Thanks to Joe Siegler and Roger Knights for writing in about a very interesting post by Mark Cuban on How Amazon will/should/could probably do a Netflix for ebooks. Thanks to Kitty for a link to The 26 loans limit on ebook lending by libraries.
These two posts are linked by the fact that they cover opportunities to take advantage of the big transition in Publishing.
Transition = Opportunity for everyone to get a larger share of the pie
The reason there’s so much discussion and hand-wringing about ebooks is that we’re in a time of major transition. Everyone thinks they can get a better deal than they had before. Everyone thinks they can get a bigger share of the pie while doing less.
- For readers and indie authors, it’s freedom and a revolution.
- For readers, it’s an opportunity to get cheaper books and to get more of the type of books they want to read.
- For indie authors, it’s a shot at getting read, and at making money.
- For Publishers, it’s a disaster and alien and scary. It’s also an opportunity to cut out lots of costs without lowering prices. It’s a shot at eliminating the used books market and limiting losses due to libraries and lending.
- For Published authors, it’s a chance to get a larger share of the profits. At the same time, they don’t want to go from little competition to infinite competition.
- For Libraries and Bookstores, it is, unfortunately, a challenge to their very existence. There’s little to no upside.
- For new Publishers and for platforms, it’s an opportunity to get a 10% to 30% cut on all of book sales. For them it’s all upside.
For everyone involved, it’s an opportunity to tilt things more in their favor. It’s also a threat as they have to make sure they don’t get destroyed by the changes the transition brings about.
Those last two sentences are the critical one here. And the only ones that matter.
There’s no point in discussing the symptoms and the side-effects of this transition/upheaval. There’s even less point in pretending that any of the interested parties is sacrificing themselves and not acting in self-interest.
Everyone is trying to do two things -
- Tilt things in their favor.
- Minimize possible damage.
Let’s start by discussing how we readers want to get more than we used to. Or to be precise – a lot more than we used to.
Readers are being just as unreasonable as everyone else
Here are a few things readers want -
- Prices between $3 and $10. Roughly half of what they were paying.
- The same features as physical books i.e. lending and reselling.
- Ability to share between various eReaders on one account, and read on other devices.
- All the best things about ebooks i.e. search, remembering your place in a book, etc.
- All the physical book benefits – the ones mentioned above, page numbers, etc.
It should be painfully obvious that readers aren’t sacrificing at all. We are getting a lot more than we were getting earlier, and yet we want even more.
On top of getting a lot more value for money, we also want the following – the power to decide the winners, more of the books we want, convenience, ease of use, time savings.
Will readers get everything they want?
Firstly, if it isn’t clear yet to everyone involved, in a truly free market readers will have total control and will squeeze authors and platforms to breaking point. It won’t be intentional - It’ll be a direct result of the fact that authors want to be read a lot more than readers want to read.
This is a fundamental fact that no one can do anything about. It just matters a lot more to authors to be read than it does to readers to read. For an author, readers’ time and validation are more valuable than any money they give. The freer the market, and the closer it reflects reality, the higher the chance that authors will be paying readers to read their books.
Yes, there will be bestselling authors whose work readers pay for. However, those will be more than balanced out by newer authors and less well-known authors paying readers to give their book a shot.
Strengthening this will be a belief that every author has – I just need to get 1,000 people to read my book. Then word of mouth, and their reviews, will make me a bestseller.
At some level, it’s best for authors if there is some artificial barrier. With ebooks available the only barrier left is a real one, i.e. quality of books. However, there needs to be some artificial barrier to add on top of that. Indie authors will eventually figure out a way to deliver high quality at low cost. At that point, everything will break down.
If some company doesn’t figure out a really solid artificial barrier that prevents every author from giving out their potential masterpieces for free – Well, everything will go to zero. Except perhaps books from an exceedingly small group of ‘bestselling authors’.
Switching over to Libraries
There are two competing things here -
- Libraries and the crucial role they play - Equality, education, reading, and so much more.
- The fact that libraries are the least well-positioned for the current transition.
Should people be upset that Harper Collins wants a limit of 26 ebook loans? Not really.
On the one hand, Harper Collins gets to eliminate the used book market and gets to limit user lending to one or zero loans per book sold. On the other hand, Harper Collins will probably end up earning less on ebooks as prices go down.
The library ebook loan concept is stuck in the middle.
If Publishers get a chance to eliminate that, they will. Perhaps in the long term it hurts word of mouth – However, Publishers don’t know where they’ll be in 10 years. They aren’t concerned about the long term.
It just seems strange that the used book market is gone, lending is close to zero, ebook prices are lower than hardcovers, and in the midst of all of that libraries just keep functioning as infinite loan machines.
Publishers’ job is to eliminate library lending. Not to reduce it, but to eliminate it. It’s the role of libraries and readers to prevent that. It’s that simple. It’s a transition and things could go either way. To pretend that Publishers will care about the greater good or the long-term implications is being naive.
Subscription plans are beautiful because they make both parties happy.
- Readers feel they can read as many books as they want. They can read any book they want.
- Publishers and platforms feel they get a guaranteed amount of money per reader, they get it every month, and they get more money than they would if they sold books individually.
That’s the key thing here – both parties feel they get a better deal. It’s one of the few possibilities, out of all the ones being explored, that results in a win-win situation.
Well, perhaps it isn’t really a win-win but it sure feels that way.
Mark Cuban brings up ebook subscriptions in a very practical way, i.e. by talking about how Publishers could turn their back lists into a source of solid revenue.
Netflix in its brilliance helped content owners monetize their libraries. Their re-runs . All those shows and movies that were gathering dust earning bupkis.
Who else has huge libraries of content that is gathering dust and earning bupkis ? Publishers. Book publishers to be specific.
Who is going to be the first to go to those publishers and offer the biggest publishers 10, 20, 30, 50 million dollars for multiyear rights to freely distribute their books online to E-Readers ?
He suggests that if Amazon offered a subscription plan, where Readers could access any book that was more than 1 year old (and not in the top 20 sales lists) for free, it might get millions of readers to bite.
It probably would.
Mark Cuban also thinks it won’t be long before someone offers a subscription plan -
Bottom line is that it won’t be long before a Netflix or Prime for E-Books happens and takes hold. Someone is bound to do it. The publishing industry needs the money far worse than the movie industry did. Their monetization of their libraries is horrid.
Yes, there are three very simple reasons why ebook subscriptions are bound to happen -
- It is perhaps the only big strategic move left. It’s the only way anyone can catch up with Amazon. It’s the only way Amazon can get a further advantage over competitors in an Agency Model era.
- It’s very easy to get both Publishers and readers to bite. Publishers get to monetize their backlists, and readers get unlimited books – every book ever published before 2009 sounds amazing. For both parties it seems to be a real deal.
- It is perhaps the only sustainable plan left.
The chances are slim that it will be done properly – because Publishers may very well feel killing off ebooks is a worthier goal than making money from their back lists, and because Publishers might not be able to get over their ‘stuck in the 1980s’ attitude.
However, ebook subscriptions will happen and will play a big part in the Book Wars.
Coming back to the Transition
It’s worth keeping in mind, when people cry out about the unfairness of it all and about the death of sacred things, that everyone is just trying to use the transition to get a better deal for themselves.
We have a bunch of very intelligent people on each side, and they’re all trying to outwit each other. Since it’s people in the world of books everyone is able to articulate their arguments very well, and use words to great effect.
The beauty of the arguments doesn’t change the fact that we are all driven by self-interest.
There are still a few win-win solutions possible, and subscriptions are one of the best. Hopefully, someone pulls it off and saves us from the race to zero.
Filed under: books | Tagged: book wars, future of books | 10 Comments »