From The Bookseller:

Will we see this week as the moment when everything changed, a peek through the looking glass into a new era? I speak not of the sometime author and Conservative MP Boris Johnson becoming the UK’s Prime Minister, but the release of Amazon’s new weekly charts showing, for the first time, the impact of the huge but opaque digital sector on book sales.

There are plenty of known knowns from the first week’s release. Rachel Abbott, the author behind the biggest-selling fiction title of the week, And So it Begins, has long been a digital hit-maker. Her début thriller, Only the Innocent, was self-published in 2011, with Amazon revealing in 2015 that she was its bestselling “indie” author in the five years since Kindle launched. Like many of these authors, however, she has been largely absent from Nielsen BookScan’s bestseller universe, her top-seller having shifted just 6,955 copies in print. The chart also highlights the success of new digitally-led publishers such as Joffe Books and the more familiar Bookouture, which feature along with Amazon imprints Lake Union Publishing and Thomas & Mercer.

There is also the impact of audio, particularly in the most read/listens chart, where Audible’s release of Arthur Conan Doyle’s Sherlock Holmes: The Definitive Collection, read by Stephen Fry, sits in 10th, below the seven Harry Potter titles, their popularity also augmented by the Fry-narrated audio editions. That so many readers are listening to backlist audio shows the potential of the market, but also that it may need a different approach.

Link to the rest at The Bookseller

Amazon Publishing has created an animated cover for its listing of Patricia Cornwell’s Quantum.

The book description includes the following:

Kindle in Motion

This book can be read on any device, including Kindle E-readers. It may include art, animation, or video features that can be viewed on certain Fire tablets and the free Kindle app for iOS and Android. You can switch features on or off at any time.

Here’s a link to the book page for Quantum and here’s a link to other examples of Kindle in Motion.

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From Publishing Perspectives:

Keen observers of the trade publishing scene this week may have noticed in the news Publishing Perspectivesreported on Monday about longtime bestseller Dean Koontz taking a new five-book series and short story collection to Amazon Publishing.

For decades, the prolific Koontz made his publishing home primarily at Penguin Random House’s Bantam, racking up more than 45 titles with the Big Five imprint, only to be discovered now talking of being “creatively rejuvenated” to have found a publisher “where change is understood and embraced” and “a marketing and publicity plan smarter and more ambitious than anything I’d ever seen before.”

And yet, years ago, many in publishing, including veteran observer Mike Shatzkin, were watching for “defections” from major houses—not to Amazon Publishing but to the self-publishing platform Kindle Direct Publishing. The idea was that an established and well-heeled author could easily hire the “author services,” as they’re called, to do the grunt work of preparing a manuscript for self-publishing and managing its life in the online sales maelstrom, while using print-on-demand to produce brick-and-mortar store copies for physical book fans.

Instead, Koontz may be the canary in the trade industry mines who hops off that darkening perch and buzzes out into the sunlight of Internet sales leadership—where the Association of American Publishers’ annual StatShot tells us, more book sales now are happening than on physical retail channels.

On Tuesday, Shatzkin wrote in a well-timed addendum to a column on publishing’s past decade, “If this is a sign of things to come, and it is hard to see why it wouldn’t be, some profound changes might be just around the corner.”

As Shatzkin tells it, “Between the time this post was started and when it was finished and published, another sign of disruption took place. Amazon Publishing signed the bestselling author Dean Koontz to a multi-book contract. At the beginning of this decade, Amazon Publishing had ideas about signing up big authors. But they were stymied then by the pretty stubborn refusal of the rest of the supply chain to stock books published by their biggest retail competitor.”

. . . .

“Whether they will successfully sell Koontz … remains to be seen,” Shatzkin writes. “But,” he goes on—italics ours—”their no-middle-person structure enables them to pay far more of each retail dollar in royalties.

“Half the sales or more can generate more income to the author than a publisher without its own retailing capability can deliver selling a larger number of units.”

Link to the rest at Publishing Perspectives

Click Here to see the Wall Street Journal Video

(Sorry, WSJ videos won’t embed in TPV.

For background on this post, see Amazon’s Upcoming Audible Captions Feature = Unhappy Publishers, and Someone Disagrees with PG – Again. And do read the many excellent comments to each post.

So Audible has stepped into a hornet’s nest with its plan to provide audiobooks with captions. PG has stepped into a related hornet’s nest by saying he thinks it’s a good idea. The hornets claim it is an unauthorized rights grab by Audible.

PG says, “Let’s look at the contract.”

PG has no access to contracts between Audible and major publishers. However, all the world has access to Audible’s Audiobook License and Distribution Agreement which is available to indie authors and publishers of all sizes and shapes. The agreement includes a notation that it was last revised on June 1, 2017. The version PG will refer to has been downloaded today.

The license uses the term, Audiobook frequently. In the second paragraph of the Agreement (unnumbered) we see a definition of the term as it will be used in the Agreement:

the audio recording of the book(s) you have identified on ACX for the grant of distribution rights (any such audio recording as submitted by you or as modified pursuant Section 3(a) below, an “Audiobook“)

[Begin PG aggravated monologue]

There is no Section 3(a).

PG suspects that, at some point, perhaps the last revision, some sort of legal stylist played with the contract, formatting it in a font with Audible’s corporate orange and changing the numbering scheme, and nobody in legal carefully reviewed the modified piece of art for designer-caused errors.

In PG’s superlatively humble opinion, contracts should present a boring appearance. Font stylists and brand experts should be kept far away from contracts, online and otherwise.

Additionally, the last person to review contract language should be an attorney and one of the tasks of that person is to always, always, always check each and every cross-reference in the contract. PG understands that you didn’t go to Harvard Law School to check cross-references, but an error in a cross-reference could be disastrous.

[End PG aggravated monologue]

Generally speaking, when a court construes a contract, rather than adopting a view which converts a portion of the contract into a nullity, the court will attempt to determine what the contract draftsperson was trying to accomplish.

In this case, PG thinks the reference to Section 3(a) originally was a reference to what, in the restyled agreement is currently Section 4.1.

Right to Edit. Audible may modify, reformat, encode, adapt and edit the Audiobook to make the Audiobook compatible with the Audible service, including but not limited to by (a) adding Audible’s standard intro and outro, and (b) removing flaws or audio elements that are, in Audible’s judgment, incompatible or inconsistent with the Audible service (e.g., playback instructions, microphone bumps, distortion, ambient sound, etc.).

Even if a judge determines that the reference to 3(a) is a nullity, Section 4.1 is still part of the agreement and grants Audible the extensive rights described therein. The section 3(a) reference would have clarified that the defined term, Audiobook, included products arising under Audible’s Right to Edit provision.

End of all of PG’s nittery-pickery, let’s get back to whether Audible is permitted to create captioned audiobooks or not.

Again, on the first page of the contract, we find Section 2.1.:

You grant Audible the exclusive license to use, reproduce, display, market, sell and distribute the Audiobook throughout the Territory in all formats now known or hereafter invented from the date you accept this Agreement until the date that is 7 years from such date (such 7 year period, the “Initial Distribution Period”). [emphasis supplied by PG]

Section 2.1 covers audiobook licenses by which the author/owner grants Audible exclusive audiobook rights. Section 2.2 covers non-exclusive audiobook licenses granted to Audible:

You grant Audible the non-exclusive license to use, reproduce, display, market, sell and distribute the Audiobook throughout the Territory in all formats now known or hereafter invented from the date you accept this Agreement until the date that is 7 years from such date (such 7 year period, the “Initial Distribution Period”). [emphasis again supplied by PG]

Alert readers will note that the other than the change from an exclusive to a non-exclusive license, the wording is identical.

So, where does the “rights grab” accusation leveled at captioned audiobooks end up after considering the quoted provisions?

Is a captioned audiobook a form of audiobook that was either known at the time the author signed the contract or invented after the author signed the contract?

PG thinks the answer to this question is affirmative.

Is a captioned audiobook something other than an audiobook, some sort of ebook with sound hybrid? Perhaps, but PG thinks it’s hard to make a persuasive argument that escapes the contract language discussed.

Section 4.1 grants Audible the right to modify, reformat, encode, adapt and edit the Audiobook to make the Audiobook compatible with the Audible service.

Is Audible “modifying, reformatting, encoding, adapting and editing” the original audiobook to create a captioned audiobook?

PG thinks the answer to this question is affirmative.

If Audible is going to offer a captioned audiobook as part of a new or improved Audible service, PG suggests that part of Section 4.1 is satisfied.

PG will note that Section 10 does include the following language: “All rights in the Audiobook not granted in this Agreement to Audible are expressly reserved by you.”

However, if the contract grants rights all audio formats “all formats now known or hereafter invented” and also permits Audible to “modify, reformat, encode, adapt and edit the Audiobook” for its new captioned audiobook offering, PG suggests the Audible authors have granted Audible that right.

From The Wall Street Journal:

Don’t blame all the vacant stores on e-commerce. Sky-high rents are squeezing retailers, too.

Although commercial retail rents are down from recent peaks, they haven’t fallen as fast as sales at struggling chains. The rents remain higher than prerecession levels in many prime shopping areas such as Manhattan, Los Angeles and Dallas.

In a high-profile example of this tug of war, Barneys New York Inc. has hired restructuring advisers and is considering several options including a possible bankruptcy filing, as it seeks to renegotiate the lease on its Madison Avenue flagship and other locations, according to a person familiar with the situation.

The landlord raised the annual rent on the Madison Avenue store earlier this year to $27.9 million, from $16.2 million, this person said. Barneys fought the rent increase but lost during an arbitration proceeding. Reuters earlier reported that Barneys had hired restructuring advisers.

The retailer also is looking at whether it makes sense to reduce the size of the 260,000-square-foot store.

. . . .

Landlords say it isn’t that simple. They argue retailers fueled demand with a flood of store openings coming out of the 2008 recession. And even when the landlords dangle lower rents, it is hard to tempt retailers to open stores when they are retrenching.

“We’ve cut rents by 30% and are offering all sorts of concessions, but we still have vacant space,” said William Friedland, a principal with Friedland Properties, which owns commercial real estate in Manhattan.

In other cases, though, landlords have an incentive to leave space vacant because slashing rents would violate their loan agreements, industry executives said. Moreover, any devaluation of the property would make it harder for them to borrow in the future.

“For these landlords, maintaining the valuation on their properties is more important than collecting an immediate rental stream,” said Richard Johnson, a partner in Odyssey Retail Advisors, a consulting firm that works with retailers and landlords. “It’s a waiting game, and many landlords would rather wait it out, hoping the market improves.”

Commercial rents in San Francisco are up 53% from a decade ago, and in Miami they are 46% higher, according to CBRE. Even in smaller cities, such as Nashville and San Jose, Calif., rents are up by nearly one-third.

Link to the rest at The Wall Street Journal (Sorry if you encounter a paywall)

PG has received a lot of comments about his post titled Amazon’s Upcoming Audible Captions Feature = Unhappy Publishers.

One of the responses which disagreed with PG’s assessment of Audible Captions as no big deal was from Marilynn Byerly. Ms. Byerly obviously put some time into collecting links to opinions that differ from PG’s, so PG thought he should promote the comment to a separate post so no one interested in this topic would miss it.

So, PV, you are a lawyer and your wife is a published author and you are fine with Amazon/Audible grabbing a book right without a contract or payment? It’s the author, traditional or self-pubbed, who gets screwed in these situations. Always. Since this is what they tried to do with Kindle rights grab, here are some good resources to study then give us your non-copyright lawyer opinion.

“Legal ruckus over the Kindle.” A fairly reasonable statement of the general facts of the case. http://tech.yahoo.com/blogs/null/121556

“Amazon Releases the New Kindle 2.” Includes some legal issues. http://online.wsj.com/article/SB123419309890963869.html

“Book publishers object to Kindle’s text-to-voice feature.” Covers some of the legal issues involved. http://news.cnet.com/8301-1023_3-10161104-93.html

“E-Book Rights Alert: Amazon’s Kindle 2 Adds ‘Text to Speech’ Function.” Authors Guild statement. http://www.authorsguild.org/advocacy/articles/e-book-rights-alert-amazons-kindle-2.html

Copyright lawyer, Ben Sheffner, blogs on the controversy. http://copyrightsandcampaigns.blogspot.com/2009/02/authors-guild-explains-stance-on-new.html

“Kindle Text-to-speech is a lot of talk.” One of the better overviews of the legal questions involved. It also includes two versions, one by a TTS program and one by a human, of some text to compare the two methods. http://www.networkworld.com/news/2009/021109-kindle-text-to-speech-issue-is-a.html?page=1

“Know Your Rights: Does the Kindle 2’s text-to-speech infringe authors’ copyrights?” Ex-copyright attorney talks about the issues involved. The best overview I’ve seen. http://www.engadget.com/2009/02/11/know-your-rights-does-the-kindle-2s-text-to-speech-infringe-au/

“DRM White Paper AAP/ALA White Paper: What Consumers Want in Digital Rights Management,” Discusses the problems of TTS for publishers and audiobook companies because it isn’t adequately defined in a legal sense. No longer available online.

Unfortunately, due to yet another wild and crazy weekend at Casa PG, PG won’t have an opportunity to review all of Ms. Byerly’s links and prepare a response until early next week.

In the interim, feel free to comment on any of Ms. Byerly’s links or other issues you feel are raised (or not raised) by Amazon’s latest experiment with audiobooks.

From The Verge:

Earlier this week, Audible revealed that it was working on a new feature for its audiobook app: Audible Captions, which will use machine learning to transcribe an audio recording for listeners, allowing them to read along with the narrator. While the Amazon-owned company claims it is designed as an educational feature, a number of publishers are demanding that their books be excluded, saying these captions are “unauthorized and brazen infringements of the rights of authors and publishers.”

On its face, the idea seems useful, much in the same way that I turn on subtitles for things that I’m watching on TV, but publishers have some reason to be concerned: it’s possible that fewer people will buy distinct e-book or physical books if they can simply pick up an Audible audiobook and get the text for free, too.

And Audible may not have the right to provide that text, anyhow.

In the publishing world, authors and their agents sign very specific contracts with publishers for their works: these contracts cover everything from when the manuscript needs to be delivered, how an author is paid, and what rights to the text a publisher might have, such as print or audio. As an audiobook publisher and retailer, Audible gets the rights to produce an audiobook based on a book, or to sell an audiobook that a publisher creates in its store. Publishers say that a feature that displays the text of what’s being read — itself a reproduction from the original text — isn’t one of those specific rights that publishers and authors have granted, and they don’t want their books included in Audible’s feature when it rolls out.

. . . .

Audible tells The Verge that the captions are “small amounts of machine-generated text are displayed progressively a few lines at a time while audio is playing, and listeners cannot read at their own pace or flip through pages as in a print book or eBook.” Audible wouldn’t say which books would get the feature, only that “titles that can be transcribed at a sufficiently high confidence rate” will be included. It’s planning to release the feature in early September “to roll out with the 2019 school year.”

Penguin Random House, one of the world’s five biggest publishers, told The Verge that “we have reached out to Audible to express our strong copyright concerns with their recently announced Captions program, which is not authorized by our business terms,” and that it expects the company to exclude its titles from the captions feature.

Other publishers have followed suit. Simon & Schuster (disclosure: I’m writing a book for one of its imprints, Saga Press), echos their sentiments, calling the feature “an unauthorized and brazen infringements of the rights of authors and publishers, and a clear violation of our terms of sale,” and has also told Audible to “not include in Captions any titles for which Simon & Schuster holds audio or text rights.” A Macmillan spokesperson said that “the initiative was not authorized by Macmillan, and we are currently looking into it.”

The Authors Guild also released a statement, saying that “existing ACX and Audible agreements do not grant Audible the right to create text versions of audio books,” and that the feature “appears to be outright, willful copyright infringement, and it will inevitably lead to fewer ebook sales and lower royalties for authors for both their traditionally published and self-published books.”

When asked about the feature squares up against the existing audio rights that are granted to it, an Audible spokesperson told The Verge that it does “not agree with this interpretation,” but declined to comment further on whether or not the company actually has the right to go through with it.

Link to the rest at The Verge and thanks to Jan for the tip.

This looks like one more instantiation of Big Publishing’s ancient credo, “New is bad, old is good.” Heaven forfend that books of any sort be improved without more money going to legacy publishers.

Absent a problem with the definition of “ebook” in the contracts between Amazon and the publishers, PG thinks what shows up in Amazon’s video at the end of this post is clearly distinguishable from an ebook.

PG suggests complaining publishers are attempting to extort more money from Amazon.

He predicts it won’t work.

If Amazon wants to play serious hardball, it can begin to delist audiobooks from major publishers which don’t agree to permit the new feature.

If Amazon wants to play a step-below-serious hardball, it can penalize audiobooks that don’t offer the new captioning feature in Amazon search results or tag those audiobooks with a warning to potential purchasers that the audiobooks are only available in an outmoded format or some such thing.

Back to even more serious hardball, how about declining to sell new print and ebooks released by publishers unless the accompanying audiobooks include the captioning feature?

If the publishers want to continue their snit fit, who are they going to turn to for sales, Barnes & Noble?