So Who Is Watching and Listening To You?

We live in a world of surveillance, moving ever closer to Orwell’s 1984. We are surrounded by CCTV cameras on buildings, streets and inside shops, some would suggest that our internet messages and activity is also being monitored under the guise of national interest and data gathering by software providers on our every click is commonplace. This new business of ‘big data’ appears to be morphing without control and is often hidden deep within the small print that we don’t read.

Last year we reported on Adobe’s collecting of eBook reading information through their service, which ironically was set up to protect copyright and the interests of their clients - the publisher, but apparently not their other clients - the consumer. LG was also discovered to be collecting details via some of their TVs on their owners' viewing habits and on what devices were connected to their TVs and was sending this back to the manufacturer, even if the users have activated a privacy setting.

Have smart devices now become too smart? Does the technology allow others to look in and to gather data and who and how can we control what we often can’t see and have not authorised?

The latest ‘data gathering news’ is about users Samsung Smart TV users who use voice activation to control their Samsung Smart TV. It is now claimed that the TV doesn’t just ‘listen’ to commands but to everything that is said and may share what they hears with Samsung or third parties, which is believed to be Nuance, the voice recognition specialist. It’s like having a ‘Gogglebox’, or worse still Orwell’s vision in every home. The users are unaware they are being monitored and although this story broke via a story in online news magazine the Daily Beast it questions how big this iceberg may be?

The Samsung policy states that the TV set will be listening to people in the same room to try to spot when commands or queries are issued via the remote. It states: ‘If your spoken words include personal or other sensitive information, that information will be among the data captured and transmitted to a third party.’

However, like Adobe, Skype and Viper before them, Samsung then send data to third parties without any encryption!

Samsung in its defence state ‘If a consumer consents and uses the voice recognition feature, voice data is provided to a third party during a requested voice command search. At that time, the voice data is sent to a server, which searches for the requested content then returns the desired content to the TV.’

They also go on to state that, ‘Smart-TV owners would always know if voice activation was turned on because a microphone icon would be visible on the screen.’

Does this same logic apply to other voice recognition services which are increasingly being deployed on devices?

But it is not just about gathering data but also about pushing unwanted data onto the consumer. Recently Lenovo was caught out installing adware onto new consumer computers on initial activation of the PC. The Superfish adware which injects third-party ads on Google searches and websites without the user’s permission has subsequently been removed.

Data gathering is done for a number of purposes; to help hone and target product and services to an individual, to sell behaviour and interest information to third parties and to eavesdrop on individuals. The problem is that the technology can often be the same and the lines between moral and not can often blur.

ADOBE Says Read The Small Print

Details about the extent of the Adobe security snoop into individual’s reading habits and harvesting of data is becoming clearer and the arrogance adopted by them over what is personal data would appear to many to raise the question as to whether they are fit to manage many services digital content.

There explanation of what they monitor conveys no remiss and some would say carries the usual ‘read the small print’ caveat and even more interestingly appears to blame publishers and others for asking for those controls even though many appear to be naïve to the fact that the controls are not only enforced locally but that the information about them is sent back to Adobe to harvest.

The information has been confirmed by a number of sources to be unencrypted and therefore open to potentially many parties to read or intercept which in this day and age beggars belief and is clearly any responsibility or care. Their privacy statement can be found at Adobe Privacy Policy  and interestingly under ‘Is my Personal Information Secure?’ states:

‘We understand that the security of your personal information is important. We provide reasonable administrative, technical, and physical security controls to protect your personal information. However, despite our efforts, no security controls are 100% effective and Adobe cannot ensure or warrant the security of your personal information’.  

We all understand that many services such as Kindle, Overdrive, etc synchronise our reading such to assist our being able to continue to start where we left off. We respect that there is a wealth of information that goes with that. But these transfers are secured and not open and remain within their walled gardens. Anything that resides in Adobe’s Digital Editions 4 library appears fair game to Adobe snooping and data harvesting, even documents and non DRM ebooks!

Adobe may now find itself under pressure from large library services and others to explain their approach and given their ACS4/5 history, the solid umbilical cord to ADE and their apparent approach to ‘act first think later’, some may now be prompted to look at alternative options. However that in itself is not an easy route. It is also clear that this is not an old data harvesting feature but only applicable to ADE4 and probably tied to the ACS5 features they are desperate to get adopted by all.

It is sobering to think that they know and send via an open stream;  

·         Unique User ID which aligns to registration

·         Device ID to restrict number of devices re DRM

·         Certified App ID to ensure only certified apps (licenced sales and rentals)

·         Device IP to determine geo-block

·         Duration of reading to meter reading against certain licences

·         Percentage of the Book Read to enable publishers to align to subscription models and determine if the book has been ‘read’

·         Date of Purchase/Download

·         Distributor ID and Adobe Content Server Operator URL

·         Metadata provided by Publisher (title, author, publisher list price, ISBN number etc)

It is also reasonable to ask why the new controls aren’t performed at a local level by ADE4 and why the data has to go back to the mothership at all. Surely if the publisher states x, y and z rules these can be enforced locally and the only validation required is at the offset to stamp the file as genuine? Perhaps that’s too simple and perhaps Abobe feel that would loosen their tight control and not give them that rich seam of data that they could………

Related Press

EFF: Adobe Spyware reveals (Again) the price of DRM: Your privacy and security

Ars Technica; Adobe’s e-book reader sends your reading logs back to Adobe—in plain text [Updated]

Digital Reader: Adobe Responds to Reports of Their Spying, Offers Half Truths and Misleading Statements

Adobe Digital Editions 3 Probably Safe From Adobe’s Spying, Experts Say

Statement from Bluefire

Go To Hellman : Correcting Information on the Adobe Privacy Gusher

Copyright and Technology: Adobe’s Latest E-Book Misstep: This Time, It’s Not the DRM 

ALA News: Adobe responds to ALA on Egregious Data Breach

Are Adobe Secretly Watching You Read Via DRM?

The question of privacy on the internet has once again raised its head with the posting by Digital Reader on Adobe’s ACS DRM system and what is claimed to be excessive data gathering of personal information from consumer’s elibraries.

We can’t comment on whether the facts as presented are true or false, but we are able to say that if true, they are a significant shift from where Adobe started from and seriously question the role of DRM and whether consumer privacy rights have been breeched.

Abobe DRM history goes back many years. ACS3 was widely used by retailers but effectively broken and open. The start of the latest ebook revolution was initiated with the introduction of the eInk readers and when Sony entered the fray they wanted a DRM system which would effectively give them a march on the rest. Adobe also wanted to regain control of a space they had clearly lost. Overdrive had also built a ACS4 beta that they were using to control their market. We remember Adobe’s introduction of ACS4 and their lack of market awareness and often rigid mind-set and coupled with Sony’s desire to rule the world, we had many often fraught conversations with the two of them but the rest of the market wasn’t ready and so they won the initial battle. Years later it’s a different story and many have either migrated to their own DRM. Amazon and Apple never did join and Kobo and Nook grew alternative offers and Overdrive stuck with their own variant.

Adobe then went into what can best described as the Dark Ages where they still championed interoperability, but where leaderless and gave up trying to manage micropayments and gave this up to a small handful of agents who managed the retail facing activity and collected the money. They then came up with ACS5 or a tighter model which was part born out of the fact that ACS4 could easily be broken by anyone who asked the right questions on the Internet and part by the fact that they were clearly being squeezed out by the big channels. Unfortunately ACS5 has some basic issues which forced Adobe to retract their initially statements and backtrack on their timelines to force full migration to the new platform.

So today we have the news that Abode appear to be data gathering consumer usage information at title level and also at library level. What was read when, what wasn’t read, and probably much more? Is this right or wrong?

Well Adobe provide a DRM locking service aimed at validating ownership and stamping this such that they can ensure rights are managed with respect to devices, etc. Why on earth do they want to gather data on usage other than to sell back to publishers, retailers and libraries. Did they offer and opt in, or opt out to consumers is a mute question and we would suggest that they had to in order to snoop.

They apparently doing this not through the standard interface with hosting sites but through a mole application in Digital Editions that they plant into the consumer library or device. We would like to see the snooper application flagged as unauthorised by the security systems and users being given at least the choice of allowing it in. Whether the Adobe service will work without the mole is an interesting question.

We have to accept that Amazon, Apple, Nook, Kobo and Overdrive all can gather information on their consumers and their walled gardens allow this, but they are walled gardens. Adobe promotes itself as open and interoperable and importantly does not have consumer customer relationships to build in the same way. Again it begs the question what do they intend to do with this information and is it being resold and if so to whom?

However, all this a new news and we await more information about Abode’s intent and what is behind the intrusion into consumer’s private libraries and reading habits.

Personally, if the facts bear up to what has been reported, then Adobe has single handily done more harm to DRM than all the articles every written about it. Consumers if made aware of it will probably shun and question the violation of their privacy.

Finally, we hope that the wider media picks this story up and fully investigates it and if collaborated exposes it to the consumer.  

Digital Reader : Adobe is Spying on Users, Collecting Data on Their eBook Libraries 

6th Oct 2014

Kobo Takes Over Sony's North American eBook Business

Today, two days after Takahito Aiki, took over the reins as CEO of Kobo, he has announced the effective consolidation of the Sony ebook business under Kobo in North America. It is almost certain that this is the final and long overdue retreat of Sony from a market that they expected to win and sadly lost from beginning. It also sends a strong signal to the market that the dominance of Amazon in this sector is real and is giving even those with potential credentials and market presence a hard time.

Sony entered the market some 8 years ago with huge fanfare, fancy ebook readers based on eink and were the early adopter and major driver and influencer on Adobe’s ACS4 DRM service. I remember meeting their senior players once in San Deigo and listening to how they were going to dominate the academic and educational markets. But their offer and market understanding was always someway behind their words. It’s also somewhat ironic that this death knell has occurred at the same time that Adobe has also gone through the PR mangle and has had to retract so publicly on their ACS5 statements.

So we have Sony ready to preinstall Kobo on its smartphones , laptops and other devices and to hand over their customers and business to Rakuten  and its Canadian ebook subsidiary Kobo. It’s also interesting as it comes at a time when devices matter little and the platform is what counts. How smooth the takeover will be for those who backed Sony and bought their devices and ebooks remains to be seen, but transferring encrypted DRM licences is not always as easy as you would expect. All this is without considering how they are going to deal with those Sony BBeb licences.

Some accept that Sony has been facing many challenges across its business and they may still come back, but with many bases to cover this seems highly unlikely.

So we read the usual hype and words on what this means, and how it is going to make the difference, but the reality is that another door is shutting and real consolidation is happening. The obvious next candidate is Nook, which on the face of it would be destined for Microsoft, the discussion on this are already in play as Barnes and Noble grapple with the same issues and facts of life. Now if we just look at the North American market at a potential combination of Nook, Kobo and Sony that would certainly give Apple a challenge and wake them up from their apparent complacency. This sort of consolidation works best in the established and dominant North American market where it can be honed before it goes global.

So what’s the betting on Nook going somewhere soon?

Adobe Climb Down Over ACS5 Deadline

After the storms comes the calm and time to reflect.

Adobe have now climbed down from their ACS5 stance and have left the migration timetable in the hands of their customers. A statement posted on the Datalogics blog says:

As stated during our January 29th Datalogics and Adobe webinar announcing the release of the new hardened Digital Rights Management (DRM) for Reader Mobile SDK (RMSDK) 10 and Adobe Content Server (ACS) 5, Adobe revealed a July 2014 time table for migrating to RMSDK 10 and ACS 5.

After receiving feedback from customers and webinar attendees, Adobe has revised the migration timetable for customers.  “Adobe does not plan to stop support for ACS 4 or RMSDK 9.  ACS 5 books will be delivered to the older RMSDK 9 based readers”, according to Shameer Ayyappan, Senior Product Manager at Adobe.  “We will let our resellers and publishers decide when they wish to set the DRM flag on ACS 5, thus enforcing the need for RMSDK 10 based readers.”

In other words, ACS and RMSDK customers can migrate to the new hardened DRM that provides a higher degree of security to EPUB & PDF content and prevents unauthorized viewing of content now and in the future in a timeframe that makes sense for them.

As stated during our January 29th Datalogics and Adobe webinar announcing the release of the new hardened Digital Rights Management (DRM) for Reader Mobile SDK (RMSDK) 10 and Adobe Content Server (ACS) 5, Adobe revealed a July 2014 time table for migrating to RMSDK 10 and ACS 5.

After receiving feedback from customers and webinar attendees, Adobe has revised the migration timetable for customers.  “Adobe does not plan to stop support for ACS 4 or RMSDK 9.  ACS 5 books will be delivered to the older RMSDK 9 based readers”, according to Shameer Ayyappan, Senior Product Manager at Adobe.  “We will let our resellers and publishers decide when they wish to set the DRM flag on ACS 5, thus enforcing the need for RMSDK 10 based readers.”

In other words, ACS and RMSDK customers can migrate to the new hardened DRM that provides a higher degree of security to EPUB & PDF content and prevents unauthorized viewing of content now and in the future in a timeframe that makes sense for them.

We welcome the change of softening of the Adobe position but now question what really drove them to do it in the first place?

Does the ebook world really need a hardened DRM that will be broken before it’s widely adopted? Does this PR slip give us all a wake up call to seriously question the benefits of hard DRM, its costs and the fact that it actually can restrict business and as demonstrated by this PR slip put many’s business in the hands of someone who merely operates a toll booth and adds cost. 

Adobe to 'Harden' their Broken DRM

Last week we asked questions about the state of Adobe’s widely adopted ACS4 DRM service and the implications of their announced migration to ACS5. Then we knew little of their plans and only of their intent, but today more has come to light on how they plan to achieve the move and the potential implications for those who sell the service and the consumer who has the files.

Below is Youtube link to a webinar that Datalogics did alongside Adobe last week. It is not recommended that you watch it all as it is not user friendly and aimed at technicians. However some of the salient points can be obtained by cutting to this shortened clip http://www.youtube.com/watch?v=9qb-sXVlK_o&t=24m48s . Adobe confirms that it will ‘harden’ their DRM in July and force migration and that this will effectively kill compatibility with older RMSDK9 (reader) based apps and devices. The move is understandable from Adobe’s perspective and very reminiscent to the language that came out in 2006 when the introduced ACS4 to strict deadlines.

What Adobe have failed to grasp is that many devices (readers) that have supported ACS4 will have significant software and maybe firmware upgrades to achieve in what is a relatively short period and inevitably there will be disconnects. It is not possible to comment on the myriad of old eink readers out there but…

Many pundits have taken aim at Amazon, Apple, Kobo, Nook and their proprietary DRM systems. However, all of these effectively can control their own environment and evolve seamlessly. Adobe’s DRM may be usable by others, but as demonstrated by this announcement, it puts your business and commercial transactions charges in Adobe’s hands. Short term this may be fine, but long term is it wise.com?

The Adobe use of the term ‘hardened DRM’ is quite apt and we have to question whether we are being taken done a road which is technology applied for technology sake? ACS4 was easily hacked and broken so one option is to ‘harden’ it and make it more difficult to hack. The other is to migrate away from encryption and find ways to make business easier for all and grow the market.

DRM is not about encrypted hard DRM. It is about digital rights management, be it hard, soft or none and we have to ask what we are trying to achieve and what works best for the market? Adobe by moving part of the individual licence that was previously on the rendering server back to the issuing server and in doing so have tightened their grip on the file, but they have increased the cost of doing business and offered little in return. Adobe is increasingly creating its own walled garden and it begs the question – is it all necessary, or is it a simple case of the Emperor having no clothes and nobody strong enough to say so?

This migration to ACS5 in fact could do more damage to the reputation of DRM that all the stones thrown at Amazon’s system.

We were around pre ACS4 and were involved in the initial services. We also sat down with others trying to seek an alternative option to ACS4 but had little time and much pressure to roll over. Trying to change Adobe’s corporate mind-set is all but impossible. Today there are many alternative options and cloud based services all but render the existing ebook model redundant. As we move towards subscription based online and ‘as much as you can eat services’, many now seek a way to escape the Adobe locked in transaction charges.

However, as we have suggested before we should not rush headlong into no DRM as that could be equally as short sighted. We must look at softer watermarking DRM which can be individually hacked, but if tied to a central licencing registry would provide provenance of legitimate ownership, which in turn could enable that often feared resell market some creditability.

It is also interesting to note the only now some 8 years after ACS4 came to market are some of the business models and issues, which were raised at the beginning are starting to be addressed. Shared devices, bulk downloads, subscriptions, educational loans etc where raised at the time but not seen by Adobe and Overdrive as important then. It drives home the point that hard DRM may not just lock up the files but may also lock up the business from doing business their way. 

Mobile Patent Wars

Microsoft has filed a patent infringement law suit against Motorola, claiming that its Android-based handsets violate its patents it holds covering office functions. However is the gauntlet really against Google and their Android system on the launch of Windows 7?

Android proved to be very successful and clearly is capable of overtaking Apple's iOS operating system so is a clear threat to Windows 7. Apple has also launched a suit against phone maker HTC claiming that its Android handsets violated some of its patents. HTC has issued a counter-claim, saying that Apple's technology infringes HTC patents. In addition Oracle has sued Google this year, claiming that Android infringes patents it holds in the Java technology it acquired from Sun Microsystems last year.

Microsoft has filed its claim with the US District Court for the Western District of Washington and the International Trade Commission. The claim covers nine that relate to a range of functionality embodied in Motorola’s Android smartphones and include the synchronizing email, calendars and contacts, scheduling meetings, and notifying applications of changes in signal strength and battery power. Well on that count virtually every smartphone is guilty and why Android and why now is the obvious question? Last week Apple even claimed ownership of the word POD and failed to recognise what everyone else knew.

The litigation and counter litigation culture is fast becoming a joke within the market and even those of us who believe in patents and copyright question whether the system is now being played and the only winners are the lawyers.

Is ePub, ePub or ePub?

We are only just really starting to get into the interoperable digital world we all seek but already cracks are surfacing and more importantly it is not difficult to envisage some further issues moving forward. Unfortunately we are not all experts in the detail, nor are many experts across the full range of issues and technologies and most importantly the experts often miss the commercial and cultural aspects in their search for technical utopia.

Yesterday I was sitting in our Pune office in India when I received an email which I am not saying is right or wrong only that the author is someone who I respect when it comes to digital file manipulation. His objective was to highlight that ePUB for iPad is different from ePUB for ADE and SonyReader and raise some areas for consideration. The mail was quiet detailed and extensive so I have just listed some of the issues raised.

1. The ePUB for the iPad needs a new-standard CSS for iPad-ePUB which will generically apply colour for Part/Chapter/Sections/Noteboxes/CodeListing and others. Fairly straightforward but not required until colour was delivered.
2. Image/Graphic format: iPad-ePUB supports JPG and PNG formats, but PNG (transparent) is recommended. Transparency of images helps’ if a coloured Notebox has an inline equation then image will not render white-patch of inline equation image.
3.The graphic dimension requirement is different for as images which occupy 25% or 40% of the page need more scaling as compared to Sony/ADE. This applies to cover dimension too.
3. Special Character support is extensive for iPad-ePUB as compared to ADE and SonyReader. This means that the iPad can render more characters as text as opposed to image.
5. iPad-ePUB does not work on XSL-stylesheet as ADE and SonyReader does. iPad-ePUB entirely works on CSS.

Although iPad-ePUB can be viewed on ADE but will not display colour enhancements in SonyReader (because of its grey screen). We can’t assure 100% cross-compatibility of ePUB between iPad and ADE/Sony, as the owner of respective specifications also don’t claim this cross-compatibility.

We already have DRM diversion as Apple, Amazon and Adobe go their separate ways. We still have multiple format s with Amazon, Blio, epub, Apple epub, Adobe ebook and obviously these will develop different versions and be open to different interpretations.

What we need to remember is that its not just the consumer that is faced with the question of interoperability but also the publisher and aggregator who has to hold and maintain them. Someone who invested early in digital files may now have to revisit these in order tomake them comply with the new demands. The recent change from 1.03 to 1.05 version of epub is a classic example of such a change.

The one thing we all want is interoperability.

Adobe PDF and InDesign Face New Competition

Why would anyone want to challenge Adobe and its now open PDF format? Adobe have developed the format without any real challenger and today printers, typesetters, digital companies and virtually every publisher deals with PDF.

Enter Founder Apabi Technology a Chinese e-book player from Beijing who have an established name in the Chinese e-book market and are used by some 500 Chinese publishers, provide digital platforms, libraries and e-book readers. They have developed their CEBX (Common E-document Blending XML) technology which is capable of storing document data and which is fully compatible with PDF. Apabi Reader is their equivalent to Adobe’s Reader enabling documents to be viewed but not edited. Apabi Maker can convert other document formats to CEBX. Apabi Carbon is the full CEBX editing suite. The company also claim that it has applications under development for Windows Mobile, Android, and iOS (iPhone, iPod Touch, and iPad).

So is it a replacement technology or a complimentary one? So what is their strength?
Founder Apabi plans to focus in the business-to-business market, with a specific focus on academic and professional content and have announced a strategic agreement with China's Science Press, which will make products in more than 18 different subject categories and plans to launch more than 8,000 e-books in five major disciplines. They claim that the CEBX format has been specifically designed to integrate with all kinds of smartphones, handheld e-book readers, and tablet computers

They believe the adoption by Chinese government departments to meet their document-processing needs and the productitivty they claim CEBX has over PDF on mobiles will be key areas to make CEBX a dominant force and Apabi tools a must have.
So it was also interesting to read about Quarks latest comeback and realise that Adobe may not have a clear run for long. Over a decade ago many book designers used Quark and it was dominant force in the market. However in that same period the likes of Adobe have made great inroads into the market and now their ‘InDesign’ holds the premium spot.

Quark, K-NFB Reading Technology, the creator of the Blio e-reader application, and Baker & Taylor, the US book distributor, have announced a partnership to offer content creators the ‘first complete solution for Digital Publishing 2.0’. The partnership aims to combine their complimentary expertise to help publishers and other content creators capitalize in the emerging digital market. Their joint offer aims to include video, audio, interactive Web pages, social media, note-taking, exporting capabilities, and more. They say it will transform static, black-and-white pages into rich, engaging digital media content.

There are obvious questions about the commitment of all three to stick it out and try to change a well defined market, their ability to get wide adoption of the Blio format and whether it can displace the current incumbent InDesign.
What is clear from both the Chinese intiative and the Quark one as well as Steve Job’s Flash denial is that Adobe isn’t going to have it as easy as they did in the last decade.

Brave New World: 2020 Vision in Digital Book World (Part 1)

Presentation to the Seoul International Book Fair, Seoul, South Korea,

Part 1 The last four years

The Brave New World report was published less than four years ago, in November 2006. Its aim was to identify the opportunities and challenges for booksellers in this new emerging digital market. We did not write the report and walk away. We undertook the task of updating it through the Brave New World blog.

When we started the blog there was no Kindle, no iPhone, no apps; Google were a threat but there was no Book Settlement; libraries were still full of books with not an ebook in sight and digital ebook format wars still prevailed.

We now find ourselves with; a colour tablet, a new ecosystem ‘Appleworld’, a growing digital market, a new pricing model, Amazon present in all areas of publishing, no Microsoft Live Book Search, Google in litigation, epub, Adobe controlling DRM and much more.

Five common threads that have prevailed through the 1500 articles that we have written in our blog

1. The inevitable convergence of technology.

In a highly visual and coloured world, who would have expected a ‘black and white’ device to break new ground? The eInk technology offered the ability to read in bright sunshine, had a long battery life and was the size of a book but lighter. It could store thousands of titles and enable you to carry your whole library around with you. The eInk reader was heralded as the next consumer ‘must have’ and the tool to promote a return to mass reading.

However, it was dull, chunky and reminded you of those early and non-portable laptops or the early mobile ‘brick’ phones. We saw eInk as a transient technology, a black and white TV in a colour TV world.

Despite its failings, short life expectancy, high ticket price and the lack of real depth of digital content, the eInk readers still achieved some significant steps. They dramatically reduced the ebook formats to basically two open ones– Adobe eBook and epub, plus Amazon’s proprietary Kindle format. Also they achieved wide adoption of a single DRM service – Adobe’s ACS4 and in doing so opened up inter-operability between devices.

Importantly, the eInk reader gave the market confidence to move forward with ebooks.

In 2006 we had smartphones that weren’t ‘smart’. Their old and tired operating systems were built for the previous era and constrained their user interfaces and ability to browse the web.

The impact that Apple’s iPhone had on the market can’t be underestimated. Overnight the mobile phone was redefined. First the ‘look and feel’ changed from trying to accommodate keys and screen, to touch screen. Second the device became multi media offering video, audio and colour. Third it continued to exploit the inbuilt camera. Fourth it was wirelessly connected 24x7 to the internet. Finally it introduced, promoted and generated a new form of application – the app with its own app store.

The iPhone also has had a significant cultural impact and introduced new technology which has been enthusiastically accepted by young and old.

It is the invention of the first decade of the 21st century.

The potential rival came from the most unexpected quarter - the search engine and advertising giant, Google. They also took an unexpected strategy to provide an open solution to all the vendors. The Android was capable of multi tasking and also had an open app store.

Just as the iPhone had done some three years ago, the iPad starts to re-defined the mobile and media User interface. Forget that it doesn’t have a camera, is not multi tasking, doesn’t have some simple and widely used connections, doesn’t support Flash. These can be and will be fixed. It is about redefining the user interface, applications and portability.

The question now is not about the applications we will use in the future. Will we now adopt a ‘thinner’ approach, accessing applications from the Internet and running and storing files via cloud computing?

2. The new entrants, the outsiders the technology giants

Google were scanning first and asking questions later. They were hoovering up all library works and creating a sizable repository of digital content. Their main competitor was Microsoft with their Live Book Search book scanning programme.

In May 2007 Microsoft declared that they were pulling out of the race. The sight of Microsoft’s enclosed Stand at BEA 2007 and publishers being shuffled in through the closed door one by one, to be quietly let down in confidence, must go down as the most embarrassing public market exits.

Google was now free to put its foot down, to scan on regardless.

In October 2008 the Google Book Settlement was unveiled. We have written numerous articles on what we see as this ill conceived and audacious ‘land grab’ for little money and exclusive gain of orphan works. Our articles chart the events from day one when we declared it ‘The Great Book Bank Robbery’ to today, when we await Judge Chin’s decision on the revised settlement.

The industry took too long time to understand the implications and had to be informed by many from outside, such as the US Justice Department, before the tide started to turn and people started to understand the challenges posed by the settlement. Whatever the outcome, it heralded a new era where new entrants seemingly went after the prizes.

Google have now announced they are to sell digital books and compete head to head with booksellers through Google Editions and they continued to scan.

However, Google now face significant opposition in Europe to the Settlement and their scanning programme and now face a second class action legal suit from illustrators and image rights bodies in the US.

Google highlighted to an industry that was built on the trading of rights that it didn’t even have a rights registry, nor the collective will to address one without being funded by others.

Apple's Steve Jobs said of the Kindle and reading in 2008, "It doesn't matter how good or bad the product is, the fact is that people don't read anymore... The whole conception is flawed at the top because people don't read anymore.” We have recently witnessed his apparent 360 degree turn with the iPad.

The truth is that you have to look at what drives a company to understand what they want out of any market segment. Apple is about Appleworld, a xenophobic and insular control approach to moving device and service sales. Books only interest them if they sell devices.

Sony went head to head with Amazon. They did provide the epub push and forced Adobe to spawn the ACS4 DRM service. However they created four devices in less than two years and although they sold reasonable numbers of units, some would suggest they lost their way and have missed the boat.

Adobe’s support of epub was a brilliant move in not only capturing the high ground but also in tying it to their ACS4 DRM service. It also enabled them to lock themselves into many of the new eInk devices coming on stream. However, the major trick was to ensure that their solution not only supported epub, but also Adobe eBook which was based on the ubiquitous PDF format.

Amazon now covers all the bases from the author to reader. They support authors direct, are a publisher, own the audiobooks market, have the largest physical global bookstore, own a sizeable chunk of the ebook market and have a global brand synonymous with value and service.

Their most significant move has been to drive down the cost of ebooks. Publishers may believe that the agency model gives them back control but when we step back, we find that the ebook price is still a lot lower than originally envisaged by many publishers and Amazon’s revenues are now protected irrespective of the price paid. Some may say this is not a wise move by publishers and one that also presents new potential issues on tax in the US and retail price maintenance in the UK.

3. The Digital Content Itself

The majority of digitisation programmes have merely taken the physical book and poured it unaltered into the ebook. In essence the editorial and production process continued unchanged and the finished book was then ‘converted’ to an ebook, merely replacing the physical jacket with a digital one. For all the huff and puff about digital many publishers’ editorial and production workflow are still rooted in the analogue world.

We wrote a number of articles on the Japanese revolution with the Keitai novels and digital Manga comics. However we saw little movement in the West ‘book straight jacket’ economic model of 250 to 300 pages. We did see limited experimentation with multi media and others starting short story publishing programme. But these were the exceptions.

We believe that Digital Publishing is Publishing and is about everything from author to reader, not just the finished product.

4. The author
The Author has now been given the opportunity to go direct digitally. Previously print on demand (POD) offered a limited channel to market but it was cost prohibitive and demanded relatively high unit price.

Many things are driving the author to rethink digital. The higher royalty rate originally offered by publishers on digital, has slipped along with advances, the midlist and back list authors continue to be overlooked. Publishers such as Random House believe the ebook is ‘just another book format’ and irrespective of contract, to claim digital rights. Others would like to rights reversals not applied to digital and POD to effectively keep books in print.

Scribd, Wattpad, Amazon and Lulu.com have all started to offer authors a digital self-publishing opportunity and channel.

In a weird twist, the new agency model could be the biggest boost to authors going digital by themselves. US author J.A. Konrath claims that he can sell more ebooks at lower prices than a publisher and earn more to boot. Under the 70/30 split things suddenly get a whole lot better! He thinks the $2.99 could become the new bargain rate for authors such as himself and one that which will look very attractive against the ‘safe’ publisher pricing.

5. Social Networking
Social networking has exploded into the culture. Today, Facebook is getting more hits than Google search. Twitter has also exploded onto the scene and Ivy Bean showed that you are never too old to learn and at the age of 103 started to Twitter. Now 104, she has some 55,000 followers.Facebook and Twitter have made celebrities out of people who many would not have even heard of. Together with the likes of YouTube, they have revolutionised journalism, even woken up politicians to new ways of communication and reconnected people who where disconnected in the old world.

In many ways Facebook, Twitter and YouTube are the new Gorillas in the back yard of publishing and pose as much opportunity, challenge and threat as any in tomorrow’s digital book market.

To read the full revised Brave New World report online

Flash Fires

Adobe’s Flash toolset is a very widely used on websites and powers animations, media players and other multimedia elements.

The fractious war of words between Steve Jobs and Adobe has once again been escalated by Jobs. First Apple changed their app development rules and in doing so ‘black listed’ Adobe’s CS5 toolset that would allow developers to quickly translate Flash code to run on the Apple platform. The initial move by Apple effectively forced developers to develop two applications - one for Apple products and one for everything else.

Jobs wrote openly stating that Adobe’s Flash is not fit for an era of smartphones and touchscreen devices and that experience had shown it results in "sub-standard apps".
Adobe response was to turn its back on Apple and embrace Google’s Android platform and also RIM, Palm, Microsoft, Nokia and others. Jobs may say many things about Flash but if it performs on the other platforms, he may be seen as more of a control freak than many even think today. More importantly, he has to keep the app developer community onside and they have the power to say enough is enough and focus elsewhere.

Meanwhile, Adobe have now decided to practice what it preaches and will giving everyone of it employees a free Android-based mobile phone and they will demonstrating an Android version of Flash at Google's I/O conference this month.

Google is caught somewhat in the middle, happy that there is a differentiator between Android and Apple and one that also supports its products including Gmail and Youtube. But it is also a supporter of HTML5 and H.264, which are the competing standards to Adobe's Flash.

Some would say that it is total hypocrisy for Jobs to described Flash as "closed and proprietary". Importantly we have to also recognise that in 2008 Steve Jobs said on the Kindle and reading, "It doesn't matter how good or bad the product is, the fact is that people don't read anymore... The whole conception is flawed at the top because people don't read anymore.”

Apple Versus Adobe/HP

An interesting presentation from Adobe /HP on their forthcoming tablet with full Adobe Flash and Air support

The Digital Will Change In A FLASH

We may be at the cusp of a major step change in how we present digital content and context which may go further than many expect and make digital accessible to all in a different and more accessible way.

Due to the processing demands of Flash only a light version of the softeware has been used on smartphones and netbooks but a new version is claimed to change this and Adobe, the maker of Flash, said it should be available on most higher-end handsets by 2010. The new software will be available for Windows Mobile, Palm webOS and desktop operating systems including Windows, Macintosh and Linux later this year with Google Android and Symbian operating systems being expected in early 2010. The only downside is that this will not initially include the iPhone who have postured much but still not made any firm commitment.

Why is Flash so important? Flash is one of the most common pieces of software installed on computers and is installed on some 98% of PCs and renders almost 75% of all online video according to Adobe.

It is obvious in that it will enable rich applications to migrate from the PC to the mobile and could negate some of the mobile operating system and browser wars. A neutral platform that is both rich and can offer streamed services and rental as opposed to the current ‘download’ and DRM mindset.

The new software supports the Open Screen Project, backed by nearly 50 companies including Google, aims to create a device neutral platform for films and games that enable them to run on any device ; set top boxes, PCs, netbooks, mobile phones etc. This means developers need only write their code once and render it to many platforms in a consistent manner.


This is bigger news than coloured eInk screens.

Sony to finally bury BBeb

The news that Sony are to scrap their proprietary BBeB format and focus on epub, is both good news and long overdue. It begs the question why they ever thought that their format was ever going to cut it and like many Sony formats before them has proved a bridge too far.We have never been asked to provide the BBeB format.

In adopting Adobe’s ACS4 digital rights management Sony were the first to embrace epub with encrypted protection and also Adobe ebooks which are also fully compatible with ACS4 and the Sony Reader.

It is easy to see both these formats, one PDF based and the other XML, being the dominate formats outside of fortress Kindle. Many of the ‘lookie likie’ eink readers are now openly adopting ACS4 which whilst DRM is still the requirement is the key to providing secure open files that are interoperable between devices.

We presume that Sony will offer customers who have BBeB files a migration in their announcement.

Amazon Swoop Strategically

A potentially very strategic acquisition was made yesterday by Amazon when they bought the e-reader application start-up Lexcycle. Lexcycle’s iPhone application Stanza is probably the most popular mobile ebook application platform and has been a huge success on the iPhone, claiming half a million hits in the first months after it app launch and 1.5 million users. Stanza is a ereader and book store application that is also available on Mac and PCs and was working closely with Adobe to make its ACS4 DRM service available to mobile platforms.

Repeating the message that B&N gave when it bought Fictionwise less than a month ago, it is reported that Lexcyxle will continue to operate at arms length from Amazon. Lexcycle’s company statement said, 'Customers will still be able to browse, buy, and read ebooks from our many content partners. We look forward to offering future products and services that we hope will resonate with our passionate readers.’

So on one hand Amazon is gathering up the digital options and placing them quietly in ‘fortress Amazon’; Booksurge (POD), Audible (audio), ABE (long tail and rare books), Mobi (DRM) and now Stanza (ebook platform). In all cases their moves have taken out either a rising star or narrowed the options within the market. They have built a very impressive family that covers all the bases between author/ publisher and readers. The acquisitions have not been expensive but are clearly strategic in their nature. Sometimes, like with Audible, they have been in conflict with Amazon’s position and this latest one certain could be seen at odds with their Kindle application.

Its also interesting that the dust has hardly settled on the Fictionwise acquisition by B&N that this move has been swiftly executed. It also comes as many waited for Adobe’s ACS4 DRM to be ported via Stanza to the iPhone effectively opening up secure epub and AeB formats to the mobile.

We have to wait and see how Amazon move forward but what is certain by this acquisition is that the ebook agenda is clearly moving onto the mobile platform and maybe despite the sales of K1 and K2 Amazon has seen the competitive threat that Adobe/ Stanza / epub / AeB poses if left unchecked.

The Abdication Crisis: UK Publishing Meekly Follows US Digital Marketing

We attended the London Book Fair this week and hence the lack of articles. Was this due to a lack of real digital news or the fact that many in the UK digital world appear on hold awaiting the US to lead or to settle GBS (Google Book Settlement)decision?

Whilst we ponder the future, we ask ourselves a number of questions, some we can answer or are confident to predict, others where we are far from the answers. The one think that is certain, is that UK publishers large and small now are taking digital seriously and many are taking their first tentative steps forward.

Some thoughts on the digital UK landscape:

Will the retail model still hold water over the library model? Free rental access has appeal over pay. Who seriously wants to own an ebook for life? The existing library model needs to be revisited and the UK needs to be wary of US suppliers dumping their library repository content into the UK market. This is not happening tomorrow but today.

The thoughts of repositories brings us to observe the current ‘aggregator’ bragging model – ‘mine’s bigger than yours’. In the physical book world size mattered, but in the virtual digital world size often marginalises the offer. When it comes to changing suppliers in the future we have to assume, or hope, that the encrypted licences can still be validated, however we have already seen the problems of changing distributors.

The major digital repositories are US controlled and focused and we are all aware that territorial rights are a challenge. Despite UK publishers public statements, privately they many still compromised.

Will digital be ceded to Google , Amazon, Adobe, Sony, Apple. These are an interesting group of technology companies and with the exception of ‘fortress Amazon’ are all from outside publishing.

Will Amazon break free of their wireless constraints and make it to the UK, or leave the market to the likes of Sony? Where do publishers place their bets?

The problem with the UK is its love of exclusive deals. Digital deals such as Sony/ Adobe, Overdrive/ Waterstones and Blackwells / Espresso may move the agenda forward but can also marginalise the competitive position against the real competitors.

Will UK copyright and deals be controlled and determined in the UK and subject to UK law or be effectively usurped by the back door and rail-roaded by the US interests. The impact of change is not restricted to the finished book but goes rights across the life cycle from acquisition and rights contracts, to what was once death but is now GBS (Google Book Settlement). Will the DMCA (Digital Millennium Copyright Act) approach be adopted by all and will take down notices, reactive contention and copyright disputes be the norm tomorrow?

The UK market appears to be placing a great deal of trust in the US to sort out the digital landscape and for the UK to merely follow. After all, the precedent was set not many years ago by Bush and Blair, but one would hope that we have learnt from that abdication of independent leadership.

Adobe and Stanza Open Up iPhone to Secure eBooks

The announcement that Stanza will support Adobe’s ACS4 DRM is good news for the wider book industry. It enables PDF Adobe eBooks and epub files to be read on the iPhone platform through Stanza’s market leading free book reader.

It gives Stanza a DRM capability that is widely accepted, secure PDF based and epub files and Adobe a second platform to complement the Sony reader. We don’t believe that it’s the end of the ACS4 expansion into the mobile platform.

Importantly it is a timely shot across the bows of Amazon and comes hot on their 15 minutes of K2 fame this week. It clearly shows an alternative to fortress Amazon and a further home for the Esperanto of ebooks standards epub. It also comes after Google declared their 1.5 million US and 620K worldwide tiles. However it importantly enables many smaller publishers to effect a quick and effective strategy through Adobe ebooks and utilise their PDF files.

Now we just need other mobile platforms to follow Stanza and release secure ebooks to this obvious platform, Adobe and Apple to offer Flash on the mobile platform and both retailers and publishers to now get behind the obvious momentum.

Rhyming Couplets?

We all know that irrespective of the K2 show, the mobile smartphone is the hottest platform today. It is effectively moving the agenda from the standalone readers onto the new platform and 2009 is teed up to be a significant year as ereaders vie with the smartphones and notebooks and downloads vie with rentals and retailers vie with libraries.

The digital dearth is about to change and whether we like it or not, Google is about to unleash ebooks, library subscriptions, free to view and sales onto the market. DRM is still here but is not protecting the content as much as it is locking content into channels and aggregators’ models.

So what is hot gossip and what do we think may make the news now K2 has had its 15 minutes of fame and Plastic Logic has again said its coming sometime?

We believe that Adobe may well announce that it’s going to port its new ACS4 DRM service to the mobile platform. This was always going to happen but it makes more sense to do it sooner than later. When would it be logical to announce it – CES in Barcelona next week, when everyone is talking mobile.

What platform will they choose? It unlikely to be Android as it would be pitching directly against Google. It’s unlikely to be Microsoft which would rule some of the others out. It would be good to select a partner that can promote it and facilitate it and that leads us to a narrowing field of players.

Some would suggest that Lexcycle's Stanza, who already has the leading iPhone application, may make a perfect rhyming couplet in harmony with Adobe's DRM.

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.

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?