The Digital Content Divide

So where is all the digital content? We have heard pleas from the UK resellers for more content and the promises of things coming from the UK publishers. So what are the issues and why have so many been so slow to embrace digital?

‘There isn’t enough resellers to justify the effort?’ Well Waterstones have been up and running 6 months and want more. Gardners are now about to launch having got the critical mass of content and offer all resellers the opportunity to play. Amazon may not have the UK Kindle, but do have the iPhone option, Stanza is on the iPhone, Overdrive is making a big play for the UK libraries, the academic publisher of the year, Taylor and Francis are one of the leading digital players and now reaping the financial rewards. There are a myriad of ebook stores available today so does the channel argument hold water? Many would say not.

‘There isn’t the consumer demand?’ Well hello, when did you last open up a newspaper or watch the news and not hear something most weeks about ebooks, digitization or the changes in publishing? People are even buying limited devices such as the current ebook readers. The media is providing the feeding frenzy, but the content is clearly lacking.

‘It costs too much to convert?’ Well in some cases it can cost a fair amount, but a lot of that is down to the analogue manner in which books are developed today for a physical world and then converted into digital often as an afterthought. However, anyone can take the typesetters PDF and convert it to an Adobe eBook for little cost. It costs more to satisfy all the other formats, but to just get started isn’t expensive.

The latest one we heard was that ‘all the conversion houses are working flat out at full stretch and there isn’t the capacity for more’. We can only say from a position of knowledge that this is pure rubbish. Some may be busy, but walk around LBF in a month’s time and discover for yourself if this is myth or reality.

The excuses can continue, there many more. The reality is that there is a logjam on one side of the Atlantic and a concerted push on the other. Does it matter? In the days of physical only and strong territorial rights it was not an issue. However, today this imbalance is a serious threat to the market. In recent weeks Hachette has already had to fire a shot across the bows of some US aggregators for territorial infringement or lack of territorial control. We regularly use US and other services that are not available in the UK and a US content domination goes with strong US centric channels and aggregation. Apart from Gardners name one serious UK content aggregator, many of those resellers out there today are using are merely fronting US services and content. Before we can buy British content we have to produce it.

Supply Chain Thoughts 3 Digital Reality

Digital logistics presents opportunities that enable the book trade to remove the physical logistics constraints that caused so much waste. In principle a digital title should only be stored once, full stop, and rendered many times. Obviously there is often more than one format of the titles but again, store once applies to each format and render to many still applies.

Does this mean there is only one winner, one store and we simply adopt the flawed iTunes model – No. It means that we create an inclusive not exclusive framework that supports and distributed files on demand. Why should a publisher not retain their assets within their own repository and only let files out on an on demand basis? This is not a theory and is being adopted by the likes of Taylor and Francis and Elsevier today. The alternative is to hand assets over to an increasing number of digital aggregators, who end up effectively controlling the channel to market and restricting it to their reach and relationships. Ask any publisher today who has to deal with many aggregators; how they control or even know what is being sold, how they ensure that their total catalogue is available through all aggregators and how they reconcile sales with different reports, schedules and terms? Often they have little control on what are their assets. With physical goods the next person down the chain buys them at a discount off RRP and sells them again at an increased margin. With digital, the money doesn’t move until the sale happens, its effectively distributed consignment stock.

Drop ship logistics can provide the mechanism which if adapted for digital distribution can go one further removing the need to build huge repositories and the current bragging rites about ‘mine being bigger than yours’. All that matters is the ability to fulfil the demand for online or download, rental or purchase. For many this may be a central aggregation service, but for those who want control of their assets it can remain effectively in their own warehouse and and leave when its sold or rented. The model may be complex to grasp on first hearing, but it is what is being rolled out by Gardners Books in the UK, Danish library service eBog and adopted by publishers such as Taylor and Francis and Elsevier.

Ironically you will find this model described in concept on page 75 of the 2006 Brave New World report.

The digital offer should be fully integrated with the physical one enabling the consumer to have a ‘one stop shop’ transaction experience and not be handed over to a separate aggregator in order to buy digital books . Separating out the transaction and the customer relationship from the instructions and communication flows from the actual pick pack and dispatch of physical and digital or whatever makes consumer sense, publisher sense and supply chain sense.