E-books are game-changers, but not in the way we all thought they would be. Far from taking over print, e-book sales have stagnated at less than a quarter of print sales and show every sign of staying there or declining for the foreseeable future.
But e-books continue to be a source of bitter controversy that divides publishers from two of their most potentially useful allies: writers’ groups and libraries.
Below, I’ll present two thought experiments for how libraries and writers’ groups could find common cause with the Big Five publishers, using tech projects that would make a better world for writers, readers, literature, and culture.
First up, libraries. Libraries are understandably exercised about the high prices they’re expected to pay for their e-books – as much as 500% more than you and I pay on the major online services. To add insult to injury, HarperCollins makes libraries delete any e-book that has circulated 26 times, on the bizarre grounds that:
a) Its print books are allegedly so badly bound that they disintegrate after 26 readings (this is not actually true); and
b) This defect in the robustness of physical books is a feature, not a bug, and should be imported into the digital realm.
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Publishers have a much bigger e-book problem than library pricing: Amazon’s dominance in e-book sales. Worse than that: Amazon is also a publisher, one that competes head to head with the Big Five, chasing the same authors to write the same books for the same readers.
Amazon knows, in realtime, how publishers’ books are performing. It knows who is buying them, where they’re buying them, where they’re reading them, what they searched for before buying them, what other books they buy at the same time, what books they buy before and after, whether they read them, how fast they read them, and whether they finish them.
Amazon discloses almost none of this to the publishers, and what information they do disclose to the publishers (the sales data for the publishers’ own books, atomized, without data-mineable associations) they disclose after 30 days, or 90 days, or 180 days. Publishers try to fill in the gaps by buying their own data back from the remaining print booksellers, through subscriptions to point-of-sale databases that have limited relevance to e-book performance.
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Here’s my thought-experiment: what if libraries cloned Overdrive in free, open source code, which every library in the world could use, and which libraries could pay independent contractors to patch and improve. Rather than paying an annual fee for Overdrive that pays for the software and dividends to Overdrive’s investors, the libraries would adopt the model that has made Drupal and WordPress so successful: paying independent contractors for service and upkeep, and collectively sharing the benefits of the incremental improvements made through these transactions.
The openness of the platform is key, because that’s what lets the libraries assert that they are able to collect aggregated statistics on usage and circulation that are sufficiently zoomed-out as to not compromise patrons’ privacy, but are still full of the key insights publishers need to compete with Amazon, their best and biggest frenemy, publisher, and retailer rolled into one.
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It’s critical that we make sure these deals benefit writers, because e-books are also a hot potato in writer-publisher dynamics. The Author’s Guild has taken a public stand demanding that writers to get 50% of net proceeds from e-books as a standard deal – double the current rate. Publishers have not taken this call very seriously so far.
But there’s a way to triple the writer’s share of e-book royalties, without costing the publishers anything, and, in so doing, take away some of Amazon’s market dominance.
That way is to allow writers to retail their own books.
The standard deal looks like this: retailers get 30% of the gross book price, and writers get 25% of the net (17.5% of gross) as a royalty. If writers were the retailers, their royalty would jump from 17.5% of gross to 47.5% of gross, for the books that they sold.
How could this work? Groups like the Authors Guild, and even its rival Authors Alliance (a group that calls for more liberal copyright rules, on whose advisory board I sit), or even both together (this being one of the few areas in which they can both agree), could raise a grant from a foundation to create an e-book retail platform that writers could host themselves, plug into their WordPress of Drupal sites, or embed as a widget on Facebook and Tumblr. This platform would allow writers to retail their own e-books, and would have a central hub, ‘‘Fair Trade E-books,’’ where readers could, with one search, find the writer’s store for whatever books they were seeking.
Writers who sell their own e-books offer two things that Amazon can’t match. The first is the assurance to readers that when they buy from writers, they help the writers they love triple their earnings, while not spending a penny more. The second is the ability to buy books from a single store, regardless of geographic location.
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The Big Five would have to come to the table, of course: they’d have to offer retail accounts to their own writers, which would incur some real accounting expense on their end. But as this service is born digital, the accounting tools could be built into the retailing software, developed in consultation with the Big Five, to plug right into their accounting systems.
PG says there’s some notable hand-waving in this plan.
First, a bunch of programmers, working for free, will clone Overdrive. Presumably without violating any software patents or copyrights of Overdrive. While Overdrive drops into a deep sleep.
Second, a bunch of non-profit organizations notably short on programmers or programming expertise get a grant from a foundation to build an ebook retail platform that would compete with Amazon.
Of course, it’s dead simple to sell ebooks better than Amazon does. That’s why Amazon’s days as an etailer are numbered. Nook and Kobo have been eating Amazon’s lunch. Beating Amazon would be a cinch for the Authors Guild and some foundation-grant programmers.
Large organizations with deep pockets and the ability to hire lots of very smart people (Walmart – Annual Sales: $482 billion) are losing to Amazon. Amazon’s ecommerce platform is a work of sublime genius. And getting better every day.
PG is sure Cory means well, but an alternate universe would be necessary for his plan to succeed. With time travel back to Bezos’ place of birth.