Monthly Archives: December 2011

From Digital Book World:

For those in book publishing, 2011 was a surreal experience – books sales shifting dramatically to e-books, hundreds of retail stores closing, Amazon selling its own tablet to compete with the iPad. For some publishers, it was a dream and for others, it was a nightmare.

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1. Borders/Discoverability

In July, the unthinkable happened. Unable to find a suitor to rescue it from bankruptcy woes, Borders closed the nearly 400 stores it had left. The blow-up caused shockwaves in books, retail and real-estate.

Book publishers lost a main distribution conduit for their product – and one that made it relatively easy for readers to discover new books, books they may not have initially intended to purchase, but end up buying anyway.

As shelf space at bookstores dwindles and more books are bought online or on devices, just how new books will be discovered (“discoverability”) is becoming the most important issue to publishers.

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2. EPUB 3

In October, the International Digital Publishing Forum gave its final approval of the adoption of a new, standard book-publishing language, EPUB 3. Building and improving upon EPUB 2.0.1, EPUB 3 fixes interoperability issues for EPUB files between different devices and also adds a whole host of goodies for publishers and developers.

Built on HTML 5, another new programming language, audio, video and other sorts of multimedia can be inserted into book files. What was once the sole purview of apps and the Web is now bleeding into books.

The catch? For one, Amazon uses its own advanced publishing language, KF8, which was announced as its new standard around the same time and addresses many of the same issues. And, of course, no devices yet support the full EPUB 3 spec, meaning that we won’t see the effects of this new standard language until some time in 2012.

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4. International

Amazon launched Italian-language and Spanish-language Kindle stores with corresponding language-specific Kindles. Kobo launched its new tablet, the Vox, in the U.S. and Canada and may expand its international reach to the U.K. and France through deals with regional booksellers W.H. Smith and FNAC.

According to Hachette Digital senior vice president Maja Thomas, Spanish-language e-books and English e-books are two of the three biggest untapped growth opportunities for book publishers.

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5. Agency/Department of Justice Investigation

In February, Random House joined the rest of the big-six publishers in adopting the “agency” pricing model where publishers set the price for their e-books across retailers. This a year after the other five, MacMillan, Penguin, Simon & Schuster, HarperCollins and Hachette, took advantage of the opportunity to set their own prices when it was given to them by Apple and the iBookstore.

While the move changed the dynamic of the publisher-retailer relationship – especially with the publishers’ largest retailer, Amazon – it may have opened a Pandora’s box.

In December, the Department of Justice confirmed that it was investigating Apple and five major publishers – all the big-six aside from Random House – in a pricing antitrust probe. While the investigation has been rumored since 2010, only recently have those rumors been confirmed by federal officials.

Link to the rest at Digital Book World

From Jenn Webb on O’Reilly Radar:

Amazon is, indeed, a disruptive publishing competitor

If it wasn’t apparent before, Amazon’s publishing intentions became plainly obvious this year. The wave started out small, with a host of expanding self-publishing tools for authors, but it grew to tsunami proportions as Amazon launched imprint after imprint, from romance to science fiction. Amazon also hired industry heavy-hitter Larry Kirshbaum, who “is charged with building something that will look like a general trade publisher.’”

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Amazon further extended its reach into publishing when it launched the Kindle Owner’s Lending Library. The ebook lending waters already were murky and contentious for publishers — HarperCollins instigated a memorable dustup, as did Penguin — but Amazon’s move into the space caused a full-fledged uproar among publishers as well as authors, and may have damaged the publisher-library relationship further.

O’Reilly’s Joe Wikert highlighted one of the main problems from the publisher perspective:

As Amazon stated in its press release, “For the vast majority of titles, Amazon has reached agreement with publishers to include titles for a fixed fee.” So no matter how popular (or unpopular) the publisher’s titles are, they get one flat fee for participation in the library. I strongly believe this type of program needs to compensate publishers and authors on a usage level, not a flat fee. The more a title is borrowed, the higher the fee to the publisher and author. Period.

And Amazon may be encroaching on feature magazines like the Atlantic and the New Yorker as well. In a sign of possible things to come, freelance journalist Marc Herman took his long-form story, “The Shores of Tripoli,” and expanded it into a $1.99 Kindle Single. According to his blog, he has plans to expand on the model, which would further sideline traditional publishing avenues.

Publishers aren’t necessary to publishing

Authors have figured out they don’t need publishers to publish books. The self-publishing book market saw quite a boom this year as the publishing format started becoming more mainstream and the services offered by self-publishing companies became more comprehensive — providing authors with platforms, sales, marketing, editing, etc.

Amazon has a role in this boom as well. The Wall Street Journal reported that “Amazon.com Inc. fueled the growth [in self-publishing] by offering self-published writers as much as 70% of revenue on digital books, depending on the retail price. By comparison, traditional publishers typically pay their authors 25% of net digital sales and even less on print books.”

Another trend emerged this year to further sideline the publisher’s role: the rise of the agent-publisher. This controversial and contentious business model allows agents to step in to provide expanded publishing services to authors. In an interview, Booksquare’s Kassia Krozser explained that the new agent-publisher role emerged because of failings on the part of traditional publishers: “Traditional publishers need to not only rethink how they sell their value to authors and agents, but they also need to rethink the economic structure of their deals.” Krozser also expressed concerns that the agent-publisher role carries a conflict of interest.

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The Book Industry Study Group (BISG) released a report in November that showed that readers are solidly committing to digital books. A couple highlights from the report:

• Power buyers are spending more. More than 46% of those who say they acquire e-books at least weekly … report that they have increased their dollars spent for books in all formats, compared with 30.4% of all survey respondents.
• “… nearly 50% of print book consumers who have also acquired an e-book in the past 18 months would wait up to three months for the e-version of a book from a favorite author, rather than immediately read it in print.”

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DRM is full of unintended consequences

It turns out DRM does more than provide publishers with a false sense of security — locking the content of books also locks those books into a platform (ahem, Kindle). This point was highlighted by author Charlie Stross in a November blog post in which he argued that DRM had become a strategic tool for Amazon:

… the big six’s pig-headed insistence on DRM on ebooks is handing Amazon a stick with which to beat them harder. DRM on ebooks gives Amazon a great tool for locking ebook customers into the Kindle platform. If you buy a book that you can only read on the Kindle, you’re naturally going to be reluctant to move to other ebook platforms that can’t read those locked Kindle ebooks — and even more reluctant to buy ebooks from rival stores that use incompatible DRM … If the big six began selling ebooks without DRM, readers would at least be able to buy from other retailers and read their ebooks on whatever platform they wanted, thus eroding Amazon’s monopoly position.

So, to recap, we’ve learned that DRM doesn’t stop anyone from pirating, nor does it come with the necessary data to support its impact. But it does give publishers one thing: a longer length of rope with which to hang themselves.

Link to the rest at O’Reilly Radar

Writers aren’t exactly people…. they’re a whole bunch of people trying to be one person.

F. Scott Fitzgerald

From regular visitor and commenter David Gaughran:

This has been a year of massive changes. Some of the older hands say that the business has always been this way.

However, I don’t think we are simply seeing another year of flux. Instead, we are witnessing a process unfold which will revolutionize publishing forever (or at the very least, the foreseeable future).

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February

To the surprise of everyone, the post-Christmas e-book boom continued through February, with self-publishers grabbing an ever-increasing share of the genre bestseller lists. When the AAP figures for this month were released two months later, they revealed a historic milestone: e-books became the dominant format for the first time, outselling both paperback and hardcover, capturing 29.5% of the market. In less happy news, storm clouds were gathering at Borders, and the signs weren’t good.

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March

While John Locke was posting record numbers and dominating the bestseller lists, two other writers caught the headlines. Amanda Hocking leveraged her phenomenal self-publishing success into a $2m deal while Barry Eisler shocked the publishing world by walking away from half a million dollars to self-publish.

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May

It became clear that the e-book revolution would be no respecter of national borders when the frenzy spread to the UK. Amazon announced they were now selling more e-books than all print formats combined. And literary agents began attracting negative headlines as they attempting to figure out a way to make money in this new world. The old order was fragmenting, and something messy and chaotic (and beautiful) was emerging in its stead.

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June

In a slow news month, a major US agency (kind of) moved into publishing, JK Rowling moved into self-publishing, and John Locke announced the sale of his millionth Kindle book – and that was just the last week in the month. Earlier in June, two indie authors made history in the UK, the malevolent hawkers of 99c books were accused of destroying minds, publishers were charged with systematically under-reporting e-book sales (and underpaying their authors), and VS Naipul was outed as a prize mysogynist.

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July

I released Let’s Get Digital: How To Self-Publish, And Why You Should which quickly became my top-seller and almost cracked the Top 1000. I made the PDF version free here which was so popular it crashed WordPress.

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November

The month opened with some (more) bad news for large publishers: AAP figures showed that new e-book revenue wasn’t quite replacing the fall off in print. Kobo were purchased in a deal which could have huge implications for the international e-book market. Penguin launched a vanity-esque self-publishing imprint, which attracted widespread criticism. And a best-selling self-published novel inexplicably disappeared from Amazon UK.

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Thank you for all your support this year. My professional career has really turned around in 2011 – selling around 1,800 books in my first seven months, hitting 5,000 free downloads, and pulling in well over $5,000 – and that’s all down to you guys.

I’m not making enough to live off, but for the first time in my writing career I can see a path to that point – and that’s a beautiful thing. I’m getting checks from Amazon each month which are paying my rent and lots of bills, and they are getting bigger all the time.

The market feels like it has doubled since December 25th. Probably because there are millions of new readers out there filling up their devices right now.

Link to the rest at Let’s Get Digital

From Amazon’s Media Room:

2011 was the best holiday ever for the Kindle family as customers purchased millions of Kindle Fires and millions of Kindle e-readers. Authors also continue to benefit from the success of Kindle — the #1 and #4 best-selling Kindle books released in 2011 were both published independently by their authors usingKindle Direct Publishing (KDP).

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“We are grateful to our customers worldwide for making this the best holiday ever for Kindle,” said Jeff Bezos, Amazon.com founder and CEO. “And in a huge milestone for independent publishing, we’d also like to congratulate Darcie Chan, the author of ‘The Mill River Recluse,’ and Chris Culver, the author of ‘The Abbey,’ for writing two of the best-selling Kindle books of the year.”

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• December’s #1 best-selling Kindle Direct Publishing book “Wife by Wednesday” was also the #5 overall best-selling Kindle book in December and has appeared on both the USA Today and Wall Street Journal best seller lists. Author Catherine Bybee was formerly an emergency room registered nurse, and has now left her job to focus on writing full-time.
• In 2011, KDP and CreateSpace author CJ Lyons reached #2 on the Amazon best seller list, #2 on the New York Times best seller list, and #4 on the USA Today best seller list. As a former pediatric ER doctor, CJ has lived the life she writes about in her cutting edge suspense novels, and she quit her job in medicine after 17 years to pursue her dream of becoming a full-time novelist. Her latest work includes “Face to Face” and “Hot Water.”

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More Kindle holiday facts:

• Throughout December, customers purchased well over 1 million Kindle devices per week.
• The new Kindle family held the top three spots on the Amazon.com best seller charts – #1: Kindle Fire, #2: Kindle Touch, #3: Kindle.
• Kindle Fire is the #1 best-selling, most gifted, and most wished for product across the millions of items available on Amazon.com since its introduction 13 weeks ago.
• Kindle is also the best-selling product on Amazon.co.uk, Amazon.de, Amazon.fr, Amazon.es and Amazon.it this holiday season.
• Gifting of Kindle books was up 175 percent between this Black Friday and Christmas Daycompared to the same period in 2010.
• Christmas Day was the biggest day ever for Kindle book downloads.
• Kindle Fire is the best-selling product on Amazon.com’s mobile website and across all of Amazon.com’s mobile applications.

Link to the rest at Amazon Media Room

From the Wall Street Journal:

My brother Randy, an avid reader since childhood, has gone for e-books in a big way. He loves their convenience and portability. But as he recently confessed to me, the new electronic format has at least one other advantage: Put simply, my brother is no longer haunted by the physical presence of books he hasn’t read.

Like most bibliophiles, Randy still acquires many more titles than he has time to read, but now the neglected texts lie quietly in a digital file, out of sight and out of mind. With traditional books, on the other hand, the guilt of an unread novel, biography or history can linger visibly for a lifetime, the ghost of a good intention never fulfilled.

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The late Updike would surely understand. In “The Unread Book Route,” one of his most memorable essays, Updike deftly charted the sad migration of newly purchased volumes from the top of the television to a lonely corner, where they kept company with other exiles.

As Updike wearily observed of the older books, “the unremitting arrival of new immigrants puts them under terrific pressure, and, like the countless microorganisms that dedicated their corpses to our petroleum deposits, like the millions of once-green leaves compressed into the coal fields . . . they form a rich resource for future ages.”

Why then, does someone chastised by so many unread books continue to add to the stockpile? Because when you have a home library, as writer William H. Gass explains, “you are constantly being solicited by good-looking texts to leave your present love for their different, more novel, pleasures.”

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Yet author Gabriel Zaid prefers to think of book hoarding not as a vice at all, but as a virtue. The truly cultured, he says, “are capable of owning thousands of unread books without losing their composure or their desire for more.” In his defense, Mr. Zaid quotes the Spanish philosopher José Gaos: “Every private library is a reading plan.”

Unread books, then, can be noble evidence of aspirations not yet met but still worth embracing. And in this season of New Year’s resolutions, shouldn’t we risk our reach exceeding our grasp?

Link to the rest at The Wall Street Journal (Link may expire after a few days)

From Future eBook:

Perhaps someone at HarperCollins had just read ‘A Christmas Carol’ and wanted to be Scrouge and to be visited in the night by the ghosts of Authors Past, Present and Future.

As reported in Publishers Weekly, HarperCollins decided to dump a Christmas infringement present on Open Road in the form of a lawsuit on 23rd December. The suit is over Open Road’s publication of the e-book edition of Jean Craighead George’s bestselling and award-winning children’s book Julie of the Wolves which has sold some 3.8 million copies. The charge is that in 1971, George entered into a contract that gives HarperCollins exclusive publishing rights of the work “in book form,” and that this extends to ebooks by the inclusive clause “computer, computer-stored, mechanical or other electronic means now known or hereafter invented.”

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Sometimes one has to take a firm stand to protect one’s rights and ensure that your investment is also protected. Other times one has to recognise that time has moved on and the intent you entered into in an old contract has long changed. The exercise can become more about flexing muscles and posturing to influencing others than about the individual case.

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The declaration of war is however a far greater challenge for HarperCollins as it declares its stance not only on this one title by all those thinking about digitally moving on. It also sets an alarming precedent at a time when digital rights are being negotiated and warns all to avoid open ‘catch all’ clauses that may come back to haunt them in the future.

Link to the rest at Future eBook

From the New York Times Bits blog:

That sound you hear is the wrapping being torn off of millions of Kindles and iPads. When those devices are fired up and start downloading texts, it will be the greatest shift in casual reading since the mass market paperback arrived six decades ago. Will this dislocation destroy the traditional book? Will it doom the traditional independent bookstore? Will Amazon and Apple control the distribution of thought and culture in America? All these questions will be played out imminently.

The migration to e-reading is usually reported as a one-way journey: You get a device, start downloading and never look back to the old-fashioned book. You start mocking those type-filled volumes reeking of another century. Meanwhile, the defenders of the old ways are digging in their heels. I know readers who swear never to read anything electronic, saying they find the format muddy and confusing and sad.

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“It seems to me that most of us in publishing have been far too quick to look to a print-book-less future,” Mr. Johnson said in an e-mail. “But that’s like saying we don’t need the wheel because someone invented the airplane.”

Melville has introduced a new series, HybridBooks, to meld the two cultures. On the physical side, the Hybrids are attractive, stripped-down paperbacks, with nothing inside but a short classic text.

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The electronic element comes in with the ancillary material. The last page of the Melville edition directs readers to a Web site, where they will find an 1852 map of lower Manhattan: a recipe for Ginger Nuts, a biscuit that plays a role in the narrative; lengthy excepts from Emerson and Thoreau; a contemporaneous classified ad for a scrivener; and similar material.

“Basically, we decided to mimic our own reading process,” Mr. Johnson said “When I read a great classic, if I like it, I want the experience to somehow continue, so I will pursue more information about the writer, or the setting, or some aspect of the plot’s background. (Dueling? What’s up with that?) My mind wanders, imagining what the world of the book looked like. And so on. Now we have curated exactly that kind of material, and it allows you to linger in the world of the book, to understand more about it — to simply luxuriate in the world of the book longer. It’s something more than just the book, but something very much ‘of’ the book. This seems very innovative to me at the same time that it seems kind of an obvious innovation.”

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Melville House calls its Hybrid line “enhanced print books.” It is a name that makes Mr. Johnson laugh. “Everyone’s always talking about enhanced e-books in this business,” he said. “They think I’m making fun of them when I call our print books enhanced.”

Link to the rest at the New York Times and thanks to S.L. for the tip.

Human language is like a cracked kettle on which we beat out tunes for bears to dance to, when all the time we are longing to move the stars to pity.

Gustave Flaubert

IP, publishing and entertainment lawyer Lloyd J. Jassin has discussed the issues of rights to new technologies under old copyright licenses:

Just as in the 40s and 50s, with rapid advances in new technology, old contracts are being dusted off and language scrutinized to answer the question “Who controls new rights created by recent technological developments?”  Due to ambiguities and omissions in many older publishing agreements, “Who controls enhanced eBook rights?” has become a controversial topic, subject to differing interpretations.

Exemplifying the digital rights controversy is the December 11, 2009 letter from Markus Dohle, CEO of Random House, in which he boldly asserted that RH controlled the “vast majority” of digital rights to its backlist.  This assertion  precipitated a collective “Yeah, right!” from literary agents across the globe.  This article, among  other things, looks at how courts interpret pre-digital age contracts.

To be clear, Mr. Dohle’s claimed ownership of backlist digital rights is based on a very favorable (for RH) interpretation of  pre-digital age contracts, in which RH received “for the term of copyright, the exclusive right to publish and sell works contracted for in book  form.”

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Random House’s grab for digital rights follows a well-established pattern in the entertainment industry. Cases addressing whether older entertainment industry contracts granted rights for new uses such player piano rolls, radio, motion pictures, television, videocassettes, and even paperbacks and eBooks, are plentiful. Like Random House, motion picture studios once claimed that they already had the right to exhibit films on television, and to distribute them as home videos. While the cases are not uniform in their holdings, rest assured, basic principles of contract interpretation exist to guide us.

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When a contract is ambiguous, the job of ascertaining the parties’ intent may, ultimately, be left to a court to decide.  Since contracts are not drafted in a vacuum, courts look at industry practice.  In the case of eBook and enhanced eBooks, courts will ask whether distribution of books in digital form was recognized by knowledgeable people in the industry when the contract was drafted.  Courts will also look for any provisions that tend to limit the “exclusive right to publish . . . in book form.”   For example, did the author negotiate a “reserved rights” clause?   To be clear, the majority of courts have held that a grant of future technology rights cannot be inferred from an agreement, unless the technology was known at the time of the grant.

When a contract is susceptible to two reasonable interpretations, the Restatement (Second) of Contracts, states that the agreement should be construed against the party who drafted the language.  Since Random House was in a stronger bargaining position, unless it could be shown that the author (or agent) had an equal hand in drafting the agreement, RH’s backlist contracts would be interpreted by courts in a light most favorable to the author.

Link to the rest at Copylaw