Kindle Review – Kindle 3 Review, iPad Review

A future where books have no value isn’t the only possibility. An alternate possibility is one where the Kindle Store becomes to books what the Apple iPhone store is to Indie game developers (and bigger developers and creators of all sorts).

Let’s take a look at a possible future where the Kindle Store is the main avenue to sell books for money.

Please assume it’s however many years in the future you think it’s going to take eBooks to be 50%+ of book sales.

The Future – A Book Industry propped up by an eBook Store

We would have an intriguing situation -

1. Almost infinite competition.  
2. Close to zero costs – apart from the author’s blood, sweat and tears.
3. Indie Authors, Small Publishers, Big Publishers. 
4. Various forms of content i.e. blogs, video books, audiobooks, newspapers and news content, magazines, podcasts.  
5. Very intelligent and very stupid competitors.

We would have almost exactly what we have with the iPhone App Store.

In fact we are going to use a couple iPhone App post-mortem posts to get an idea of what to expect -

1. Noel writes about making a living, barely. 
2. NimbleBits talk about their strategy to create NimbleBits and do cross marketing. 

Note: Also consider reading my previous posts on Lessons for Authors from the iPhone App Store and App Store Success Stories for other insights.

Read up on iPhone App Store stories and a clear picture emerges.

The 1-9-90 model of Book Success

A model like the iPhone store would lead to a 1% – 9% – 90% model.

1. The top 1% would make unreal amounts of money. Think thousands of dollars a day. The very best-selling books would be making tens of thousands of dollars a day.
2. You’d even have mega-sellers that make hundreds of thousands of dollars a day.
3. The next 9% would make a living. Not a very good living but a living nonetheless.
4. The remaining 90% would starve. Or do day jobs.

There are a few twists though -

1. The Bestseller lists would dominate everything.
2. That in turn means marketing and cross marketing would be huge.  
3. You would have indie authors competing with the giant Publishers.
4. You would have network effects and people’s opinions factoring in.

In some ways the barrier to entry has been removed and replaced with the barrier of marketing costs.

Where do Indie Authors end up?

There are some good potential strategies Indie Authors could utilize -

1. Build a cross-promotion network – indie author sites, books, apps should all be promoting other indie authors in the same genre.
2. Build up your own site or take one like Smashwords and link to it and send it traffic.
3. Be Cory Doctorow Part 2 and take some idea users really want to believe in and promote it. Perhaps your angle is that eBooks should have a resale market. It doesn’t matter what it is as long as readers like it.
4. Give out your first three books for free and build up a following. It kills book prices down the line and at the same time it’s a strategy that works.
5. Start a blog and use social networks and Twitter to connect with a lot of people.

Indie authors have to develop a strategy to find the people who would be interested in their book and get them to read their books.

The Small Window of Opportunity

Whenever there’s a huge transition – such as the one books are going through now – there’s an opportunity to make a killing.

Indie Authors can do what smart companies like Amazon and SmashWords are doing i.e. carve out their place in the new world of Publishing.

1. The window of opportunity is just 1 to 2 years. 
2. You can’t hedge your bets i.e. pick eBooks and go all out for eBooks.  
3. You have to give people what they want i.e. a book review site in your genre, free book site in your genre, a very interesting blog with free short stories or something similar.
4. Even though it’s terrible long-term the free book to get readers strategy works and might be worth pursuing.

There are going to be blogs and sites that capture a ton of traffic and users in every genre.

• Why not let it be your site?

You get to start working now on your brand and your marketing strategy – As the world of Publishing transforms itself, be sure to carve out your niche.

This scenario of fighting to be in the top 10% of a limitless Kindle Store seems painful – yet it’s not as painful as Free.

Can the App Store model beat Free?

This entire post assumes there’s a chance we can beat free. It’s a careless assumption -

1. The Apple iPhone App Store is the exception to the rule. 
2. Most content and software on the Internet is free.

Could books really buck the trend and remain a viable business?

Well, there’s quite a good chance.

Reasons to Hope Books remain viable

There are good reasons to hope Free doesn’t win out -

1. The presence of six big Publishers means Publishers can band together.  
2. Amazon and Apple are both interested in making money off of content.  
3. They are also both forward thinking companies – neither is eager to kill off a huge revenue stream.
4. There are a decent number of users who are willing to pay good money for good books.

Perhaps the biggest reason to hope is that Free is beginning to show cracks.

Reasons Free isn’t as compelling as it used to be

We’re in a very different world from 10 years ago -

1. Newspapers have sacrificed themselves at the altar of free and shown it doesn’t work.
2. Advertising to supplement free hasn’t worked most of the time. 
3. Nearly all ‘Free’ Internet companies have died.
4. Even most of the successful ‘Free’ companies are having trouble showing strong profits.
5. As Free touches more people’s livelihoods they understand the danger.

There is no longer a sense of invincibility around Free.

Perhaps people have also begun to realize that if you win with Free you don’t get a prize. If your product is free and you kill your competitors your revenues are still zero.

There’s also good old fashioned capitalism and companies that can whip even Free.

Domination by a Company makes Free difficult to implement

When you have a situation where a company puts a lot of thought in and/or gets an early lead the company can do some critical things -

1. Cater to customers of good intent. 
2. Eliminate or Limit Free – something Amazon did by keeping the number of public domain books low and imposing a $1 minimum price on books.
3. Highlight Paid Products and High Earning Products - something Apple does including in its Best Apps of the Year list.
4. Keep out Free/Open elements from the eco-system.  

Of course, competitors are going to try and destroy the whole model for their own gain. However, Apple and Amazon have survived so far and we better hope they continue to.

The App Store and the Kindle Store are the only two ecosystems so far that afford product creators a shot. They aren’t open and they’re evil and they’re the only companies that will save game makers and authors and creators of all sorts from the starvation that the Internet promises.