Thoughts on eBook formats

The traditional markets that have existed for hundreds or thousands of years are still struggling with this newfangled digital media stuff, trying to impose old world restrictions on it that just don’t work. I’m all for an author, musician, artist or programmer getting paid for their work. But DRM as it exists is doomed. Virtually all DRM is eventually cracked and it just becomes a race between the manufacturers creating more complex DRM and hackers breaking it, and lawyers and judges threatening jail terms and huge fines to people doing no more than they have for decades – sharing their albums and books. You know something is wrong when the word “sharing” becomes redefined to mean something synonymous with “criminality”.

The music industry has been dealing with this for a while longer than the book industry and are slowly coming around. For most of the songs on the iTunes music store, you can buy slightly more expensive DRM free versions. Many other on-line music retailers are following suit and offering DRM free songs. And it actually seems to be working. People keep buying them and the record companies and artists are making money. Removing DRM from music did not result in the total downfall of the recording industry.

I think the key points that made it work for music are:

1. Make it very easy to buy what you want. Easier and safer than searching some seedy “warez” site filled with malware and viruses.

2. Make it cheap. 99 cent songs, 9.99 albums are affordable. As cheap or cheaper than I used to buy my vinyl LPs 30 years ago!

3. Universal formats. Download a song and play it on virtually any device.

Eventually the publishing companies will come around on this stuff. They are on their way:

1. Make eBooks easy to buy. They are doing well on this. Between Amazon, B&N, and iBooks, you can easily find pretty much any book that is available in digital format. Yes, you can also find pirated, cracked books, or crack the DRM yourself, but it’s a pain in the neck. Much easier to buy.

2. Prices probably need to come down. A book at $12.99 or more makes searching for a pirated version just that much more attractive.

3. The fact that the Kindle has its own proprietary format that no other device can read, and the fact that the Kindle cannot read ePubs, DRMed or otherwise, is perhaps its worst “feature”. Amazon gets away with this for now because they have the biggest and best selection of books and the best, most popular dedicated reading device. Very similar to iTunes a few years ago. But I think eventually Amazon is going to need to adopt the ePub standard or allow and actively encourage other ebook manufacturers and publishers to use the AZW format, making it the de facto standard. However, I think and hope that eBook DRM will go the way of music DRM.

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16 Responses to Thoughts on eBook formats

  1. Stephen says:

    Just to clarify, in the United States, all music in iTunes and the Amazom mp3 store is sold DRM free at no additional cost to the consumer. Unfortunately some countries, like Japan, still have the additional cost to get the song without DRM, and many studios don’t even offer their songs without DRM there.

  2. The other thing about price – books and music used to be very expensive to produce and distribute. You needed printing presses, and expensive production equipment that are now either very cheap, free or irrelevant. Distribution (and the waste of unsold copies) is also now zillions times cheaper obviously.

    Meanwhile the price of CD’s and books continued to go up. Hopefully that is just the ‘grab the money because the writing is on the wall’ phase, which is pretty much over anyways.

    In a perfect market the cost of a book would be the author’s cut, plus production, plus a *modest* profit for the publisher. Let’s hope we get there, though I’m not sure the likes of Amazon, Apple or O’Reilly (aka home of the $70 book extolling the virtues of open source) will take us.

  3. You can offer ePub books on iBooks DRM-free. I recently submitted an iBookstore version of the U.S. Bankruptcy Code through DRM was optional and I chose to sell my book without it. Free options of the same content are available online, but my hope is that people will value the convenience of the ePub format and pay for it and based on sales so far, it looks like people are willing to pay.

  4. Keith Peters says:

    Robin, a few people have attempted to take a look at how much ebooks do and should cost. The knee jerk reaction is that with no printing, binding, and shipping, they should be next to nothing. It turns out that production is not a huge percent of the budget. Here are a couple of links, you can probably find more.

  5. Nice link, on the mark..

    (also in music, the deals for the bands are getting worse, not better. I’m not sure about publishing, but I’d bet the average author’s dividend checks aren’t a big chunk of the cover price. The ‘feed the creators’ thing execs always say is cringe-worthy).

  6. Hmm, I think the charles-tan link is missing the point a bit. Every step in producing a book has gotten (or should have gotten!) cheaper. From writing, research, fact checking, through distribution, inventory management, targeted advertising… Also he drops out retail but assumes all those savings will be passed to the distributor rather than the publisher or author..? Something like 30% seems to be a deal generally available to anyone, so I’d imagine publishers aren’t going to pay 60%.

    I can’t think of a way other than proprietary formats where something digital doesn’t comoditize the distributor/retailer part (thus kindle/apples love for them). From their point of view then, if it is a race to the bottom on the price of hardware and the store’s cut, then why bother? I think the profits as is are very high, and the potential is higher, which is why they are doing it. I’m not convinced that the costs are anywhere near the same as they were in print 10 years ago (even though the prices are).

    (hmm, can you tell we just paid for two sets of university text books? That is probably shading things, grr ; )

    Computer books are a $400 million industry, and it competes directly with free content on the internet. Hmm. Spoils to the most savy, and good for them I guess : ).

  7. and did I mention, hmm? Hmm. Must learn to think more quietly.

  8. keith says:

    Robin, most of the books I buy for the Kindle are of the 9.99 variety, give or take a couple of bucks. I feel like that’s a pretty reasonable price. There are regular calls to boycott anything over 9.99 on the Kindle store. But yeah, the cost of text books and tech books are a bit ridiculous. Programming ebooks regularly go for around $30. I really doubt the a tech book costs 3x to produce than a novel. It just comes down to what the market will support.

  9. keith says:

    Another thing that I’m not sure is covered in any of those articles is the fact that a relatively low percentage of published books actually make any kind of profit. I’ve read that only something like 10% even make enough to pay back the author’s advance. That holds true from my personal experience. This means that the best sellers carry all the weight and make up for the loss of the rest. I’m not seeing clearly at the moment exactly what relevance that has to how ebooks are priced, but some part of my brain says it’s important.

  10. Good point about the 10% carrying the others. I wonder how much of that is industry driven vs organic? It seems sometimes they decide early where the promotional budget will go and more or less drop the others – maybe hyped hits are just more ‘efficient’ than the 10 solid books they have?

    Now that music is more fragmented/open we seem less prone to the few mega bands having 90% of sales. Maybe those other 90% are what a Kindle will help, rather than the 10% keeping more of the profit that initially seems more intuitive. Or maybe I’m just getting old and don’t know the same music cool kids know : ).

  11. Shoom says:

    The last five “sound carriers” I bought (Vinyl) came with a download code for the music on them. Really a great concept, since I’ve always been asking myself if it would be legal for me to download the music I’ve already got on record, instead of digitalizing them myself (Short answer: no, long answer: nope).
    So here’s an idea: Why not sell the cellulose thing with some sort of right to get the digital thing in any way you want, be it for kindle, iPad or even just as a pdf…
    After all, like with music, you pay for the information (and music, prose, etc. are just that) not for the “messenger”. Unless you’re collecting Laser Discs… 😛
    It definitely would be a good incentive to sell more of those old dust catchers and for me to try out this whole eBook tshatshke…

    • keith says:

      Shoom, I completely agree. Whenever you buy any kind of media these days, wheter a book, music, movie, whatever, it’s enforced that you are only buying the right to use the information in a specified manner. If I’m only paying for the right to use the information, and not actually buying the medium, Why should I pay full price to get that information in two different formats? This is one thing that some tech publishers do right – buying the dead tree copy of a book allows you to download the ebook version for free. But most still charge full rate for each.

  12. Daniel R. says:

    One thing that has bothered me about eBooks is the difficulty with lending or selling. While the digital clutter of eBooks isn’t like physical books, many books once I’ve read them I’d like to just pass them on to the next person.

    • keith says:

      I agree. It’s another one of those things that hasn’t been worked out. B&N made a half hearted attempt at lending. But you can lend each book exactly one time to one person for two weeks. And then you can never lend that book again. And you can’t read it while it’s lent out. You can just sense the fear that someone had over even allowing that.

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