Microsoft/O'Reilly Alliance Means DRM-free Ebooks Coming from MS Press

Andrew Savikas
September 24, 2009 | Permalink | Comments (1) | Listen

Full details are in Tim's post on the Radar blog (and in the Press Release and in the statement from Microsoft ), but thought one part of this deal worth calling out specifically here:

I'm particularly excited that as part of this agreement, Microsoft has committed to make its ebooks DRM-free and device-independent. One of our goals at O'Reilly has been to make sure that ebook customers can read them on any device, and have the ability to keep using them even if they change their preferred device. Having Microsoft Press join us in this commitment is a big step forward towards an open ebook market.

We begin transitioning distribution (including digital) in December, which means there will be lots to show and tell at February's TOC Conference.

Mobile as New Medium

Andrew Savikas
September 7, 2009 | Permalink | Comments (20) | Listen

While prepping for my talk tomorrow on mobile publishing at the Digital Publishing Group in New York, I was also popping in and out of a related ongoing email conversation about textbooks and iPhones, and couldn't help but weigh in on the question of how to handle some the issues like cross referencing and annotations on the iPhone compared with in a textbook. Several people suggested the comments were worth sharing with a larger audience:

These are relatively minor technical problems that generally already have solutions. The bigger issue I see is that thinking of the problem as "how do we get a textbook onto an iPhone" is framing it wrong. The challenge is "how do we use a medium that already shares 3 of our 5 senses -- eyes, ears, and a mouth -- along with geolocation, color video, and a nearly-always-on Web connection to accomplish the 'job' of educating a student." That's a much more interesting problem to me than "how do we port 2-page book layouts to a small screen."

Mobile is big on the agenda at TOC Frankfurt, TOC New York, and I'm sure will come up during the upcoming TOC online event.

O'Reilly iPhone App Tips and Tricks

Adam Witwer
September 4, 2009 | Permalink | Comments (0) | Listen

• "Hidden" features -- handy things you can do that aren't always obvious in the UI
• Long code lines -- my attempt to help users deal with the question we get most often on the support queues
• Extracting the EPUB files -- yes, there is an EPUB file in that app, and you can get to it quite easily

The App Store and the Long Tail Part 2: The Real "DRM" At Stake

Andrew Savikas
August 10, 2009 | Permalink | Comments (5) | Listen

Note there's a lot of images in this post, so if you're reading it via RSS, you may want to click through to the original post if you can't see the images.

A few weeks ago I wrote about how the small number of sales from many different countries were adding up to more than the large number of sales from the US in the App Store for our books. That trend has continued (and accelerated), and right now about 60% of our App sales are coming from outside the US:

When I've talked with other publishers about our success with iPhone Apps, they typically discounted what I said because I was talking about iPhone: The Missing Manual, a title particularly suited to the device. And to a degree, that's a fair argument, and I don't expect very many other books-as-apps to sell as well as that one. But the results for the next batch of 17 titles is instructive. For the two-week period of July 20 to August 2 (the first two calendar weeks the apps were on sale), five of the 17 titles sold more units as iPhone apps than via print (as measured in Bookscan). Here's a comparison across all 17 titles:

That got me wondering why there's not stronger interest from other publishers, especially trade publishers, in iPhone apps (besides concerns about pricing and the approval process). Then as I was looking at rankings for some of the top paid book apps, I spotted a possible answer.

In the App Store, each country has its own top 100 lists (overall and for each category, and for free as well as paid). Something that's #1 here in the US may not even register on the top 100 in another country. Here's the current (as of this writing) worldwide rankings for the "Classics" App, the #1 paid book app right now:

Classics is one of the most popular paid book apps in nearly every country with iPhone service (the list actually goes further down than shown above).

Now here's the current (as of this writing) worldwide rankings for "Twilight" which has been holding steady in the top 25 paid apps here in the US:

Yup, that's it. Just the US. Presumably this is a rights issue -- Hachette either doesn't have the rights to sell this book as an App anywhere else, or they're choosing not to. But taken in light of our own sales of nearly 2/3 outside the US and the data from Classics, that means a publisher who can't (or won't) sell their app outside the States is missing a lot of the market. Here's the current rankings for the "A Twilight Trivia" app, which is ranked above Twilight in the US (and is not affiliated with Hachette or Stephenie Brown):

So there's clear interest in the Twilight content on the iPhone outside the US -- enough interest to keep this app well into the top 100 paid book apps in dozens of countries.

Perhaps the most important "digital rights management" at stake right now is that of the rights to sell digital content globally.

If you're planning to attend the Frankfurt Book Fair, producing and selling digital and mobile content from a global perspective will be a big part of the program at TOC Frankfurt on Oct. 13.

Does Digital Cannibalize Print? Not Yet.

Andrew Savikas
August 7, 2009 | Permalink | Comments (10) | Listen

One of the big risk factors publishers think about when it comes to digital books is that they will cannibalize print sales. Factor in the lower prices we're seeing for ebooks, and it's a quite reasonable concern.

Looking at data on sales from our website, at first glance that would appear to be exactly what's happening:

Over the past 18 months, we've gone from print outselling digital by more than 2:1 to just the opposite.

But that's not the full story. If there really was cannibalization happening, you'd expect to see our print sales underperforming the overall computer book market, but that's not what's happening. Here's a comparison of how our sales (as measured by Bookscan) stack up against the broader computer book market. The data here is normalized (the first period in the graph is set to 100, and subsequent results are calculate relative to that period):

Roger Magoulas, who heads up our Research Team (which is doing some way cool stuff with App Store data) put it this way in a recent backchannel email covering this as part of a larger analysis:

By looking at the data and these charts we infer that while O'Reilly physical book sales are down compared to last year, this seems more the result of the drop in demand for computer books since the financial meltdown than the impact of ebook sales. Since O'Reilly is a relatively prolific publisher of econtent we would expect that ebooks would affect O'Reilly's physical book sales more than other publishers and we don't see that evidence in these results. Even if ebooks are taking a bite out of O'Reilly physical book sales, we see no negative effect on O'Reilly's slightly increasing share in the physical book market nor on how O'Reilly's sales correlate with the overall market for physical computer books.

So, for now, if what we infer is correct, you can put away your exorcism crosses, ebooks seem more a legitimate expanded market opportunity than a projectile vomiting Linda Blair wannabe.

Two Cool New Bookworm Features

Andrew Savikas
July 30, 2009 | Permalink | Comments (0) | Listen

There's no question that there's plenty of room for improvement among EPUB readers. From simple things like poorly handling multiple author names to more complicated issues like CSS support, readers (the people, not the software) deserve better. That's one reason we've been sponsoring the open-source Bookworm reader, which is among the best ebook readers around (and looks great on mobile browsers, including Kindle's).

Liza Daly (@liza) has a post over on the O'Reilly Labs blog covering two very cool new Bookworm features:

• Feedbooks integration: one-click import from the most popular Feedbook titles, localized to the language set in your Bookworm preferences
• Add to Bookworm: any website can use the same technique to create an "add to Bookworm" button

Bookworm is currently available in seven languages: English, German, Danish, Finnish, Italian, Spanish, and Japanese (if you're interested in helping to translate Bookworm into more lnaguages, let us know). Report bugs and request features over at the public issue tracker. (And if you want to contribute to the project, visit the project page over on Google Code.)

Anderson: "It's All About Attention"

Andrew Savikas
July 29, 2009 | Permalink | Comments (0) | Listen

Over on Spiegel Online, Chris Anderson does a great job responding to nearly all of the standard old-media responses to new media. Unsurprisingly (I'm sure Wired would have done the same) they pulled one line from a lengthy response to create the provocative title "Maybe Media Will Be a Hobby Rather than a Job." The full passage is much more useful and nuanced:

In the past, the media was a full-time job. But maybe the media is going to be a part time job. Maybe media won't be a job at all, but will instead be a hobby. There is no law that says that industries have to remain at any given size. Once there were blacksmiths and there were steel workers, but things change. The question is not should journalists have jobs. The question is can people get the information they want, the way they want it? The marketplace will sort this out. If we continue to add value to the Internet we'll find a way to make money. But not everything we do has to make money.

The complete interview is worth a read.

Would an Apple Tablet be an Ereader? Yes and No.

Andrew Savikas
July 28, 2009 | Permalink | Comments (4) | Listen

Last Friday the latest round of rumors of an Apple Tablet swelled considerably after a piece from Apple Insider asserted the device is now on the 2010 product roadmap:

However, the past six months have reportedly seen the critical pieces fall into place. Jobs, who's been overseeing the project from his home, office and hospital beds, has finally achieved that much-sought aura of satisfaction. He's since cemented the device in the company's 2010 roadmap, where it's being positioned for a first quarter launch, according to people well-respected by AppleInsider for their striking accuracy in Apple's internal affairs.

That means that the device, which is expected to retail for somewhere between the cost of a high-end iPhone and Apple's most affordable Mac notebook, is bound to turn up any time between January and March, should there be no last minute setbacks. Analyst's following the Cupertino-based company may consider factoring first full-quarter sales of the device into their models for calendar Q2.

The news sparked considerable interest among publishers, who apparently see this development as a "Kindle killer" that will upset Amazon's apparent dominance of the ebook ecosystem. It's understandable from the perspective of a publisher, but if this device actually exists, it's doubtful anyone at Apple sees it as an "ereader" any more than it sees the iPhone as "a GPS device." (The speculation stems from a piece in the Financial Times quoting an anonymous "publishing executive" and saying Apple has been talking to publishers.) Apple also talked to major newspapers before the iPhone launched, but they didn't build the iPhone as a mobile newspaper.

Some have been speculating about whether Apple would ink deals with aggregators like OverDrive or Ingram Digital to secure ebook content for a tablet. But that assumes that Apple sees a need to directly deal with ebooks the way they deal with music, and I don't believe that's likely. While it's possible they'd beef up the native PDF capabilities in a larger device, I think it's much more likely they'll establish the market (the App Store) and the platform (some variant on the iPhone SDK), and let developers and content creators take care of the rest, the way they have already on the iPhone with games.

Seeking Alpha has a nice analysis of Tablet Fever, and correctly places any discussion of news or books in the context of the App Store, where it firmly belongs:

Steve Jobs has mentioned that he has never seen anything like success of the App Store in his career. If he is saying that, then I'm saying that this 9.7 inch iTouch that has been designed to optimally utilize the apps will become the flagship Apple product... The order of operations for the iPhone are phone first, iPod second, Apps third, and Internet browser fourth. This new iTouch is principally designed to take advantage of the App Store gaming, books, news, entertainment, social networking, etc...

Wanted: Proposals for TOC 2010

Andrew Savikas
July 23, 2009 | Permalink | Comments (0) | Listen

If you follow us on Twitter, you already know that the Call for Proposals is now open for the 2010 Tools of Change for Publishing Conference (Feb. 22-24, 2010 in New York).

One of our main themes last year was that all publishing is now digital publishing, and that's becoming clearer with each new announcement about a new device, reseller, smartphone, or other new way to reach an audience -- an audience that is now often walking around with a bookstore in their pocket or briefcase. Here's some of the topics we're looking for:

• Reaching mobile readers: when your customers carry bookstores in their pockets
• Pricing and packaging digital books
• Case studies of successful (or unsuccessful!) new publishing and digital initiatives
• Case studies from implementing lessons learned at a previous TOC Conference
• Strategies and tactics for incorporating print-on-demand into a supply chain
• Moving beyond books: selling merchandise, community, experience, and other scarce goods in a world of "free"
• Tools and challenges for an efficient all-digital workflow
• Revising your P&L's for the economics of digital publishing
• Understanding and responding to the changing retail landscape
• Using the web to find and promote the original people behind "user-generated content"--authors
• Best practices for working with Amazon, Google, and other big internet players
• How to capture and analyze web metrics of interest to publishers
• Best new practices and tools for working with and supporting authors during editorial, production and/or marketing phases
• Systems and devices for displaying digital copy (demos welcome)
• Business models for delivering and/or receiving material via new devices
• New copyright clearing, assertion, and determination mechanisms
• XML, EPUB, RDF, and other TLA's (three-letter acronyms) decoded and explained
• Using open-source tools to assemble a digital publishing workflow

If you have an idea for a session, tutorial, or "lightning demo" we want to hear from you.

And if you're making plans for the Frankfurt Book Fair, don't forget to sign up for TOC Frankfurt, a one-day conference looking at these issues from a European perspective.

Long Tail Evidence from The App Store

Andrew Savikas
July 20, 2009 | Permalink | Comments (5) | Listen

Last week we released 16 of our books as iPhone Apps (and on Saturday added The Twitter Book), and there's some interesting Long Tail data coming in. We've seen Long Tail behavior in the data from Safari Books Online and from Google Book Search, though in this case it's about geography: even though regions like Colombia, Belgium, and Greece are individually generating a small number of sales, together they add up to more than the total number sold in the US:

CSS in an XML Workflow

Laura Dawson
July 17, 2009 | Permalink | Comments (3) | Listen

At the StartWithXML Forum in New York in January, Rebecca Goldthwaite of Cengage gave a great demonstration of how Cengage uses CSS in their XML workflow. Many publishers regard style sheets as an invitation to create cookie-cutter book production, with the fear that all their books will look the same. This is emphatically a myth. Have a look at her seventh slide for examples of how one stylesheet can actually create many different looks.

CSS Zen Garden has been up for a while (Liza Daly used this model to create the EPUB Zen Garden a few months ago). It's a sort of CSS sandbox where graphic designers can play with style sheets and render the same content in very different forms. Clicking on the four links below will demonstrate what CSS can do:

• Home Page 1
• Home Page 2
• Home Page 3
• Home Page 4

It's well worth checking out and maybe having some graphic designers play around with it.

StartWithXML is Going to London

Laura Dawson
July 17, 2009 | Permalink | Comments (0) | Listen

StartWithXML will be continuing in London! On September 2nd, at the British Library, we'll be conducting a one-day forum similar to the one we held in New York last January, but with a British publishing focus. Our sponsors for this event include Klopotek, MarkLogic, PLS, BIC, Publishers' Association, and of course O'Reilly.

We're still in the process of firming up our speakers, but we do have information posted here. Additionally, if you are a British publisher or service provider, there's a survey for you here.

As we get more news, we'll add it here - meanwhile, we're continuing to research and gather information about where publishers are in the StartWithXML process.

Content is a Service Business

Andrew Savikas
July 13, 2009 | Permalink | Comments (25) | Listen

I've been a fan of Trent Reznor's music since first hearing Pretty Hate Machine in junior high school, but in the past few years I've been increasingly impressed by his attitude and approach to the economics of the modern digital media business. His release of Ghosts I-IV is a case study in how to do exactly what Kevin Kelly outlines in Better than Free : "When copies are free, you need to sell things which cannot be copied." Notice that even though the Free Download option is right there at the top, the $300 "ultra-deluxe" version is sold out (and was sold out within 24 hours of being released).

On his forum a few days ago, Reznor posted advice to aspiring young musicians eager to make it in the music business, and the advice is just as applicable to writers and other artists working in almost any digital medium and attempting to compete with the vast content available on the Web:

[W]hat you NEED to do is this - give your music away as high-quality DRM-free MP3s. Collect people's email info in exchange (which means having the infrastructure to do so) and start building your database of potential customers. Then, offer a variety of premium packages for sale and make them limited editions / scarce goods. Base the price and amount available on what you think you can sell. Make the packages special - make them by hand, sign them, make them unique, make them something YOU would want to have as a fan. Make a premium download available that includes high-resolution versions (for sale at a reasonable price) and include the download as something immediately available with any physical purchase. Sell T-shirts. Sell buttons, posters... whatever. [emphasis added]

This is not just about using free digital content to sell physical goods. It's an acknowledgment that what you're selling as an artist (or an author, or a publisher for that matter) is not content. What you sell is providing something that the customer/reader/fan wants. That may be entertainment, it may be information, it may be a souvenir of an event or of who they were at a particular moment in their life (Kelly describes something similar as his eight "qualities that can't be copied": Immediacy, Personalization, Interpretation, Authenticity, Accessibility, Embodiment, Patronage, and Findability). Note that that list doesn't include "content." The thing that most publishers (and authors) spend most of their time fretting about (making it, selling it, distributing it, "protecting" it) isn't the thing that their customers are actually buying.

Whether they realize it or not, media companies are in the service business, not the content business. Look at iTunes: if people paid for content, then it would follow that better content would cost more money. But every song costs the same. Why would people pay the same price for goods of (often vastly) different quality? Because they're not paying for the goods they're paying Apple for the service of providing a selection of convenient options easy to pay for and easy to download.

This is not new to digital content. Why would the price of admission to see a given year's Razzie Award winner be equivalent to the price of admission to see the year's Best Picture? Because the price of admission is not for the content. It's for the privilege of seeing it early, and doing so on a big screen in a social environment -- movie patrons pay for the service provided by the theater, not for the movies themselves (here's a counterpoint on movie pricing). That's the point that Reznor and Kelly are making: think long and hard about what your customers want, and provide the service of giving that to them.[1]

"But people are still buying content when they buy a book or an album," the argument goes. Yes, they are. The same way that you're buying food when you go to a restaurant. You are purchasing calories that your body will convert to energy. But few restaurants (especially those you visit frequently) have ingredients any different from those you can get yourself at the corner store, for much less money. So it can't be true that your primary goal is to purchase food; you're purchasing a meal, prepared so you don't have to, cleaned up so you don't have to, and done so in a pleasing and convenient atmosphere. You are paying for the preparation of the food and the experience of eating it in the restaurant, not the food itself [2] (beyond the raw cost of the physical ingredients, which in the case of digital content is effectively zero).

This came up during a discussion on Peter Brantley's email list recently, in the context of what someone is paying for when they buy one of our Cookbooks (which contain "Recipes" for how to accomplish specific tasks with a particular computer language or technology, often culled and curated from material and techniques previously published in blog posts, mailing lists, or help forums). I asserted that rather than the content itself, people are paying for the preparation of that content, to the extent that it helps them solve their problems more quickly and conveniently. When you think about what we do as a service business, then it makes perfect sense: readers are paying us for the service of finding a bunch of great and interesting stuff, and putting it together in a convenient package. It's the convenience of not having to find it themself, and the concise package that saves them from having to dig through a bunch of web bookmarks or search results. I didn't buy "Home Buying for Dummies" last year because I wanted a book on home buying; I bought it because I didn't want to screw up something really important (buying a house) and was willing to pay someone to spell out all of the stuff I needed to worry about in one place. People don't buy Jim Cramer's books because they want Jim Cramer's content -- they buy his books because they think it will help them get rich, and they think paying him is a great shortcut alternative to acquiring his knowledge (knowledge, not "content") themselves. These are services, not products.

The recent (and absurd) notion put forward by European publishers to "strengthen copyright protection as a way to lay the groundwork for new ways to generate revenue online" is intimately tied up with this issue of the value of content (and therefore the value of various players in the content value chain, like authors, publishers and the latest bogeyman, aggregators and search engines). Arguing that you need to beef up copyright protection to make sure there are ways to generate revenue online incorrectly assumes that what people are paying for is the copyrighted content itself. People do not care about content, they care about themselves and their problems.

You don't get an "A" for effort just by spending time and money creating content (and you are not entitled to your business model -- you have to earn that money every day by doing something that people find worth paying for -- and they decide it's worth paying for, not you). Content only has value to the extent that someone will pay for it because it accomplishes something they'd rather exchange money for than do themselves -- and when was the last time you said "Gee, I really need some content. I could write some of it for myself to read today, but I'd rather pay someone else to do it." [3] Google and other aggregators haven't stolen any value from the creators of the content they are aggregating -- they have done what intermediaries have always done, which is create new value based on doing for customers what those customers cannot or do not want to do themselves -- the service of sorting through all that content to find the thing that solves their problem. (I use "problem" loosely -- it may be boredom, loneliness, a tax audit, an idea for a first date,...) Again I'll return to Kevin Kelly, who elucidated the role of aggregators in relation to content creators far more eloquently than I ever could:

The giant aggregators such as Amazon and Netflix make their living in part by helping the audience find works they love. They bring out the good news of the "long tail" phenomenon, which we all know, connects niche audiences with niche productions. But sadly, the long tail is only good news for the giant aggregators, and larger mid-level aggregators such as publishers, studios, and labels. The "long tail" is only lukewarm news to creators themselves. But since findability can really only happen at the systems level, creators need aggregators. This is why publishers, studios, and labels (PSL) will never disappear. They are not needed for distribution of the copies (the internet machine does that). Rather the PSL are needed for the distribution of the users' attention back to the works. From an ocean of possibilities the PSL find, nurture and refine the work of creators that they believe fans will connect with. Other intermediates such as critics and reviewers also channel attention. Fans rely on this multi-level apparatus of findability to discover the works of worth out of the zillions produced. There is money to be made (indirectly for the creatives) by finding talent. For many years the paper publication TV Guide made more money than all of the 3 major TV networks it "guided" combined. The magazine guided and pointed viewers to the good stuff on the tube that week. Stuff, it is worth noting, that was free to the viewers. There is little doubt that besides the mega-aggregators, in the world of the free many PDLs will make money selling findability -- in addition to the other generative qualities.

I love his metaphor of the internet machine ("a very large device that copies promiscuously and constantly"), and it's one worth keeping in mind if you think you're in the business of selling "content," because you are probably wrong.

Update: Jim Lichtenberg kindly reminded me he gave a presentation [PPT] on the same topic at the 2008 TOC Conference. Worth a read.

1. Many publishers have actually been doing the same thing for years with hardcover, trade, and mass-market editions of the exact same content at different prices.

2. This is why celebrity chefs aren't particularly worried that doing TV shows and selling cookbooks describing exactly how to make the food they serve in their restaurants will harm business.

3. There are people who do in fact want to pay someone to write content for them as a service. They're called publishers.

What Ebook Resellers Should Learn from Scribd

Andrew Savikas
July 7, 2009 | Permalink | Comments (12) | Listen

Scribd made a splash when they opened up a "Scribd Store" for selling view and download access to documents. Their terms (80% to the document publisher) are quite generous, though one reason publishers keep so much is that most of the merchandising (including pricing) is self service -- Scribd could learn a lot from other media retailers if they're interested in really promoting document sales.

But one area where existing ebook resellers could really learn from Scribd is in terms of data access and reporting. During one particularly frustrating conversation with an ebook reseller just last week, I learned that we'd be lucky to get sales reports nearly 6 weeks after any sales. These are digital sales. On the Web. Paid by credit card. No inventory to track, no shipping, no check or invoice processing.

Compare that to Scribd, where I get an email every time a document is sold telling me how much it sold for, and the total lifetime earnings for that document. I can also view a graph showing document views over time:

And every single day I get a detailed summary of document activity (this is a very small excerpt):

Here's your daily summary of what's happened with your Scribd account since 
you last checked out the site.
 ------------------------
      Someone liked your document entitled "Apache 2 Pocket Reference by O'Reilly Media"!     
 7 minutes ago
 ------------------------
      Someone liked your document entitled "JRuby Cookbook by O'Reilly Media"!        
 7 minutes ago
 ------------------------
      Someone liked your document entitled "Analyzing Business Data with Excel by O'Reilly Media"!    
 31 minutes ago
 ------------------------
Maria added your document "Tomcat: The Definitive Guide by O'Reilly Media" to their list of favorites
        
 39 minutes ago
 ------------------------

There's also quite a variety of reporting formats and interfaces in the wild among ebook resellers, meaning lots of time is spent by either IT staff or accounting staff (or both) parsing and processing each flavor of report. Though there is a Digital Sales Report format, I haven't heard about any reseller actually using it (if you know of one, tell me in the comments).

Success on the Web requires nearly realtime analytics, and that's one area of ebook retailing Scribd seems to really understand.

"Being wrong is a feature, not a bug"

Andrew Savikas
July 2, 2009 | Permalink | Comments (2) | Listen

A thoughtful piece from Michael Nielsen on the disruption of the scientific publishing industry includes a lot that's very relevant to other publishers and media companies. For example:

In conversations with editors I repeatedly encounter the same pattern: "But idea X won't work / shouldn't be allowed / is bad because of Y." Well, okay. So what? If you're right, you'll be intellectually vindicated, and can take a bow. If you're wrong, your company may not exist in ten years. Whether you're right or not is not the point. When new technologies are being developed, the organizations that win are those that aggressively take risks, put visionary technologists in key decision-making positions, attain a deep organizational mastery of the relevant technologies, and, in most cases, make a lot of mistakes. Being wrong is a feature, not a bug, if it helps you evolve a model that works: you start out with an idea that's just plain wrong, but that contains the seed of a better idea.

Around here we like to say "fail forward fast," and it's an acknowledgement that we will learn much more by trying and doing (and probably failing) than by planning. The real challenge with that is to make those experiments as cheap (financially and otherwise) as possible.