pictures and since John Lewis is out of stock the difference between a ‘limited edition’ and ‘exclusive’. We thought you may wish to spot the difference.

The Great Book Bank Robbery - Legal Notice

On the 16th January on page 9 The Bookseller printed a whole page ‘Legal Notice’ on behalf of the Google Book Search Settlement Administration. We waited expecting some commentary or debate in the press but saw none.

The ‘Legal Notice’ was entitled ‘If you are a Book Author, Book Publisher or Other Person Who owns a Copyright in a Book or Other Writing’.

It went on ‘Your rights may be affected by a class action settlement regarding Google’s scanning and use of Books and other writings’. It warned, ‘This settlement may affect you because it covers US copyright interests in books published outside the US. If you hold such an interest in a book or other material in a book, this settlement could bind you unless you timely opt out.’

The notice summarised what the settlement provided, who was included, what material is covered and what you should do. 'The settlement class includes all persons worldwide who hold a US copyright interest in any book or insert.' Books include 'in-copyright works; novels, textbooks, dissertations and other writings that were published or distributed in hard copy on or before January 5th 2009... Inserts include; 'forewords, essays, poems, quotations, letters, song lyrics, children’s book illustrations, sheet music, charts and graphs if independently protected by US copyright contained in a book...’

The notice sets out the critical timeline:
May 5th 2009
Object or comment in writing
Opt out in writing of the settlement and keep the right to sue Google individually
June 11th 2009
The court will determine whether to approve the settlement at a fairness hearing
January 5th 2009
File a claim for cash payment

Otherwise do nothing and remain within the settlement and be bound by the courts ruling, including a release of your claims against Google.

The Great Book Bank Robbery - Its All About Rights

Robert Dalton’s article in the New York Book Review, (see belows), prompts us to raise a number of questions with the proposed Google settlement.

‘Of the 7 million books that Google reportedly had digitized by November 2008, 1 million are works in the public domain; 1 million are in copyright and in print; and 5 million are in copyright but out of print.’

Question to ask and debate:

1. How many of the 5 million digital scans had permission granted, or due diligence on ownership performed on them?

2. If 5 out of seven books are potentially orphans (books whose rights ownership is not automatically clear) are Google going to scan first, sell second and maybe pay out third? Everyone else has to do sue diligence and even the potential Orphan Acts demand such actions. So are Google exempt from this?

We do not accept the often arrogant position taken that it’s for the good of all and they were merely poor little orphans. The opportunity to reverse this is fraught with litigation and bully boy approaches to what is not common property. If you leave your house vacant for a few weeks, does that entitle squatters to take it over?

3. Rights reversals have been a cornerstone of publishing but are these to now disappear by default and are those who argued for it to change now to get their way by means of jumping on the Google bandwagon? Tethering rights virtually unconditionally and in perpetuity is not in the spirit let alone the letter of the majority of contracts to date.

4. What is going to be the price of old books still in copyright but out of print. The proposal is complex based on several elements but how do you price today a book that was published in 1957 for $2? Some would suggest that the proposed algorithm is a farce. Some would argue that it could have only been dreamt up by someone who is either a geek or only understands front list pricing. If anyone thinks this works go down ask a few antiquarian book dealers how they price books and ask them what they think to the proposed model?

5. We all know that we have a problem with territorial rights within a global networked economy. We have witnessed the recent actions by Hachette with respect to US digital aggregators and etailers. The question now is where does Google Book Search start and finish and can it only operate in the US? What if a title is available in the US under HarperCollins and the UK under Hachette and Google have the US version?

6. If the rights owner is unknown then that revenue is held over but does Google still get paid for something that is clearly not theirs to sell?

The Great Book Bank Robbery - A Reseach and Information Library Perspective

A well constructed and logical article by Robert Dalton, a professor at Harvard in the 'New York Review of Books', titled ‘Google & the Future of Books’ which is one we would like to share with our readers.

Dalton writes as a research librarian and although this is a different perspective to the trade, his arguments are ones that should be heard and debated by all. He gives a balanced and lengthy insight into the history of research papers and learned journals and that in itself is a recommended read. The parallel he draws between the scholarly or learned journal model and Google is very interesting. He examines the potential impact of the Google settlement, but questions if the intent isn’t achieved, who or what will check the outcome.

‘No one knows, because the settlement is so complex that it is difficult to perceive the legal and economic contours in the new lay of the land.’

‘Of the 7 million books that Google reportedly had digitized by November 2008, 1 million are works in the public domain; 1 million are in copyright and in print; and 5 million are in copyright but out of print.’

Springer Has the Largest eBook Offer?

There are only a few publishers who can boast a significant ebook catalogue and Springer is clearly at the front of the list. Today they offer access to the largest collection of eBooks, more than 1,500 peer-reviewed Springer journals and 18,000 protocols for laboratories. Springer has continually increased the volume of titles and since starting its digital collection in 2006 and now has some 30,000 eBooks and plans to continue to increase this by some 5,000 titles each year.

Springer operates an open and liberal digital access programme for its library community , allowing unlimited simultaneous access, to fully searchable books that can be downloaded and printed. Importantly once purchased Springer's eBook Collection content, is owned by the library in perpetuity.

Litopia After Dark

Last night we were once again invited to participate on the panel of Litopia. As well as an informative daily Litopia has a weekly broadcast which is both live and available to download from iTunes. It is run by that charismatic and entrepreneurial agent Peter Cox and brings topics book subjects, humour and industry insights to the table from a writer’s perspective.

Last night was the first in a new format and discussed subjects such as; the state of the book industry, the fortunes of the newsprint and magazine sectors, the publishers’ reaction to dyslexia in authors, the Google Book Search settlement and whether fairy tales are now too scary for kids.

The show is well worth a listen and has a very healthy audience that is growing.

Last night’s show
http://podcast.litopia.com/2009/01/24/litopia-after-dark-what-the-hecks-

LITOPIA DAILY - The World's First DAILY Podcast For Writers http://podcast.litopia.com/

Peter Cox's Blog
http://petercox.info/

UK considers Broadband Levy on Piracy

Today we read of the impending major UK government report by Lord Carter the Communications Minister. The report looks at how ‘piracy’ should be tackled and one suggestion is to levy all broadband bills to compensate the losses of to film and music companies due to illegal downloads. The companies claim the illegal activity is costing them £1 billion.

Well not bail them out for their miss management. We have bailed out the banks for their ineptitude and bad judgement.

The big question is why a tax on everyone for the actions of some is right? Maybe people wish to support artists and ensure that they earn but propping up some of the music producers and perpetuating a model that doesn’t work isn’t the answer.

There are only two people that matter in the media value chains, the creator who puts in the intellectual property and the consumer who values and pays for it. Those in between, have to earn their place at the table and add value and sometimes in changing times, have to go or change. Propping them up with what is a false subsidy is merely delaying the inevitable. The UK poured bad money into the car industry in the 70s and it didn’t work. Handouts are easy but solutions are harder.
Please try again.

Crunchpad Prototype

We wrote a few weeks back about the potential of the large iTouch tablet we. We hope it happens and believe it would be a real ‘killer device,’ but we have to wait in hope. Meanwhile the folk at Techcrunch are pursuing their dream of an affordable, basic touch screen web tablet that is ‘lite’ and basically running just a browser. They call their prototype the ‘CrunchPad’ and we believe it warrants some considerations as it aligns to many of the visions we have.

Its aim is to be cheap, very important in today’s climate. They were aiming for $200, but expect it would be higher. We believe it has to be under $200 and more like $100. It’s build as a tablet twelve inch touch screen offering 1024x 768 resolution with the concept being to be as thin as possible, have a single button for on and off, headphone jacks, a built in camera for video, low end speakers, a microphone and currently weighs in at 3 pounds. It will have Wifi, maybe one USB port, a built in battery, half a Gigabyte of RAM, a 4-Gigabyte solid state hard drive. It will runs on open source linux, Firefox and Skype for VOIP.

Although the prototype looks 'industrial' and lacks some slick design casing it shows the potential.



They have a formidable team headed by Louis Monier, formerly the founder/CTO of AltaVista and previously also with eBay, Google and Cuil.

Follett Announce a New Educational Reader

We have seen the recent emergence of more digital formats and readers some of which are mere pretenders and others confusing noise. Today we read news that is potentially important because of who has developed it and their position in their market. Follett, has revenues in excess of $2.3 billion and provides universities, libraries and schools and school districts in the US and increasingly globally with a wide range of educational tools and services, touching millions of students ranging from adults to grade school children. Follett is truly an educational force.

A new Follett Digital Reader has been developed specifically to meet the needs of K-12 eBook users and will be released on 9th February. During February the focus will be to get the reader installed on computers and at the beginning of March automatically they will migrate the entire existing digital download collections to the FDR format. The reader only effects downloaded ebooks with the existing online collections remain as current.

Follett downloaded eBooks currently are protected using Adobe’s ACS3 DRM and are opened with Adobe® Reader® or Adobe Digital Editions®. Adobe products are now migrating to ACS4 DRM and are planned to cut over in March. The new Follett Digital Reader replaces Adobe DRM and reader products, which Follett believe limits their dependence on Adobe, gives them the ability to develop and introduce additional functionality and importantly enables them to meet the specific needs of their significant K-12 and Public library customer base.

The new reader currently will only read Follett ebooks and works with Adobe Flash 9.0 and 10 and Microsoft.Net and runs on PC and Mac platforms. To read more visit
http://www.follettebooks.com/readersupport/index.html

We believe that this move is significant and is real news. Together with others, Follet are now taking control of their digital business and channel. The move to Flash is both understandable and some would say a wise move as it offers much moving forwar. The battleground would now appear to be between those who believe ebooks should be downloaded and read on a portable dedicated devices and those who who still belive the online and download PC and laptop world works and potentially have their options open with mobile platforms. The concern is that we have yet another format and what this means further down the digital road.

ePricing - Be Careful What You Wish For

Fictionwise the ebook specialist retailer appear to be monopolising the publicity machine of late. In one breath they claim to have "one trillion words served" mark recently and the other they have had the interesting but unexplained fall out with Overdrive.

Now all this week through to the 25th, they are offering a 60% micropayment rebate when buying with a credit card or PayPal. This is not a cash rebate but a credit to be set against future purchases. They are now actively promoting their own format both for those caught in the fallout with Overdrive and as part of this latest offer by giving an additional 5% rebate for titles bought in the format.

The market issue of what the digital price point should be for ebooks remains unclear. Although Amazon has boldly ventured with setting a $9.99 price point on their Kindle store, few have followed and there have been limited digital discounts to date. What offers have been visible are on special limited time window offers which are usually focused a promoting specific titles.

Some may say that publishers are trying to reduce the digital margin given to resellers and using this to offset their digital costs. Others would argue that there is a reluctance to get dragged into the current discounting fiasco on physical books that is rife in markets such as the UK. However, given that the ebook is often a carbon copy of the physical book with no extras what is the price comparison with it and the price to the consumer? Why would the consumer pay more for an ebook than a discounted physical book? If libraries are going to lend ebooks for free with no obligation to visit the physical library why would the consumer pay to own and ebook?

Pricing is important to the consumer and often when there is uncertainty things fall to the lowest common denominator and on price that’s often free.

US Magazine Digital Revenues Must Change

The web continues to impact the US magazine sector with some 18 titles stopping their print presses in 2008 and now being joined only this month by Country Home, Electronic Gaming Monthly and Plenty magazines.

Advertising Age reported that Time Inc.'s digital ad revenue last year totalled an estimated $245 million, or 10% of the company's total ad revenue. The revenue achieved is greater than some their competitors such as Conde Nast, who only achieved 3%, but not as much as others such as Martha Stewart magazines, which have achieved a greater percentage of their revenues. They suggest that anyone who is generating over 8% of print is ‘ahead of the digital curve’.

If you believe that sub prime only related to housing think again. Ad pages sales and their rate sales have been recently driven by increasing circulation at the cost of subscription prices, marketing, resource and distribution costs. When the ad pages crashed the circulation was at a height that was now longer realistic and for some, the gap between cost and revenue has become a gulf.

Circulating print copies, is also now getting more expensive in the US, with Anderson News, which handles about 25% of all magazine distribution, raising a new charge of 7cents per issue.

So what do consumers want and importantly what are advertisers wanting to now pay for? Some would say that merely taking today’s print copy and slapping it onto a website isn’t cutting it for either party.

New York magazine, whose information is local generates about 20% of its ad revenue from digital but is planning to raise this to 50% within 5 years. The Economist, raised about 16% of its ad revenue from digital last year, and along with Time Inc and others such as Sports Illustrated are clearly starting to make digital inroads.
Interestingly Time Inc.'s People.com isn't planning on living off ad revenue alone. This spring, the site will start selling downloadable games and they are releasing a 1$ iPhone application planned to push revenues higher.

Print will always have a place, and a consumer base but digital is coming and finding the the right model, content and revenue balance is the goal. It is clear that magazines like newsprint are sailing into uncharted waters and have to be open as to where the revenues will be generated moving forward.

If Facebook Where a Country?

If Facebook were a country it would be the 8th largest on the planet and would be bigger than Japan, Russia, the UK and most of the developed world. Its 54.5m unique users a day is the equivalent of everyone in the UK logging on every day.

The rise of social networks is so far the phenomena of the 21st century but where are they going next? Where is the money? Can we all subscribe to many networks or do we focus just on one? Is there room for more or are we at saturation point? When does a generalist loose appeal to a specialist networked community?

The trick is obviously to turn the eyeballs into advertising revenues, but with such a large and diverse membership, are global brands the only ones that will work? Can list management offer sales based on preferences? Individual companies can mine into the community to promote themselves but can do this without paying the service provider, so again its down to how they make money?

The one thing that is certain the consumer is unlikely to pay to be a member so the money has to come from somewhere. Unlike countries Facebook and the other networks can't nationalise the Banks or print money.

3 Mobile to Offer Books on the Go?

We were pleased to read from several sources that Mobile operator 3 is to offer its customers the chance to download over 1,000 ebooks and audio books direct to their mobile phone. The operator has a track record in trying new things and was offering Skype inclusive deals over two years ago.

The Books on the Go service, is reportedly already available to Vodafone customers and offers books for download from top publishers, including Penguin and HarperCollins and is provided by former SAS soldier and writer Andy McNab’s GoSpoken.com. Authors available for download include Stephen King, Patricia Cornwell, and Celcilia Ahern.

3 UK’s entire customer-base will be able to preview free extracts before either downloading the whole book for £5-10, or choosing to download the book in several parts at a cost of £1 to £3 each. Downloading an entire audio book is reported to only take "minutes" while eBooks will "be available to read in seconds".

The problem was that even as a 3 customer we couldn't the books or any refernce to them on any 3 site. If anyone at 3 knows about it please let’s us know as we would like to try it out, but can’t be bothered to keep searching for it.

Digital Entertainment Content Ecosystem or DRM to You and Me

Who would you place your bet on, Apple, the largest music retailer, or DECE, a US consortium of entertainment, retail and IT companies that want to establish a new in which consumers buy, access and play digital content. DECE is creating a ‘new generation of DRM.

Although Apple have announced that they are dropping DRM on music the restrictions still apply to films. Apple, who aren’t members of DECE can in effect ignore any new DRM from DECE and make it impossible to play them on any Apple devices such as iPods, IPhones and be sold through iTunes.

DECE (Digital Entertainment Content Ecosystem) has some 25 members including Sony, Paramount Pictures, Microsoft, HP, Cisco, Samsung, Panasonic and Intel. DECE's ecosystem for digital entertainment is planned to cover movies, books, TV programmes and games. Whether Apple joins or stays outside the delivery of yet another DRM solution is immaterial as its ultimately only going to impact one player – the consumer.

DECE believes consumers should be able to buy from multiple stores and access the content anywhere on any device, which sounds good but if they can do that why do they need DRM? DRM was created not to enable right to be exercised but to restrict and control their potential abuse. It would be great if DECE were to create a different rights model that mirrored the physical world and enabled sharing and was born out of trust and not distrust. However it's probably not in their genes to think that way.

ePub Enters the Public Library

Members at both Cleveland Public Library and CLEVNET member libraries can now download EPUB eBooks from the library's website. The EPUB files can be read on the Sony reader or via Adobe Digital Editions on a PC or Mac. Digital aggregator Overdrive is planning to extend the service to other libraries powered by its service.

The libraries are able to offer a variety of borrowing options, such as 7, 14, or 21 day lending periods. This again raises the question that if you are now able to rent an ebook for free, why would you want to buy one? You only need to validate that you are a community member and are entitled to lend material and never need to set foot in a library again. How do we balance a public library and a retail model? What is the impact on author royalties if the dominant ebook model was based them being loaned under a library licence with an aggregator such as Overdrive?

Blu-ray Maybe Too Late

Sometimes the spoils of war are too late and surpassed far easier than they were won. Last year Sony appeared to have won a bloody video format war with Toshiba and everything seemed to be going Blu-ray. They had won the endorsement of Hollywood studios and major retailers and all that was now needed was for the consumers to buy Blu-ray players.That hasn't happened in the numbers expected. 10 million Blu-ray players have been bought but this is only 10% of the total US television market.

A number of factors have influenced the disappointing take-up. There is the credit crunch and consumer spending confidence, the fact that unless you are watching on a large screen the quality gain is not appreciable, there are cheaper alternatives and finally there is the library reinvestment which is not a small cost.

When we look at eink and ebook readers no one will dispute the quality of the technology to read in adverse conditions, no one will dispute the devices tick readers functional boxes. However the content still isn’t there, the devices lack colour, the prices of both devices and readers isn’t right and finally we have a recession. Maybe by the time the market really takes off we will be in the world of the mobile, content may be free of at least restrictive DRM and we won’t be downloading and buying libraries, but renting to read on demand and online.

Some would suggest that even an elephant has a shorter gestation period than an ebook reader.

Plan Now - The Consumer Clearly Wants Free Digital Content

According to a report by International Federation of the Phonographic Industry (IFPI), which represents 1,400 music companies in 72 countries, 95% of all today’s music downloads are illegal. This is despite the growth of legally available tracks, the removal of DRM and the wide availability of services to buy from.

Music fans in the UK downloaded 110 million single tracks in 2008 and bought 10.3 million digital albums - accounting for 7.7% of the market.

Although legal downloads have increased by some 25% in the last year to 1.4 billion the worldwide market has effectively shrunk by 7% and the gap between falling CD sales and increased downloads is not closing sufficient to avoid big questions over where its all going. The IFPI, estimated more than 40 billion music files were illegally shared in 2008.

Free content is now a real threat to all media. Music has shown that not engaging with the issue but trying to fight and restrict it in every way has not worked. Going after the ISPs is not the answer, it's just another potential battle and one that its hard to see the music producers winning.

We firmly believe that we should now accept the concept of 'music for free' at the point of consumption, is not a debate, but a goal and that this need to be paid for by another model. Merely battling forward on the belief that eventually it will turn the corner and consumers will return to buying music is just dumb!

What does this mean to other digital media formats, such as film, games, newsprint and books? It’s a fairly safe bet that the consumer will not view these very differently and although the restrictions may work today, they will be broken tomorrow. The Booktrade is still at the beginning of its digital journey but the sheer volume and diversity of its content and number of rights owners means that it probably faces the prospect of being divided in its approach and offer. Some would suggest that we have clearly already seen the warning signs.

Phones Just Got Smarter II

In December we reported about the new LG GD910 wrist phone, music player, touch screen with a still shot and its amazing details, well we now have a video care of The Registry.




WE WANT ONE!!!!

Publish and be Dammed – Its Often Good for Business

We wondered if it was a spoof some sort of joke but it appears that Apple has become a censor on their new App Store. An e-book Knife Music by CNET’s Davis Carnoy was submitted to Apple's App Store but was only accepted after the author removed two offending F words as it contained ‘objectionable language’. Carnoy removed the words resubmitted the application and it was approved.

So if you write a book full of objectionable language, the shelves are full of them, it appears you must not make them into an application but retain them as a pure ebook. Fine, as long as we understand the rules. Frankly some would question them being submitted as an application in the first place, but we guess publicity may be the answer.

Then there is the case widely reported about former UK ambassador to Uzbekistan Craig Murray and his follow-up to his bestselling memoir Murder in Samarkand. Due to legal threats The Catholic Orangemen of Togo was dropped by Mainstream. The book, covers Murray's time in Africa between 1997 and 2001 as part of the British diplomatic service, as he negotiated peace with Sierra Leone rebels and worked towards democracy in Ghana.

Murray has made the book available for free on his website and other sites across the internet, as well as self-publishing a number of hard copies which he is selling, signed for £17.99. With a reported 15,000 downloads on its first day and the publicity already achieved he expects sales to exceed the 23,000 of his first book.

Censorship is often a two edged sword that proves time and time. The Internet just makes it easier to spread the word and get the attention of a huge audience.

What about the rights of the Digital Consumer?

TeleRead.org reports that growing concern over the lack of territorial controls has resulted in Hachette requesting its e-book titles are delisted from US digital books retailers. This action is because major US distributors (Overdrive, Ingram Digital and Mobipocket) have yet to implement systems to limit sales to assigned territories in a manner with which Hachette is comfortable.

Today’s digital marketplace is complex with distributor/ wholesalers supplying e retailers, whom may be operating across multiple territories. Who decides what an acceptable control is or what they are comfortable with? Will another publisher find what is acceptable to Hachette is not acceptable to them? Why do we have industry bodies and not use them to sort issues such as these out unilaterally? What about the books already bought that have now potentially lost their seller? Who does the consumer turn to if they have a problem?

It is important that we ensure that the consumer has minimal perceived barriers and risk in their take up digital content, be it online, offline, rented or bought. Yet some would say that we keep tripping over ourselves. Think of the consumer who can only buy certain devices in certain countries. The consumer who is offered a growing volume in one market and a slow take up, or dearth of content in others and an inconsistency of digital representation across titles in all markets. The consumer who is asked to spend a high ticket for books, for what they may well perceive as content that has no distribution and inventory costs and is identical to that already available in print. The fact that they also are expected to buy an expensive, one dimensional reader, which will probably have a limited life expectancy. Finally they have to grapple with DRM, which must be three letters least loved by many consumers. They have just seen DRM blown to dust in the music market and can get classics with no DRM today, but are expected to accept DRM restrictions in order get the content they want.

To top it all they see the fall out of Fictionwise with Overdrive with little if no real explanation and don’t understand why its them that has to clean up the mess.

There are a number of realities we must face with digitisation, but none is more important than consumer perception.

Sony to Post Loss

On the day that Waterstones disclosed that it had sold around 30,000 Sony ebook readers and a week after the Bookseller reported that the Sony had sold some 300,000 ereaders in the two years since its launch, Reuters reports that Sony Corp is expected to post an operating loss of around $1.1 billion for 2008/09.

This is the first Sony loss in 14 years, only its second in its history and could be double that stated, depending on inventory in the first quarter 2009. Only last October Sony were forecasting a profit. As the global recession hit demand for its products the giant electronics company announced 16,000 jobs cuts in December, along with further investment cuts that it expected to result in savings of $1.1 billion a year.

Mobile News

O2 Xda Flint

O2 has announced the O2 Xda Flint, specifically targeted at the education sector. The Flint can accommodate eBooks, capture electronic notes, read or review documents download digital learning applications, content and courses from VLEs and more. The pocket-size device has 16GB of internal flash memory, WiFi and can host applications such as Bluetooth V2.0, Internet Explorer, Opera 9 browser and Windows Mobile 6.1 Professional.

However after the wow come the reality check. It’s expensive at nearly £500 and why wouldn’t someone buy a proper netbook? Some may say that this is convergence too far and time to rethink what the consumer’s want and what price they will pay.

The HTC Sapphire

Speculation is rife over HTC's next Android mobile with reports that the handheld has no physical keyboard, unlike the current T-Mobile G1. The phone features the same design cues and trackball raises the posibility that the G2 will run on a new version of Android OS that will support a onscreen virtual keyboard.

With manufacturers such as Motorola, Sony-Ericsson, Toshiba and Asus all expected to launch Android OS devices this year and are set to chase HTC, which manufactured the first Google phone.

You've Mail Mr President

So the big question is not what Barack Obama do in his first days as the most powerful man on earth but whether he will keep his Blackberry? Some would suggest that the security specialists could be even inventing ways to bring the security of the device into disrepute justto get him of his constant companion.

Then we read that security researchers at iDefense have discovered a couple of potential exposures in the way that BlackBerry Unite and Enterprise servers handle malformed PDF files. The exposures rate 9.3, on a scale of one to 10 on the Common Vulnerability Scoring System (CVSS) and potentially enable hackers to inject hostile code onto computer systems running the BlackBerry Attachment Service. The immediate fix - disabling the receipt of PDF attachments - may be a bridge to far for those dependant on seeing all documents but the patches once applied will tough to live with for many organisations, given the widespread use of the document technology.

So what alternatives does the President have to help him keep grounded and in constant communication in this new age?

The Digital Newstand

A novel You Tube video on delivery on the news via an old US newsstand rack has generated some commentary around the net. Click to find out more about the story behind Scott Walker’s video The Digital Newstand.



An interesting commentary came from the Examiner.com who advocated linking the machine to a print on demand machine to effectively generate newsprint on demand and to also personalise adverts based on the location of the rack. Although this is probably highly impractical, uneconomic and basically a solution looking to solve a problem that is to a degree already solved via the online world, it did stimulate our thinking on localised advertising around localised news.

I Want 'My News', Now and for Free!

Much has been written of late about the state of the newsprint industry. The US market appears to be in free fall, with the operative word on many tongues being ‘free’. Journalists are losing their jobs, papers are up for sale, or sailing closer to the wind and the advertising revenue, which once made this sector so lucrative is either drying up or electing to go elsewhere. Newsprint publishers are ceasing to print on paper and going free online.

Does this mean that newspapers will disappear tomorrow – No? Does it mean that some will fall – almost certain?

Newsprint has a long history which has local, regional and global pressures. What once was local copy in Malaysia, a city in Scotland, national press in Australia is now available instantly to us all globally, 24 x 7. Services such as Google aggregate the news and segment it to fit our tastes, alerts constantly feed our favourite key words. Journalism is fast becoming democratised, where every blog, web article is becoming a potential news feed and the letter to the editor is often no longer mediated, but instantly posted and encouraged.

It seems a long time from the birth of the tabloid at the beginning of the 20th century. This explosion was fuelled by mass literacy, world events and the public’s insatiable appetite to read ‘spicy news’. In the late 20th century restrictive practices were broken in the UK and everywhere we saw the rise of the free local paper. Established local papers were driven to change or die. The the whole advertising model came under threat from the free classifieds such as Craiglists and the Google online ad machine. In the UK market, the downturn in the economy has hit the spending of big newsprint advertisers such as estate agents and the motor trade.

The increased demand in recent years by advertisers for 100% colour resulted in UK publishers investing in newspaper presses, but now publisher/printers are looking to close shifts or working with other newspaper Groups to close presses altogether. Many UK publishers are now looking to reduce costs by outsourcing their production facilities overseas. To compound this further, UK newsprint has just seen one of its largest cost increases in recent years.

Mass connectivity and technology literacy is now fuelling change. Increasingly everyone is connected and online. The person on the street with a mobile, has often became the photographer and sometimes even the journalist.

In an attempt to create loyalty and broaden their appeal UK papers in recent years have started to trade on their brand. Bookclubs acting as white label stores, glossy inserts full of gadgets and special offers, clubs from wine to dating were all born, CDs and DVDs were enclosed as special ‘extras’. Is this the future of newsprint or merely an attempt to raise revenues and cross subsidy?

Hard economics have started to bite and along with technology are opening up both new opportunities and new threats. Newspapers, so long a safe and predicable media has failed to respond. Readers have become more discerning and eclectic, wanting not general, but ‘My News’. Today the industry appears like rabbits frozen and caught in the glare of the digital headlights. Layoffs, closures, debt are all hovering like vultures around many well known names. Journalism is torn between authoritative column inches and democratised blogs. We have previously written about the cartoonist, who are now changing their own model in response to the pressure on their strips.

Papers such as the Kansan in Kansas City may point the way forward for a community press , The New York Times and others have to grapple with the challenges of general or what is now ‘commoditised news’ and although it seems that the ‘specialist’ papers such as the Financial Times and Wall Street Journal have a captive model based on their insights and commentary, we note that 80 jobs went yesterday at the FT.

The one thing we can be sure of is that the landscape and business model is changing. ‘My News’ is real, ‘Free’ is real, many want their news ‘now’ and fed to them 24 x 7.

Digital Pricing

GalleyCat has lifted the stone on ebook publishing and used an ‘expert’ to tell them,

"The large publishing houses' cut is generally 45-55% of the book's list price (this is split with the author whose cut is 15% of list price). Distributors are generally taking 10% or more of list price. Amazingly, the less expensive the book, the distributor cut can grow pretty dramatically because almost all distributors include a minimum charge. DRM providers are generally taking 3-5% (and in the case of less expensive books even more) of list price. The credit card processors, even with micropayments, take 3-6% of the sales price."

Their ‘expert’ concluded that ‘these overhead costs will keep driving e-book prices higher and hurting e-book retailers’

We would offer the following thoughts.

Today the publisher takes a physical product and converts it to digital formats. This obviously costs money and the more formats or the more complex the tagging, the more it costs. However, as publishers change their editorial and production processes to a digital tagged workflow we would envisage the average pre production costs reducing by some 20 to 25% and this would obviate and post production conversion costs. These benefits could be taken as a bottom line benefit or reflected in the price.

Digital files need to be hosted, picked, packed and dispatched. The storage and the carrier may be cheaper, but it’s not free, nor is it the same as the physical world. Publishers tend to outsource digital distribution to one distributor who in turn supplies several aggregators who in turn sell through eretailers. Not an efficient distribution model and often with different players to the physical world and so incurring additional cost in itself. Digital Drop Ship would make sense, cut costs and increase asset control, but this is not the model being pursued by many.

Are we talking about the list price of the hardback or paperback? In the case of hardback and paperback pricing, we have the same content in a different package but at a different price. What is the pricing relationship and why can’t the same be applied to digital? One publisher we know sells ebooks at a fixed percentage off whatever is the current format price so when the paperback comes out, down goes the price of the ebook. Does this make sense? We also see no price difference between say an Adobe eBook and other more complex formats, even though today one costs more to produce and potentially offers more.

DRM is not cheap both in its development and its provision. If the industry wants to use DRM it is not free.

Finally, go to Amazon’s Kindle store and look at their pricing. Personally I like the $9.99 price point and although it’s not uniform, it creates an iTunes perception. Look at the difference between the publisher print price quoted, (usually the hardback) and the digital list price, (usually different) and of course the saving claimed by Amazon. This is where the rubber hits the road, consumer perceptions on pricing are created.

What Every Woman Wants?

Harlequin have launched a survey at better understanding their women readers and their thoughts on ebooks. As one of the trade’s leading ebook publishers and with a very strong female following the results will be very interesting.

The Tools of Change Conference in New York, February will discuss the results in a panel session called “Smart Women Read eBooks”.

The question we loved was number 12, ‘It has been suggested that one reason women buy and read ebooks is the "brown bag" factor -- hiding the covers and titles of books that might be embarrassing to purchase and/or read in public. Is this a consideration for you? Any comments?’

To view the survey click here

Malaysian Fedral Government to Equip Primary Schools with ebooks

As Malaysians prepare to welcome the lunar Year of the Ox, the NS Times reports that the Teregganu state's ebook pilot programme, to furnish all its Primary Five pupils with an ebook, is to be extended throughout the country to solve the problem of primary school pupils having to carry heavy textbooks.

Many may ask where Terengganu is? The Malasian state is located some 500 kilometers northeast of the Malaysian capital Kuala Lumpur. The Federal Government started with a pragmatic programme equipping a 100 pupils and hopes to equip all it primary school pupils with a laptop-like device costing RM1,300 each in the next two years and are even creating a factory to assemble the devices and state government has been given the rights by manufacturer Intel to sell the devices.

The programme is expected to cost the state government RM30 million, which will be funded by money from oil royalties.

Overdrive and Fictionwise Fallout Publicly

This weekend we started to read blogs and commentary referring to Fictionwise, its ereader, Overdrive and DRM which referred us back to a page on Fictionwise’s site ‘OverDrive and the eReader Replacement File Program FAQ’.

Overdrive, one of the largest digital aggregators has apparently given Fictionwise, one of the largest ebook retailers notice that they would cease serving files to Fictionwise customers as of January 31, 2009. In itself that is not an issue and may be just a commercial blip. However, Fictionwise report that they have sold some 300,000 ebook units via Overdrive and customers must take action to protect their investment, which makes this not an insignificant blip.

The files are DRM-encrypted and delivered by Overdrive’s servers and not stored on Fictionwise itself, this means that customers who purchased them will no longer be able to download those files as of the end of the month.This means that anyone who sells an ebook that is automatically licensed on download by another party, has no control over that licence. Their customer is totally dependant on that third party in the future. They now need to download the eBooks to make sure they are up to date for your current devices, and make backup copies. A process that is not exactly going to give the consumer confidence.

Fictionwise has taken a whole page on their website to explain the situation and steps they have taken to ‘protect their customers investment in eBooks’. Fictionwise has now ceased selling Overdrive eBooks and they can't provide the files in the original file formats have begun to negotiate with publishers to allow eBooks previously purchased from Overdrive to be substituted, where possible, with Fictionwise's own eReader format files.

The timing of the situation is not good. It comes less than one week after Apple effectively put DRM to rest in the music sector, as the ebook market appears to be showing signs of genuine growth and DRM free files are making news on the iPhone. Some would say that this bad publicity for DRM and again questions why consumers would want to buy files that may become obsolete with time or locked into technology that is transient.

Digital Textbooks Move Forward

The Kansas City Star reports that Northwest Missouri State University students start their spring semester classes will be participating in a pilot electronic textbook program which began last semester with four classes and about 200 students. This spring, about 4,000 of the school’s 6,500 students will use electronic textbooks.
Northwest’s plan to eventually eliminate all bound textbooks makes it a leader in the change to digital textbooks. However, they state that they can only go as fast as publishers make the digital copy available and not all students are as comfortable with the electronic textbooks so students who want a traditional textbook could still get one.

Currently the university spends about $800,000 to maintain a student rental inventory of some 50,000 to 80,000 textbooks. A textbook-free campus would save the university about $400,000 a year.

This again raises the question of rental versus purchase and in a WiFi campus or permanently connected environment the need to download. Think of the information and feedback publishers would have available if they could see the text books student usage, annotations and bookmarks. There are many opportunities that digital brings over and above just replicating the physical copy and the challenge to many is to establish a strategy that is capable of evolving and not just following the rest.

The Future is Free?

Last week BBC Radio 4 covered an interview with Chris Anderson, editor-in-chief of Wired magazine on his new book 'Free: The Future of a Radical Price'. Anderson best know for his writing on ‘Long Tail’ economics, has now moved on to a future where the customer no longer pays? He believes that digital product prices are now falling until the point when they reach zero and that this is creating a new business model where companies grow rich by charging their customers nothing at all.

‘We go from an economy where things get more expensive, such as oil and food - the economy of atoms - to an economy where everything gets cheaper, which is the economy of bits.’

He cites Google, Wikipedia, Craiglist as a disciples of the new model and that although their consumer offer is free, the likes of Google are extremely profitable. Someone has to pay, but in his model a few paying customers can cross-subsidise everybody else. Open-source computer software such as Linux, is free to users who can then alter and build upon the system, but only as long as they make it freely available to everyone else. Even the likes of IBM now create free software and cargo and baggage on airlines can cross subsidise passenger flights. He cites Flickr Basic being free, whilst Flickr Pro is sold to premium subscribers.

As games move more online then Anderson believes they are moving to his free model and that the majority of players will play for free and that the games companies will make their money from other means.

So what about ‘books’? We have seen the emergence of the free back list ebook offer to promote new front list. We have seen increasing use of free digital marketing materials, including the whole book for a limited time period. However, unlike other media sectors, we are still currently stuck in an ownership model based on collecting book libraries. Perhaps, the future of digital books are online and on a rental basis and it is easy to envisage these being cross subsidised. However, as the majority of books are still physical and the industry remains in denial over digital being cheaper, we may not adopt the Anderson model at the same speed as others.

Sony Flexible Full Color Paper Screen

For those who have yet to see OLED flexible screen technology

Self Publishing Continues to Grow

In November, 1644, at the height of the English Civil War, John Milton self published ‘Areopagitica’ which was distributed via pamphlet, defying the censorship he argued against. In the Fifties Howard Fast, who was then blacklisted under the ‘McCarthy era’, self published his epic novel Spartacus. There are many stories where the author had no choice and many more where the author merely couldn’t get the attention of the publisher and was forced to self publish. Although many have self published the real success story are rare.

As today’s slush pile gets ever bigger and getting a first time novel often comes down to who you know, more than what is, self publishing is becoming big business. This has been assisted by technology such as print on demand, which has removed the need to engage in expensive print runs and inventory and of course the Internet, which has made it easier for anyone to sell anything from anywhere.

One of the major self publishing marketplace players Authors Solutions, has continued to consolidate its positioning by acquiring this week one of its major competitors, Xlibris, for an undisclosed price. Xlibris, founded in 1997 was one of the first companies to use the emerging digital technology to create a new and appealing offer to aspiring authors. In September 2007 Authors Solutions also bought another competitor, iUniverse and now has some 100,000 titles within its catalogue, the equivalent of UK’s new titles annual output. Author Solutions are reported to have published 12,000 titles last year and sold more than 2.5 million copies of its books. This would now rise to 19,000 new titles under the new combined company.

The interesting issue continues to be where an author’s and consumer’s best interest lie and where the greatest value is perceived by these two parties. The self publishing operators now offer the author a full range of services; editorial, design, marketing and not just print and dispatch. Obviously the more services that are used the greater the author investment and risk. However as publishers grapple with a tight market and become more selective will they drive more authors to seek the DIY route? Will copy editing and design services that have long been outsourced by many merely service whoever pays? As some publishers cull their backlist to focus on front list, will this drive established authors to revert rights and also seek a second self published life? We can guarantee is that the number of titles produced or available within the total market will not fall, as more authors self publish then the operator’s model can only improve and technology can only improve the visibility of all titles.
xlibris, iuniverse

Off Target?

Laurence Orbach ‘Depth Charge’ article in today’s Bookseller is interesting in the questions it raises.

We all know that the industry publishes too much and coupled with a growing back list, the consumer is now faced with a formidable choice of reading matter. As a result, the bookstores in their quest to present the depth and range, stock an inventory that is often only manageable on a sale or return basis.

So Laurence now questions whether bookstores should stop, ‘selling backlist, aside from a few staples and p.o.d., and became like apparel stores, selling mainly frontlist? There would be more space for big promotions; inventory turn would improve; and publishers and retailers would sharpen up their marketing and selling skills…Maybe publishers could sell to retailers on a firm sale, guaranteed gross margin basis, allowing markdowns in place, doing away with the expense and nuisance of returns, and their demoralising impact.’

Firstly, lets look at the basic principle that of front and back list. Does the consumer care or even aware of what is front and backlist? Is the publisher a rights owner and manger and are they only interested in those rights for the short or the long term? The analogy with apparel is interesting as if may give some insight into some views about the length of ‘seasonal’ interest a book has to some.

Secondly, the shift to a firm sale market would be interesting as this could significantly impact the front list best sellers, which some would suggest are often dumped into stores on the back of sale or return. Shifting the risk and responsibility onto the bookstores is understandable, but what will the publisher do who can’t get the visibility in-store and what impact will this have on the current RRP pricing?

Finally, the interesting point the article raises is with respect to the changing and challenging value perceptions that the consumer has of the market. So are we suggesting that the High Street will only stock the top ten bestsellers whilst the Internet will sell anything and everything?

Palm Pre Comes Late to the Party

So today Palm has set out to reinvent themselves. They have finally realised that their devices have been obliterated on all fronts and what was once a must have device – the PDA, and the Treo smartphone are no longer on the consumer radar.

Enter the Palm Pre a touch screen smartphone aimed at competing with the iPhone and revitalising Palm’s fortunes. The Pre comes with eight gigabytes of storage, GPS navigational capabilities, Wi-Fi networking and a slide-out keyboard. The Pre is to be distributed by Sprint and is aimed at helping them compete with AT&T’s iPhone alliance.

Palm face a number of significant hurdles, not least their market position and economics would lead some to suggest that they are not the most stable of the players in this market. As applications become more important to smartphone consumers, how do they get application developers to use their WebOS platform? Can they really expect developers to drop iPhone, RIM, Android or Symbian applications in favour of the Pre?

Watch TV and MySpace Together

MySpace has developed the Widget Channel, which enables users to keep abreast of MySpace's social-networking activity, such as e-mail and photo browsing while watching TV. The widget sits at the bottom of the TV screen and is set of development tools developed jointly with Intel and Yahoo. The aim of the Widget Channel is to develop mini-applications that complement TV viewing with Internet information.
Users can receive instant updates of friends' activities directly on their TV screen and will also let them view their friends' profiles.

The MySpace Widget will be available on Internet-connected consumer electronics, such as set-top boxes, Blu-ray players and TVs and are designed to work with Intel's Intel Media Processor CE3100 system-on-a-chip platform for consumer electronics devices.

The Onion's Wheel

We found this video fun and a great prank.


Apple Introduces Revolutionary New Laptop With No Keyboard

Enhancing touch and feel on the internet?

Today we read and drew a deep breath on the Ars Technica article ‘Oprah and her book club latest target of patent trolls’ by John Timmer.

The article refers to a US patent Patent number: 7111252 "Enhancing touch and feel on the Internet," which is being reportedly used to sue Oprah claiming that it has been violated by her book club.

The patent in question starts by describing the ability to provide a three-dimensional representation of an item from multiple perspectives on the internet and goes on to specifically describe an online book reading capability. Search, Look, Browse, or Whatever Inside, all fall squarely within the sights of this patent. Although first filed in 2000 and not issued until 2006 it’s hard to see how this could be granted years after many book and magazine sampling offers had been implemented and were widely available over the Internet.

Illionis Computer Research and the patent holder Scott Harris has apparently already sued and settled with Google and now is obviously eying up the next case.

If the patent as it appears is genuine and is applied as documented, we may now all now have to ask how our book page samplers work?

The Shape of Things to Come

A good article we recomend to read from this weeks Guardian The shape of things to come, by Clay Shirky, web thinker and adjunct professor of New York University.

Music DRM RIP

In some 10 years the music business has rewritten itself and now has a different perspective on digital. Yesterday in San Francisco Apple finally announce that it would drop the anti-copying restrictions on all of the songs in its iTunes Store and also importantly change its pricing structure to allow record companies to set prices. Last year iTunes sold 2.4 billion tracks, but even this was not enough to compensate for the 20% decline in CD sales.

Apple had started the track based price revolution but was not now in control of it and the iTunes price point of 99 cents had to go as Amazon and others were blowing it away already. The result is that the majority of songs on iTunes will drop to 69 cents beginning in April, while the big front list songs will go for $1.29 and some will remain at 99 cents. The music industry hope that this will increase legal digital downloads and appeals to consumers.

More and more services now sell MP3 unrestricted files and the writing is clearly on the wall for DRM in music. Apple clearly seen this in 2007 and had wanted to move in the same direction. However, the music moguls at some majors wanted to play silly games allowing rivals to iTunes to sell MP3 files, whilst retaining the restriction on Apple. Apple are to now also offer customers a one-time fee to strip copying restrictions from music they have already bought. Some would even question the logic of charging 30 cents a song or 30 percent of the album price when consumers can do it easily for themselves for free.

The one interesting move that was announced was that customers would now be able to download songs directly from iTunes via wireless networks to their iPhone without having to go through their computer.

So what do we think of these announcements?

On pricing the reality is the music companies will find it hard to maintain this model and consumers will cherry pick the bargains and buy selectively at the best price. By creating multiple price points based, not on scarcity but demand, some may think that they will shoot themselves yet again in the foot. The reality is they have created only one price point - 69 cents and two that the consumer will object to paying for.

It is the consumers, not Apple, that have in 10 years overturned the music industry on DRM and its anti-copying restrictions and the music majors have finally been brought to their senses yet again.

Apart for the consumer, the one winner out of this is probably the iPhone.

Android May Not Just be For Mobiles?

Whilst much focus is on Google’s content grab they continue to move forward on other fronts. Last week, VentureBeat’s Matthäus Krzykowski and Daniel Hartmann loaded Google’s Android operating system onto an EeePC10000H netbook. This not only proved the concept but when loaded Android was able to use the onboard graphics, sound, and wireless capabilities of the netbook.

Last month the system was ported to Nokia N810. So while Android is a new mobile operating system it now appears that it is capable on running on many PCs, laptops and netbooks. Although Android is developed on Linux it does not use Linux X Server graphic drivers, which means that standard Linux applications that use the X Server, must be first be ported to the Android system in order to work. However most Linux drivers are reported to work under Android so the port to netbooks is relatively easy.

So where is this all going? Tech Republic suggests that the combination of Chrome, Android and Google Desktop could result is a full operating system push, ZDNet speculate that Google could effectively create new revenues from selling Android application on PCs.

We can’t say where this will go but with more Linux based devices it looks probable that Google is aiming for a bigger slice of the market than just mobiles.

Dell Adamo - Coming Soon

Dell has launched a web site to raise awareness for it’s upcoming Adamo. The site merely states ‘coming soon’.

The speculation in the market is that the Adamo is an ultraportable laptop squarely aimed at the Apple Macbook Air. Dell had earlier leaked out accessories available on its Web site for Adamo Thirteen, which it later deleted. The accessories included a 45 watt AC adaptor similar to the power adapter used in the MacBook Air, a DVD+/-RW slot drive which would indicate size constraints.

If Dell were to develop a ultraportable laptop that was light and importantly cheap in comparison to the Macbook Air then we could see a significant market shift towards notebooks and ultra light laptops.

All eyes now turn to the International Consumer Electronics Show in Las Vegas, which starts in a couple of days and is where announcements often get made.

One Dollar Orbit Promotions

We have seen ebooks being given away for a limited time to promote titles now we read in Publishers Weekly that science fiction and Fantasy publisher Orbit which is part of Little Brown Book Group and Hatchette is offering one dollar e-books to consumers. One title a month will be priced at a dollar and at the end of the month it will revert to its list price and be replaced by another one dollar offer.

The one dollar titles are available at www.onedollarorbit.com and a number of partnering e-retailers such as Fictionwise and Amazon. Currently the promotion is featuring the first title in a series from debut author Brent Weeks, ‘The Way of Shadows’. Next month it will be featuring Iain M Banks, ‘Use of Weapons’ which was published in 1992 but will coincide with his latest release ‘Matter’ scheduled for February 2009.

The main Orbit site includes a significant sci-fi blogroll, author site links, extracts sci-fi news events and conventions, feeds and is an impressive community offer.