Q&A;: Philip Parker, Developer of Automated Authoring Platform

Mac Slocum
April 30, 2008 | Permalink | Comments (0) | Listen

Philip Parker, founder of ICON Group International and a management science professor at Insead, has developed a patented approach to publishing that combines databases and programming with editorial management -- sometimes via humans, sometimes via computers. ICON Group produces books in 17 genres, including health care, business, reference and crosswords.

In this Q&A;, Parker discusses ICON Group's computer-driven process.

How do you identify book topics?

Based on personal and research interests, I select a genre. Once a genre is selected, I do all titles in that genre (e.g. all trade categories that are officially recognized).

Are writers, editors, or designers involved at any point?

Depends on the genre, but yes, all are relied on heavily at many stages. Health guides are written by medical professionals and hand edited. The business reports have highly edited sections, but 90 percent is computer based.

What types of sources/databases do you pull information from? Are there data sources you don't currently have access to that you think hold promise for this type of publishing?

Depends on the genre. I use the sources that are used by regular authors. For example, an economist uses well established sources to do econometrics, I use the same sources. Many companies and governments have under-utilized data sources and databases that may yield interesting genres; I have worked on the ones that I found of interest to me. I have a huge store of proprietary data. If I use a government source, this is cited, and will vary by genre (e.g. CDC for infectious disease information).

You were part of a print-on-demand (POD) panel at TOC '08. Are all Icon Group books POD? What POD service(s) do you use?

No, not all are print-on-demand. We use LSI [Lighting Source] and Booksurge for POD. We do some POD ourselves for specialized orders.

Could your company -- or a similar company -- function without POD?

Yes, in fact, most of our titles are not POD, but electronic via subscription for large libraries -- corporate and non-corporate.

Are all books also made available as ebooks? What ebook formats do you use?

Yes. PDF, DOC, Mobipocket (coming soon), Pocket PC.

Do researchers or clients ask you to prepare specific books?

Yes. We are able to do financial and labor studies on demand.

Mike Maznick says there's some fairly negative feedback on some of the titles. Is that a consequence of the automated nature of the content creation? Do you feel confident people buying these books know they're generated? Or does that not matter?

All publishers have negative and positive comments (e.g. O'Reilly). I would find it strange if our titles did not. Of the titles we have on Amazon, some 50/210,000 have real comments. Many are satirical. Of the ones from actual buyers, all publishers will receive negative and positive feedback (both can be not real, as Amazon comments are almost wiki based; posted by various people, including affiliates who are trying to sell titles).

I do not track the feedback on Amazon, but I imagine of the 17 genres (crosswords, classics, trade, outlooks, etc.), the negative ones are probably only on the health care guides, which are sold mostly to libraries and patient associations. Of all the genres, this one [health care] is not "generated by computer" -- all the text is written by professionals. The computer is used for formatting and doing the index, and compiling the glossaries.

I have a feeling that the low ratings are because the person does not like the content, thinks that better content or similar content is available elsewhere (e.g. the Internet) or was hoping for more. The health guides are clearly marked as Internet guides, and they cite Internet sources. All of the guides are vetted (by librarians, etc.). If people are dissatisfied because they think the computer wrote the text in the books, then they are dissatisfied for the wrong reason, which is unfortunate.

Many patient associations have not only reviewed the books, but also recommended them to patients and families. On balance, I think it better to make these available to patients with rare diseases who wish to better know how to navigate the Internet, beyond a Google search. For the other genres, I have never received negative feedback, only positive feedback or questions about methodology.

What is your most popular title? How many copies were sold?

Our trade reports, which are purchased by consulting firms, investment banks, and companies involved in international trade. This series is very popular. We gauge sales by series, not by individual titles. Traditional publishers think in terms of individual titles.

On average, how many copies of a single title do you sell?

There are thousands held by libraries (this is public data at World Cat). Some firms subscribe to all titles. Again, we often sell series. Some [titles] sell hundreds, some sell just a few, as a part of a series sale. The prices seen on Amazon are one-off -- we sell few or none of these.

For a typical title, what percentage of the total retail sale is profit?

We do not have a typical title. ICON Group as a whole makes no "profit" -- all resources are plowed into R&D; for new genres. The margins of the books at retail -- as opposed to profit -- are very low for the POD titles, and higher for the business titles. The margins for the low-priced products follow the industry, though we have lower margins as POD can be expensive compared to short-run printing.

A recent New York Times article says that each book costs you "about 12 cents in electricity." What other costs are involved in the process?

It can cost hundreds of thousands of dollars, or more, to set up a genre (programming, licensing, editing, research/analysis, etc.). Many [genres] take about 1 year to create, some take 3 to 5 years. I have been doing this for about 8 years now.

How is pricing determined?

Same as in the publishing industry. In some genres we try to equate marginal revenues to marginal costs. On lower-priced POD we make sure we cover the basic costs. On higher end, we try to be substantially below related titles (e.g. trade and outlook, and other business reports). The latter [higher end] are really not sold via Amazon much, but rather through MarketResearch.com, EBSCO (content inclusion), NetLibrary and traditional channels for those markets (direct sales).

How many titles do you plan to develop this year?

Depends on the genre. For Mobipocket (mobile books), we plan on about 68,000 titles. For others, maybe around 50,000. We are working heavily on my dictionary and animations.

Related:

• Video: "Patent on 'Long Tail' for automated content authorship"
• Automated Authoring Frequently Asked Questions
• Measuring Success on Self-Published Titles

Roundup: Free Doesn't Always Apply, Kindle's Ebook Impact, Indie Bookstores and Chains Face Same Competitor, UK Publishers and Amazon in Price Battle, Borders Gets a Better Deal

Mac Slocum
April 11, 2008 | Permalink | Comments (0) | Listen

Free Doesn't Work for Every Company

From Peter Brantley: Hank Williams of Why Does Everything Suck? does an informal economic critique of Chris Anderson's "things tend to free" hypothesis:

"Some of you will argue that Google does fine based purely on advertising. But just because one company can commoditize everyone else's work and make pennies on things that used to generate dollars, is that sustainable across the whole economy? Or would we really be reducing the overall amount of money flowing into the digital market and therefore to the overall labor force?" (Continue reading ...)

An Educated Guess at Kindle's Impact

Kindle sales figures aren't available and the devices are still sold out, but the Associated Press notes a connection between the Kindle's Nov. '07 release and an uptick in ebook sales across the industry:

Publishing officials are reluctant to discuss sales figures, but say that they have seen double digit increases in e-book sales since the Kindle's release, including renewed interest in downloads on the Sony Reader.

Independent Booksellers and Chains Face Big-Box Competitors

Looks like the "enemy of my enemy is my friend" maxim is coming in to play with the increased attention big-box retailers are giving to books. Small indie booksellers and chain stores, such as Borders and B&N;, are feeling the pinch from big-box store markdowns. From the Washington Post:

Costco, Target, Wal-Mart and Sam's Club aren't just moving in for the kill with big discounts on the latest Stephen King or John Grisham page-turners. They are also engaging the culturally connected, targeting readers who delight in cocktail or book-club conversation about the latest titles. About 34 percent of book buyers made purchases at such locations last year, according to the Simmons National Consumer Survey.

Publishers and Amazon Locked in Price War

The UK's Times Online says Penguin, Bloomsbury and other publishers are trying to woo customers with steep discounts on their own Web sites. Amazon isn't happy about the cuts:

There are fears that Amazon may retaliate by regarding a publisher’s online price as the recommended retail price and applying its trading terms to that. If a publisher discounts a £20 book to £15 online and Amazon has a contract for a 50 percent discount on the full price, Amazon would pay the company £7.50 instead of £10. Publishers say that this would be unfair and could ultimately drive up prices.

Borders Gets a Better Deal

Borders has revised its $42.5 million loan with Pershing Square Capital Management. According to The Bookseller, the loan interest rate has been reduced from 12.5 percent to 9.8 percent. Pershing has also boosted its backup offer for Borders' international operations to $135 million.

Related:

• See more publishing news and insight in the TOC News section.

Roundup: No Returns for New HarperCollins Unit, Amazon's Mobile TextBuyIT, Publisher Staffers Get Sony Readers, Ebook Shortage, Custom Cookbooks

Mac Slocum
April 4, 2008 | Permalink | Comments (0) | Listen

New HarperCollins Unit: No Returns, Few Advances (Subscription Required)
The Wall Street Journal says a new unnamed HarperCollins unit will not accept retailer returns and will pay little or no author advances. The business will direct its efforts toward Internet sales and writer profit-sharing.

Update 4/4/08, 1:30 p.m. The New York Times has additional details on the HarperCollins unit:

• Hyperion founder Bob Miller will run the business.
• The unit will release ebooks and audio books for all its titles, a move designed to give consumers "information in any format that they want," says Jane Friedman, president and CEO of HarperCollins. Alternative formats might be included with printed editions at no extra cost.
• Miller says the business will aim for 25 published titles per year.
• Authors may get a 50-50 split on profits, but the tone of the article suggests these details are still to be determined.

Amazon Offers Mobile Shopping Through TextBuyIT
Retailers might want to confiscate cell phones at the door. Amazon's new TextBuyIT service lets customers peruse and purchase Amazon products via text messaging. Purchases are confirmed through an automated calling system.

Publisher Staffers Get Sony Readers
Publishers Weekly says Sony Readers are being distributed to employees at major publishing firms so manuscripts and other documents can be managed digitally. Random House, Hachette, Simon & Schuster and St. Martin's are all on the Reader bandwagon. Phil Madens, Hachette's director of publishing standards and practices, tells PW:

"We looked at how much we were spending on paper, postage, ink. A 400-page manuscript would cost $7 to print. In the first couple of seasons, the Reader will pay for itself."

Ebook Shortage from Big Publishers?
In an analysis of Publishing Trends' latest ebook figures, David Rothman concludes:

... right now readers just aren't getting all the titles they need in E [ebook format], partly because DRM and other eBabel-related issues have complicated life for shoppers and many publishers and e-bookstores, thus reducing the potential rewards for publishers of all sizes.

Custom Cookbooks on Demand
Members of BigOven, a food-focused social network, can create and order custom cookbooks through the BigOven site. The system runs on SharedBook's "reverse publishing platform" API.

Further Thoughts on Amazon/BookSurge

Laura Dawson
April 3, 2008 | Permalink | Comments (1) | Listen

I keep turning the Amazon/BookSurge story over in my mind, and decided today that it was worth a deep look at the stakeholders, and their stakes:

Print-on-Demand (POD) publishers: These include self-published authors as well as publishers with tens of thousands of titles. The POD model is cost-effective for many types of publishing. POD publishers choose their printers based on cost, quality of the product they turn out, and other differentiating terms.

Amazon: Not only do they sell books, but through their POD service BookSurge, they print them. They have just mandated to POD publishers that they will only sell POD titles printed by BookSurge. If POD publishers want to sell non-BookSurge books, they need to pre-print copies and send them to Amazon's warehouse. This takes the "OD" out of POD, and defeats the business model entirely.

What Amazon has done, essentially, is force the POD publishers to choose between BookSurge, its proprietary service with a proprietary format, and Lightning Source/Lulu/etc. Amazon says that it hasn't actually forced a choice -- that publishers are free to use whatever service they like and then pre-print five copies to be stored in Amazon's warehouses. For a small publisher, that's pretty demanding, and the fact is, most POD publishers use on-demand technology because it's cheaper. By pre-printing titles for sale, small publishers get into the same business that mainstream publishers do -- the business of pulping and remaindering books that don't sell.

Ingram: Not only do they distribute books, but their POD service Lightning Source prints them. Lightning Source is the largest POD service in the country. They also ship titles for Amazon that aren't carried by other sources. Ingram on Monday said that none of this actually had any impact on Lightning Source, but that's not the case. Amazon has said they will not send true POD orders to Lightning Source. The only way they will sell Lightning Source titles is if they already have those books in the warehouse.

Barnes & Noble: Like Amazon, of course, they sell books. They also have a very close relationship with Ingram. They will not sell any books printed by BookSurge. It may be that Ingram doesn't do anything directly to Amazon in retaliation for this loss of business, but they might suddenly get even closer to Barnes & Noble than they already are -- maybe team for an exclusive digital initiative.

Baker & Taylor: Like Ingram, they distribute books. They are the preferred vendor for Amazon, though Amazon will go to Ingram if B&T doesn't carry the book in question. One issue is, will the non-BookSurge books reside in B&T warehouses? Could B&T find itself carrying Lightning Source books because Amazon will only deal with those as they deal with books from non-POD publishers?

Borders: In trouble. Relaunching a website, purportedly on May 3. This is where Borders could get smart and play Switzerland. They could serve as a POD portal, selling all POD titles regardless of affiliation. But at this point it's asking a lot for Borders to keep its head above water, much less strategize at this long-tail level. So unless they've suddenly acquired some major talent in several divisions of their Web site, that's rather a long shot.

The Customer: He just wants a book -- his mom's book, a how-to book, a book on an obscure topic. He wants a book that may only be available on-demand. How does he know where to find it? Why must he go to Amazon, and then B&N, to see if he can get it? Amazon's not going to sell Lightning Source titles; B&N's not going to sell BookSurge titles. But the customer doesn't know or care who the printer is. He just wants to be able to find and buy the book.

That all said ... it's worth looking at both Lightning Source and BookSurge with a microscope.

Ingram has done some interesting things with regard to book distribution in the last few years. First, they created Ingram Digital Group (IDG), which is charged with exploring content delivery initiatives to both retail outlets and libraries. Second, they acquired VitalSource, an ebook platform heavily in use by college textbook publishers. Third, they acquired Coutts, whose MyiLibrary product is also an ebook platform for the academic and institutional market.

So Ingram has these delivery systems for large amounts of content, ready to package as white-label platforms with subscriptions included. With the digital files that Lightning Source uses, Ingram could conceivably distribute the current POD offerings as ebooks as well, distributed across its Coutts or VitalSource platforms.

Meanwhile, Amazon is scanning books for its "Look Inside" program. Obviously, it has a platform capable of delivering ebooks -- it does so daily. If Amazon insists that its POD publishers stick with BookSurge, and treats other POD vendors as traditional book publishers, then it could conceivably build a feeder system like IDG has with Lightning Source: from BookSurge into the "Look Inside" platform and into ebooks.

And if Ingram's longtime alliance with B&N (10 years ago, B&N attempted to buy Ingram) is threatening Amazon -- if the mere potential of IDG allying with B&N.com to distribute Lightning Source/VitalSource/MyiLibrary content as ebooks is at all threatening to Amazon -- then surely Amazon's sudden focus on BookSurge is a natural one.

Amazon UK Staying out of POD Fray (for now...)

Andrew Savikas
April 2, 2008 | Permalink | Comments (0) | Listen

Amid the furor over Amazon's latest maneuver with POD and Booksurge, comes word that Amazon.co.uk has "no plans" to bring Booksurge across the pond.

Then again, that statement shouldn't be as reassuring as it sounds to UK publishers:

An Amazon.co.uk spokesman said there were "no plans" to introduce the BookSurge service into the UK, but added: "We do not comment on future plans."

(Thanks to O'Reilly UK's Graham Cameron for the link.)

A Q&A; on O'Reilly’s "Up-to-Date" Publishing Experiment

Mac Slocum
April 2, 2008 | Permalink | Comments (0) | Listen

There's a common conundrum in the computer book world: software companies often release updates on a monthly or weekly basis, yet many programmers rely on printed references that can take months to write and produce. There are online options, but we also know that many readers still want something printed.

To try and tackle the problem, O'Reilly has launched a new experiment with the just-released Essential Silverlight 2 "Up-to-Date" edition (Silverlight is a new technology platform from Microsoft). Readers get a book that's current when they purchase it, but also get access to updates that can be physically inserted into the book.

I recently spoke with four members of the Essential Silverlight 2 project team to get their take on the development of this book as well as their view on the broader "updateable" concept.

Q: How is Essential Silverlight 2 different from traditional books?

Laurel R.T. Ruma, co-editor: The book is in a durable plastic binder that has three hole punches with metal pins. The binder can hold 425 pages, so there's room to grow.

Q: How does the update process work?

Ruma: You buy the book through a bookstore or online and then you register it through O'Reilly. When Microsoft releases a new beta, Christian [Wenz, the author] starts writing. Around 6 to 8 weeks later, a PDF of the update will be posted online and you'll be notified because you're registered. You can download the PDF for free and print and trim it yourself, or you can purchase printed and punched copies for an additional cost.

Q: When will the first update be available?

Ruma: Updates will be available online April 21 and in print the first week of May.

Q: What were the challenges in developing this book?

John Osborn, co-editor: There are unique challenges because it's a retail product -- security, display, etc. We needed to work with the binder vendor to create a security seal so people don't steal pages.

Laurel Ackerman, Director of Marketing, O'Reilly Open Tech Exchange: We needed to consider how it would integrate into a bookshelf. The dimensions of the book [7 inches x 9 inches] are designed for a retail shelf.

Christian Wenz, author: It was quite a challenge to plan the whole book structure. When writing a regular book, you can change the structure until very late in the process. Here, we had to create a flexible structure that would allow us to add content later without having to ship a whole new book with every update.

Ruma: We had to think about things like page numbering, because different pages and sections can be updated. We used a system that goes by section, chapter, and page number [e.g., 1.3.1]. We also had to shift all the templates because of the pins. Really, we wanted to make it so the reader will have to replace as few pages as possible. We want them to replace in a thorough way, but not a wasteful way.

Q: Was the production process different for the Up-to-Date edition?

Ruma: A standard book takes 6 to 9 months to write and 12 weeks to produce. We did this one in a little more than a month.

Christian and John had worked on a Silverlight 1.0 PDF. Christian incorporated his book updates into his 1.0 document within two weeks. Production on the book took another two weeks. And then it went to the printer for two weeks.

The book had to be done for the Microsoft MIX conference in March [2008]. We knew we would have an audience that is extremely interested in the subject matter and would give us unbiased and honest feedback.

[Editor’s note: authoring and production for this title was done using DocBook XML and a customized version of the open source DocBook XSL stylesheets.]

Q: What has the feedback been like?

Osborn: Generally the first reaction was 'Wow, this is a great idea." From there it was tons of feedback, most of it really good.

Ackerman: All of the feedback we've gotten from programmers is relief and delight. There's a lot of frustration out there with people waiting for books between releases. They're thrilled to be getting the content so they can start working.

Q: What type of content is best suited an Up-to-Date book?

Osborn: I see two scenarios: One is like Silverlight, which is a product in beta. Knowing the software release sequence and knowing the end point works well. In the second scenario, I could see something where you pick a core technology, like Visual Basic, and then offer updates. If anything new comes along, we'll provide it.

Q: Do you think other publishers will move toward updateable books?

Ackerman: I think it's inevitable that publishers will be going this way. At TOC, the two big topics were on-demand publishing and the value that publishers bring to information. Both of those things are in this book.