Google Opens Wide

Google announced today a settlement with the AAP and Authors Guild which will change the way books are accessed and read. Excerpted from the Google Book Search site:

Accessing books

This agreement will create new options for reading entire books (which is, after all, what books are there for).

• Online access

  Once this agreement has been approved, you’ll be able to purchase full online access to millions of books. This means you can read an entire book from any Internet-connected computer, simply by logging in to your Book Search account, and it will remain on your electronic bookshelf, so you can come back and access it whenever you want in the future.

• Library and university access

  We’ll also be offering libraries, universities and other organizations the ability to purchase institutional subscriptions, which will give users access to the complete text of millions of titles while compensating authors and publishers for the service. Students and researchers will have access to an electronic library that combines the collections from many of the top universities across the country. Public and university libraries in the U.S. will also be able to offer terminals where readers can access the full text of millions of out-of-print books for free.

• Buying or borrowing actual books

  Finally, if the book you want is available in a bookstore or nearby library, we’ll continue to point you to those resources, as we’ve always done.

It’s the Economy, Stupid

I’ve been talking with several clients about the affect of the economy on their business, and it seems that publishers are in a unique place right now.

The costs of producing books is pretty jaw-dropping no matter what segment of the market you’re in. And of course everybody’s scrambling around looking for places to cut costs. But let’s not forget added revenue opportunities either – wouldn’t that be nice at a time like this?

It’s not magical thinking.

Publishers aren’t going to publish less in this economy – they can’t afford to pare down their lists when they’re trying to add revenue to the bottom line. But they also can’t afford to produce books at the rate at which they have been – the print and distribution costs are prohibitive in some cases; the revenue made from publishing the book will already have been eaten up (and then some) by the costs of publication themselves.

So now what?

This very weird confluence of events is a sign that the horse has left the barn (train–>station, toothpaste–>tube, cat–>bag, genie–>bottle). In other words, the costs of print publishing are so high that pretty much the only area of growth, the only area where new revenue is possible in an economy this tight, is in the digital realm.

(Yeah, you knew I was going to say that.)

Are consumers buying digital books? Let’s not gaze into the "how many e-Ink screens have actually shipped" crystal ball. That’s not the point, and it’s an irritating distraction. Generally speaking, if more digital content is AVAILABLE, people will buy it.

Let’s talk about that a little bit. Digital content is cheaper to produce than print content. Yes, in the educational market you also have to include a lot of interactive exercises, embedded video, etc. But recently I have found that digital textbooks are in fact cheaper to make than print ones…by about 1/3. You can monetize the "digital assets" – the activities, the videos, the sound files – across several titles, which brings down the cost. And the cost of NOT GOING TO PRESS is significantly less. The cost of not shipping the books…yeah, you’re not shipping the books. The cost of not warehousing the books – all this is savings.

So you can charge less. Again, forget about Amazon and the prices on Kindle titles – Amazon’s prices are purely fictive. The only cogent generalization you can make about Amazon is that you cannot make very many cogent generalizations by looking at what Amazon is doing. You’re not going to charge less than 1/2 of what the print title would bring in – that’s a fast road to losing your shirt.

But you can set the prices of your digital products to be about 2/3 that of the print product, and still maintain a healthy margin. And consumers will be more inclined to pay for a cheaper product. Particularly younger consumers who don’t like to pay at all for content, who are not averse to reading on a screen, etc.

Digital books are cheaper all the way around. Cheaper to make, cheaper to buy. Which is quite meaningful to companies and consumers alike, right now. Waiting for "more adoption" is missing the point – and the revenue and the savings.

FBF Survey

New Features on Bloggapedia

Pirates Desiring Kindles Should Ask Santa

Peter Sunde, a co-founder of the BitTorrent site the Pirate Bay, has asked for a Kindle. He does not intend to buy one, of course – he has asked Wired, posted on his own blog, and just generally made it known that he would love one. (Hey, I would like a LiveScribe pen and a new digital camera – anybody? Anybody?)

He does not say what he is going to do with it, but the folks at Teleread have a good guess.

David Rothman Recovering

David Rothman, the man behind Teleread, recently suffered a heart attack – but the folks at Teleread are keeping us all updated and we’re grateful for the news that he’s recovering and expected to leave the hospital sooner than initially anticipated.

Borders on the Brink

Yesterday Borders issued Pershing Square Capital 5.15 warrants because it failed to find a buyer by a previously-set deadline of October 1. And no wonder, in this market.

The question is, now what? Borders is frantically cutting costs – adjusting hours, slashing inventory, and renegotiating distribution deals. That saves $120 million per year over what their costs are now…but they won’t even see that savings until the end of 2009.

Finding a buyer right now is not a very promising prospect. How do they hold on? Physical retail is so tough because so much is predicated on real estate – for your shops, for your inventory. And who knows when that market is going to gain some traction again. Add to that the forecast that folks are not going to be doing a lot of holiday shopping this year – which for bookstores is fundamental to survival – and things look grim.

OCLC adding tagging to Worldcat

Yes, folks, the tagging mania has hit the library catalog. OCLC has announced that it’s allowing a tagging functionality in WorldCat. From Library Journal:

Now, logged-in users can add an unlimited number of their own tags to any item retrievable by the WorldCat.org search engine…Bob Robertson-Boyd, OCLC product manager social networking, told LJ that the company is waiting for a critical mass of tags to be added before factoring them into the search results: “we want [the tag data set] to grow large enough to make it useful for users.” When that happens, OCLC may consider adding tags as another advanced search option, or featuring tag results as part of the faceted browsing on WordCat’s search results page.