Thursday, February 4, 2010

Macmillan vs Amazon: Many winners in this battle

TechCrunch reports that some of their readers (and presumably thousands others) are turning to sites like Barnes and Noble while Amazon continues to be slow in resuming sales of Macmillan published titles. Widespread news coverage of the event might not be hurting sales of Sony Readers and B&N nooks for that matter.

The more I think about it, the more I realize there may be many winners in this battle - with Macmillan being fairly low on the list.

  • Apple wins in two ways. First, they are garnering lots of publicity by the nature of proposing the agency-style relationship in the first place, and Steve Jobs clearly calculated comments post-special event about the price of books at Amazon coming up to parity with Apple, rather than vice-versa. Secondly, most of the negative reactions towards their pricing deals will have faded by the time orders are being accepted and reviews are being published for the iPad. Apple (allegedly) starts a fire storm over eBook pricing - and Amazon pays the price!
  • HarperCollins - and many more publishers. Macmillan shoots first, Amazon blinks, and Harper (and presumably the other big publishers) follow suit to cut similar deals with nary an ill word against them. You can't blame other publishers for following the newly established model.
  • Me! Look, I like $9.99 books just as much as you do - if I thought $1.99 could be done without hurting the authors and preventing the release of great new books I'd like that even more. But mostly, I like reading them electronically and I dislike waiting. If the choice is $25 in hardcover, $9.99 in eBook but wait 7 months or $15 in eBook immediately - I'll take the latter every time. People pay $10 to see a movie when they can rent it months later for half the price, why should books be any different.
  • Kobo, Sony, Barnes and Noble and half a dozen other smaller eBookstores. Does anybody really think a startup like Kobo wants to pay $12 for a book and sell it for $9.99? Did anybody really think Barnes and Noble wants to sell eBooks for a $2 loss rather than sell a $24 copy in a physical store at a profit? 
That last point is fairly important. While Sony may have practically started the eReader industry here in the States, it's Amazon that popularized it. "Is that one of those Kindles?" is as common a phrase today when I'm out and about as "Is that one of those iPods?" was in the early days of Apple's dominance of the MP3 player industry. There's a nurse at my allergist who knows the nook from the Kindle, as she wants a nook badly and is quite curious as to why I would own both. Aside from that, regardless of what I'm carrying, people tend to ask me either "What is that?" or ask if it's a Kindle, or if I like my Kindle - but always use the word Kindle.

If you want to establish yourself in this industry, you probably need to realize that people know Amazon likes to sell books for ten bucks - and join with the ranks of seemingly "everybody but Sony" in matching that price. Sony's a special case anyway - until nook's are widely available, Sony is the only player with a large retail presence. You see their Readers in Best Buy, Sony Style, Borders and many other retail powerhouses.

Kobo in particular has a lot to gain. Once the branded offering with Borders is done and the Spring Design Alex ships, they'll have even greater mindshare and volume. They also are a company that wins no matter what - as long as Amazon loses. If Amazon starts ceding marketshare to B&N - well, Kobo works with their products. If Sony picks up some customers - Kobo again can be a viable source of eBooks. Pretty much every product that supports DRM and isn't from Amazon or Apple is going to be Kobo compatible, after all.

Amazon purchases Touchco, touch screen Kindle seems inevitable

I spotted at A Kindle World news that Amazon has bought Touchco, a New York area startup specializing in touch screen technology. The technology is billed as 'completely transparent' (although I'm sure that's a euphemism for 'very transparent'), and affordable to produce at $10 a square foot.

A Kindle World believes this fall will see a touch-screen enabled, possibly Mirasol color powered Kindle. I'm a bit more conservative, seeing as both technologies are yet-to-ship. Clearly Amazon has interest in affordable touchscreens, and for sure every eReader manufacturer is looking heavily towards Mirasol for future products, but the landscape is littered with products not quite ready to ship right now.

Wednesday, February 3, 2010

$1 off each of your next 3 Kobo books

Use coupon code 3books up to three times to get $1 off each of your next three books purchased via Kobo. This coupon is valid through February 7th.

Rupert Murdoch to Amazon: $9.99 eBooks are not the future

From coverage of yesterday's News Corp. earnings call, CEO Rupert Murdoch speaking:

We don’t like the Amazon model of selling everything at $9.99. They don’t pay us that. They pay us the full wholesale price of $14 or whatever we charge. We think it really devalues books and it hurts all the retailers of the hard cover books. We are not against [inaudible] books. On the contrary we like them very much indeed. It is low cost to us and so on. But we want some room to maneuver in it. Amazon, sorry Apple in its agreement with us which has not been disclosed in detail does allow for a variety of slightly higher prices.
There will be prices very much less than the printed copies of books but still will not be fixed in a way that Amazon has been doing it. It appears that Amazon is now ready to sit down with us again and renegotiate pricing.

Jay Lake (Macmillan author) on the Macmillan/Amazon dispute

Jay Lake weighs in on the verbal spat between Macmillan and Amazon. He does so with an open letter to Kindle enthusiasts. He brings up some excellent points:

  • Amazon only mentioned the high end of Macmillan's proposal - and said little about the eventual drop of books to as low as $5.99 as they age.
  • That the proposal by Macmillan effectively mirrors the sale of print books - expensive at first, cheaper as they age.
  • That printing costs for large publishers selling popular books are as little as 10% of the overall cost of the hardcover - and only 20-30% for indie publishing firms. 
Not only is the article intriguing, but there are some fascinating comments as well.

Adobe Digital Editions 1.7.2 released

Adobe has released Adobe Digital Editions 1.7.2. The major feature of this release is official support for Windows 7 and Mac OS X Snow Leopard on both 32-bit and 64-bit platforms. In addition, several bugs were fixed.

Download ADE 1.7.2.

Barnes and Noble's roller coaster stock ride

Shares of Barnes and Noble soared up after activist investor Ronald Burkle sent a letter seeking to increase his ownership stake from 19% to 37% of issued shares, reports The Wall Street Journal.

With the stock alternating between declines and sharp rises, it's been an interesting ride this year. The stock had declined somewhat after poor holiday sales were announced. There was a quick jump as rumors swirled that Apple's eBook initiative was a partnership with Barnes and Noble for content, and then dropped just as suddenly once the news broke on January 27th that Apple has cut deals with publishers directly. Now, with news of Ronald Burkle trying to acquire more and more of the company without triggering an anti-takeover poison pill, the stock is up sharply again.

DISCLAIMER: Last year I was a shareholder for Borders, and currently own a fairly small percentage of stock in Barnes and Noble.

Georgia Senate expands definition of textbook to include electronic texts

This Tuesday morning, the Georgia State Senate voted by a margin of 45-5 to expand the definition of textbook to accommodate the use of electronic textbooks.

“I know how kids learn today and it is not the way it was when I was a kid,” said the bill’s author Cecil Staton (R-Macon). “It is not about telling them to go read a textbook that was written six years. It is classrooms that allow our children to learn through whatever means are available.”

Senators who voted against the bill worried about rising costs - proponents of the bill see that as a separate issue, as this bill does not require the use or purchase of said texts.

Tuesday, February 2, 2010

More on the Stanza USB Sync removal

John Gruber over at Daring Fireball has more on the removal of USB synching from Stanza. It would appear that the current iPhone SDK has no publicly documented functions for USB synchronization of files and content. This would mean that the request to remove such functionality was done more to keep developers compliant with SDK terms and less to do with potential competition between Apple's iBooks and existing eBook application providers.

Reviewed and Compared: M-Edge Touring Sleeve for nook

When M-Edge offered me the chance to review one of several new nook cases and covers, I jumped at the chance, as I'd been eying their Touring Sleeves for quite some time. I prefer reading "au natural", which is to say carry an eReader in a sleeve for protection, but hold the physical device case-free while reading.

The Touring Sleeve, like most of their products is not specific to the nook - they have versions for all three Kindles (original, Kindle 2, Kindle DX), plus all current Sony Readers. They've already announced plans to release this product (and many others) for the Apple iPad given it's near-certain success in the marketplace. The full review after the jump.

Kobo weighs in on the shift towards the "Agency" model

Michael Tamblyn, blogging for Kobo carves out a list of seven simple ideas that he feels are important to both Kobo and their customers:

  1. eBooks are the future.
  2. eBooks should be priced less than their physical counterparts.
  3. eBooks should be released simultaneously with their printed counterparts.
  4. eBook list prices should be set by the publisher or author.
  5. Retailers should, as they always have, be able to drive sales and reward customers.
  6. $9.99 is not the only price.
  7. A locked-in book is a less valuable book.
Reading just the tag lines for their seven points you might come across with the idea that they largely are more on the side of Macmillan than Amazon in this dispute, although they don't come out and take a side per-say. It makes a lot of sense to me that they would side this way - nobody wants to sell books at a loss when you have no hardware or other lines of business on the back end to support you. It's not a loss leader if it's 80% of your sales, and I suspect that bestseller's are a huge part of regular Kobo sales. I can't imagine they enjoy following Amazon down the path of selling at a loss just to stay price competitive. 

Stanza removing USB sync option after demand by Apple

Stanza, maker of a popular eReading app for iPod Touch and iPhone users allows you to access over 100,000 free eBooks. It also had the ability to copy ePub books via USB cable for a quick way to supply your own eBooks (non-DRM). TechCrunch is reporting that they've removed this functionality. after a demand by Apple.

Displax touting virtually transparent touch layer in sizes from 3" to 120"

Portuguese firm Displax is touring a new technology that could turn virtually any surface into a multi-touch display. Their technology can cover a curved or flat surface, works on top of OLED, e-Ink or LCD, comes up to 120 inches in diagonal length and is all of 100 microns thick. They claim to have 98% transparency, in essence blocking virtually no light/e-Ink from beneath.

Current models have a multi-touch limitation:

Currently, it can detect up to 16 fingers on a 50-inch screen.

Sadly, this does not affect me, as I myself have a 10 finger limitation. Displax currently states shipping will begin as soon as July of this year.

EC Media joining Infibeam in launching eReaders for the Indian market

EC Media, a firm largely owned by India-based publishing house DC Media will launch it's eReader by late March / early April of this year.

Compared to Infibeam's Pi at Rs 9,999, they will have 6" and 8" models available for Rs 8,000 to Rs 18,000. At a top end of $389 after conversion, that's competitive to the US prices for a Kindle / Kindle DX, however currency exchange is never quite that simple as living wages and cost of goods tend to differ greatly, of course.

FLEx Lighting looking to light your eReader

FLEx Lighting, who had a booth at CES this year has developed what they say is the world's thinnest LED backlighting technology, at 0.5mm thin.

In an interview with the Chicago Sun-Times, co-founder of FLEx, Shawn Pucylowski is hoping to attract Amazon or another eReader manufacturer to adopt his firm's backlighting solution.

Monday, February 1, 2010

Mammoth iPad preview link

If there's a more comprehensive preview of the iPad, drop me a comment as I haven't found it. Phone Different has an iPad preview that if printed comes in at around 35 pages.

Complete with pictures, explanations and a little video if you have questions about the iPad, I'd surely start there.

Barnes and Noble: nook gripes

With 1.1.2 impending, I'm hoping the following issues are addressed. These are the ones that bother me on a regular basis.

  • Lack of sorting in My Documents - at the very least, should be able to sort by date, author or title. Currently there is no sort, items show up in the order in which they are placed on disk. There are workarounds, but none that are acceptable to average users.
  • Merge My Documents and B&N books. Kindle does it. Once we acquire media, do we really care where we acquired it from? If I load 5 books from Kobo and have 5 purchased from B&N - why would I want to view them separately.
  • Folders or tags, please. Kindle has this same shortcoming. We should be able to create folders and organize books. Or use tags and sort by tags. Or sort by book genre. 
  • Bookmarks / last place read. It's still way to easy to have your nook forget where it was. After a full reboot, and often after a USB connection, the nook forgets how far into a book I was. 
  • Preorders to show accurately. This shouldn't even require an update, it can be addressed on the server end. Right now, if you browse Game Change at Barnes and Noble's web site, it shows as a pre-order (for the eBook edition). When shopping from your nook, it shows up as if it can be purchased immediately, which is damn misleading!
I'm looking forward to spending time with Sony's new reader, as I continue the quest for a perfect (hah) eReader.

20% off your next Kobo book, today only!

Use coupon code dealfeb1 today only at Kobo to get 20% off your next eBook purchase. Kobo books are compatible with any Adobe Digital Editions compatible reader, which is to say just about every mainstream reader with the exception of those produced by Amazon.

John Scalzi (Macmillan author) on Amazon

There are a lot of people with opinions (they're like as... well, you know the saying), but John Scalzi (published by Macmillan) has a great article (hat tip: TeleRead) on his blog that's well worth your time. He comes up with seven ways in which Amazon blew it in their handling of the dispute:
  1. The Stealth Delisting
  2. Amazon lost the authors
  3. Amazon lost the author's fans
  4. Amazon let Macmillan strike first in the press release war
  5. Amazon flubbed its own response
  6. Amazon destroyed its own consumer experience, without explanation, for several days
  7. Because of the idiotic events of the past weekend, people will just want an iPad even more
Give his article a read for the detail behind these seven points...

Free "Piracy" by Adrian Johns courtesy of The University of Chicago Press

Today only, so sign up quick (email address is required). The book is in ePub format, and requires Adobe Digital Editions to be transferred to your (non-Kindle) eReader.

“[Johns] traces the tensions between authorized and unauthorized producers and distributors of books, music, and other intellectual property in British and American culture from the 17th century to the present. Johns’s history is liveliest when it is rooted in the personal—the 19th-century renegade bibliographer Samuel Egerton Brydges, for example, or the jazz and opera lovers who created a thriving network of bootleg recordings in the 1950s—but the shifting theoretical arguments about copyright and authorial property are presented in a cogent and accessible manner. Johns’s research stands as an important reminder that today’s intellectual property crises are not unprecedented, and offers a survey of potential approaches to a solution.”—Publishers Weekly

Six free Amazon Kindle books

Peculiar Treasures (The Katie Weldon Series #1)
"Peculiar Treasures" by Robin Jones Gunn - Katie Weldon is just finishing her junior year at Bible College. As she juggles finals, maid-of-honor duties at her best friend's wedding, work and an almost-romance with her boss, she finds herself contemplating other big questions, such as whether to take a resident advisor position her senior year, and what to do about her undeclared major. Gunn has been writing about Katie and her friends for years, most notably in the popular Christy Miller series, and this is first in Gunn's Katie Weldon series. f Katie's dilemmas may seem like the stuff of unabashedly light fiction, but they aren't without gravity and intrigue. Gunn is adept at denuding light fiction of its usual tics-mediocre prose, clich├ęd characters and predictable plots-and imbuing it with the hallmarks of literary fiction. The characters are multidimensional and ring true at nearly every turn. The dialogue that ensues is at once heartbreaking and utterly familiar to anyone who has ever been in Katie's shoes. Moreover, Katie's religious faith never feels sentimentalized or tacked on, but is integrated beautifully into the charming plot.

Daisy Chain (Defiance Texas Trilogy, Book 1)
"Daisy Chain: A Novel" by Mary E. DeMuth - Adult/High School—Fourteen-year-old Jed is the son of an admired and respected preacher in Defiance, TX. His younger sister, Sissy, soulfully longs for a dog and, with a timid lisp, references Anne of Green Gables and The Velveteen Rabbit. His artistic mother writes daily notes and affirmations on the petals of stolen flowers. What the congregation doesn't realize, however, is that Jed's father is a violent, abusive, and controlling force who permeates his family's sense of self and safety. To further complicate Jed's formidable hardships, his friend Daisy Marie Chance has just disappeared from their small town after he neglected to walk her home. What follows are Jed's Sisyphean struggles to set things straight: protect his mother and Sissy, stand up to his tyrannical father, and find Daisy. His only—and possibly dishonest—companions are Daisy's "loose" and hardened mother, a quirky prophet, and an ex-cult member dying of cancer. Slightly troublesome here is the use of colloquialisms that start to sound too quaint in their frequent overuse. Further, there are a plethora of loose ends and a few awkward time lapses—but this is the first book in a proposed trilogy. Despite these challenges, the intrigue of Daisy Chain will have definite appeal to teen readers of Christian fiction, especially to boys who will appreciate Jed's perspective and attempts to rectify his faith with real life.

Velvet Elvis: Repainting the Christian Faith "Velvet Elvis" by Rob Bell - Bell, pastor of Mars Hill Bible Church in Grand Rapids, Mich., offers an innovative and intriguing, if uneven, first book. This introduction to the Christian faith is definitely outside the usual evangelical box. Bell wants to offer "a fresh take on Jesus"—a riff that begins with the assertion that Jesus wanted to "call people to live in tune with reality" and that he "had no use for religion." Bell invites seekers into a Christianity that has room for doubts (his church recently hosted an evening where doubters were invited to ask their hardest, most challenging questions). He mocks literalists whose faith seems to depend on a six-day creation, and one of his favorite people is a woman who turned up repeatedly at his church, only to tell him that she totally disagreed with his teachings. He cites his church as a place of forgiveness, mystery, community and transformation. Bell is well-versed in Jewish teachings and draws from rabbinic wisdom and stories freely. His casual, hip tone can grate at times, and his footnotes, instructing readers to drop everything and read the books that have influenced him, grow old. Still, this is faithful, creative Christianity, and Gen-Xers especially will find Bell a welcome guide to the Christian faith.

Talk of the Town"Talk of the Town" by Lisa Wingate - The show American Megastar is the hottest thing on television but its associate producer, Mandalay Florentino, is worried. She's just arrived in the tiny town of Daily, Texas, to arrange a surprise "reunion concert" for hometown finalist Amber Amberson. Only it turns out everyone in town seems to know the secret. And paparazzi are arriving. Word from Hollywood is that Amber has disappeared with a "bad boy" actor. Can anything go right in this tumbleweed town? Imagene Doll loves her town of Daily, Texas, but things are lonely without her beloved husband. Life seems dull. At least until that fancy-dressed woman pulls into town, looking terrified and glamorous all at once. Soon life's not the least bit boring as Imagene and the rest of Daily find themselves at the center of a media maelstrom--with a young girl's future on the line.

Never Say Never"Never Say Never" by Lisa Wingate - Kai Miller floats through life like driftwood tossed by waves. She's never put down roots in any one place--and she doesn't plan to. But when a chaotic hurricane evacuation lands her in Daily, Texas, she begins to think twice about her wayfaring existence. And when she meets hometown-boy Kemp Eldridge, she can almost picture settling down in Daily--until she discovers he may be promised to someone else. Daily has always been a place of refuge for those the wind blows in, but for Kai, it looks like it will be just another place to leave behind. Then again, Daily always has a few surprises in store--especially when Aunt Donetta has cooked up a scheme.

John Newton: From Disgrace to Amazing Grace"John Newton: From Disgrace to Amazing Grace" by Jonathan Aitken - "A new life of John Newton is a fitting celebration of the bicentennial both of Newton's death and of the abolition of the slave trade, Wilberforce's triumph in which Newton played a key role. Master biographer Jonathan Aitken is in fine form, sympathetic, insightful, scholarly, and vivid, and his book, like its subject, must be rated spectacular."J. I. Packer, Board of Governors' Professor of Theology, Regent College "A riveting historical account of the life of this notorious eighteenth-century sinner who was dramatically saved by God's grace. This book should be required reading for any person who loves history, loves the song, and is serious about following Christ."
The Honorable Jack Kemp, former Secretary of Housing and Urban Development; former U.S. Congressman.

Calibre 0.6.37 released

Calibre, the excellent book management software for users of any eReader with a USB connection has been updated to v0.6.37. A relatively minor release, but with a few interesting features for sure. 
  • E-book viewer: Add support for viewing SVG images
  • Add category of Recently added books when generating catalog in e-book format
  • OS X: Allow adding of books to calibre via drag and drop on the calibre dock icon
  • Add support for masthead images when downloading news for the Kindle
  • MOBI metadata: Allow setting of metadata in old PRC files without EXTH headers as well
In addition, a number of bugs have been squashed.

Download Calibre now for Windows, Macintosh or Linux.

Amazon, Macmillan and agency based relationships

As has been widely reported, Amazon is restocking their virtual shelves with Macmillan published books after a very publicized and somewhat vocal dispute between the two powerhouses.

The fallout is very interesting, since the model that Macmillan wants to move towards (the so-called Agency model) would actually bring less revenue to Macmillan and allow Amazon to make a profit on more bestsellers.

Amazon presumably prefers the old method, since they enjoy selling books, yes, but also Kindles, and generally just increasing their marketshare. What better way to get you to try a Kindle than to offer a $25 MSRP hardcover that sells for $17-18 in a store for $9.99? The short term problem was selling that title at a loss in many cases. Amazon gets a fixed percentage off MSRP, anywhere from 50% to 70% is reported. By selling all titles for $9.99, on the titles with a higher MSRP it's very easy to end up selling at a loss.

When you switch the model to Macmillan settings books at a price of $12 to $15, but keeping only 70% of the selling price rather than the hardcover MSRP, they would see their per-book gross drop to $8.40 to $10.50 - less than 50% of a $25 book! Amazon no longer buys books at a fixed price and sells them at a different point, but rather grosses 30% of the book - always a profit!

So why is the publisher lobbying to make less money and Amazon lobbying to continue to make little to no money? Simple: market share!

If people merely shift from buying $15 to $25 books in a store or mail order and instead move to buying $9.99 titles for an eReader, this damages Macmillan long term. It makes a new release priced closer to the way an older release coming out in paperback is priced. Paperback is not something they look forward to, those are all the people that found a way to wait a few months rather than buy it when it first comes out, and they make less money. The cost savings in printing a paperback don't equal the cost savings to the consumer in buying a book for $6 to $12 rather than $15 to $25.

If you can grow the market, however, and get people to either stick with hardcovers or buy an electronic reader with similar margins, but the absolutely convenience causes them to subtly buy a few more titles per year, this is preferably. They don't want to dilute their position in the market long term by keeping growth stagnate, but shifting readership to cheaply priced content.

Amazon, however, is in a different position. While they sell a lot of books online, their stranglehold is in eBooks. They have an iPod like share of the industry, and unlike the iPod which has music store competition by way of mass market music being sold without DRM, they have a stranglehold on the sales of content to those users. They continue to grow the industry by offering these dirt cheap titles, but they are growing it in a way that's detrimental to their publisher's goals, especially their gross margin goals.

Amazon is threatened, however. Sony invented the American consumer eBook market, but Amazon took over it overnight (this is no different than MP3 players, where Apple came in virtually overnight and redefined the industry as a mass market one, taking the majority of the customers along the way). Now, however, there are new competitive products from Sony, wireless is becoming ubiquitous across all major vendors' product lines, Barnes and Noble is gunning for them, Skiff, Que, Alex and others are looming and at the low end are a ton of generic, similar looking products that inevitably cost a bit less than their Amazon-branded counterparts.

Oh, and Apple is entering the market. Apple is not acting evil by sleeping with the enemy here. They aren't getting into bed with Macmillan to systematically drive the price of books up to wreck havoc on Amazon and take over the industry. They may wish to wreck havoc on the competitors and take over the industry - but not through price fixing. The reality is, Apple runs the iTunes Store (music, music videos, movies and TV shows) at a slight profit. That's always been their stated goal, and it's worked. It drives sales of their hardware devices, and let's face it - is there an easier way to get last night's episode of The Office onto a phone or video player?

But Apple is not one to have a loss leader. They aren't going to sit back and sell a few million books at a $2 or $3 loss to grow their market. They are going to find a way to not lose money on their store, still sell millions of books, and more importantly meet that goal of selling 10 million iPads in the near future.

If along the way, the publishers see that the realities of this agency deal are also good for them, of course they are going to try and make that the new standard for selling eBooks.

Would I prefer $9.99 new titles? Honestly, no. If all other things were equal, of course I would. But I don't like delayed access to eBooks. To me, the perfect model is a new titles out the day the hardcover hits the store, and a price that's mildly competitive. Sure, it should cost less. No, that doesn't dilute the mindshare of the expensive hard cover title. Everybody understands that printing and shipping has a cost associated to it. Is that cost half to two thirds the cost of a book's MSRP - no, I doubt that very much.

On the heels of that, should be an immediate drop in price simultaneously with the release of the paperback. Did the cost of the eBook drop by then? No, but early adopters always pay more. I paid $599 for my first iPhone. Lots of people paid a lot more than $259 for their first Kindle. There is a premium to get content quickly, this exists in print as well. Half a year or more later, those people who couldn't wait already have read the book and it's appropriate to begin discounting.