Emerging topics from TOC 2010

Mac Slocum
February 26, 2010 | Permalink | Comments (0) | Listen

It's interesting to chart technical developments in the publishing industry against TOC's brief history. As Andrew Savikas notes in the following video, things like ebooks and mobile have evolved from small topics to dominant themes. If the pattern holds -- and I don't know why it wouldn't -- we'll see international markets and digital analytics claim more attention at future events.

An expert view of unicorns and digital rights management

Mac Slocum
February 25, 2010 | Permalink | Comments (1) | Listen

Kirk Biglione, principal at Oxford Media Works, was tracking the Apple tablet / iPad way before other analysts. I believe he was one of the first to dub it "the unicorn," a phrase that beautifully captures the inflated hopes and the actual promise attached to the thing.

Beyond unicorn watching, Biglione is also a digital rights management (DRM) historian who brings a clear-eyed perspective to this inflammatory topic. While others jump on soapboxes, he actually does the homework. Case in point: Biglione's in-depth look at the music industry's stormy history with DRM.

Biglione took a few minutes at TOC to discuss both topics with us.

Author, sell thyself (but in a good way)

Mac Slocum
February 24, 2010 | Permalink | Comments (2) | Listen

Authors who want to jump into Twitter, Facebook and all the rest should pay heed to Chris Brogan. He's spent years -- more than a decade -- carrying on a conversation with his audience. Take a look at the sheer number of @ replies in his Twitter feed and you'll see how seriously he takes this stuff.

In the following interview, Brogan outlines easy community-building techniques and common pitfalls that should be avoided at all costs (narcissists, beware). He's also got a few pointed comments for laggard publishers.

Web community is messy in all the right ways

Mac Slocum
February 23, 2010 | Permalink | Comments (6) | Listen

When you run into Richard Nash, founder of Cursor, you're encountering the embodiment of TOC enthusiasm. He's the anti-curmudgeon.

As you'll see in the following interview, Nash is passionate about the web's ability to connect audiences and authors with the topics that excite them. His thoughts on tagging are particularly compelling (1:57 mark) because he really hits at the heart of web communities: like tags, communities are broad, messy, organic things that should never be pigeonholed by strict taxonomies.

What Nash outlines could very well be a blueprint for future publishing businesses.

The chaos and the opportunity in Arab publishing

Mac Slocum
February 23, 2010 | Permalink | Comments (1) | Listen

Egyptian publishing is far more chaotic than its Western counterparts. ISBNs are used fleetingly and book rights are a moving target. But that same chaos also breeds opportunity, particularly in the mobile and digital publishing spaces.

Ramy Habeeb, director and co-founder of Kotobarabia, sat down with us at TOC 2010 to discuss the current state of Arab publishing as well as the impact mobile and epublishing may have on that market.

The e-reader growth spurt of 2010

Mac Slocum
February 23, 2010 | Permalink | Comments (1) | Listen

At last year's Tools of Change for Publishing Conference, ThreePress Consulting president Liza Daly introduced attendees to the small crop of e-readers in the nascent e-reader market. There weren't many devices to choose from a year ago, but the session hinted at big changes to come.

As TOC 2010 is held this week in New York, it's clear those changes have arrived en masse. E-readers are bountiful -- everyone jumped on the bandwagon -- and adoption is poised to grow beyond envelope-pushing consumers.

I caught up with Liza to get her take on the latest e-reader developments: Amazon vs. Apple, iPad vs. Kindle, mobile apps vs. web apps, and more.

TOC Preview: The Future of Digital Textbooks

Andrew Savikas
February 19, 2010 | Permalink | Comments (4) | Listen

Technology is driving change in the way people teach, learn, and create. The impact of technology on teaching and learning in K-12, higher education, and professional learning has been profound, and, while no one can predict the future, it's safe to say this transformation has only just begun.

At next week's Tools of Change for Publishing conference, a session titled "The Future of Digital Textbooks" and an open roundtable on publishing, emerging technologies, and education, will discuss the devices, business models, and technologies impacting education and textbook publishers.

As a prelude to TOC, panel moderator John W. Warren, Marketing Director, Publications, at the RAND Corporation, posed questions about digital textbooks and their impact on students and teachers to panelists Neeru Khosla, Co-Founder and Executive Director of CK-12 Foundation; Frank Lyman, Executive Vice President of CourseSmart LLC; Nicholas Smith, Chief Operating Officer, Agile Mind; and Eric Frank, Co-Founder and Chief Marketing Officer, Flat World Knowledge.

John Warren: What are the prospects for ebook devices, such as the Kindle, compared to tablet devices such as the iPad, or accessing digital textbooks on computers, whether desktop computers or laptops?

Neeru Khosla: Ebook devices in their present format (i.e. Kindle, iPad) have limited functionality. They also cost too much for education. When a panel of high school students was asked what device they couldn't live without, 75 percent responded that they couldn't live without their computers. That's a complete device -- providing their music, communication (Skype, AIM), reading, you name it. 

For an ebook reader to be successful it will need to be a multifunction device. For now, there are simply too many limiting factors -- affordability, battery life, portability, and readability. I believe that most of these limitations will be overcome with time; however, the mindset of readability in print format versus online is a huge one and needs to be addressed.

Frank Lyman: Millions of college students are now using computers to access various kinds of digital course materials. This activity has reached almost complete market saturation, with 88 percent of students owning laptops, 9 out of 10 using course management systems and accessing online course materials within the CMS.

Because nearly every student can already access digital textbooks on a computer, the initiatives that are successful at scale in the near term will likely be those focused on the computer as the main access point. Scale is more important in the academic market than in most consumer markets because the institution is interested in providing an equal experience across student groups. This is one of the main reasons why digital learning moved slowly during the past decade, as the "digital divide" narrowed for both computer ownership and broadband access.

That said, I believe there are strong prospects for both ebook and tablet devices in education. The Kindle DX may not have been successful in its initial pilots, but that may reflect the reality that it's better suited for specific educational uses as opposed to being an across-the-board textbook device. For example, at the Darden School at the University of Virginia, the Kindle replaced printed loose-leaf business cases, and there it has been received more positively than in some of the other pilots.

In my opinion, tablets have greater potential as a game-changing device across the educational market. Browser-based interfaces will run some of the best existing interactive learning products for computers, and the new form and functions are likely to drive a new generation of innovative teaching and learning products. That said, in the near term, scale will continue to be an issue for these devices. Until an institution can feel comfortable that students have equal access to this type of experience (as they do with a textbook) they will be reluctant to support large-scale initiatives. So the tablet market will probably grow as the laptop market did -- student by student at first, then adopted institution-wide by some forward-thinking schools, finally reaching the kind of scale that we now see with laptops. Content strategies that support the tablet market will grow more robust through that lifecycle.


Eric Frank: In general, I think we will see continued fragmentation in how people read textbooks. Device manufacturers, be they dedicated devices like the Kindle, broader utility devices like the iPad, or fully featured computers, will continue to compete to gain textbook market share by consistently adding functionality and decreasing price.

All of that competition will lead to device convergence -- dedicated devices will continue to look more like computers, computers will continue to get smaller, and reading functionality will be enhanced. In the end, it will be a lot like the PC market -- lots of consumer choice, huge fragmentation, and constant downward pressure on prices for device manufacturers.

For content companies, this fragmentation presents a continuing challenge. The fixed editorial and development cost to publish a single copy of a textbook requires investment. Now, however, publishers need to spend more money converting files to each of the formats required by devices people are using. And publishers will be paying a "toll" to the device manufacturer that now has pricing power, like Amazon or Apple. All of this while the pressure on prices the market will sustain for digital books will continue to press inexorably toward zero.

Nicholas Smith: I'm going to pose an alternative question here. What problem is the ebook trying to solve? From an educational perspective at least, I feel a little bit like we are trying to put wheels on a horse. This question, and the general discussion, seems to come from the viewpoint of publishers trying to fit traditional content into a new format. What problems are we trying to solve for students and teachers? Is it simply the dissemination of two-dimensional print content in a highly consumable, electronic format? We have an opportunity and a responsibility to design products that fully leverage the power of technology.

Stealing from Henry Ford, let's not design a faster horse; let's design an automobile. Learning involves reading, but it involves so much more that we can offer through technology. Imagine that I no longer read a page of text and look up, realizing that my mind has been wandering for half of the page. Maybe I start the "page" by watching a video that engages me in a topic and poses some provocative questions, I then read a paragraph or two, and finally I'm presented with a couple of questions. By answering these questions, I confirm my understanding of what I just read and can continue reading, or drill down into this topic further through some links if I am curious. If I answer the questions wrong, I am immediately pointed to where I need to go to get steered back on course. And then, when I get to class, my teacher already knows what I and others have been having trouble with, since the results to the questions I've answered -- and failed to answer -- are sent to her, thus she can teach to what I, and other students, don't know instead of what we already know.

That's an automobile, not a horse with wheels.

Got Tips for TOC Newbies?

Andrew Savikas
February 18, 2010 | Permalink | Listen

This week I'll be posting some preview highlights about next week's (nearly sold out) TOC Conference in New York.

While there's plenty of familiar faces on the attendee list for TOC (welcome back!), there's also a lot of newcomers who can learn from your advice and experience about how to make the most of their time at TOC.

We've posted a Newcomer Tips page on the conference website where you can leave your suggestions in the Comments section. We'll also be offering (optional) "Alumni" and "Newbie" ribbons to affix to your conference badge if you'd like to wear your status with pride. Pick yours up before the opening cocktail reception as a great way to break the ice.

A full list of on-site events is posted here.

TOC Preview: Ebooks Are Here (But Print Still is Too)

Andrew Savikas
February 17, 2010 | Permalink | Comments (0) | Listen

This week I'll be posting some preview highlights about next week's (nearly sold out) TOC Conference in New York.

Much of the conversation in publishing today revolves around ebooks, digital reading, and the exploding mobile web. As it should. But of course print books are still the cash cow for most publishers, and will remain an important revenue stream and delivery format for some time to come.

We've lined up several sessions meant to address the challenges of retaining and sustaining a print business and workflow alongside the need to innovate and experiment with digital and mobile reading:

• Digital Printing
  
• Running Two Companies—Taking Book Publishing beyond Publishing Books
  
• The Digital Marketing Wave: Handselling in a Networked World
  
• Case Study: Lessons Learned from TOC 2009 to Grow my Publishing Business
  
• Going Beyond Ebooks: One Publisher's Journey from a Book to Training, Print to Digital
  

While you're checking out the sessions, you can also create a personalized conference schedule on the conference website.

TOC Preview: Getting the Reader's Perspective

Andrew Savikas
February 16, 2010 | Permalink | Comments (0) | Listen

This week I'll be posting some preview highlights about next week's (nearly sold out) TOC Conference in New York.

One of the concerns we heard loud and clear from last year's conference (and has been echoed since more broadly in a variety of blogs, Twitter, and email conversations) is that publishers aren't paying enough attention to how things look from the reader's point of view, especially when it comes to things like pricing and purchase experience.

We've lined up several great sessions and panels to explore the reader perspective from a variety of angles. Note that when you've logged in to the conference website, you can indicate whether you're interested in specific sessions:

• How Academics and Students Use Ebooks: Evidence from the JISC National Ebooks Observatory Project
• Test Driving the Digital Reading Experience
  
• Essentials of Digital Books from the Consumer's Point of View
  
• Form & Function: The Future of Reading Digital
  
• Changing the Way Medical Students Learn: Four Stories from Europe
  
• Understanding the Ebook Consumer: The Results of the BISG Consumer Survey
  

I'm also happy to say we've managed to squeeze in a session about using the capabilities of Apple's new iPad to better serve digital readers.

More tomorrow...

Lightning Demos and Ignite!: Micropresentations at TOC 2010

Andrew Savikas
February 12, 2010 | Permalink | Comments (0) | Listen

At the first three TOC Conferences, we held evening "Lightning Demo" sessions for brief product pitches and short-form presentations. The constraints of a brief time slot often spur impressive creativity among speakers (and for the audience, the clunkers are mercifully short!).

This year, we're putting the Lightning Demos right in the main program (on Wednesday morning) with a great list of people and companies ready to give a short but sweet preview of their technology. And we're bringing the popular Ignite! format to the Tuesday afternoon keynotes, with our first-ever Ignite! TOC. Ignite speakers have exactly 5 minutes to speak, exactly 20 slides to show, and exactly 15 seconds for each slide. It's a fun and fast way to sample a lot of great stuff in a short amount of time (there's some great Ignite! videos up on iTunes and on the Ignite website if you want a sneak peek at the format).

I'm almost certain we'll sell out for TOC New York sometime early next week, so if you haven't registered yet, sign up today.

What Does Publishing 2.0 Look Like? Richard Nash Knows

James Turner
February 11, 2010 | Permalink | Comments (3) | Listen

Traditionally, writers wrote, editors edited, publishers published, retailers sold, and reader read. But in the age of the Kindle, ebooks, author websites and comment boards, all the roles are becoming fuzzy. Richard Nash has started a company called Cursor, which is trying to pioneer the idea of social publishing, specifically to try and address some of the changes that technology is bringing to the industry. He'll be speaking about Cursor at O'Reilly's Tools of Change in Publishing conference later this month.

James Turner: Can you start by telling us a bit about yourself?

Richard Nash: After graduating from college, I embarked on a quixotic career as a theater director for the best part of a decade, until I embarked on an equally quixotic career as an independent publisher, running an indie press called Soft Skull. I worked my ass off to get it to where it was functional, and I bumped up against some hard realities of conventional supply-chain book publishing, which is that it is a rough business when it comes to cash flow.

Early last year, I decided that, basically, the rest of the world was too damn interesting and that, as the entrepreneurs like to say, there were some inflection points that looked to be looming. I didn't want to be operating with my head, if not in the sand, at least deep within a legacy organization putting out fires on a day-to-day basis, when the world was changing all around me. So I'm now in the middle of launching a startup that I've been fine tuning with the help of a lot of people over almost the past year.

In some respects, you could argue that the startup seeks to apply to long form narrative what O'Reilly's and Pearson's Safari has been doing in computer books. By which I mean to identify a given community and publish for that community and get that community involved as much as possible in every aspect of the publishing activity. Or I could even say to make it larger than just the publishing activity, to be involved in every aspect of the reading and writing experience.

Why Mobile Will Win: eReaders are Sustaining, Mobile is Disruptive

Andrew Savikas
January 25, 2010 | Permalink | Comments (14) | Listen

In one of the comments to Friday's speculation post about The Tablet, Scott Lewis sums up one of the most common objections to the viability of smartphone-based reading:

3.5" screen... 3.5" screen... 3.5" screen! Can't think of anything else to say. It's too small for serious reading.

And Scott is correct that a 3.5" screen offers an inferior reading experience compared with a paperback when measured using the attributes that define a quality print reading experience. And that's precisely what Kindle and other eReader and eInk-based devices attempt to do, which is "help ... sustain the rate of historical performance improvement that their customers had come to expect." This is classic Clay Christensen disruptive vs. sustaining technology, as we watch firms attempt to make a "better book":

The second pattern is that the purpose of advanced technology development in the industry was always to sustain established trajectories of performance improvement: to reach the higher-performance, higher-margin domain of the upper right of the trajectory map. Many of these technologies were radically new and difficult, but they were not disruptive.

But people who are reading on smartphones are choosing to do so based on new and different attributes. Again from Christensen:

Generally disruptive innovations were technologically straightforward, consisting of off-the-shelf components put together in a product architecture that was often simpler than prior approaches. They offered less of what customers in established markets wanted and so could rarely be initially employed there. They offered a different package of attributes valued only in emerging markets remote from, and unimportant to, the mainstream. (Emphasis added)

Attributes like convenience, portability, price, immediacy, and connectivity are more important to these customers than attributes like paper weight, coating, or smell. So it's no surprise that we're seeing the quickest growth in smartphone reading outside of established markets. (As another data point, we sell more of our iPhone apps in Australia than in Canada, even though Canada has a significantly larger population, and is a much bigger market for our print books.)

Designing eReaders aimed at converting existing readers (particularly in large English-speaking markets) is a fine strategy if your aim is to achieve better margins through a "better" book and capture more customers from among your current markets. But doing so risks at best missing a much bigger new market, and at worst a complete evaporation of the old one. Mike Masnick offers a very nice summary of this trap over at TechDirt:

Historically, pretty much every disruptive innovation has followed Christensen's curve, meaning that the eventual outcome really is a better overall solution for the market, and thus makes the market much bigger, even if it doesn't look that way at first. But, the problem is that it's difficult to see that. So, when we get industry defenders (whether it's the recording industry, the movie industry, the newspaper industry or others) insisting that it doesn't make sense to jump off that cliff and embrace these new offerings, because the market just isn't big enough (or, as short-sighted Hollywood execs have taken to saying: "turning analog dollars into digital dimes"), we note that they're absolutely making the management trap described above.

In just the past two years, we've seen smartphones get much better at doing things like navigation, video, and even voice recognition. I have little doubt they'll improve for reading too.

Several of the sessions at next month's TOC Conference are aimed at helping publishers avoid this strategy trap, as well as better understand these new market opportunities. Space is limited, so sign up today.

The Unicorns are Here, They're Just Not Evenly Distributed Yet

Andrew Savikas
January 22, 2010 | Permalink | Comments (15) | Listen

I really didn't want to do another post about The Tablet. But then I saw this piece from Fortune (via @jafurtado -- does he ever sleep?) and this sentence drove me to it:

[S]ome publishing industry watchers think that if a deal were to go through, it could lead to an Apple-enabled selling platform that would allow publishers to sell books at a price they determine.

ARRGHHHH!

Sincere apologies to William Gibson for the the title of this blog post, but everything that publishers seem to want from this device that will deliver them from evil is in fact already here.

The iPhone and the iPod (and the Nexus One, the Droid...) are rich multimedia devices capable of full-color, high-resolution display of text, images, and videos, as well as stereo audio. Many of them have GPS built in, along with an always-on web connection, and built in (or easily and freely acquired) social media hooks (email, Twitter, SMS, Facebook...). But most importantly, they feature (drum roll please ......) a platform that allows publishers to sell books at a price they determine. This market is available worldwide, it never closes, and most of its customers are within inches of the registers nearly all of their waking hours (and often beyond). This selling platform requires no inventory, returns are minimal, and sales data is provided nightly.

I've heard numbers tossed around suggesting that for some large trade publishers, Amazon represents 70% or more of their ebook sales. That's a scary situation, but consider that of the top 10 bestselling books on Kindle (as of this writing), exactly the-opposite-of-70% are available in the Books aisle in the App Store, and all at prices significantly higher than on Kindle:

• Dear John ($4.39 on Kindle, $13.99 in the App Store, )
• Adventures of Sherlock Holmes ($0.00 on Kindle, $0.99 in App Store)
• The Lovely Bones ( $7.50 on Kindle, $16.99 in App Store )

If publishers pushed the price lower on those iPhone Apps, Amazon would quickly decline from 70% of ebook sales (and I would lay odds that those additional app sales would exceed any corresponding decline in Kindle or print sales).

The problem is seriously compounded by the territorial restrictions most publishers face because of the historical approach to acquiring rights. But the Tablet isn't going to fix that problem -- publishing executives are the ones who can deal with that one, especially for frontlist titles. (I accept this is a very, very, very Hard Problem. There's enormous legacy business and infrastructure, and perhaps more importantly organizational structure and politics to manage. I'm glad I don't have that problem, but neither does your emerging competition.) Publishing executives must also accept that wishful thinking is not a pricing strategy. If your current cost structures do not permit you to include relatively low-priced mobile ebooks in your product mix (preferably at the same time or before the print version), then your cost structure must change.

But I said this post was about The Tablet.

I should clarify here that I have no actual knowledge of any Apple plans, nor any knowledge of conversations between Apple and publishers beyond what's already been reported in places like Fortune. So salt this complete and utter speculation to taste, but here goes:

• If a tablet is announced on Wednesday, it will run on a variation of the iPhone OS, and include access to the App Store (and the 100,000+ apps within it, including 15,000+ books).
• If Apple is talking to publishers, they are playing matchmaker between publishers and developers to help publishers turn their content into apps (including apps designed specifically for the new device). Book-style content is something a lot of people are already expecting to be prominent on this device, and it's in Apple's interest to make sure there's good stuff there at launch, stuff that's interesting and appealing to a wide audience. For example, I highly doubt that the New York Times just happened to sign up for the iPhone SDK and submit an App to be ready when the App Store launched. Apple must have helped. (Yet no one then claimed Apple was getting into the newspaper business...)
• That 30% is non-negotiable, so any give-and-take on this stuff relates to promotion and merchandising. It's most certainly worth a lot to any App to be featured in a product announcement, TV commercial, or ad campaign, and this device will result in whoppers on all of those fronts.
• Apple will almost certainly update iTunes (including the App Store) and that update may well include better merchandising and recommendation features for all apps, including books.

Nothing on that list prevents any publisher from taking advantage of the 50M+ strong market that already exists. While it's true that creating mobile apps requires software development skills, it's also true that at one time, creating a web site was considered something that required similar skills, yet somehow publishers seem to have figured that one out along the way. (OTOH, those two skills are merging very fast, especially for book-style content.) There's of course room for collaboration on developing or adapting open-source alternatives to commercial products.

Of course, building out mobile apps and a presence on emerging and growing platforms and markets (not to mention dozens and dozens of devices and services) is no easy feat, and in the same way that financing a print run and selling into the trade required both capital and a certain set of skills that publishers developed, a new generation of distribution service is on the horizon -- though whether existing publishers play a major role in that remains a very open question.

2009 O'Reilly Ebook Revenue up 104%

Andrew Savikas
January 22, 2010 | Permalink | Comments (2) | Listen

During the past 18 months we've seen a dramatic shift in customer preference from print to digital when looking at sales from oreilly.com, which is a substantial sales channel for us. And looking across all of our sales channels for individual ebooks -- including mobile apps -- 2009 ebook revenue was up a staggering 104% on 2008 (which was more than 50% above 2007):

Overall, printed books are still the biggest sellers for us (though Safari Books Online is our second-largest individual sales channel), but with the market for printed computer books declining at a double-digit rate, digital sales will overtake print much sooner than most people realize.

It's becoming clear that as in the print world, there are a handful of very large channels (four or so for us) and then a lot of smaller ones that together add up to quite a bit. Pushing a large quantity of content into all of these channels effectively isn't easy, and suggests the role publishers have long played of aggregating authors for retailers and retailers for authors will only grow in importance -- though whether existing publishes continue to play that role remains to be seen.