Kindle Review – Kindle 2 Review, Books

I’ve been dying to write about how the Kindle ushers in a new model of publishing and the end of expensive curation. The release by Amazon Encore (Amazon’s new publishing branch) of Kayla Cluver’s Legacy is validation that this new model of publishing exists.

Publishing = Expensive Curation.

Publishers have controlled the direction and profits in the books market for so long, and the market has changed so little, that they are especially inclined to feel that the world of books revolves around them. Well, does it?

If we look at the core value that publishers provide, its Curation – they decide what books are good enough to print for book lovers.

Publishing is basically expensive curation.

Yes, there is value provided in other ways i.e. polishing a book, marketing it, etc. However, if we had to name the single, most critical role that publishers fulfill it would be ’Deciding what Books to Publish’.

Publishers separate the wheat from the chaff, and they are far from perfect. Two of the biggest costs incurred in publishing books are -

1. Successful books subsidizing failures.  
2. Each sold copy subsidizing the copies that did not sell and had to be returned.

This is, based on the current publishing model, impossible to avoid. Because we never know which out of 5 good books will be the runaway success, and we never know how many of a good book will sell.

Here’s the thing though – there’s a new model that gives us far better indications of which book is going to be the runaway success and how many copies of each book will sell.

New Publishing = More Efficient Publishing

There are numerous costs of physical books that we can easily see ebooks and the Kindle improve on i.e. distribution, paper, printing, ink, warehousing.

However, the far more important distinction, and one that everyone is missing, is that ebook technology and direct to customer retail channels like the Kindle change the game in terms of ’selecting what books to print’ and deciding ‘how many books to print’.

1. In the new model of publishing, anyone can publish, and you can publish as many books as you like.
2. Actual end users vote for books, with their hard earned money, and decide which books succeed.
3. In the new model of publishing, you can scale up the quality of the product, and the number of copies printed, at any time.

New Publishing has a few other important distinctions -

1. The cost for failure is much lower.
2. There is instant feedback. 
3. There is no longer room for expensive curation.  
4. Distribution, Warehousing, Shipping become minor costs.
5. Helping Customers Make Intelligence Purchases, Product Discovery and Search become very important.
6. The middlemen between authors and readers are going to slowly get eliminated.

The old publishing model is costly at every step. New Publishing is going to kill those costs (and the companies who live off of those costs).

As an example, consider shipping costs - WhisperNet costs Amazon 12 cents per MB (most ebooks are smaller in size than that).

That means the cost of shipping a book in the Kindle Store is less than 10 cents. Contrast that with the $4 or more that a physical book costs to ship.

New Publishing has cut the costs of the shipping step to 1/40th. The old model simply cannot compete.

Amazon has put itself in place to own New Publishing

Amazon owns (focusing just on the US for the moment) -

1. Amazon.com – the biggest online book retailer.  
2. Kindle – the most popular ebook reader, not to mention a direct retail channel to customers. 
3. Kindle Store – the largest collection of current, in-demand ebooks. 
4. Self Publishing options with Amazon DTP, CreateSpace, etc.

The only part of the publishing spectrum Amazon doesn’t have a rival for is the Top Publishers. However, that changes with Amazon Encore (the Publishers Weekly article is worth a look).

The Kindle, the Amazon.com website, and its other assets give Amazon a huge competitive advantage - knowledge of user purchase patterns and instant updates on purchases.  

The combination of -

1. Customer behavior on Amazon.com i.e. what books are people looking at, what are they buying.  
2. Customer behavior of Kindle owners i.e.  what books are they buying, what books are they sampling, etc.
3. Customer feedback i.e. user ratings and reviews and purchases and returns.

Furnishes Amazon with the wisdom of the crowds, and more importantly, the actual buying patterns of the crowd. This, along with its other strengths, will let Amazon replace traditional publishers and dominate New Publishing.

Why Amazon chose Cayla Kluver’s Legacy, and how it Illustrates New Publishing

This is Cayla, a 17 year old girl in Wisconsin, who couldn’t get an agent or publisher, published her book anyways (self-published), worked for a year promoting the book, and now has a deal with Amazon Encore.

Cayla Kluver

Here’s a short snippet -

Anyway, I started writing my debut novel, Legacy, about two years ago (written in June 2008). It took me nine months to complete, then six (maybe seven) months to do the necessary revisions and editing. It was a lot of hard work, but a great experience, one that really got me grounded and showed me once and for all that being an author is what I want to do for the rest of my life.

In New Publishing an agent or a publisher’s opinion of whether your book can sell does not stand in the way of you getting your book out.

Reading the actual story behind Legacy is enlightening. However, what is not said is even more enlightening. Look at the story and you being to see how New Publishing will work -  

Authors must create Initial Success themselves

1. In New Publishing, lots of authors will release their books, and will put in the work to market and sell their book.
2. Actual readers will decide which ones are good – by actually buying the books.
3. Author’s continued effort, word of mouth, and online reviews will lead to more purchases.

New Publishers will step in to try to create Mega-Successes

1. The ones that actually begin to sell, and show promise, will be cherry-picked by New Publishers (like Amazon Encore).
2. Then these books will be pulled from the market, and new, polished, refined versions will be created.
3. The new versions will be mass published and marketed and sold across a variety of channels.

Amazon owning New Publishing might not be a bad thing.

A lot of other companies (Google, Apple, etc.) want to cherry pick and get their 30% cut and let the existing model mostly stay as it is.

Amazon is pushing for REAL improvements in publishing and putting in a lot of hard work - New Publishing is going to be built with Amazon as its very foundation.

If you’re an author, the opportunity to compete on merit and to let end users decide whether you succeed, is the fairest shot you could ask for. Amazon is providing that. They might end up with too much power – However, they’ll improve all of publishing – something no other company is even trying to do.

I had thought that this article would end up being an indictment of Amazon as a potential monopoly. Instead I’m left with the realization that their willingness to take on publishing as it exists today is crucial to make things better for people who love to read. Every other player (including book publishers) is simply focused on getting their own cut – it’s rather depressing how little customer focus exists in publishing in general.