Conversational Reading

Amazon Applies for Patent to Advertise in Your Kindle

The patents are here and here.

Speculation thereof here:

Before everyone gets in a huff, let’s consider Amazon’s intentions with these patent applications. Surely they would never allow advertisements to be placed in books which you have purchased legitimately at full price, so let’s put that out of our heads. But what if you could take a few bucks off the cover price at the cost of a few contextual ads relating (if possible) to the book’s content? Personally, I wouldn’t mind — partially because I don’t use a Kindle or intend to any time soon, but more because it’s a no-lose situation. Amazon wouldn’t risk alienating its loyal Kindle base with dirty tricks like this, so it’s safe to assume it’ll be at least somewhat opt-in.

An abundance of free or reduced-price content would widen the appeal of the reader — I imagine many people are put off e-books by the idea that they are not getting their money’s worth. As offensive as the idea of inserting ads into a book is to me (and surely to the average reader), it’s almost certainly part of a value proposition which increases the utility of these expensive little buggers.

Of course, there are a lot of precedents for advertisements in books. That said, I think I'd rather pay full price.

Related Content

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Google Gives Libraries Price Oversight

NYT:

In a move that could blunt some of the criticism of Google for its settlement of a lawsuit over its book-scanning project, the company signed an agreement with the University of Michigan that would give some libraries a degree of oversight over the prices Google could charge for its vast digital library. . . .

Under Google’s plan for the collection, public libraries will get free access to the full texts for their patrons at one computer, and universities will be able to buy subscriptions to make the service generally available, with rates based on their student enrollment.

The new agreement, which Google hopes other libraries will endorse, lets the University of Michigan object if it thinks the prices Google charges libraries for access to its digital collection are too high, a major concern of some librarians. Any pricing dispute would be resolved through arbitration.

A Crime Novelist Experiments With The Kindle

Bryan Gilmer generated some instant publicity for his novel Felonious Jazz by radically discounting the Kindle edition:

My Kindle edition went live last Monday at $7.99, so I announced it on a couple of Kindle message boards online. By Wednesday, I'd sold one copy. One! Message board replies said, "If you want us to try a new author, give us a really low price. It'll generate sales and reviews." So I marked it down to $1.99 Thursday morning and posted the price change on the same boards. What happened next was remarkable:

As of 5 p.m. Friday - about 36 hours later - Felonious Jazz was the No. 1 selling hard-boiled mystery on the Amazon Kindle Store and the 17th best-selling title in Mysteries & Thrillers . . .

 If you look at the book now, you'll see that the price is back up to $4.99.

It's interesting to see what some guy could do more or less by accident . . . there's clearly some potential here for a savvy publisher to figure out a way to exploit the Kindle version, at least until we're deluged by a tidal wave of $1.99 ebooks.

Amazon Is Losing Money on Each $9.99 Ebook

Publishers Weekly confirms something I've long suspected:

Currently, publishers make as much money on Kindle editions as print editions, since Amazon, the largest e-book retailer, pays the same discount for e-book editions as it does for print—off the same list price, whether bound book or e-book. (An Amazon spokesperson would not comment on the discount issue, but a number of publishers confirmed that Amazon pays the standard discount—which is, with some fluctuation among houses, about 50% off list price—for Kindle editions.)

Amazon, which sets the price for everything it sells, is, as many people interviewed point out, losing money on a majority of Kindle editions. Although the price point for Kindle editions varies, the dominant one for hardcover bestsellers is $9.99, a price one publisher called “a killer.” (The e-tailer is pricing some of its Kindle bestsellers even more aggressively, with titles like Stephenie Meyer's New Moon, currently #4 on the Kindle bestseller list, at $6.04.) At $9.99 Amazon is selling its Kindle editions at, generally, a 60% discount; Amazon sells its print bestsellers at, on average, a 45% discount. The reigning price point in the Sony e-book store, with variations, is $11.99.

This is obviously a move to build up market share for the Kindle, something I suppose Amazon is in a position to do since it is one of the few book retailers to actually be in the black at this time. This also means that $9.99 ebooks are untenable over the long run, unless publishers choose to give Amazon a steeper discount in the future.

As Publishers Weekly notes, if this tactic works then eventually Amazon won't have to rely on publishers to give the discounts it wants--it will be in a dominant enough position to demand whatever pricing it prefers. So, in other words: hope that competitors manage to capture a sizable portion of the market.

For more info, readers should see my interview with Ted Striphas, where we touch on Amazon's already dominant market position and what that might mean.

Incidentally, I finally saw my first real-life Kindle on public transit earlier this week. I also saw five people with non-electronic books, myself included.

Newspapers Making a Kindle-Killer?

It's no secret that newspapes have hastened their own downfall with poor decisions and some ridiculous, even illegal ideas (like massive price collusion).

But, they might now be getting into the act. The Wall Street Journal reports that they're exploring a Kindle knock-off designed to read newspapers and magazines:

Hearst Corp., which publishes the San Francisco Chronicle and Houston Chronicle as well as magazines including Cosmopolitan, is backing a venture with FirstPaper LLC to create a software platform that will support digital downloads of newspapers and magazines. The startup venture is expected to result in devices that will have a bigger screen and have the ability to show ads. 

Gannett Co.'s USA Today and Pearson PLC's Financial Times are among newspapers that have signed up with Plastic Logic Ltd., a startup that is readying a reading tablet, the size of a letter-sized sheet of paper, that can displays books, periodicals and work documents. The device, which uses digital ink technology from E Ink Corp., the same firm behind the Kindle, is slated to be rolled out by early next year, and will offer publishers the chance to include ads.

The article also mentions that Apple and News Corp are each exploring their own versions of such a device. 

To the extent that these will offer plausible competition to Amazon, I'm all for it. Not that we've seen Amazon do anything too bothersome yet, but it doesn't help anyone (except Amazon shareholders) to have one company run off with the lion's share of the e-reader market.

And in many ways, an e-reader that focuses on periodicals makes a lot more sense than one that focuses on books.

It's also interesting to see that for all Jeff Bezos's touting of Kindle sales figures, the periodical circulation via Kindle is abysmally low:

The Wall Street Journal -- the second-most-popular newspaper for the Kindle after the New York Times -- has more than 15,000 subscribers, according to a spokeswoman for the paper, compared to its paid circulation of more than two million daily. Fortune magazine has roughly 5,000 subscribers, according a person familiar with the matter, while the magazine has an average print circulation of nearly 866,000.

I think the basic message here is: hold onto your money for now. The e-reader market is going to see a lot of change over the next few years, and unless you absolutely need one right away you'll probably end up getting something better suited to you, and cheaper, once things have time to develop some.

Digital Catalogs: Gateway Drugs?

Ellen at the UNC Press blog is worried that digital-only catalogs are just the first step:

The tough (and painful) budget crunching happening throughout the publishing industry right now coincides with new technologies that can allow us to do more online and less in print. Here at UNCP, we are not quite at the point of getting rid of our print catalog and going all online, as HarperCollins has done, but who knows what we’ll be doing next time around. Personally, I wonder, if I can’t hold it, will it still feel like a completed project? I’m talking about catalogs at the moment, which hold sentimental value only (if at all) to those who put their sweat into them, but then I start to panic: is a digital-only catalog the gateway drug to digital-only books??

I doubt this is the case precisely because there are people like Ellen around to worry about something like that. The nice thing about the book industry is that, unlike other industries, it's still dominated by people who use and love the things they make. It's a lot more likely that an auto industry CEO will cancel some car he doesn't view as the most profitable possible than bibliophile publishers are going to stop making books because they see a little more revenue in it.

In any event, I don't think printed books are going to be a losing proposition anytime soon. The market is going to give people the product they want: most readers don't buy or otherwise consume catalogs, so publishers are going to digitize away. By contrast, we're seeing a lot of "keep the book" sentiment among consumers, leading me to believe that publishers are going to view printed books as desirable for some time.

Related Content

• HarperCollins Switches to All-Digital Catalogs
• Interview with Fran Tooley of NetGalley
• Reading and Publishing in Print's Late Age: An Interview with Ted Striphas

How to Turn a Kindle Into a Brick

A poster named "Ian" in a forum on the website MobileRead (a website for people who read books on mobile devices) has made the following claims about Amazon's Kindle in a posting entitled "Amazon has banned my account - my Kindle is now a (partial) brick":

I have been a loyal Amazon.com customer for many years, but today, I received an email stating that I have been banned from the site and my account has been closed, because I apparently have an extraordinary rate of requesting refunds due to a variety of factors. . . .

I have now discovered that I cannot manage my Kindle2 account (I can't log into Amazon) or purchase any new content.

In effect, I now have a $359 brick, not covered under any warranty, not able to be used the way it was meant to be, not able to be returned (not that I even want to, I just want to keep reading!)

I called customer service several times today; the supervisors there explained that I cannot use the Kindle store but "I can get content onto the machine different ways."

While I can't speak to the fairness of Ian's banning from Amazon's site, his story does bring up some important issues about consumers' rights in the age of electronic texts that we are slowly but surely entering. This is something that I touched on briefly in my interview with Ted Striphas and something that Striphas goes into in considerable detail in his book, The Late Age of Print.

Whether or not Ian is making truthful claims, his story highlights the fact that consumer rights and concepts of copyright are changing as we move more and more into electronic media. One poster to the forum suggests that in banning Ian, Amazon is attempting to protect its rights as a bookseller:

Sorry, Ian. I think you appear to Amazon to fit the profile of someone who buys books and holds them long enough to strip the DRM and then return the book.

Amazon does have every right to protect itself, just as Ian has every right to demand fair treatment. These are boundaries that are currently being negotiated, but make no mistake: when you buy an ebook, you are not buying a book. You are getting a different concept of fair use.

Consumers should be aware that just because a Kindle or a Sony Reader attempts to recreate the experience of reading a book, it doesn't mean that Amazon or Sony consider themselves to be selling you the same rights that you purchase when you buy a book.

I haven't yet bought an e-reader, and I don't plan to anytime soon, but people who embrace this medium should do so knowing that they're getting a different set of consumer rights. If you don't like what you're getting, demand more.

Electronic Review Copies

Chad echoes a point I've made before: e-readers like the Amazon Kindle don't necessarily make sense for those of us who don't need access to 500 books at any given moment, but they do have specialized applications. For instance, letting bookstore employees read ARCs:

Jessica’s main focus in her post is on replacing traditional print advanced reading copies with e-version—something that makes a lot of logistical sense to me. The unit cost for printing galleys is more than the unit cost for the finished book, and (for small presses at least) it’s quite an expense to print and mail even just 250 ARCs of a book. Not to mention that these 250 copies have a pretty weak reach. A huge proportion go to reviewers who never review the book anyway, with only a handful ending up with enthusiastic booksellers.

And from a bookseller’s perspective, not having to receive and carry around tons of heavy books makes a lot of sense:

bq, Here’s the next most important issue: E-readers make sense for people who read in massive quantities. Many of our sales reps are already reading on Sony readers, and it makes sense for booksellers too.

For more on this, see my interview with NetGalley. As I understand NetGalley right now, the service can't do precisely what Chad's outlining above. But I do think they're headed in the right direction, and I wouldn't be surprised it NetGalley started figuring out how to make this happen.

And on the other side of the argument, the Vroman's Blog makes this point:

I can see resistance from publishers, though.  If the physical ARCs they distribute now end up at The Strand, how long before the digiARC of Jonathan Lethem’s new book ends up on the internet somewhere, months before publication date?

This is just a point that Ted Striphas takes up in his book (and to a lesser estent, in my interview with him yesterday). It's a completely legitimate concern, and, lacking some kind of miracle encryption, probably one that publishers would just have to learn to live with.

Amazon Boycott of Ebooks Over $10

As I've been reading Ted Striphas's The Late Age of Print, I've been seeing books and ebooks in very new ways. That is, I'm beginning to see the interconnectedness of copyright, production, distribution, and fair use/reuse swirling around books and reading. I'm also starting to see how greatly all of these are being impacted by developing technologies.

So this note about an informal "boycott" of ebooks over $10 on Amazon strikes me as very interesting.

Kindle books are kinda like movie tickets. While you can re-read the book, you cannot: donate it to a library, sell it to a used book store, sell it on Amazon’s Used Marketplace, [or] trade it to a friend . . . The publisher does not need to pay for paper, glue, press time, press employees, insurance, ink, boxes, or shipping. Amazon does not need to stock its warehouse, pay staff to fulfill orders, or pay shipping. The price needs to reflect these VERY important facts.

It's the first part of this that is the most provocative. As Striphas documents in his book, publishers have long sought to control how readers use a book after it has been purchased. (For instance, in the 1930s major publishers sponsored a contest to come up with a derogatory name for someone who borrowed books (it never caught on).)

Ebooks will clearly give publishers ways to exert more control over what you do with a book once you've purchased it. This can be anything from adding code to prevent copying to the book, to trying to prevent you from lending it, to even making the book "expire" after a certain amount of time has passed. These are all issues that we're going to have to negotiate as the ebook medium develops, and although I'm not sure I agree with the boycott (I have no idea of $10 is a sustainable price for ebooks), it is clear that readers will have to stick up for their rights of fair use and ownership.

I doubt that this boycott will have any lasting impact on ebook pricing, but it is an intersting initial skirmish in what will undoubtedly be a protracted battle over how people who choose to read books electronically will do so.

Can Electronic Media Ever Really Replace Books?

As digital music has taken on a larger and larger role in my life, I've realized just how much I dislike CDs. In fact, I'm at the point now where I'll pretty much just spin a CD one time: when I rip it to my computer.

This raises a good question: Why do I even need CDs? I never use them to actually listen to music, they're ugly, they clutter my apartment, they usually cost more than downloading the same music from iTunes. In fact, now that all my music is digitzed, I'm tempted to ditch all of my legacy discs.

The reason I bring this up is that I could never make this argument about books. Obviously I'm a book-lover, so I'll always want some books around me, and I still enjoy the experience of reading a book more than reading an ebook. But even if I imagined a future where I liked reading ebooks better, I could still think of certain things books brought to the table that are unique to them.

My point here is that some media, like CDs, seem to just be clunky delivery systems. That is, downloads are a far better delivery system than CDs, and now that we have downloads I don't see any reason to keep using CDs. There's nothing intrinsic to them that seems worth preserving. This is no doubt partly due to the fact that we've only had CDs for about 25 years now, so they haven't had a chance to become an essential cultural object.

But something like books has a much longer history and has had the time to become woven into the cultural fabric of our lives. It's become more than just a means of delivery, and people seem loath to ditch them for that reason.