Friday, July 31, 2009

Sony PRS300 and PRS600 Service Manuals?

Market rumours of a new Sony reader took a further step forward today with the leak of two service manuals on the Internet. The new models appear to be a PRS300 and a PRS600 which would obviously replace, or compliment the PRS500 and PRS700 respectively.

To view the documents as PDFs: PRS300, PRS600

The most depressing aspect of the specs is the continuation of their BBeB format. Sony championed the adoption of the 'open' epub format and Adobe’s ACS4 DRM but seem to forget to mention Adobe ebooks (PDF) which play perfectly in the device and are fully supported by ACS4 and widely adopted and still talk about their own format as if the market cares.

Thursday, July 30, 2009

One Cable Connects So Many

We have written before about the dependence much of Africa has to the undersea SAT-3 cable running down its west coast from Portugal and Spain to South Africa.

We now discover that much of West Africa has suffered a major fault and are still struggling to get back online. The fault has caused a communications blackout and many problems in Benin, Togo, Niger and Nigeria. Some 70% of Nigeria's bandwidth has been effected, disrupting; banking, government and mobile phone networks. Companies have been forced to use satellite links just to maintain connections to the rest of the world.

The 9,300mile SAT-3 cable lands in eight West African countries as it winds its way between Europe and South Africa. On the other side of Africa the countries have had no alternative but to go to mobile communication, but the disparity and poor connectivity across the continent, shows the difference between the highly connected western world and the poorly unconnected third world.

We Are Waiting For Real News

First we had Barnes and Noble bragging about the size of their digital repository, 700,000 titles. Now we have Sony bragging that they are to offer 1 million titles. When you look closer, you soon discover that the vast majority are public domain works that are from the likes of Google's Book store. Public domain is what it says on the can, ‘in the public domain’, free to use and are 90 years or older, so although good many are in archaic language.

So is it news or mere public posturing like children in a playground arguing who is best or biggest?

Google and Sony have decided to be best buddies on more than just public domain titles and partnered on a promotional game, where users must use search Google Books to answer five book-related questions per day and write a brief note about books. The winner will receive a Sony Reader.

More interesting is the strong rumours circulating that Sony has a new ebook reader. We were asked to speculate on this but in today’s climate of a new eink ‘lookie likie’ every few weeks and the wider adoption of Adobe’s ACS4 DRM service by other device manufacturers, we wondered what they could do to excite the market. 1 million public domain books is hardly exciting. Maybe they could go wireless but again what’s so special when others have done it anyway? Now colour eink would be interesting but we know that isn’t going to happen soon. A media tablet to out manoeuvre Apple would be a smart move, but we doubt that this is for release today.

So its back to the playground and the wait for the Kindle in the UK and more importantly the Apple Touch tablet.

Every Little Helps

Love them or hate them Tesco like WalMart are pushing back the walls of their stores.

Firstly, Tesco Mobile has announced it will be launching the UK's first ever 'Unlimited' monthly tariff. It will be allowing their plan subscribers to unlimited talk, text and data for just £30 per month. There is a fair use policy but with a ceiling at the equivalent of £500 worth of calls, texts and browsing per month it should be one that only a very few will ever reach – that’s unless you know better.

Tesco CEO Lance Batchelor is widely quoted saying, "You don't have to choose if you're a chatterbox or a texter, you can use your mobile as much as you want without having to worry about the cost. We believe that this will change the way people use their mobile phones. The new tariff aims to give people a simple, guaranteed way to have unlimited calls, texts and browsing. It takes away the concern and uncertainty about your monthly bill as it's fixed at £30, meaning you can talk, text and browse freely."

Tesco has a virtual network running off the back of a licensing agreement with O2 so everyone will be watching what they and the other carriers now do. After the recent performance problems on the O2 service it will be worth watching its performance as it takes on Palm Pre, the iPhone and now Tesco unlimited.

Tesco has also made the API (application program interface) to its online shopping service available to developers who will now be able to make their own apps to let you load up your trolley from just about anywhere. It may not be the same as Ocado’s iPhone app, which lets you shop even when out of mobile or Wi-Fi signal, but opens up the total catalogue of the UK’s biggest retailer. The Guardian reported earlier this month on some of the earlier adopter constraints ‘Tesco offers an API for its shopping. Now start thinking what to use it for’, but there are potentially more positives than negatives in this move.

This would enable access from any phone and for developers to place Tesco product buy buttons in to websites and potentially for consumers to scan barcodes in store to get product information directly on their mobile. This approach offers significant opportunities to anyone with a catalogue and a Tesco relationship – maybe books?

UPDATE: within 24 hours Virgin Media have matched Tesco's unlimited offer. Nay more takers?

Wednesday, July 29, 2009

An eReader With a Difference

The "E-Alim EL1000" is certainly one ebook reader with a difference. Forget the 7” LCD touchscreen, stereo speakers and microSD expansion slot, the ability to store and display pictures and video. The reader, whose name translates as "the electronic scholar," is claimed to be the first Arabic ereader.

It can displaying the Qur'an in six different Arabic fonts and translates the Qur'an into 24 different languages: Albanian, Azerbaijani, Bosnian, Dutch, English, Finnish, French, German, Hausa, Indonesian, Italian, Latin, Malaysian, Persian, Polish, Portuguese, Russian, Spanish, Swahili, Tamil, Thai, Transliteration, Turkish, and Urdu. The device also contains Tafseer (Qur'anic commentaries) in voices of 6 famous Reciters, Hadith (information about Muhammad's way of life), prayer times and Qibla Direction for major cities of the world and other religious materials. It is even supplied with an external analog compass so that users can oriented themselves properly for purposes of prayer.

The E-Alim EL1000 has been launched in the United Arab Emirates where it is available for 917.5 Dirham (approximately $250) and is expected to sell around 10,000 units this year.

It is interesting move in that it has an appeal to a huge audience and has taken a narrow, but multi media approach to its market.

For more info visit

Tuesday, July 28, 2009

One Book They Can't Digitise

Taschen intend to publish a special commemorative edition of Norman Mailer ‘MoonFire’ with real pieces of moonrock. All those conspiracy theorist who still doubt that Apollo 11 went to the moon, will probably knock as a sham. They may equate the exercise as equivalent to selling a lock of Jesus’s hair.

However, the extra large tome, featuring NASA and LIFE magazine glossy stills, is going to be produced with each copy signed by Buzz Aldrin. Taschen will only produce 1969 copies to mark the anniversary the year of the landing. All but 12 copies will sell online for around $1,000. However, 12 copies will come with official pieces of Moon rock that crashed to Earth in a meteorite. Taschen are waiting for a valuation of the rock before setting a price, but have said that it will be one of the most expensive books ever made.

Taschen’s previous massive tomes include ‘Goat’ on Mohamed Ali, and the Hemut Newton collection that included its own reading stand by Starck.

Its difficult to see these fitting onto a Kindle.

Watch Spotify on an iPhone

We previously reported about the streaming music service Spotify development of an iPhone app. Before it has been accepted by Apple Spotify have now released a YouTibe video showing just how it would work on an iPhone both on and off line.

Apple has already approved streaming music applications from Pandora, and Sirius XM, so it will be interesting to watch their reaction to what is clearly a cut above them all Spotify. The iPhone application will require users to be premium service members which is ad-free and costs £9.99 a month.

We now wait and hope it will be approved.

A Kindle at the Round Table

“When I was growing up I had three wishes. I wanted to be a Lindbergh-type hero, learn Chinese and become a member of the Algonquin Round Table." - John F. Kennedy

When you next book a room in the infamous Algonquin Hotel in New York you might find that a book comes with it. We have long seen the creation of libraries within hotels, some comprise of books left behind or donated by guests, others selected by the hotel. However there are few hotels in the world with the literary pedigree of the Algonquin and its round table. Now they boast that a Kindle pre loaded with your favourite book is available as one of the services for guests during their stay.
It appears to offer something to everyone that is without an ereader and is certainly a novel experience.

However, what happens when you are only half way through your chosen book and about to leave. We imagine you have to check in your Kindle and the book you bought goes with it. You could of course buy the unit and book but that’s as likely as buying one of those scrummy bathrobes they offer at a price. You could quickly log onto Amazon and buy the physical book, or you could just give Matilda a stoke and go home unfulfilled.

Somehow we think this is one of those ideas that looks good to start with and falls apart in its execution and consumer experience but there again the Algonquin was the first New York hotel to fit electronic room keys.

Friends Reunited on the Block Again

We all look and wonder at the lustre of social networking sites. One minute they are the vision of a student or wanabee millionaire, the next they are attracting significant traffic and wild market valuations. However for every success there are hundreds of failures and success does not always mean that they are sustainable.

Look at MySpace with its starlets, Ms Allen and the Artic Monkeys. Once the ruler of the social sites, it now has to sit below Facebook. We once thought was going to make it but alas not. We often have joined these sites and once the initial momentum is over, realised that they often aren’t the universe they claim, are hard work to maintain and left them as quickly.

Now what we would regard as the granddaddy of them all, Friends Reunited looks like it is going further down the slippery pole, with widely reported rumours that ITV may sell it for just £15 million. In December 2005 ITV paid £175 million for the site! However, ITV still reported a £18 million contribution from Friends Reunited in 2008, though this was down from £22 million in 2007. So a sale may earn out quickly if the friends stay reunited.

Monday, July 27, 2009

Sharing Digital Revenues

Digital books are not just about ebooks podcasts, online, they are merely the delivery formats. It’s about how we acquire, develop, market, promote and sell rights. We have long argued that ‘digital publishing is publishing’ and the need to look not just at the end format but at all aspects of the life-cycle from the author to the reader. Today we see many grappling with some these wider aspects of digital publishing and an environment, which for many sectors, will have to support both physical and digital side by side for as far as we can envisage.

Last week The Bookseller reported on the issue of royalty rates on ebooks and the apparent impasse that Random have with many in the over their claimed lower rates.

The question is not whether the rate should be ‘x’ or ‘y’, but what is the appropriate model to be adopted today for digital rights and how is it likely to change over time. There are a number of points we should also acknowledge:

First, a royalty deal struck today may not pay out for maybe two years yet in that time the digital market may have shifted significantly. The digital market is not stable and out of the control of any one party. Best intension and what appears a good or fair deal today is vulnerable to outside forces.

Secondly, digital pricing is all over the floor, a true dog’s dinner! Some want to align ebook pricing to the physical, others use them a promotional leaders, others such as Amazon are trying to create a price point independent of RRP. In a world where the net receipts are vulnerable, many will opt for royalties based on them, but for the author a percentage of net can mean a percentage of little.

Thirdly, the new retail entrants are often trading on fixed ‘value share’ terms, so a percentage share on royalty makes sense, but in these cases the percentage should often rise not fall.

What is clear is that we have a timeline issue which means what we know, or can predict today, is almost certain to change tomorrow. This surely demands, that digital rights should be at least revisited on an agreed schedule and not fall into a perpetual licence contract. Should a term time right on digital align to a term time right on physical or even visa versa? In a world of Print and digital on demand some would suggest that rights don’t revert, but given that precise shift surely its time to ensure that licences are term based and not dependant on inventory movements and ‘reprint under consideration’.

We see no real alternative to individual digital licences based on channels and revenues. The alternative could be digital falling into the special sales route where the deal may be more important than the royalty earned by the author. The physical world has different channels and it is fair to envisage the digital one will be no different. However, the channels and revenue models will be different and aligning these to the physical may be at best, unwise.

Finally, we would like to throw in what some may regard as totally inappropriate. In a digital world where stock is effectively on consignment and every sale is a real cash generating sale why not pay the author their royalty in real time? Some will argue that advances etc need to be covered before royalty trip in but should that apply to digital and is it so sacrosanct?

Apple Tablet To Change Media?

Back in January this year we reported on the rumour that Apple could be developing a killer device - new larger iPod Touch, which we predicted would clearly not only rewrite the notebook world but obliterate the eink readers in a heartbeat. Now that rumour is closer to reality and the Financial Times and others are reporting that Apple is racing to offer a portable tablet-sized media computer in time for the Christmas shopping season.

Forget the 1984 Kindle, Sony and the ever coming Plastic Logic this could be the Walkman and iTunes plus moment for video, TV, Music, Audio and of course ebooks. It will be the same as the step change from black and white TV to colour but with all today's channel offers!

The touch-sensitive computer is predicted to have a full colour, 10 inch screen and have internet connectivity like the iPod Touch with full access to the web and to Apple’s online stores for software and entertainment. It will be coming to market at a time when video streaming is taking off, mucis streaming is hear, downloads could not be easier and importantly for books when market hype is starting to met market demand.

The big question is not whether there is a market demand for such a product aligned to a service such as Apple’s, nor is it about whether Apple will create a great device but on the price and service ties. It will be interesting to see if the service to support the device is tied to an exclusive carrier or open and whether the price can remain low enough to be a ‘no brainer’ for Christmas. If the price can be competitive with the current iPhone and iTouch it certainly will move.

Start saving now, a major media step change is about to happen.

Sunday, July 26, 2009

The World According to Associated Press

The Associated Press is to create a news registry to protect their online content from copyright violations. The organization has already issued and then backed down on DMCA take down notices to bloggers who had linked to the AP, used their headlines or paraphrased AP stories.

AP’s proposed new registry, will attached AP content to a digital-permissions framework which will be actively monitored. Today each article and in the future, each picture and video, would have a digital “wrapper,” data invisible to the consumer. The software would also send signals back to AP, letting it track use of the article across the Web. Created and managed the Media Standards Trust, the new system allows the organization to gain proof of what it defines as violations in order to enforce its copyright policies.

Some see it as an attempt to lock up the news, others a rewriting of 'fair use' by the back door.

The New York Times reported Mr Curley, AP’s president and CEO, “If someone can build multibillion-dollar businesses out of keywords, we can build multihundred-million businesses out of headlines, and we’re going to do that,” The goal, he said, was not to have less use of the news articles, but to be paid for any use. Search engines and news aggregators contend that their brief article citations fall under the legal principle of fair use.

News aggregators like such as Google News have licensing agreements with AP for the use of its material but not for general Internet searches that turn up news articles. Is the right to link to articles using a brief snippet of extract from that article, or the original headline on the article now fair use or subject to payment to AP?

At a time when the Newspaper industry is clearly struggling this would appear a classic ‘finger in the Dyke’ and draconian approach. Read this interest article, 'NYT Co.’s top lawyer doubts that aggregation is a copyright issue' and discover some of the potential legal issues and a transcript of an interview with NYT’s legal council.

Update Comment received from Matthew Cain, Media Standards Trust

I saw your blogpost regarding AP's recent announcement and wanted to clarify a couple of things.

The AP news registry and tracking features were not "created and managed by the Media Standards Trust". Instead, the Media Standards Trust, working with Sir Tim Berners Lee's WSRI, have created an open source draft news microformat (road signs, if you will) for readers to identify the key attributes of a news article. Far from being invisible to readers, this appears as a box at the end of an article and helps the reader distinguish news from PR and identify things such as:
* who wrote the story
* the location of the story
* any principles under which it was written

More information is available here:

AP have developed additional set of features which helps them monitor and track articles. The Media Standards Trust has no involvement with this.

I would be grateful if you could amend your post accordingly.

That Was The Month That Was

July is proving an interesting month for the UK broadcasting and video market as companies change hands , focus and new enterants start to emerge.

First we saw the change of focus of Joost, which started with a fanfare , significant backing and support. Having been the driving force behind the groundbreaking Skype and Kazaa services, it looked like Joost’s founders could do nothing wrong. Alas reputation doesn’t guarantee success and this month Joost announced a reinvention refocus dropping its consumer video focus and reinvent itself as a business to business web-TV platform provider. The company had found it increasingly hard to stay afloat as a consumer-focussed independent ad-supported online video service.
Joost biggest problem was content, or the lack of great content and its model by the time it woke up.

to stream the video through web browsers it was too late as users had already gone elsewhere. Whether it will survive as a ‘white label’ service provider remains in question.

Project Kanageroo, a collaboration between BBC Worldwide, ITV and Channel 4 which was thwarted by the Competition Commission earlier this year and now has been acquired by Arqiva, which owns and operates part of the UK's terrestrial TV infrastructure and is a spectrum licence holder.

Argiva aims to use the technology to launch a new video-on-demand service with content likely to come from a range of content providers including the three broadcasters involved in the original joint venture.

Meanwhile Argiva face stiff competition from Hulu who continue to have discussions with UK broadcasters including ITV and Channel 4 and plans to launch in the UK later this year. Their offer is likely to include a significant amount of US content and would provide a one-stop shop for video on demand content.

The BBC's director general has suggested other broadcasters could share its iPlayer VOD service, which allows viewers to watch BBC shows online at a time of their choosing.

The BBC has revealed more detailed plans for, Canvas, its proposed joint venture with ITV and BT. It is now clear that what is envisaged is a platform and it intends to work with industry bodies such as the Digital Television Group, the European Broadcasting Union and the

Open IPTV Forum in defining appropriate standards. It is envisaged that Canvas will support a wide range of revenue options, including targeted advertising, micropayments and subscription and how these will be supported, including the approach to conditional access, digital rights management and billing.

The idea of a ‘box’ that combines broadcast and broadband delivered programmes with an intuitive interface is attractive to consumers. However, although the BBC has a role to play in establishing technical transmission standards, do they have the same role in designing the user experience of the box.

We envisage many more moves emerging, but the real test and answer lies in what the consumers decide to back.

Saturday, July 25, 2009

Vonnegut Goes eBook

Last week Random House announced that its imprint, Delacorte Press, would release 14 previously unpublished short stories by Kurt Vonnegut. Vonnegut who was best known for his satire, humour, anti-war sentiment and science fiction writing, died in 2007.

However its not the posthumous collection that is the news but that they will be made available as ebooks. The first story, “Hello Red,” would be available as an e-book in August followed the next month by a second, “The Petrified Ants.” The remainder will be available on Oct. 20, the day Delacorte publishes “Look at the Birdie,” a new hardcover collection of Vonnegut’s short fiction. Delacorte also has plans to release new additions of fifteen of Vonnegut’s best known books.

The e-books will be sold for $1.99, but is unclear as to whether this signals the return of the short story for the ebook, which makes a lot of sense, or whether in this case they are being used as promotional tasters for the physical book. It is also not clear whether by buying the ebooks the price paid is deducted from the book when its published.

Apparently Mr. Vonnegut is claimed to have told an interviewer in 1995 that he would “welcome” being called a Luddite.

Why can’t the short story stand in its own right as an ebook. We have long argued that the form lends itself to digital reading. Whether, its short stories, selling by chapters or selling individual works such as poems, digital should stand in its own right. Yet it appears some now see ebooks not as works in their own right, but as promotional teasers and that publishers still cling to the physical economic model.

Kangaroo or Karoo Court?

Karoo has a unique service position as an Internet service provider (ISP) in Hull. It is the only ISP in the area, which has no BT lines and has long adopted a policy of automatically suspending service of suspected file-sharers. In order to get their service restored, customers had to sign a document accepting that they were guilty and promising not to repeat the offence.

It appears that following a BBC report outlining the firm's practice. Karoo now issued a statement saying that it has been "exceeding the expectations of copyright owners". Karoo will now adopt a "three strikes" rule, in which suspected file-sharers will receive three written warnings before action is taken.

Andrea Robinson, a Karoo customer from Willerby, told the BBC that a day after her service was cut off, she received a letter from the firm claiming that she had been using the peer-to-peer file-sharing service BitTorrent to download the film Terminator Salvation. She was told to attend the company's offices to resolve the issue.

"They gave me a form to sign to get reconnected," she told the BBC. "The form basically said 'if I admit my guilt you'll reconnect me'. So I didn't sign it and walked out."

The practice follows the Amazon Kindle debacle which lead to a personal apology from Jeff Bezos and a change of policy at Amazon. The current approaches is like chasing the drug takers whilst the dealers stand on the street corners dispensing the wares. Karoo appear to have ‘exceeded everyone’s expectation’. Some may wonder if Karoo is short for Kangeroo which appears to be their type of court justice

Palm Continues to Taunt Apple

Palm has taken a decision to re-syncing its Pre Web OS to iTunes. This follows iTunes issuing an update to block their previous hook up.

The question now is whether this latest twist will end up in court? On June 16, Apple issued an iTunes support document that said it does "not provide support" for non-Apple hardware that attempts to use iTunes for synchronizing content from a Mac or Windows PC. Palm’s openness would suggest that they are taunting Apple and expecting a reaction. If Apple were to turn the other cheek then it may be an open invitation for others to follow and could undermine iTune dominance in the market. Others see it as strengthening iTunes in the same way that the adoption of MP3 made it more attractive to a wider audience.

However there is another viewpoint that Apple is open to the Palm approach in that Palm hasn't done anything to Apple's software, only its own Web OS software and therefore there is little that they can do legally. Palm has not violated Apple’s software so has not infringed any copyright.

Until there is clarity, or the Apple engineers devise code that prohibits Palm, it would appear that Palm wish to continue to synch to iTunes software and taunt Apple.

Friday, July 24, 2009

A Wireless Power Fix

We all forget the power transformer and often the transformer is the lump we hate to carry everywhere with us. So is the solution close at hand? This BBC video describes and interesting development that may just signal the end of wires and the beginning of true 'wireless'.

It leaves many questions unanswered re who will pay for the charge but it is worth a note.

Bezos Says Sorry

Remember when Gerald Ratner was forced to apologise publiclly for his statement on selling 'crap' and the lack of apologise we all recieved from the city bankers for their gross incompetence? Apologise are often hard, especially in public, so we take our hats off to Jeff Bezos for the following statement he issued on Kindle Community web site. We hope he doesn't loose his head over it like Gerald Ratner did.

This is an apology for the way we previously handled illegally sold copies of 1984 and other novels on Kindle. Our "solution" to the problem was stupid, thoughtless, and painfully out of line with our principles. It is wholly self-inflicted, and we deserve the criticism we've received. We will use the scar tissue from this painful mistake to help make better decisions going forward, ones that match our mission.

With deep apology to our customers,

Jeff Bezos
Founder & CEO

Wednesday, July 22, 2009

Samsung Enter the Smartwatch Market

Mr Bond is that a phone, a computer or just a watch on your wrist?

We wanted the LG GD910watch phone but the price was too high even for a vanity piece of jewellery and now Samsung in releasing one the S9110 and plans to bring it to Europe. The 450 euro smartwatch will be launched in France with a 4.5cm touchscreen, metal body and leather strap.

At just 11.98mm thick it's described as the world's thinnest smartwatch with Outlook e-mail, voice calls, MP3 player, and Bluetooth to support that earpiece it sounds impressive and is under half the price of the LG GD910 offered by Orange.

On Target

What makes a best seller? Is it stacking it high on sale or return in bookstores, is it a good review in the best newspaper or the kiss of Oprah, is it the right price offer? All these help and marketing sells books, but often the focus is still on that 13 week window and then it moves onto the next bestseller. Does the consumer know what is front list and in many cases do they care?

Michael Cader introduced us to a New York Times report on, ‘Target Can Make Sleepy Titles Into Best Sellers’ which was about how outlets such as Target can make significant sales on what would appear to be failures. By selecting a title as one of its Bookmarked Club Picks, the book gets prominent display throughout the chain’s stores and sales follow. Players such as Target can also benefit under the special sales umbrella, buy into print runs, take a minimised risk and enjoy a calculated return.

Target, Wal-Mart and Costco have a proven ability to sell significant quantities of books and often trade on high profile titles such as Harry Potter. However, Target has been quietly building its book club, a program it calls Bookmarked Breakout, and promoting and selling largely unknown writers. Target’s 1,700 stores carries about 2,500 titles each, are of a predictable range of genre and interestingly are faced out (so much for publisher brand). The book club promotions are house are set apart often at those important end of aisles.

In some cases Target sales outstrip any other outlet and Jacqueline Updike, director of adult sales at Random House says, ‘Target can sell hundreds of thousands of copies of a book that is virtually unknown in the rest of the marketplace.”

Target select and sell like a bookseller should using a panel of Target employees who meet monthly to review submissions from publishers. The panel may select classics, unknown authors or bestsellers and the publisher is asked to produce a special edition, and the author requested to write a letter addressed to Target readers.

We often deride the large mass market retailers but we forget that the reason they are where they are is that they understand retail; selection, marketing and selling.

The Price Is Right

We walked around Adsa (WalMart UK) this week. Denim jeans £3 and designer denims for £14, hardback and paper books, that are both current and fighting for sales in every other bookstore offered at 50% off. We can now buy most popular CDs between £5 and £8 and yet we still refer to this as ‘rip off Britian’.

The reality is that players such as the supermarkets have driven out production and supply chain waste and moved from production based, to market and demand driven costing. The physical manufacturing, distribution and replenishment processes have been squeezed and yesterday’s prices now look a total rip off.

Amazon and the chains have broken the price of books as it relates to the list price, but not necessarily as it relates to cost. Book prices have dropped but jacket prices have often increased to compensate.

Enter the ebook. We have written many times on the issue of pricing ebooks and the price alignment with other formats. The reality is that in a demand and market driven environment and especially one where one digital book looks the same as any other, a price point will happen. Music, DVD and other media markets may have their anomalies, but in the main, price points still prevail irrespective of the production cost.

So when Sourcebooks recently decided to withhold the release of the ebook, so it didn’t impact the hardback sales, we ask once again – is it

Amazon is creating an eBook price point of $9.99 that, irrespective of your position, is likely to stick. Ask Apple about iTunes and their infamous $0.99 price point. The challenge is not how to continue to confuse consumers and fight price points but how the market can make such a move work and still reward the author.

When we look at some of the significant business model changes that are happening today, we realize that we must be flexible and even prepared to burn the model altogether. For example, look at Spotify music streaming service, which still pays royalties but is ‘free’ at consumption. Look at how network carriers have created bundles of services and in doing so have effectively cut the cost to their customers.

We still have not found the answer to the potential digital rent for free from a library versus digital pay to buy retail models.

The one person we must continue to reward is the creator. Interestingly there appears little reason why they can’t be paid more frequently, if not in real time for their digital sales.

Retailers Are Stepping Up to the Digital World

The news that Barnes & Noble is back in the digital ebook business is no great shock, nor one that is likely to be a repeat of its last entry and exit. Our ‘Brave New World’ report clearly put down the case for retailers to play a major roll in ebooks and digital sales and today, 3 years on, the shoots of our findings are starting to be seen. In the UK Waterstones went with an exclusive Sony deal and have now been joined by more open offers from Borders UK and Blackwell and will soon be joined by many others. In Australia Dymocks have long championed their offer. So the return of B&N is both welcome and a sensible move.

We can ignore the public posturing of ‘my repository is bigger than yours’ this is just mere schoolyard bragging that when stripped down soon becomes irrelevant. However, we can’t ignore the acquisition of Fictionwise, nor the market strength and brand that Barnes and Noble now reintroduces to the market. Will the offer dethrone Amazon – unlikely? Will it increase the battles over ebook pricing – almost certainly? Will it make more publishers create ebooks – almost certainly? Will the impact be restricted to the US – no?

What is certain is that consumers will want choice of what the buy and where they buy it. With offers from Barnes and Noble, Borders and Amazon will US consumers seriously select a device that restricts choice and one which shot itself in the foot last week with its Orwellian actions? Do publishers really believe that they can make the step change from producer to retailer and offer both range and depth? Some will succeed but many will realise what their core strengths are and that retail may not be one of them.

What is clear is that ebooks will go global and geographic restrictions on devices, their support or exclusive deals are not the way forward. It is perfectly feasible today for all retailers to participate and to sell physical alongside digital. The more retailers that take up the challenge, the healthier and more diverse the market and the offer will be. Retailers do not need a reader device or to buy a Fictionwise, or to strike up an exclusive deal, or even to set up a complex technical infrastructure, they just need to offer the consumer what they want , at the right time and at the right price – no different than today. They need to have one that offers physical and digital side by side in a single basket, one that is technologically inclusive not exclusive, one that fully exploits digital marketing and promotion and many will be surprise to find a more level playing field than they think.

Spotify Continues to Break New Ground

The music streaming sector is just about to become significantly move interesting. We have long supported the Spotifty service which in our opinion is one of the music models for the future and makes consumer and business sense. Spotify has just announced a deal with IODA (Independent Online Distribution Alliance) which will add a further 2 million tracks to its catalogue. We are also aware that it has plans to launch in the IUS later this year and there are rumours of an iPhone app.

However, we now await the heavily rumoured Microsoft offer, (they always appear to be late to most parties today). We believe the Microsoft entry will have a significant impact in raising the profile of streaming services, add competition if integrated with its other offers, could pose a threat to Spotify whose stellar growth has been largely built on word of mouth. The US may prove a major battleground.

The other interesting aspect of Spotify’s latest deal is that it will not only bring in independent labels and artists such as The Prodigy, Bob Marley and the Wailers , but also Stephen Fry’s witterings. This in turn starts to question why not audiobooks ? The question is whether a streaming service should be restricted to one genre, media format or whether it should be open to all. The obvious line in the sand today is audio versus visual, but is that a real line tomorrow? When video can easily accommodate audio, should audio restrict itself and in doing so leave itself exposed?

If we were audiobook publishers we may well be tempted to start to think hard about Spotify. Forget trying to imitate and copy it or looking for a specific audiobook service. This approach is too narrow and often tied to day’s model, but look instead at making a step change that is clearly making sense to others. What will it mean to audio rights, royalties, earnings – we don’t know today, but that is no excuse to ignore it.

The Apple Tree Continues to Blossom

The one thing to watch in difficult times is who is making the money and how they are achieving it. When times become easier it is often they who can put their foot down and drive the sectors and the economy.

Apple have announced that in its 3rd fiscal 2009 quarter, which ended on June 30th, the company's year-on-year quarterly revenue rose to $8.34bn together with its net quarterly profit which rose to $1.23bn. The revenue results are up from $7.46bn and $1.07bn in the same quarter last year and profits are up around 15%. What is interesting is that the last quarter profits saw a year on year rise of the same amount.

Apple saw a 4% year on year quarter increase of Mac sales and even though their new 3GS model didn’t launch until the end of the quarter and moved 1 million units in the first weekend, they sold 5.2 million iPhones during the period.

There's Money In Those Old Books

The University of Michigan has announced a collaboration with Booksurge, Amazon’s print on demand service. As a result Booksurge will offer reprints of some 400,000 rare, out-of-print and out-of-copyright books from its library in soft cover editions at prices from $10 to $45.

The books are in more than 200 languages from Acoli to Zulu and include a 1898 book on nursing by Florence Nightingale, "Notes on Nursing: What it is and What it is not." Some of the books are one of kind, meaning they had been available only from the shelves of the University of Michigan.

The move is now possible because of the university's project to digitize its collection in partnership with Google and the as books in the Michigan-Amazon deal are in the public domain, the revenues generated will be split between Booksurge and the University.

The arrangement is a significant addition to BookSurge's inventory and it will be interesting to watch if others follow and whether the arrangements will be exclusive or open. The other question is how Google will respond as the move could be seen as cutting off what many thought was an obvious revenue stream .

Today the deal involves public domain works and as we wrote earlier this week with respect to the dispute between Wikipedia and The National Portrait Gallery in the UK making – he who owns the public domain rendition and digitalises it can now earn from it.

University of Michigan libraries Dean Paul Courant said the arrangement means "books unavailable for a century or more will be able to go back into print, one copy at a time." Albeit at a new price.

Tuesday, July 21, 2009

The Google Charm Offensive Moves to Europe

European Union regulators are looking to mediate a discussion between European publishers and authors and Google over Google’s Book Settlement. European Commission officials will meet with copyright holders on September 7 to discuss the search giant's $125 million proposed settlement with U.S. publishers and authors. The US court will decide in October, whether to grant what some believe will be a monopoly on ‘orphan works’ and effectively change copyright not only in the US but globally. Google is currently on a charm offensive trying to persuade all plus the US Department of Justice that they are really the grandmother and not merely a wolf in her clothing.

The one thing that is certain is that the charm offensive will incease as the decision date draws closer but the question and doubts remain on the table. Some would say that fear of the alternative is driving some to support what many have exposed as wanting. It will be interesting to see which associations stand up to question the settlement and who finds themselves sitting on a fence torn between conflicts in their member interests.

Monday, July 20, 2009

Polymer Vision RIP?

Polymer Vision, which developed the roll out, Readuis eInk device, has entered chapter 11. The company had previously said it was looking for investment, but it appears along with a European launch, it never materialised. The 5-inch display may have impressed some but it fell down that crack of not knowing what it wanted to be when it grew up. In a crowded market that is getting more crowded by the day the question now is whether others are vulnerable and likely to follow before the market grows?

Some may look to the Polymer Vision technology and see a fire sale opportunity, others just another ‘lookie likie’ albeit with a roll out difference.Unless the technology is significantly different and the hype compelling, it is difficult to see the current playing field changing.

Apps Stores: Fad or the Future?

Last week Apple’s app store reached another milestone with 1.5 billion downloads and now supports over 65,000 applications.

So on the same day that O2 launches a £10,000 prize for the best iPhone application voted by its iPhone members, Google believe the app store days are numbered and others say that the app craze is going to just go on getting bigger. Who is right and who is wrong? What are the issues driving this demand and is it a fad or the start of something big?

In a drive to incentivise and reward developers and grow customer loyalty O2 has launched a two month, £10,000 prize competition to select the best iPhone app. The key criteria for the winner will be an app that can ‘help build a lasting relationship between O2 and its iPhone customers.’

Ilja Laurs, CEO of GetJar, a leading independent application predicts that there will be a peak of around 100,000 apps by the end of the year, but with a failure rate of some 90%, he questions whether the lack of revenue will force a rethinking of the current development environment. Will consumers pay and play once, or adopt the apps into their lifestyle? Are apps essential tools and fulfilling real demand, or mere novelty and fashion fads

Symbian’s Lee Williams believes that the app store model is flawed in that it offers too much unwanted stuff and not enough relevant content and applications that will help enrich or add value to a user’s life.

Vic Gundotra, Google's engineering VP believes the app store is a fad and that the focus will shift to powerful browsers. Obviously Google is investing heavily in the Chrome browser, the Android operating system and search, all of which they see as platform and device independent. Therefore it makes sense for them to dismiss apps as a fad.

The question today appears to be one of mobile bandwidth and the lack of interoperability of applications, making development a nightmare and consumer choice complex. Tomorrow the game would appear to be moving towards one app across multiple platforms, devices, carriers, but this requires that all so elusive collaborative thinking and approach that is often lost in today’s ‘exclusive’ world.

What is clear is that app development is a gambling business today and one many will loose their shirt on and one that a few will find very rewarding.

Sunday, July 19, 2009

Apple To Let Other Operators Carry the iPhone?

According to Mobile Today, Orange and T-Mobile will be allowed to sell iPhones in the UK in six weeks' time when O2's two-year deal comes to an end. However, before everyone jumps up for joy, O2 will be given exclusive rights to sell the faster iPhone 3GS model. The Palm Pre currently is restricted to O2 under another exclusive deal.

Is it just another Apple rumour. or are we finally going to see the iPhone unlocked just in time for Christmas. Forget the Kindle coming to the UK, the unlocking of the exclusive with O2 may be a far bigger generator of revenue as many may upgrade and stay with their current carrier and the device offers far more for all.

The move will also push the Apple app store, iTunes and of course the resultant bandwidth usage. The other mobile manufacturers have so far failed to dent Apple’s iconic ‘must have’ status and opening up the iPhone is just as much about the pull of the app store as much as the device itself.

Apple now must open its offer up to more. We see its biggest competitive threat being that other new player on the block, Google and their Android offer and we all know that they will play with anyone and everyone.

Wikipedia and the NPG Fall Out Over Copyright

You can pay to view a picture in a gallery, but even though it was painted centuries ago they are not public domain once the image is digitised. Some say that owners of out of copyright material are not going to digitised works if the derivative works they create aren’t protected and as a result everyone will be the poorer. Others would argue that they are public domain and should be free to all.

Wikipedia has caused a storm in using images from the UK’s National Portrait Gallery (NPG). They say the gallery is betraying its public service mission, the gallery says it needs to recoup the £1m cost of its digitisation programme. The gallery appears to be objecting more to the use of high resolution images which they can earn off. The NPG says that their images in books and magazines generated £339,000 in the last year and that the current situation jeopardises their ability to internally fund their digitisation process.

Other institutions have made significant donations to the non-for–profit encyclopaedia but the NPG wants money and insists that its case has been misrepresented, and deny that it has been "locking up and limiting access to educational materials".

So when is the digitisation of public material ‘private’ and for sale only, and when is it ‘free’? The NPG claim that Wikipedia infringed English copyright laws, which protect copies of original works even when they themselves are out of copyright. They also claim that special software was used to "de-scramble" the high-resolution tiles, allowing the whole portrait to be seen in high resolution.

It’s another case of he who pays to digitise, regenerates copyright on the derivative work and in this case there is only one copy to digitise, so ownership also counts. We wonder why Wikipedia needed high resolution for online use and guess we will all continue to enjoy the real thing in galleries.

Two Weeks and Two New eBook Readers

We returned from two weeks vacation but while we were away the world of ebooks didn’t take time off and two new devices were spawned in our absence.


The market for ebook readers is growing all the time and we have often referred to the many eInk ebook devices as, ‘lookie likies’, but now they really are! Whose has copied who, the Chinese appear to have copied Amazon, who else? The Chinese Founder Group has announced its $200 Kindle ‘lookie likie’ aimed at the Japanese and Chinese market at this month’s Tokyo’s Digital Publishing Fair.

Founder’s e-reader is called the ‘weFound’ and looks like the Kindle 2 with a 6-inch e-ink display. It doesn’t have a Whispernet wireless connection and uses a SIM card to directly downloaded books onto the device. This means that unlike its original brother, the new pretender’s internal modem doesn’t restrict downloads to a single network. The other obvious difference is that it displays double-byte characters which are essential for supporting Japanese, Chinese and Korean characters.

Founder has stated that the ‘lookie likie’ will be commercially available at the end of the year in China.


However they are not the only new boys in town and the Ectaco JetBook has also arrived to the party. However, there is a real difference here in that the Jet Book does not the use eink or a back lit screen but a LCD screen. The Jetbook also doesn’t have a touch screen function and uses numerical buttons along the right side of the reader and directional and page turn buttons located under the screen to navigate.

The JetBook comes with the usual bundle of free books pre installed but has one huge disadvantage in that it doesn’t support DRM files. So you may get the King James Bible and the Fodors Travel Guides and loads of classics but will miss out on many best-sellers. Not a wise move today. It can play MP3 files but only supports a 2MB SD card so again not a wise move.

Saturday, July 18, 2009

Palm Pre blocked on iTunes

The Palm Pre had enabled itself to be recognised by iTunes, such that when you plugged it into your computer, iTunes thought the Pre was an iPod and proceeded to download music, video and picture files onto it. However, when iTunes 8.2.1 stops that and in Apple’s own words, “addresses an issue with verification of Apple devices.”

Apple may have blocked the access, but in doing so, they merely send the Palm Pre users elsewhere to use other sites. The world of 'exclusive' is not where we should be going in the digital market and this is yet another instance of xenophobia.

The Rights of Man

You switch on your Kindle and are just about to resume reading your latest novel only find it has gone. Not only have you lost it from your Kindle, but also from your library. You quickly scan the library to check that everything is there and find that Amazon, in a truly Orwellian move has gone in and removed it. The irony today is that Amazon removed George Orwell's ‘1984’ and ‘Animal Farm’.

Amazon state, "These books were added to our catalogue using our self-service platform by a third-party who did not have the rights to the books. When we were notified of this by the rights holder, we removed the illegal copies from our systems and from customers’ devices, and refunded customers."

"The Kindle edition books were removed from the Kindle store and are no longer available for purchase.," The consumer notification email is reported as reading, “When this occurred, your purchases were automatically refunded. You can still locate the books in the Kindle store, but each has a status of not yet available."

Irrespective how the take down, user communication and refund was achieved, the event highlights several digital issues.

Who owns what?Whose property is it once a sale has been achieved? We respect it may be an illegal copy but given the rights owner has to follow a take down process, why is there not a similar defined process with respect to the consumer?

If the copyright status of well known books can be confusing, what chance has the less well known books or even orphans of being protected? The industry requires a right registry but everyone wants to continue to slope their shoulders and expect others such as Google to set it up. Why don’t have a rights registry today and why have the appropriate associations and secondary publishers failed so miserably to step up to the mark? Why are we continuing to rely on the reactive and inefficient DMCA take down process that has failed so many times and given ‘safe harbour’ to the status quo?

What about the annotations and bookmarks added to any work by a consumer for the purpose of research or study? Once the file goes the wholes file goes, extras and all. Their own work is effectively taken without recall.

Amazon told the, "We're changing out systems so that in the future we will not remove books from customers’ devices in these circumstances," but what does that mean and what comfort does that give both copyright owner and the consumer? Will there be a standard for all ,or will it be as today, or everyone make it up as they go?

Publishers should also be accountable for copyright errors, after all how can the likes of Amazon know better? However, it is Amazon who gets the blame and whose reputation is tarnished not the publisher. It is Amazon who the consumer will point the finger at. However, even here there is a twist to the tale in that 1984 and Animal Farm were being sold as a public domain works by a digital packager, MobileReference. However how do they determine copyright when we live in a global connected world where1984 is out of copyright in Australia but in copyright in the US. This may penalise the US consumer today and yet tomorrow the Google rules could easily flip this for many books around the world. Who is going to police the global situation and territorial restrictions that are almost impossible to control?

We have read much on the Google settlement from those who advocate that it will be better than today and even scaremonger on what the alternative could be. However, incidents such as this clearly demonstrate once again that its time that a rights registry is established and not just for the benefit of one offer or one country but for all. In a business that is all about rights it is often embarrassing that we all sit and wait for others to tidy up the mess.

We Are Back!

What continues to impress me about Canada is the level of reading, for what is a country of a mere 30 million. In Toronto you can find the Central library virtually across from the Yorkville Library and only a short walk from a substantial Indigo store and a specialist Japanese Foundation library. Book City and BMV where also highly visible and appealing to the bargain buyers. Reading appears healthy pastime shared by many.

The HMV store in Montreal had an interesting arrangement of the books specially selected to appeal to their clients which included; Catcher In the Rye, Zen and the Art Motorcycle Maintenance, Lovely Bone, The Bell Jar, Animal Farm, On the Road.

Interestingly we didn't see any ebook readers!

Saturday, July 04, 2009

Friday, July 03, 2009

US Justice Department Formally Asks: Have We Been Googled?

The U.S. Department of Justice has opened a formal investigation into the settlement between Google and book publishers over the digital publishing rights to certain books, citing antitrust concerns. Judge Denny Chin, who is ruling on the settlement, received formal notice of an investigation from the DOJ and released the letter as part of the court docket concerning the case in the U.S. District Court for the Southern District of New York.

Google issued a statement: "The Department of Justice and several state attorneys general have contacted us to learn more about the impact of the settlement, and we are happy to answer their questions. It's important to note that this agreement is non-exclusive and if approved by the court, stands to expand access to millions of books in the U.S."

Google has recently embarked on a charm offensive , making the argument that Google really isn't that dominant a company and reminding everyone that the competition "is just a click away."

Thursday, July 02, 2009

Trinity Mirror To Close Down 9 Locals

We all are aware of the advertising and digital challenges facing the newspaper industry worldwide. The locals are being hit hard by free models and a downturn in advertising and the nationals are losing the meatier advertising and are competing with there own free and online challenge.

Today Trinity Mirror announced the closure of 9 UK local newspapers in the Midlands and the lay off of some 120 staff. They are proposing to close the Loughborough Trader Xtra, Lichfield Post, Tamworth Times, Burton Trader, Ashby Trader & Echo, Coalville Echo, Walsall Observer,the Bedworth Echo, Rugby Times and two niche publications, the Earlsdon Blog and Farm Ad and merge the Solihull News and the Solihull Times in Birmingham. In addition Trinity's Midlands printing business is also being impacted by the layoffs.

The problem with the changes that are happening is that they are breaking up the newspaper infrastructure which develops journalists, feeds larger newspapers and news industry with validated stories and sustains many business print demands via their presses. The change could have long term effects on the quality and authority of what we read and the development of people writing it.

There Are 2 Million Free Electronic Books On The Internet

Project Gutenberg has joined forces with The World Public Library and Digital Pulp Publishing, Internet Archive, Baen to promote The Forth World eBook Fair. Two years ago The First World eBook Fairs introduced 1/3 million books, which became a million and a quarter last year and this year tops two million. They expect to have 2 1/2 million by July 4. The contributions come from 100 plus eLibraries including; Project Gutenberg, The World Public Library, The Internet Archive, eBooks About Everything and IMSLP's Music eLibrary.

Michael Hart, Founder of Project Gutenberg and co-Founder of World eBook Fair has ambitious goals of widening the number of devices and programs people can read ebooks on and clearly has his eyes on mobiles. In addition he wants ebooks not just in the top six languages but for the 250 languages with over a million speakers.
The goal of World eBook Fair is to provide free public access for a month to 2 Million eBooks.

For more information:

Wednesday, July 01, 2009

eBook Price Wars?

Are the gloves coming off and are we seeing just a pricing skirmish or a battle of wills and pricing nerves between and Barnes and Noble?

According to TechFlash Barnes & Noble, is now offering ebook versions of New York Times bestsellers for $9.95. This obviously is a fraction under than Amazon's standard $9.99 ebooks price for same books.

So is $9.95 better than $9.99? What is probably more important is the clear message it is sending to consumers and there is only one direction many go from here.

Sales Tax Impacts Amazon Affiliates

Amazon continues with its affiliate program in New York but has now stopped its affiliate programs in both Rhode Island and North Carolina. All three states have passed laws that would have required Amazon to collect sales tax on their affiliate program. Obviously, some states are worth the effort others maybe not.

So what is this sales tax and why is it affecting affiliate programs?

Sales tax is applied to the total amount of the order including gift-wrap fees and is based on the shipment's destination state and local sales tax rates. States that impose sales tax collection on Shipping & Handling expenses require that sales tax be applied to Shipping & Handling when the item that is being shipped is subject to sales tax. There are exemptions such as magazines, bibles and some states have no sales tax. The US also needs to note that goods sold to Canada incur GST (Goods and Services Tax).

The state of many state budgets is forcing them to look again at Sales tax and the opportunity to close loopholes and collect money. After all the tax is exactly the same as someone buying a book or goods in a retail store, they total the goods up and then sales tax is applied at the checkout. In the case of the affiliate program they would have to collect the tax and many may claim this would impact their business. So as an affiliate it would appear I have an economic model built on tax avoidance.

The question then is whether Amazon is right to blame the tax system for their withdraw from North Carolina, but accommodate it in New York? Many, such as Barnes and Noble, operate affiliate programs and deal with the taxation issues, so why can’t Amazon? Some may say that the affiliate program was just a way to build their brand and drive more buyers to what was an Amazon store that was being merchandised by others. They would also point out that the Kindle is ‘affiliate free’ and there has been a steady change in the affiliate business model that has been applied in Amazon’s favour.

There needs to be a level playing field between the physical store and the virtual one. Like so many issues, digitisation is now forcing us to question boundaries, rules and practices that have never been really tested.

Will The Kindle Swim In Germany?

Amazon’s Kindle plans to dominate all markets and break out of the US have taken a setback. One of its main market targets, Germany, is proving a difficult one with respect to their wireless connectivety. We have already written about Whispernet and its limitations now Wirtschaftswoche, report that negotiations have stalled. The issue is Amazon’s inability to strike a deal with the main wireless companies in Germany, T-Mobile and Vodafone.,

It is suggests that the problem may not just be about money but the fact that T-Mobile is owned by Deutsche Telekom, who is reported to be working on its own reader! Meanwhile Sony, with its PC tethered ereader offer continues to claim ground in Germany where it has struck a distribution agreements.

Amazon’s greatest strength is its wireless connection , but this only works if it is able to leverage that advantage, otherwise its lays like a beached whale, unable to swim and unable to move. Some would say that it would be relatively simple to make a dual device that offers both wireless and PC tethering, but that assumes you realized and built that architecture in the first place.