Digital Eloquence

When we wrote the Brave New World report, we expected the digital audio market to take off. After all, the devices were already there, the download mechanisms existed, the bandwidth was there and MP3 was going DRM free with music. All we had to do was to plug in the earphones. But it didn’t happen and instead the ebook lurched forward, took off and we forgot the audiobook. The reasons for the lost audio opportunity were many; Amazon’s acquisition of Audible and their retention of the old book club model, the lack of digital content, the cost of production and subsequent high ticket price of audiobooks, rights etc.

We were stimulated with launch of Silksoundbooks.com in June 2007. It appeared to have all the boxes ticked being backed by top tier actors such as Bill Nighy, Judi Dench, Richard E Grant and Jane Horrocks and it was also selling titles at a reasonably low price of £7.95. It was as if the classics were going to get a lift and digital audiobooks were to happen. Sadly the 60 initial titles remain and the expected ‘1,000 within three years’ didn’t happen.

Last night we were a panel guest on Litopia After Dark and met a fellow panellist BJ Harrison. BJ has started his own classic digital audiobook venture based in Utah. He again has chosen the classic public domain route and now has some 150 titles all recorded by himself and available via thebestaudiobooks.com and his iTunes ‘The Classic Tales Podcast’ , which in its first award-winning season registered 3rd in their overall iTunes podcast charts. B.J. Harrison mixes the world of classic short fiction from Poe, Dickens, Hardy, Stevenson, Fitzgerald and many others, with the longer classics of Twain, Dumas, Stevenson. The list of authors reads like a ‘Who’s Who’ of classic literature and he has not restricted it to North American. His prices are very very keen and should appeal to a wide audience seeking a listening read at a bargin price. Its approach is very similar to the successful action Wordsworth Editions took to bring down the price of printed classics.

We were stimulated by what BJ has achieved and although some may say its only on a small scale, it again raises the opportunity and a way to do things differently. He mauy have taken a similar route to Silksoundbooks in adopting the classics but there is no reason why the approach and model can’t be used by authors under a collective umbrella.

Does the audiobook stand in its own space, or will it become just a text to speech device feature, or an additional file element to an enhanced ebook?

We think that the audio format has a place and is not just for the visually impaired. Again we are drawn to Dickens and the short instalment or episodic release. The enthusiasm with which he captivated hie audiences and drove his sales of the books. What a fantastic way to release a story in the digital age and even a different way to sell and market a story..

To listen to the 'Litopia After Dark' podcast 'Million Dollar Voice'

Via Radio Litopia

To visit BJ Harrison’s web emporium of digital eloquence

Amazon Trade In Service

What separates Amazon from the crowd and makes it a true bookseller may be its understanding of the lifecycle of books and of consumer needs and desires. It has always excelled at customer service, but it is its ability to breakdown the barriers that separate the various bookselling channels and go where others often fear to tread that we believe really separates them and makes them different..

This week we stumbled upon what we regarded as a new Amazon Trade In service which truly reinforces their ability to look at the market needs and drive change.

We always respected our old friend and consummate bookseller Fred Bass of Strand bookstore in Manhattan. He bought New York’s review copies when the Reviewers had finished with them and sold them often even with the Editor notes still inside. He stood at his counter and bought used books on the spot. Some copies were rare, others not so rare, or even old. He understood that reader’s shelves weren’t virtual and owners often needed to sell some books to make way for new ones. It was the perfect recycling system and another reason to visit The Strand.

We also remember speaking at the IBF conference in South Africa in 2007 and learning from the Russian delegation about a ‘Second Life of a Book’ scheme in Moscow. The scheme enabled books be returned to any bookstore that stocked the title. No receipt required and as long as the book is in mint condition the retailer will hand back 50% of the retail price of the book. They don’t give it refund in cash but in the form of an electronic top up on a book debit card. The book is then returned to the shelf and sold at 10 to 15% discount. The returns can also only be done between the hours of 10 and 10 on a Saturday.

The point is that books can have a second life, they do have a value, they can be recycled and readers only have finite shelf space.

Amazon now has created ‘Amazon Trade In’. It is an online service that enables users to match their products be they books, DVDs, games to the exact version displayed in our Amazon Trade-In Stores. This obviously is a ‘beta’ service and today Amazon strictly ensures that they retain control of what they accept. Against the listed acceptable items will be specific trade in conditions and once accepted the users prints off a delivery label and packing slip, dispatches the items and receives an email confirmation. An Amazon.co.uk Gift Card will be deposited into their account after the goods have been received.

There are various categories with Digital Games for; playstations 2 and 3, Xbox360, Wii, Sony PSP; Physical Books on Business, Finance, Computing, Law, STM, textbooks. The fiction books listing looks very sparse and has many different renditions of the same title and often at very low price points. It is obviously still beta and will be interesting to watch especially on high ticket book genre such as initially listed. Students have always traded their course books and Amazon has always accommodated used books and even owns ABE for trading rare books.

We found the Trade in forum page interesting. The second most discussed topic was on trading in ebooks and asking if Amazon would extend the service to cover this obvious opportunity. Amazon today does not trade in ebooks but there is an obvious market demand for it. If offered, it could not only ‘lock in’ readers further to the Amazon Kindle platform but also help them offer low prices. Imagine, Amazon sells you a ebook, you read it and then trade it in and the best part is that the ebook never really leaves the Amazon warehouse! It continues to question the old ownership model and the current lack of first sale doctrine on ebooks. Why would you buy an ebook that you couldn’t trade in with Amazon in the future and that may be locked into a DRM (digital rights management) service Amazon would not accept? Would other technology companies be able to, or wish to respond? Who knows, there could be a special levy to reward the author on secondary sales. Although many will firmly say ‘no’ and that it will not be permitted, we have to also consider the impact of not addressing an obvious market opportunity.

Business models should reflect market demand and the trick is to make them a ‘win win’ for all.

To read about the 'Second Life of a Book'

Apple: Shares, Trademarks, Ethics and China

In 1997 Apple share were worth as little as $3.19 and the company even faced the possibility of bankruptcy. Yesterday, the shares passed $500 (£317) a share for the first time and rumours and enthusiasm continued to mount about the new iPad. It is a truly remarkable turnaround and values Apple today at some $460bn.

There are reports claiming that Apple has ordered some 65 million 264PPI 'Retina Displays' from Samsung and LG for its iPad 3 assembly line. The numbers if correct would indicate that they expect a significant uplift in sales over that of the iPad2, which was released only a year ago. With the anticipation that an iPad 3, will be announced on March 7th, it appears clear that Apple is confident its 3rd generation iPad will break all previous sales records.

Enter the dragon in the form of China and two stories which although unrelated have the potential to impact the party.

Who Owns The trademark iPad in China?

Apple is a brand leader and has created a family of iconic brands and patented technology which it has protected and managed with vigour. Today it faces a trademark battle with Chinese company Proview Technology over the 'iPad' trademark.

Apple had paid some $55,000 to buy the European rights to the "iPad" trademark from Proview's parent company. Proview had registered the mark in several countries back in 2000, with China being added in 2001. Proview now claims that it holds the right to the name "iPad" in China and that this was not sold to Apple.

So is this a false claim by Proview, or will Apple have to dig deep to now buy the mark that they have globally established? The challenge for Apple is that it is in China which can’t be ignored and is now a super economic powerhouse and also one of their major markets.

A court in Shenzhen in December dismissed Apple’s claim that it owned the iPad name in China and following the ruling, Proview requested the authorities in over 20 Chinese cities to investigative whether iPads were being sold. Now Chinese site Hebei Youth Daily reportsd that on Monday China's Trade and Industry department was actively confiscating Apple's iPads from store shelves in Shijiazhuang, because the tablets are, ‘being sold in violation of Chinese trademark law.’ Authorities are also reported to be acting in a second Chinese city, Xuzhou.

Lawyers representing Proview Technology are also reported to be seeking a ban on exports of iPads from China. As China is a key manufacturing base for Apple, this move could have an impact on iPad global sales.

However, an out-of-court settlement is expected, with the next court hearing due on February 22 in Shanghai. Some analysts expect a settlement could be around 10 billion Yuan ($1.6 billion US). A high price to pay but one that shows the value of the global iPad brand. It will not be the first brand ‘mistake’ by Apple who famously had a long standing dipute with the Beatles Apple organisation and even tried to claim iTV without a thought for the UK company ITV.

Some would suggest that the fact that China recognise trademark law is a huge step forward and that they are using it against a western company is somewhat ironic.

The Ethical Workplace

In a second Chinese issue Apple find themselves under the scrutiny of employment ethics on the issue of using underage workers and also the earnings of the workers in its supply chain.

Speaking at a Goldman Sachs technology conference Apple CEO Tim Cook tackled the topic of conditions in Apple's supply chain in China and other countries, ‘Apple takes working conditions very seriously, and we have for a very long time. Whether workers are in Europe or Asia or the United States, we care about every worker. Apple's suppliers must live up to this to do business with Apple.

However, CNN recently interviewed an 18-year-old employee at Apple’s Foxconn, a key supplier, where a worker claimed that she was forced to work overtime and did not receive benefits and sick days.

Last month The New York Times claimed that Apple found ‘consistent violations’ of its code of conduct after inspecting 396 of its facilities. They cited that; ‘The workers assembling iPhones and iPads…work excessive overtime’ and that, 'Some say they stand so long that their legs swell until they can hardly walk.’ Worse still, there have been a number of attempted suicides at the Foxconn facilities and it is claimed that last month, 150 Foxconn employees threatened to leap from a three-story building after claiming of poor pay and pressurised working conditions.

Apple has subsequently asked the Fair Labour Association (FLA) to audit Foxconn facilities in Shenzhen and Chengdu, China. It is then planned that the audit will then move on to other Apple production partners. Apple says that by the time the FLA is done, facilities that produce more than 90 percent of its products will have been inspected.

Cook stated that in January, Apple collected data every week on more than half a million workers in its supply chain and achieved 84% compliance.

However today, The Korea Daily, raised the issue of worker pay and claims that factory workers in China who are producing iPads collectively earn about $8 per unit or about 1.6% of the cheapest iPad's price. This contrasts starkly with with Korean factory workers, who earn about $34 per unit or 6.8 % of the sales price.

Apple is probably better than many on the issue of ethics, but they are also now more visable than probably all the others. As their share value and sales continue to rocket this raises many obvious questions. So the ethics issues have to be faced head on by the company if it is to retain its valuation glow.

Is There a New eBook Club Model?

As ebooks diverge in many different directions we find that we are often still left with the same 'buy to own' business model. We have long argued for ebook rentals not just for libraries, but in general and believe that the market is ripe for a 'Netflix'or 'Spotify' for ebooks.

Ballantine books today have launched a new digital platform 'booquo' and claim a wide range of Castilian ebooks for their Spainish community. The service will be available via a Digital cloud based Library Club on monthly subscription. The cost is reported to be 9.90 euros per month and entitles "a monthly reading of digital books available" and the basic book club. Those who are already members of the book Club, will only pay a fee of 7.90 euros.

However our interest soon waned as we read the usual book club demands that you purchased a book every catalogue and thought what a wasted opportunity. When will the dying breed of book clubs that use the old ‘BCA’ tired and dated model learn?

Imagine, a ebook club which had hundreds of thousands of ebooks, which you could read free on a monthly subscription. If you wanted to buy the book you pay the rate card and it’s yours, if you just want to read it you could do so online. You could be restricted to a small number ‘free reads’ per month and if you wanted more you pay a higher subscription. The service could carry advertising and royalties would be based on loans and advert revenues. It could even be multi media and carry audio, films, music and games.

Some will say that we are dreaming, but I bet we aren’t the only ones.

Digital Library Fallout Continues

The above poster comes from Sarah Houghton, who is the Acting Director for the San Rafael Public Library, Calofornia and writes a blog Librarian in Black. In frustration to the current non supply of some major publisher's ebook titles, Houghton had posted the notice on her library wall.

Yesterday, Penguin added fuel to the debate when it announced that they have effectively shutting down their ebook relationship with the major digital public library service provider, Overdrive. We find ourselves now asking many questions about the state of digital public library support from publishers and the thorny issue of the ebook rent and loan business models.

Why are some refusing to allow public libraries to loan out their ebooks which are freely available to buy in the market? Why has Penguin withdrawn its ebooks from the Overdrive digital library service? Why has a prominent group of major publishers refused to supply ebooks to public libraries? Why did HarperCollins previously invent a rule that said ebooks wear out after the same number of loans as their physical counterparts and must be bought again? Why are some insisting that library lending has to be done physically in the library and not over the networks?

If we look at the public library we see the friction many predicted between publishers and the libraries over digital content. You can wrap it up many ways, but at the heart lies commerce and the challenges of download to buy versus loan for free. If libraries seize the opportunity to loan ebooks and appeal to a wider and larger audience they could undermine today’s revenue streams. If they don’t seize the digital opportunity and remain wedded in the physical world they could spiral into obsolescence.

Some would suggest that libraries charge for ebook rentals and also sell downloads, but does this work against their public principles. Some would ask why publishers aren’t renting books out direct themselves and why we are still wedded to the ‘ownership’ model in a virtual world? If there were to be a significant shift in market demand, do publishers have rental models that would hold water?

Some like Bloomsbury Online are quietly forging library relationships and moving forward, whilst others appear to be standing firm behind the barricades and not moving.

The Overdrive service is not new and it is the dominant provider to public libraries today, not just in the US, but increasingly in many countries. The libraries like the retailers have left it to third parties to invest and provide the common platform and repository. Was this wise, – probably not? Was it inevitable given the funding, – probably? However, we are were we are and it isn’t going to change for some time.

The tragedy is that these battles are being fought in public at a time when we all try to help reposition the public library in the face of disruptive change, spending cuts and even closures. It would appear to be more about reacting to change, not from a collective, but a singular perspective.

Some of our other recent posts on this subject:
Can eBooks meet the Changing Social Demand? Nov 28th 2011
Whose going to capture the various library worlds? June 20th 2011
Amazon Takes Another Step to Join the Publishing Pieces May 5th 2011
Amazon Overdrive Potentially Lock Up Libraries April 20th 2011
Freeing eLibraries to Compete? March 15th 2011
Digital Library Madness: 26 and You Are Out February 27th 2011
'Public Libraries: Back to the Future'. Brave New World December 2010

'Digital Drop Ship' Logistics and Commerce

When we look at the book supply chain in its most simplistic form we find; authors, who create the work; Publishers, who acquire the rights, develop, hone, produce and take the work to market; Retailers, who promote and sell it and finally, the consumers who buy and read it. The Physical book supply chain was always made complex by the sheer numbers of unique titles, from thousands of publishers, which were sold through thousands of retailers. Consolidated publisher distribution and third party wholesalers helped aggregate the bulk, but it remained a ‘many to many’ and crowded supply chain. Some saw this as a weakness, but in reality, it was a strength, which despite its inefficiencies, it gave us great diversity.

In the late 90’s online bookselling saw both publishers and even retailers handing over their internet sales and customers to new internet entrants. It was amazing to see even large retailers initially prepared to duck out of the internet and align their internet fulfilment with the likes of Amazon. Some woke up and started to create their own internet offers as they realised that it was just another channel and it was their customers and margin that they were handing over. Others were happy to sell someone else’s range, through a customised generic ‘white label’ websites and just collect the commission on sales and many publishers developed their own web sites but still often handed over the fulfilment and sales to others such as Amazon.

Around 2006 the ebook re-emerged. It was now driven by a new breed of eink devices and a digital network capable of supporting media. Many decided it was too expensive, too difficult, or too risky to compete and again handed over the trade to a handful of digital aggregators/retailers. Many just sat on the fence and waited to see if it would happen. As a result we now find the ebook world is effectively serviced through a handful of digital aggregators which include the ever agile and market dominant Amazon. As a rule aggregators do not link to other aggregators to retrieve files, but instead demand all files reside in their own repository.

Some would suggest that the ebook supply chain just got very simple and cut out the majority of bookstores. Ventures such as Indiebound offer bookstores the white label solution, but the reality is, that with the exception of the likes of Barnes and Noble in the US, the retailers did little to embrace and invest in ebooks.

Many publishers were happy to create ebooks and were happy to mix direct marketing with indirect fulfilment.

We now even have an ‘honesty box’ sales environment were publishers no longer count the units out the back door. They hand over a single file and then rely on sales reports from others on how many units actually shipped and at what price.

A few however adopted a different approach. This separated the different activities associated with the sale on similar principles to the ‘drop ship logistics’ that is used by many in the physical and internet world. Here the retailer can sell anything from anybody. The customer finds the ebook at the online store pays for it and their cash transaction is processed locally. When cleared the transaction is automatically transferred via web services to the digital repository holding the title with instructions to ‘pick, pack and dispatch’ it electronically to the consumer. Once downloaded the retailer is notified of the completion and the whole process is completed all in real-time.

Some would suggest that is what happens today and to a degree they would be right. However, the fulfilment is often by one aggregator. In 2007 we created ‘digital drop ship’. This could use a combination of digital repositories many hosted by the publishers. The web service coding and messages were standard and the location of the file could be determined either locally at the retailer or remotely at a clearing centre. The same infrastructure could also support library and other rental services.

We could go on but the point is that the publisher were still able to send files as they do today to the half dozen major retailers and then service the rest themselves. They effectively be counted the downloads out of their own backdoor and controlled their assets. Importantly they now enabled anyone sell their ebooks, with no commercial risk, retaining tight control over their inventory and never letting a single unit out the door until it was sold.

Some may say we are dreaming, but it exists today.

Today we find the power in the ebook supply chain is shifting firmly into the centre - to the aggregators. As we have seen these then can be or become retailers, restrict the market to their white label offers and importantly control the channel. They could also become publishers themselves, initially in self publishing and later by their own imprint or perhaps acquisition of other’s lists. We have also seen the movement away from devices and towards the ‘closed platform’ often with its own DRM and file format nuances. The likes of Amazon, Apple, Kobo, Barnes and Noble platforms all close down the opportunities for others and have become the new ebook ‘king makers’.

We are not saying that ebook consolidation is bad, but we are saying that it creates new challenges, risks and opportunities and perhaps its time to consider some of these before we sleepwalk into a position we may feel uncomfortable wakening up in.

The Fantastic Flying Books of Mr. Morris Lessmore

A friend shared this with us and although it is 14 minutes long it is a simple story about the joys of books and reading. Enjoy

The Fantastic Flying Books of Mr. Morris Lessmore from Moonbot Studios on Vimeo.

Are Sony's Days in eBooks Numbered?

Sony once aimed its sights at being a big player in digital publishing. It created its own ebook format, was one of the major drivers behind Adobe updating the neglected ACS3 with the ACS4 DRM service, were the early backers of the ePub format and of course introduced several eink ereaders. It even entered into one of those ‘exclusive trade deals’ with UK retailer Waterstones. However it failed to deliver the list, didn't not develop a plausible platform and lost the eink world to Kindle. Some five years on and how times have changed. Sony were around at the begining of the digital reading chapter, but this may be one ebook that will remain unfinished and is in danger of slipping from the front list and going out of digital print.

Sony’s problems would be small if they were just about their ill fated venture into ebooks. However, today Sony have just announced a 159 billion yen ($2bn) net loss for the last quarter of 2011 and have slashed their full-year forecast to a loss of 220 billion yen ($2.8bn). Hard times, require hard action and Sony have reacted and announced that in April ex-PlayStation exec, Kazuo Hirai will take over from Howard Stringer as Sony president and CEO.

The reasons for the challenges facing Sony are as many as the different markets they deal in. They include the implications of the losses it made on selling its S-LCD display shares to Samsung. Also there is the cost of the migration of Sony Ericsson back to Sony with the associated creative accounting on deferred tax assets and a fickle electronics market,where Samsung have eaten into Sony’s once strong market share and it has dropped some 15.7% in the last quarter. Then we have the floods in Thailand a strong Yen and a sales drop of some 24.4% in its consumer products and services sector. Even Sony Music and Sony Pictures didn’t lift the gloom with Picture only registering a modest profit and Music seeing a sale year on year decrease of some 11.7%.

Its hard to see Sony making a comeback into digital publishing and its offer would require some serious investment and change of fortunes at a time when the business obviously reqires to focus on its core operations.So as Waterstones look set to announce another partner is Sony's ebook venture at the end of the road?

Kobo Unplugged

The one thing that you can say about Kobo is that they remain focused and determined to forge an international offer and pit themselves in the face of some formidable competitors. Their international strategy was eloquently conveyed by their evangelist and Vice president of content, sales and merchandising , Michael Tamblyn, speaking at the Digital Book World conference in New York. Michael said that when you start from Canada you have no option but to go International.

Michael’s presentation is good and well worth a listen and brings home some of the realities of managing a tight roll-out to many countries and the need to segment operations and stick to a template approach. They aim to establish themselves in 12 more countries this year, which may not sound that ‘gun ho’, but is a country a month and will get harder as they break out of the English speaking and ‘western’ markets.

However, international growth, which is heavily reliant on ‘partners’, can have its challenges. Last weekend we visited a large WHS store and saw first hand how a partner can let you down badly. Getting some retailers to treat it better than just an instore franchise is itself a challenge, but this was in what was a ‘hotch potch’ of a ‘pick and mix’ store that frankly made the old Woolworths look good and was hardly aligned to the messages Kobo needs to get across. Yesterday, Asda announced that they would be selling the Kobo touch reader for £87 which is just under the Amazon Kindle price of £89, which enjoys the Amazon brand and is backed by significant mainstream advertising campaign. Simply relying on spot buys, bin end POS and a comparable price isn’t exactly pushing the boat out. We have already seen how the old Waterstones was unable to retail ebook readers in store. Its one thing to have retail partners, its often another thing altogether to control their representation of your offer.

Michael presents some very interesting figures for Kobo sales of self published titles in various countries. Self publishing represents some 7% of US unit sales, this rises to 8% in Asia, 9% in South America, 10% in Australia, New Zealand and Europe and 14% in Africa. He explains some of the reasons behind the local variances but the percentages are somewhat higher that we expected and demonstrate that the opportunity that is potentially starting to blossom under the ebook umbrella.

Michael also shares some interesting insights on local and global pricing which demonstrate how many publishers still see physical and digital pricing locked together.

Kobo are now within the Japanese giant Ratuken, which will give them better backing and they know that they will need it as they race to get themselves established in many countries and across all the continents. This is about raising brand awareness and credibility just as much as it is about service. Whilst Barnes and Noble still today remain largely unknown outside of publishing and the US market, Kobo now has a better street profile in a growing number of countries. It will be interesting to see how the Kobo brand stands up to the potential Waterstones’ adpotion of B&N’s Nook and how they both compete with Amazon in the UK later this year.

To hear Michael's 15 minute presentation

Related posts
Kobo Steps up to go Global (Nov 2011)
Can Kobo Win at the Races? (oct 2011)
Kobo Has to Follow (June 2011)

Lost in Transition

The ISBN, ISSN, BIC and BISC codes and jacket images have all helped the trade, but do they still matter as much in the digital and direct marketing era?

It’s as if we have all been on a constant never ending journey to improve the contextual information and identification of works. Everyone in publishing today understands the relevance and power of good structured bibliographic information. This helps us search, find, validate and select the right work, but is this still enough in today’s consumer driven market?

Today we use the likes of Google to search, Wikipedia to search deeper, Amazon and ABE to search for books and the likes of email, Facebook and Twitter to communicate. The reality is that they are what many of us use and so are pivotal to any marketing strategy. Does the consumer know or even care about the ISBN and would they know the BIC and BISC category codes?

Today we have to start to think about the user, how they want to find things, how they socialise and how they can validate the relevance of what they find.

The emergence of the jacket image, which really started with the likes of Amazon in the 90s, has now become a de facto standard. Whether we like it or not, users can and will often immediately, ‘judge a book by its cover’. It’s hard to imagine selling physical let alone digital trade books over the internet today without the jacket, but is that enough?

We all dabbled with ‘search inside’, but even Amazon often got this wrong and their ‘surprise me’ page could often turn out to be a ‘reject me’ one. First chapters were not fully exploited as a free teaser and the page selection experience was and remains somewhat inconsistent and haphazard across the market. It is interesting that academic publishers often understood the key pages to sell their books, but others left it to the arbitrary, ‘pick 10% from anywhere’, which could include front matter and even blank pages!

A product description, (blurb) and readers comments and their ratings often now accompany an individual title, but again more as filler than a driver and are often restricted to one site. Some would also suggest that some consumer comments, read like they had been written by a marketing person, an author and not a consumer.

We have seen the author video which often was too long and also tended to play to the converted. We have seen the emergence of other video reviews from retailers and fans but these often languish on YouTube looking for a home. Youtube is as valid a promotion platform as any, but how many use it and what information is tagged?

Google gave us the ultimate search across the content itself but this often was only as good as the term used and the pages rendered. How many jacket images and illustrations are correctly tagged, promoted and linked through the likes of Google images?

So as we move into the ‘enhanced ebook’ world and the content itself can explode into different media, how do we package that contextual wrap such that it is contestant across the market, engages consumers and sells books, be they physical or digital? Esther Dyson once said that the key to the Internet was being able to find that digital needle in the digital haystack. We would suggest that we haven’t found it yet. We may also have to rethink what we do and consider a revolution not a gentle evolution.

Some would suggest we adopt the DOI identifier but they would be as foolish as when it was first muted in the late 90s. Some would suggest that every form of a rendition is given a unique ISBN and that would appear to miss the mark. Some would suggest it more important that we are able to group renditions and present choice than divide them and offer a disjointed picture.

Finally, we are moving from a front list bestseller mass market to one that sells all books, in all forms and has a distinctively long tail. How do we revisit those long forgotten titles and ensure that they too have visibility?

It is important that we recognise that context needs to be uniform and available to all across the market. So what would you see as the contextual information of tomorrow?

iPhone Enlargements!!

Every now and then we see something we didn't expect but that when we think about it is obvious.

Today we found a host of iPhone accessories which demonsrate why the likes of Kodak have left the room.

60X Magnification Mini Digital Microscope with LED Head Light and UV Light for iPhone 4 just $14.49



Long Focal Lens Tripod Set for iPhone 4S/4 Just $29.99



Telescope 6X Zoom Camera + Case Holder for iPhone 4 / 4S Just $11.67

Perhaps the immortal Mae West would now have said,'Is that a iPhone in your pocket, or are you just happy to see me?'

Click to see more from miniinthebox.com

So who is an ePublisher?

Although they varied with the market sectors they served, being able to defining a book publisher used to be fairly easy. The same could be said of film, broadcasting, music, games publishers. However digital has the capability to change these well defined and understood divisions and not only explode the physical media container and constraints, but also the content itself and the roles of those who produce it.

Last week’s over hyped Apple event did one crucial thing – it brought home the reality that an ebook is just a mere digital container that can accommodate many different forms of digital content. Yes, we all knew this, but now everyone, everywhere can clearly see it. This not only has the potential to change what we see as an ebook but also creates a new awareness and potential market demand for something different.

The ‘digital container’ changes roles. Will the author be able to mix and mix digital content into a digital package or will they need help in identifying, validating and clearing rights to extra material. Will the role of the publisher as a collator, packager and administrator become more important in some sectors? Will others outside of the traditional book market step in to be publishers?

We now read that NBC News plans to launch NBC Publishing, aimed at publishing 30 interactive new e-book titles in the first year. The ebooks will be based on current events, documentaries, trends, biographies, and profiles and they are looking to leverage their existing content assets from shows such as NBC Nightly News, Today, Dateline, Peacock Productions, their archives, NBC Sports, and Universal Pictures.

The venture will enable NBC to use video, audio, and current programming in creative new ways and may prove pivotal as TVs become smarter and connected. They have brought in two publishing executives to help on the venture and plan to use a network of freelance professionals as needed. NBC claims over one million hours of archival video content going back to the ’20s can repurpose NBC news coverage and also plan to work with independent authors who use NBC’s resources.

It is possible to now see a greater polarisation of publishers with at one end the specialist and smaller publisher and self publisher and at the other large or divisions of large media entities. We already have the players such as News Corp, Bertlesmann, Pearson but are now likely to see others enter not necessarily with text content as their main asset. It will be interesting to see if the BBC soon rues the day it lost its publishing control.

Whatever, happens mixed digital media is here. The challenge is not burning your fingers in lavish digital utopias that don’t earn out and grappling with the issues of rights, acquisitions, licences, permissions and sales.

What the eDickens?

Last week we wrote about the logic of the appeal of the short story in this new digital world and yesterday we attended The Museum of London’s special 200th celebration of Charles Dickens.

What may you ask have has Dickens to do with today’s digital publishing world?
The answer is simple and is significant if we are to learn from the past and keep our literary heritage alive.

Dickens was a master of the instalment.
He not only wrote many works by the chapter, he also delivered them as ongoing works. He used the ‘penny press’ to presale the stories by instalment and in 1837 was selling some 50,000 copies of his Pickwick periodicals at a shilling a time. These contained one chapter sandwiched between pages of adverts. Many of these adverts had little to do with books or even the subject matter of the story. In fact the adverts demonstrate the diversity of the audience.

The journals appeared either weekly or monthly and given the number of chapters and volume of sales, plus the advertising revenues, should have earned him a good return. It is claimed that when Great Expectations was published in weekly instalment in 1861 it had weekly sales of some 100,000 units a week. Interestingly they didn’t diminish his book appeal but fuelled interest in the finally work.

We find ourselves again asking why we are not publishing digitally by instalment today? The Keita novels in Japan thrive through instalment and Stephen King and others have also ventured down this digital route, but why hasn’t a publisher grabbed this clear digital opportunity by the throat? Is it down to the way many write today? Has the publishing and editorial process got in the way of the instalment? Is it just too revolutionary?

Why are even short stories still seen as collections and packaged as such. Even worthy initiatives such as Quick Reads appear to be locked into what some may question as yesterday’s thinking and merely duplicating the physical offer digitally.
What is also interesting is that Dickens lived through the literacy revolution where the masses were able to read and penny fiction was a way of feeding their new habit in a digestible form.

Dickens embraced the new
The transport and communications revolution of Dickens’ time was, on reflection, as great as that we have today with technology and communications changes. He travelled extensively, especially by the new railways, used the new telegraph and postal services. Between 1858 and 1870 he gave some 472 readings of his works in the UK and US. He even had special bound reading copies in larger font and was a consummate speaker. He was a writer, social observer, pamphleteer, speaker, columnist, playwright and publisher.

Dickens enhanced his works
In Victorian times the novel was often enhanced by illustrations. The ‘Sketches by Boz’ was illustrated by George Cruikshank and as with many Dickens tales the reader was able to picture both in words and in imagery the story as it unfolded. Today we have often lost the imagery of yesterday. Does the new ebook now enable us to once again enhance and illustrate the book? There is now a new opportunity to bring back the imagery and even differentiate the different renditions.

Dickens wrote in the language of the people
Dickens was a master of not just description but narrative. He was a master of dialect and could write and express narrative to reflect a person’s origins, class and the times. He even travelled one day to Yarmouth and used the dialect he heard to paint the character he wanted. It is fascinating to hear how Dickens used the dropping of the ‘h’ , or how he could change ‘ing’ to be ‘in’ or even ‘ink’ to reflect the character. He would have been a nightmare to edit today!

But this understanding of the narrative and even the enthusiastic way Dickens would have read to his captive audiences may also be new enhanced book opportunities.

It is not hard to see the relevance of Dickens to today and why it is somewhat ironic that 2012 is the 200th celebration of his birth.

That Was The Week That Was: Apple, Kodak and a Blackout

So what was the biggest news story this week? The filing for Bankruptcy of that previously leading technology giant Kodak, the Presidential launch and hype of Apple’s grab for textbooks and to create an exclusive iWorld or the darkness created by the likes of Wikipedia and others and resultant climb-down of US legislators to their ill conceived SOPA and PIPA bills?

Kodak clearly teaches us that no one is immune to disruptive change and the emergence of digital technology and integrated video and photography in every smartphone simple by passed them. It is a very real lesson and one we should rank alongside many others who failed to adapt. In any value chain we all have to add value to survive.

The Apple launch will have significant repercussions far wider than the intended textbook market. Apple has not thrown a people into the pond but a whacking great bolder, that forces us to question much of what we do between author and reader. The one thing that is certain is that it will change not only what we do but how we do it and what we trade moving forward. Apple is not the winner merely the one to throw the first stone.

So what about the lights that went out over the Internet and the ensuing recreation of what, would have been bad law. This was a relatively quiet but significant revolution. Backed largely by big media and content producers such as the movie studios, record labels it is seen by them as their way to control and fight piracy and by many others as going too far the bills would have gone too far and with the capacity to created a nightmare.

The Stop Online Piracy Act (SOPA) was going to be bad law and along with its Senate cousin, the Protect IP Act,(PIPA) have galvanised protests across a very wide spectrum of companies and have been controversial from the beginning. Site such as Wikipedia and Reddit switched themselves of in protest. The object was to demonstrate what could easily happen under these ill conceived laws.

Under SOPA, a rights holder can take steps to shut that site off from search engines, ad networks, even Internet service providers and basically starve the offending site out of existence.

But critics see as being to easy to close down a supposedly offending site by just writing a strongly worded letter and would give legitimate sites a huge new set of legal obligations. Like a 21st century McCarthy witch hunt on the Internet.

On Wednesday U.S. lawmakers' websites were inundated with messages and Google delivered a 4-million-name petition against SOPA and even before the switch off, President Obama declared that he didn’t support SOPA. The silent majority stood up.

Is it the end, or will those experienced political wranglers and lobbyist divert their money to try and make some minor changes and push this bad law through?

This certainly was the week that was!

Apple iBooks Hangover

Today we all wake up with an Apple hangover from yesterday’s iBooks Education announcement. We all will now face a bombardment of commentary on whether it is good, bad or ugly. Opinion will be divided. Technical detail on file constructs will loose all but the die hard techie. The commercial rights and wrongs of the restrictions Apple have built in to contracts, their pricing vision and much more will be heatedly debated. Finally, we will face the reality that we are now entering a significant escalation in the Gorilla wars between the big four technology media reading platforms that stretches far past learning and is fundamentally coming down to which player is smartest in capturing our attention and creating the groundswell to lock out the others. The war win not be won by the smartest technology, the most open technology but by the smartest marketing and PR programme.

Last night we participated in a debate on Litopia After Dark. It was good and at a high level. It was also strange in that we all appeared to be struggling to form an opinion either for or against and found ourselves asking for more clarification. This is not a case of glass half full, versus half empty, it is about getting common understanding on a wide range of social, commercial and technological issues as they relate to the offer presented and forming an opinion based on what we know and not on what we don’t know. We recommend you to listen to the Litopia Broadcast.

Today we can look at the high level issues and then drills down to further clarify points.

Social
It is a given that learning can benefit enormously by universal access to technology to assist students of all ages to engage and develop. This is not just a US or even developed world issue and is truly global. However, at a time when spending everywhere is tight, we must ensure that choice prevails, in such a manner that it drives down cost and is inclusive and not divisive. Our thoughts are not about Apple versus Amazon but about Apple versus initiatives such as OLPC.

It is important that choice is available such that we avoid adding more fuel to the educational divide of those how can afford and those who have to learn without. Yes textbooks are expensive today, but replacing them with expensive technology that has an equally short shelf life, may not be the answer.

Finally, we must also consider who is the creator, who is the packager, who buys, who adapts and who users the content and context that supports learning. The value chain in one learning community or geography, doesn’t always prevail in another.

Authoring
We have long recognised that we now live in a world where we no longer listen, read and watch, but were we increasingly write, produce and repurpose, or ‘mix’ our own media. The iBooksAuthor toolkit looks to fit this bill perfectly and acts as one would expect. It enables multi media to be packaged to explodes and enriches today’s flat content.

It is reportedly aimed at publishers but is it really aimed at them, or to undermine them?

Irrespective of the technical issues of the tool, we see a potential groundswell of self publishing authors taking to the tool to create their works and enrich them. Is this restricted to education – no. Is it restricted to educationalists even within the learning environment – no. Some would suggest that it has the power to help further democratise writing.

Why would large publishers then be standing next to Apple and supporting the launch? Some would suggest that these same publishers are backing not one but many horses and spreading their bets widely. Will they shift from their other investments in the likes of Coursesmart or fledglings such as Inkling?

The challenge that publishing and learning now has is identifying who the author in the ibookauthor world is. Is it the traditional author, the publisher, the education board, the institutional library, the teacher, the parents ot groups, or the student? Some will say all of the above.

Publishers today add more value than just producing a textbook and paying the author. They ensure quality, conformance, provide supplemental learning aides and content for the different stakeholders. The more complex the work, the more collaborative the workflow and the wider the participation of creating and producing it. Does ibookauthor support collaborative works, or is it simply focused on the single creator?

Will textbooks have to be created as is today and then enriched after the event, or enriched at concept and flowed into varies renditions?

If we move to a ‘cut and paste’ world of self authoring, not just of text but media, who will act as the gatekeeper, who will ensure rights are not infringed, who will ensure ‘fair use’ doesn’t become open piracy? It is one thing to democratise creativity it is another to try and control abuse. Yesterday we talked about the lack of a rights registry tomorrow we may now have to accept plagiarism as a given.

Commercial
The commercials disclosed at the event and on Apple would appear to be divisive. They have plucked a price point of $14.99 out of the sky and whether we all agree or disagree, that like mud will stick. Does this include or exclude any tax and Apple’s 30% commission? How is the pie divided up and what is the expected cut for all parties? Some will suggest that it is aimed at increasing volume sales, but others will suggest that the market is finite and in some subjects areas, very finite. Some suggest that it will lead to more smaller works. So instead of one textbook, you could now have four richer ones. Will buying more twxtbooks still add up to the same cost to the student as the one textbook today and so defeat the argument of affordability.

There are many potential issues for ‘authors’ and publishers to consider in the terms published. Obviously these may not be applied to those Apple want on board, but we expect that there will be much written on this subject and it impact on whether the platform is open or closed commercially.

Technology
Some would talk about technology first, but It is interesting and fitting that we find ourselves bringing it up last.

Already the debates are raging across the internet as to the level of openness Apple has adopted with their new tool. Yes it is compliant with ePUB3, but with extensions and those would appear to be more in the CSS style sheet end and could prove a challenge to unlock for many. It make it a close format, merely hiding behind an open standard.

It would also appear that ibookauthor is free, open, but only available in Appleworld and on Apple devices. Good for Apple sales and domination, not so good for many others outside this community with sunk investment.

What we don’t understand today is how these new textbooks will work with the LMS environment and whether they will sit outside, inside or create new ones of their own called iBookstore?

For just one take on some technical aspects read this early paper by Baldur Bjarnason. There will be many more over the next few days.

Some have questioned the size of the files and the devices ability to accommodate them but these issues can be overcome. We await the next Apple launch.

There are many who recognise that all technology doors can be open and issues overcome. To many self publishers and small publishers, app developers etc these lock-ins may not matter as much as getting their creation published and in the one store.

We were asked last night what we thought the impact would be 5 years out.

We think:

• it will change self publishing of rich material, be it reference, learning, information etc.
• the take up in education will be slower that Apple would like as the beast is cumbersome and change is not overnight.
• Google, Amazon, Adobe, Facebook all have to respond and these will heavily impact the coming platform wars and not just in learning
• Governments and those holding the purse strings will decide some battles and with the budgets for content and technology starting to blurr in the US, this may be the start of a huge platform war

Today the dust is far from settled and some would suggest that anyone who is today either 100% for or against the initiative is not going to change their opinion whatever comes to light. The presentation and hype certainly drives a stake in the ground and made messages which are hard to disagree with, but it is not those but the Apple execution that we must focus on and decide if it works as delivered, needs to be adapted or doesn’t fly.

The Renaissance of The Short Story?

We now live in a sound bite word where the channel hopper often rules and where our time is often torn between many competing distractions. It is only fitting therefore that we are now starting to question and revisit the length of the story and recognise that it is just as rewarding to engage a reader on short and digestible read as a long one.

We have long argued that the digital era should herald a renaissance of the short story. As digital explodes the physical book spine, it starts to re write the economics and the need for 256 pages. No longer is it about tens of thousands of words but more about compact stories, or developing stories by the chapter.

My mother-in-law and many of her contemporaries broke into writing via short stories, which were much in demand across many magazines at the time. My Father-in-law like many started as a journalist and developed the skill of reworking, cutting back and sticking to the storyline.

Digital has started to now accommodate the short story and some such as Salt and Penguin has embraced the opportunity. The BBC has a National Short Story Award and the Quick Reads literary charity is now 5 years old and has distributed over 3.5 million ‘Quick Reads’ written by bestselling writers and celebrities aimed at engaging more people in reading.

This weekend the Telegraph dived in with a competition not based just on digital but recognising the potential to reintroduce this concise literary form that has inspired so many in the past. The British library have also launched a online service to enable everyone to enjoy the likes of Somerset Maughan, Kingsley Amis, Edna o’Brien and William Trevor reading their own works.

All these initiatives start to create a new form. Some will view them as singles that are then wrapped into a collection, others as stand alone stories that can be promoted bought and read as such and others as instalments to a greater living story. Poetry also starts to also have new opportunities to engage a wiser audience. Even those textbooks may be rented or sold by the chapter. Irrespective, the short is coming back and will give author a new opportunity to make that connection with the reader.

Apple Education Plus iPad?

Before his death Steve Jobs had already targeted textbooks as the next opportunity His idea was to hire the best textbook writers to new create digital versions that were complimentary and exploited the iPad. Importantly he wanted to make them free so they would obviate the US state adoption and certification process, which he thought was “corrupt.” In chapter 38 of his biography he says “ if we can make the textbooks free, and they come with the iPad, then they don’t have to be certified. The crappy economy at the state level will last for a decade, and we can give them an opportunity to circumvent that whole process and save money.”

Apple have now announced a special event at the Guggenheim Museum in New York City on Jan. 19. It is widely reported that Apple will announce partnerships with textbook publishers aimed at positioning Apple at the heart of the multi billion dollar market. Apple will launch their new digital textbook business. We don’t know the plan, but expect that in a market dominated by a few large publishers such as Pearson Education, Cengage Learning, McGraw-Hill Education, John Wiley & Sons and Macmillan that some will be looking for that Apple magic to rub off on just on their sales but their share values.

A report, "Simba Information's 2011 National Textbook Adoption Scorecard and 2012 Outlook," claims that almost all adoption states now are either promoting or permitting the inclusion of digital textbooks and other digital resources and importantly this includes hardware. It states that "Texas jettisoned the term textbook and replaced it with instructional materials, expanding the adoption process…Recent changes have also allowed districts to acquire hardware using the adoption funds." With respect to Florida it reports that the state’s Board of Education has overhauled its instructional materials adoption process and placed a greater emphasis on the approval and spending for digital materials, By the 2015-2016 school year…districts are required to spend at least 50% of their funding on digital materials."

If Apple were to secure a significant foothold in the market and deliver a seed change in how textbooks get adopted and bought they could well see significant revenues both in devices and in collecting 30% commission on each textbook sale.

So apart from the industry stalwarts such as Follett who are some of the leading digital textbook players today and can they adapt top any disruptive change?

CourseSmart.
The company was founded by a consortium of higher education textbook publishers to both offer digital inspection copies and full titles. It currently has iOS app for reading textbooks and with the backing of the major publishers is a force in the market. It is questionable whether this is used as the content repository and vehicle and so bolster its position further, or is sacrificed by its publishers and will now find itself competing with Apple.

Kno.
Kno has moved from being a device company to a platform and software one and is reported to have some 150,000 textbooks from 45 publishers. Kno textbooks are already viewable on Apple devices and the company was the top-downloaded educational app in Apple’s App Store at the end of last year .

Inkling.
Inkling has an iPad textbook app), which combines reading school texts with social and interactive ways to study with others with links to external and authoritative sources. McGraw-Hill and Pearson have both invested in Inkling.

Vitalsource.
Is part of Ingram Content Group also has its own app, with 60,000 digital textbook titles available for download to any iOS device. Vitalsource now has two million students using its platform worldwide and providing feedback to tell a publisher, “Nobody is reading Chapter 8,” as well as enabling enhanced multimedia applications.

Then there is the wonderfully branded site http://www.appletextbooks.com/ . A few challenges here we think.

The iBookstore hasn’t lived up to the expectations that many had and the Apple agency model is subject to a number of fair trading reviews. Will textbooks fair differently and make the difference and how will impact others already trading digital content?
We then have the Appleworld rule against running apps on iOS devices that direct the user away from Apple's ecosystem to buy competing products without using Apple e-commerce engines to handle the transaction. Apple has imposed a 30% tool both and made it harder to buy from the likes of Amazon, Barnes and Noble and others. However as demonstrated by Amazon’s latest ipad optimized website its relatively easy to provide a clean and touch-friendly for iPad-based browsing experience for readers without a 30% toll booth. With increasingly powerful Web-based solutions using technologies like HTML5, Apple won't be able to keep its ecosystem as closed as it might like.

Amazon’s touch-optimized Kindle Store for iPad allows readers to purchase or read Kindle e-book selections via Safari. The HTML5-based reading app is available via amazon.com/cloudreader and provides access to e-books through the browser, offline and online, with no downloading or installation required. Cloud Reader automatically syncs with other Kindle apps.

The AAP (American Association of Publishers) estimates that the college textbooks industry was worth $4.58 billion last year. Student Monitor, a private New Jersey student market research company claims that autumn etextbook acquisitions where up over 100% on spring and accounted for some 5% of sales. Simba Information, estimates that etextbooks will rise by 44.3% and generate $267.3 million US sales this year and they also estimate that, sales generated from state textbook adoption programs in Texas totaled $660 million in 2011.

However, we have to be also mindful of Job’s intent was not just to shake up the ‘corrupt’ textbook supply chain but to make them affordable if not free! Whatever the outcome Apple appears determined to shake the tree and collect the fruit.

First Sale Doctrine: Digital Threat or Opportunity?

One of the drawbacks with ebooks is that there is no second hand market for them. Unlike physical books you can’t sell a book once you have read it. You can’t even put it on your bookshelf. It is doomed to sit often forgotten on some virtual bookshelf.

The lack of ‘first sale doctrine’ on ebooks is a big opportunity lost today as we find ourselves tied up in DRM knots and fear of the digital unknown. Too much of what we do is negative and restrictive and denies freedoms, rights and norms taken as a given within the physical world. Denying established social practice just helps fuel further consumer piracy.

Music is probably the last sector media should look at for digital guidance.
Last week EMI filed two lawsuits against different online music services, Grooveshark and ReDigi for breach of contract and copyright infringement.

The first case against Grooveshark is understandable in that it is claimed that the digital music service has paid no royalties since entering a licensing agreement to stream music nearly three years ago. That it has taken three years to issue a lawsuit is somewhat amazing and EMI’s filing comes after three other major record companies; Universal Music Group, Sony Corp and Warner Music Group, all filing accusing Grooveshark of pirating thousands of songs.

Founded in 2006, Grooveshark claims 35 million users and has major adverting support contracts. It allows users to upload songs to their servers, which it then lets other users stream for free. A virtual ‘swopshop’. The music industry is starting to accept services like Spotify and Rhapsody that stream music by subscription, but Grooveshark is again different and operates heavily under the protection of the Digital Millennium Copyright Act.

Founded only last year ReDigi is different again and operates under the “first sale doctrine” legal concept, that allows users who buy a copyrighted item like a book or CD the right to sell it or give it away. ReDigi operates a ‘used music store’ where users upload unwanted songs and buy others at a discount. ReDigi claim that they can verify individual MP3 files were legally purchased and not ripped or downloaded from a file-sharing network. Interestingly the sellers must also install a ReDigi program on their computer that removes any copies of a song from the seller’s computer.

The case pivots on the claim ReDigi is infringing copyright in making copies of digital files as part of the process of uploading songs from a seller’s computer and transferring them to a buyer’s. EMI claim that, unlike selling a used CD, a used MP3 is theoretically the same as a new one and hence the infringement. ReDigi counters saying it is merely acting as a responsible marketplace. Again EMI is not alone and the RIAA (Recording Industry Association of America) has also sent ReDigi a cease-and-desist letter.

So we return to the question of opportunity versus restriction, or a glass half empty versus a glass half full. Digital files have been made different not by technology, but by unimaginative thinking, restrictive DRM and bad law that is no longer relevant to the times. We must all realise that just as like having different tax rules for the same product, having different consumer rights will just drive more honest consumers to cut corners and disrespect copyright. The publishers may protect today’s revenues, but in doing so may end up losing tomorrow’s and their customers.

Publisher be they music, games, ebooks all have to realise that the right to resell is a given and finding a way to allow that is a must. We already have digital rental and loans and restricting or denying resell is just plain lunacy. The resell markets could in fact blooster the price of the original sale and start to create value added ownership. It could even offer the independent bookstore a digital lifeline. The ebooks and publishing market is a very fragmented and getting consensus of vision let alone action is often a challenge in itself.

Media on Demand Takes Another Step Forward

The way we all consume and pay for media is changing radically and moving from, pay to own, to subscribe for on demand. This is no longer about music, film, games, TV,information and books , but about all digital media and how we find it, access it and pay for it.

The film on demand wars just got a lot more interesting in the UK with the news that Movie and TV streaming service Netflix has launched in the UK and Ireland. It is claimed that Netflix has been the single biggest driver of internet traffic in the US and has over 20 million online subscribers in 47 countries.

Online rival and Amazon owned Lovefilm, recently surpassed two million subscribers and both it and Netflix now line up against Sky Movies,Sky Atlantic, Virgin Media, YouTube and retailers such as Tesco’s Blinkbix for the online market.

Netflix has only launched its online service in the UK and in doing so has pledged to break BSkyB's stranglehold on the movie market. The service will allow users to stream film and TV content on devices including tablets, smartphones, games consoles and internet TVs and all priced at just £5.99 a month. Not to be undone Amazon's LoveFilm, has announced a new "streaming-only" tariff at £4.99 a month. Netflix hopes that its personalisation technology and an integration with Facebook, which allows people to share what they are watching with friends on the social network, will also provide it with competitive edge.

Netflix has also announced a number of new TV and film deals with partners that include Channel 4, Disney, ITV, Sony, 20th Century Fox and All3Media. These deals are mainly for the second rights window as opposed to BSkyB’s which has prime rights deals with the six major Hollywood studios which enable it to air films in the first pay window. When Netflix launched in Canada the company had no "pay one" deals.

Netflix has also announce deals with the likes of the BBC, Miramax, Lionsgate, MGM which will give it access to titles such as Pulp Fiction, Kick-Ass, Top Gear and Doctor Who. Lovefilm has agreements with partners including ITV, BBC, Warner Bros, Entertainment One, Sony and Studio Canal for titles that include the Twilight Saga, Tinker, Tailor, Soldier, Spy and The Social Network.

So the UK now has three determined online streaming service providers who are not only going to aggressively compete on price but also on content. We see the growth and demand for Spotifty's music on demand, Wii's expansion to media console and recognise that as media continues to converge, platforms become important and usage migrates to on-demand we ask why many many still see books as different?

Is eInk Sinking?

Apart from basic Amazon Kindles what other eink devices are selling today. It could be said that even the Kindle could soon be on Fire. The fact is that the ‘loookie likie’ devices that once littered the market are today being usurped by AMOLED smartphones and tablets. The best measure for this decline came today as E Ink Holdings Inc. shares slumped some 6.9% (the lowest close since July 1, 2009) on the news of the company’s December sales which had slid 84% from a year earlier!

Fourth quarter sales were only down 4% from the third quarter and overall annual sales were up 53% However, E Ink alarmingly reported that its December consolidated sales were down 55% from November and also down 57% from a year earlier...

Investors may see this as a temporary sales issue, but some will see eink has had its day as we know it today and is unlikely to bounce back and that far from a seasonal dip it could be a sudden decline. We have seen yet another supplier BeBook bite the dust and its hard to see any real action other than basic Kindles..

CES 2012 and Device Rumours

This time of year is not about January sales, but CES in Vagas and the new electronic gadgets and devices on show or rumours afoot. This year may not be so exciting as previously, there are some very interesting developments.

Ultrabooks

There will be more tablets this year, but the question remains as to whether they are seriously going to compete with the iPad at the high end and the Kindle at the low end, or end up as RIM, holding the baby? Are the manufacturers going to avoid the tablet and concentrate on the ultrabooks? The ultra thin 'weightless' models that are now starting to flood into the market to compete with the Macbook Air. Its just as if everyone wants to be Kate Moss! Personally we have been eying the Asus ultra model for a couple of months. With laptops now weighing in at just over 1Kg why do we need a tablet? These models are not new, but the $100 per device incentive from Intel to manufactures to build them is. As a result there are expected to be about 50 ultrabook designs on show, costing around $1,000 and as we all need to upgrade some time, why not with a device that is as light as a feather..

OLPC Tablet

We have always love the One Laptop Per Child project and it is now set to unveil its long-awaited tablet for $100. The tablet will feature an 8-inch 1024x768 screen, a Marvell Armada PXA618 chip and 512MB of RAM, running either Linux Sugar or Android OS. It will be able to be powered by hand-cranking and even has a solar panel optional extra! We love the housing and design and it shows that a $100 tablet is now a reality.

We recommend viewing Engadget’s video review of the device.

Google tablet?

Rumours are rife again on Google introducing a low end tablet early this year. This would probably follow their tie ups with Motorola and partnership with Samsung on Nexus. However do they have the media to make it attractive or will it remain an also ran like many other tablets?

Wii U Media Console?

There are the rumours that the Wii U will support a touch screen in the next generation console. The feature will have Ereader features which would allow users to download not only books, but newspapers, magazines, comics but much more. The touch screen will be used in a typical fashion to scroll of flip pages and would make the Wii U a more services orientated console and widen its appeal to be more of a entertainment and media than just a gaming device. There are even reports that Nintendo is secretly building its own Apple-like app store for the upcoming Wii U console.

Reading on Kindle via solar power?

Finally, Gizamo reports on a new leather Kindle case with an integrated reserve battery that can store solar energy to power a built-in pop-up LED reading lamp for up to 50 hours.

Do Barnes and Noble Have A Digital Strategy?

Last year the US market lost Borders and book chains globally started to look increasingly as vulnerable. Today’s news on the deliberations, speculation and announcements at Barnes and Noble are the latest shockwaves to reverberate across the publishing world. Whatever they do, or don’t do, it is apparent that everything is up for grabs, with reports of the sale of Sterling Publishing and the splitting of the Nook ebusiness from the bricks and mortar business. As its shares tumbled on the news to what looks, from the outside to be a PR and communications ‘challenge ‘ it leaves many asking just what the strategy and the desired outcome is.

Barnes and Noble have stated that the two sides to their retail business have very different levels of maturity and investment. What is alarming is that they make the public announcements and then say that there is no certainty that the review will result in a separation but that they do not rule out a potential sale of the ereader business. The obvious lack of strategy will not assure investors and without the Nook ebusiness what is left? The bricks and motor business is solid, but with no US chain competition, B&N would appear to be not taking up the slack Borders left behind.

The Nook sale could generate substantial cash for shareholders but does it include BarnesandNoble.com or is it just the ebook business? Barnes and Noble’s ebook business is where it is today on its brand. We think its time that Barnes and Noble realise that the brand is Barnes and Noble not the Nook. Without that affiliation would consumers still buy Nook? Would it have sold even a fraction of its sales without the Barnes and Noble brand? It is different to Kobo and Indigo, where KOBO’s brand was built separately from the start and also internationally many consumers have not even heard of Indigo. Is Nook actually strong enoughto survive alone and even if Waterstones were to adopt it would it be just another case of dejavu?

Even more surprising is the news that Barnes and Noble intent to get out of publishing and sell off Sterling Publishing. The shareholders may be rubbing their hands at the thought of cash but is Sterling in fact the digital family silver? In a world where content is the key, why sell off a viable content business that feeds the digital engine. Barnes and Noble have long bought into print runs, had their own imprints and Sterling’s wide range of content is perfect for digital exploitation. At a time when digital content is about to explode and Amazon is increasing its publishing activities, it wise to dispose of this asset for a few pieces of silver? There is also the question of whether the potential sale of Nook and Sterling will include Pubit , or exclude the self publishing ebook imprint?

We can see that B&N is not going to win the battle against Amazon’s Kindle platform. Their pockets are not deep enough, neither are the strategically positioned even within the US, let alone outside it, to do so. Can they be happy being the number two in the US or even lower and nowhere outside the US? Will Apple or Google inflict more damage to their market share? As Apple prepares to launch its own self publishing offer and go textebook and Google prepares a tablet, where would Nook stand? Like Amazon, B&N understand publishing and bookselling, but unlike Amazon they are carrying too much baggage, have less understanding shareholders and have greater financial exposure.

Addicted to Piracy?

According to industry bodies, governments and the press, digital piracy is reaching epidemic proportions and swift and focused action is needed to save the media industry. We are now regularly informed of the growth of piracy, the estimated number of illegal transgressions, amount of revenue stolen and even the numbers of jobs lost to piracy. Piracy is not restricted to any one medium and impacts the; software, games, film, music and now book industries.

Content piracy is not new and many of us have committed piracy, or know someone who has done it, either wittingly or unwittingly. We must face the reality that it will never be totally eradicated and there are degrees of piracy.

We now have legislation being rushed through different bodies that is aimed at shutting down sites and fining or black listing users. We have all read of the court prosecutions against individuals bought by bodies such as the RIAA. However if we step back, we could easily conclude that the threat of the stick, appears to be having little, if no effect and that piracy would appear to be on the rise in all sectors.

The questions we pose are not aimed at solving piracy, but at trying to understand what drives it and in doing so, look at alternative ways to contain, or reduce it. In many ways, it is a social problem similar to others such as; drugs, gambling, drinking and prostitution. It is important that we do not set our sights too high and by doing so, alienate those we wish to influence and that we are realistic in what we wish to achieve.

What are some of the root causes which are feeding the current digital piracy habit?

Free

Napster didn’t create the ‘digital free’ perception, but helped raise its profile to the masses. As Napster and others changed to pay models, they failed to migrate their bases and the ‘free’ music demand they created remained. Is the problem really ‘free’, or is it the ability to share and network with friends? We obviously will face the challenge of first defining a ‘friend’.

We believe that people are willing to pay and also recognise the need to support creative talent. However we also recognise that the hard core of people who will always demand ‘free’ are not going away and maybe are impossible to coral.

Fair Use

The right to fair use has always been prevalent and is very relevant in academia and libraries. Digital potentially lifts the fair use lid and can create confusion in the eyes of the user. Creative commons licensing is a positive way forward and is starting to address this. It adopts a mature approach to copyright licensing and one which accepts the fair use doctrine. However, works that are not licensed under creative commons can fuel confusion and lead to a piracy approach to all works.
Interestingly, our copyright laws were built in an era where we listened, watched and read media, but today they must encompass and era where many now also create media.

Music and film industries have had to grapple with the demand for sampling and our permission rights now need to reflect this. The challenge remains a rights industry without a rights registry and frustration can often lead to rights shortcuts and piracy.

Price

Price is always the sore point. Academic, text, professional, reference and trade books all have pricing challenges. It is easy to put a recommended retail price on a title, it is a lot harder to convey its value and sell it in a world that is now discount crazy, very price sensitive and where a price comparison is only a click away. We would suggest that the heavy discounting of physical books has had a significant devaluation impact on the perceived value of ebooks. It is also crazy to try to enforce a retail price maintenance ‘agency’ regime on ebooks, whilst allowing a price discounting free for all on physical books. Think of the consumer perception of such open hypocrisy.

Tax

We all have an aversion to paying taxes, especially taxes we don’t agree with. Governments openly reduce the tax on pbooks to promote reading whilst taxing ebooks to raise revenue. Are Governments and tax authorities actually fuelling piracy with taxes that are clearly inconsistent between the physical and digital rendition of the same work? Taxes have to be raised and someone has to pay, but no one likes to be ripped off. Who can justify a 20% tax difference? This taxing hypocrisy is not unique to the UK and is prevalent across many countries. Governments have to realise that the economy is now global, digital transparency is real and clear double standards will drive many to piracy. The media associations should be educating the government to think about its negative actions on tax.

Ownership

We all know that a digital file can be spliced and diced far easier that its physical cousin. One click and the font and its size can change. Another click and we have text to speech. We can annotate alongside the text, create bookmarks and of course copy and paste and much more. Today we still put ebooks into a DRM straightjacket ‘for the good of copyright’. We do not allow ‘the first sale doctrine’, often make it impossible to share books with friends and even limit the number of devices we can transfer the file to. The industry has failed to grasp even half way measures, such as social DRM (watermarking) and has maintained a hard line DRM approach. It reminds one of the early music days before the operators realised that MP3 wasn’t as much a threat as DRM which overly restricted user’s rights. It is questionable whether there would be any viable download market today if the likes of Apple had not abandoned their rigid DRM and embraced MP3.

Users want to ‘own’ their files and even sell them. If this is not recognised, then it either puts pressure on the price paid, or generates piracy. We must look at the ‘on demand’ and cloud based licence models, such as used by Spotify and Netflix.

However, is the industry ready or even willing to entertain such a radical shift when it can’t appear to even sort out its digital lending relationship with libraries?

The issues that drive piracy are not simple and are more about social economics.
Cracking down on the dealers of piracy is understandable, but it is not addressing the demand and the actions needed to change social behaviour. When we throw are arms up and complain about the level of apparent piracy and its estimated loss of revenue, we should perhaps ask ourselves, what we would accept as acceptable and work towards monitoring and maintaining this. A zero tolerance approach to piracy may well result in more not less.