Kindle

Ezra Klein's take on the Kindle. I'll say this. I love gadgets and I like books and I don't really like carrying books around or go in for nostalgic reveries about the scent of paper on my fingertips. So basically, I'd like a Kindle. But at $399 it seems a bit pricey. Or, rather, at $399 the books should be cheaper. After all, distributing a digital text is way, way, way cheaper than than manufacturing, storing, and shipping a hardcover book.

But Amazon's selling a physical copy of Great American Hypocrites for $16.47 so you're only saving six bucks by buying the Kindle version. But at its best, the transition to digital media is all about volume -- subscription services like emusic (and of course illegal downloads) are what makes the iPod good.

Comments

To some, it looks pretty ugly, but it sounds like it works great, feels really good in the hand and reads well. I also heard there were a lot of new books available for $9.99, which isn't too bad, but it sounds like they're not all that cheap.

Ebooks, to succeed, need to be (1) cheaper than physical copies and (2) easy to access/download/read. Kindle has the latter figured out but could probably use some work on the former.

Posted by ben | May 10, 2008 5:41 PM

Whee! I can't wait until widespread illegal downloading does to publishing what it's done to the music industry!

Fortunately, authors will always be able to rely on touring and merchandise sales to produce a steady income.

Posted by James Gary | May 10, 2008 6:02 PM

The price is disappointing.

I'm sure they will have to lower the price soon.

Posted by thehova | May 10, 2008 6:42 PM

I have a son who just finished his 1st year at college and a daughter who's in HS. The Kindle seems a perfect solution for the distribution of text books and other required school reading. Even the business case for the authors & publishers (although clearly not all the other steps in the distribution channel) could be compelling. Yet, there doesn't seem to be any interest in this area.

Posted by Mark | May 10, 2008 6:43 PM

I have a son who just finished his 1st year at college and a daughter who's in HS. The Kindle seems a perfect solution for the distribution of text books and other required school reading. Even the business case for the authors & publishers (although clearly not all the other steps in the distribution channel) could be compelling. Yet, there doesn't seem to be any interest in this area.

Posted by Mark | May 10, 2008 6:44 PM

Net price to public of Kindle-Book = $9.99.

Net cost to Amazon to provide Kindle-Book = $0.02.

Net profit in system = $9.97 = 99.8%.

Net royalty to author, maybe $1.50.

Net profit to everyone except author = $8.47 = 85%

Net number of gullible Kindle-Book buyers = minimal

Net likely success of Kindle-Book project for Amazon = minimal

Net stupidity of Amazon business-model = very high.

Posted by RKU | May 10, 2008 6:44 PM

I have a son who just finished his 1st year at college and a daughter who's in HS. The Kindle seems a perfect solution for the distribution of text books and other required school reading. Even the business case for the authors & publishers (although clearly not all the other steps in the distribution channel) could be compelling. Yet, there doesn't seem to be any interest in this area.

Posted by Mark | May 10, 2008 6:45 PM

I have a son who just finished his 1st year at college and a daughter who's in HS. The Kindle seems a perfect solution for the distribution of text books and other required school reading. Even the business case for the authors & publishers (although clearly not all the other steps in the distribution channel) could be compelling. Yet, there doesn't seem to be any interest in this area.

Posted by Mark | May 10, 2008 6:45 PM

I have a son who just finished his 1st year at college and a daughter who's in HS. The Kindle seems a perfect solution for the distribution of text books and other required school reading. Even the business case for the authors & publishers (although clearly not all the other steps in the distribution channel) could be compelling. Yet, there doesn't seem to be any interest in this area.

Posted by Mark | May 10, 2008 6:47 PM

The kindle is a huge value to me. I read a lot, I'm willing to spend money on books, but I don't want my house looking like the main library. Thus, there have been many books that I haven't bought because the library didn't have them and I couldn't justify bookshelf space. Now I can go ahead and buy them.

Which is why I'm waiting to buy HITS until it comes out in kindle form. Any idea when?

Posted by Anne E | May 10, 2008 6:53 PM

I have a Kindle. I bought it the first day. I love it.

Yes, it is too expensive and books are too expensive (but there are thousands of books you can legally download for free, and the Mobireader free authoring tool formats them properly for Kindle). Since I really enjoy a lot of 19th century fiction, the free books are great.

What I really like, being a person who reads a lot, is the ability to buy books and not have them pile up in my house. I also like being able to take several books with me with very little weight penalty. And I like downloading a book instantly when I want it. The adjustable font size is nice too. It's also lighter and thinner than almost any book.

The ergonomics could be better. It's too easy to accidentally turn a page. It looks and feels more like a product that Microsoft would design rather than Apple. It's kind of overly complicated.

There are not yet enough current books available, and yes the price is too high (but prices do drop when the books go into paperpack).

I use it almost every day. Most people that I show it to find they like it a lot better than they imagined.

Posted by Sherry | May 10, 2008 6:54 PM

Probably best to wait for the 2nd generation of it to come out, get better bang for the buck, and books/other written media will probably/hopefully! be cheaper.

Posted by Sid | May 10, 2008 6:57 PM

"But at its best, the transition to digital media is all about volume -- subscription services like emusic (and of course illegal downloads) are what makes the iPod good."

A 16.50 Kindle book is 73% of the papercopy at 22.50

An iPod Vampire Weekend is $10, while at Wal-Mart you get the actual disk, CD booklets, etc. for $12

$10 is 83% of $12.

So if it seems quite pricey for Amazon to charge you 73% of the normal cost for a digital book, it should seem even more pricey for iTunes to charge you $10 for an album.

And how much is an iPod again, compared to a regular CD player?

All that said, I love my iPod. I'd love a Kindle, too, but not for most of the books I own. Rather for the books I want to read once and then get rid of. Of course I can't re-sell a Kindle book...

Posted by Colatina | May 10, 2008 7:11 PM

"A 16.50 Kindle book is 73% of the papercopy at 22.50"

Sorry, I mean that $10 is 60% of $16.50.

Posted by Colatina | May 10, 2008 7:22 PM

Right now, the Kindle doesn't read PDFs natively. I wonder to what degree that limitation is due to technical issues, versus business considerations. Anyhow, it's a deal-breaker for me. Also, for $400, I'd like open wi-fi and a browser, please. It actually might be good for the Web if lots more people started surfing in greyscale, sans video.

James Gary has a point. Publishers have to be terrified of winding up like the music industry as their product turns into digital objects. It's probably in the publishers' near-horizon economic interest to make the digital transition as slow as possible. Amazon's doing pretty well with the paper-based status quo too; although they are almost certainly positioned to do better than the publishers when the digital transition does take hold.

Posted by Doug Lay | May 10, 2008 7:29 PM

Converting a pdf for use on the Kindle is very easy. The Kindle would require some kind of conversion software. It's really very easy to put a book or document in pdf format (or text) onto the Kindle.

Also, Mobipocket books are read natively on the Kindle.

I'm not sure about the future of ebook readers. A lot of people read ebooks on pdas and laptops. As screen technology evolves and people grow up reading computer screens, I doubt there will be a use for such a specialized device. I'm actually finding the eeepc to be the best all around personal video player, handleheld game, mp3 player, web browser, pda, web radio I've ever owned. The Kindle is nicer for reading books, but I think it's just an issue of the screen.

An eeepc with a flip screen, touch screen, easier to read screen,better battery life and more storage would be pretty close to the perfect personal multimedia player, ebook reader and web access tool. The technology is just not quite there yet.

Posted by Sherry | May 10, 2008 7:39 PM

James Gary has a point. Publishers have to be terrified of winding up like the music industry as their product turns into digital objects.

I'm actually slightly more optimistic about the protection of copyright for printed material than it has been for music.

DRM ("Digital Rights Management") on music is an impediment for me--where possible, I still prefer to buy the physical CD and scan it into iTunes, for the freedom of knowing I can move it at will from computer to computer, burn mix CDs for friends, put it on my iPod or whatever. With books, it's a different story-- it's not important, for example, that I scan my library of fiction into my computer to read random chapters on shuffle play.

Perhaps I'm being incredibly naive about "information wanting to be free," but I can imagine copyright protection for books might be a bit more respected than for music, for the reason that DRM for books just doesn't inherently get in the way of how people use the content.

Posted by James Gary | May 10, 2008 8:01 PM

Do like I do. Fuck "intellectual property".

See Stephan Kinsella here about that:
Patent Attorney Stephan Kinsella Presents On Why We Need To Rethink Intellectual Property:
http://www.techdirt.com/articles/20080504/2229041029.shtml

Go to either an FTP or HTTP book downloading site, or browse the alt.binaries.ebooks.technical Usenet group for PDF and CHM copies of books.

I probably have fifty grand worth of computer texts and other material from those sources.

Book publishing is as doomed as the media industry, but it will take longer as books are more ubiquitous and the technology to make them truly portable and digital isn't quite perfect yet.

Fiction will probably be the last to go since it's generally cheaper than textbooks. It's ridiculous to need information on a hundred varying computer topics in order to function as a consultant, but every damn computer book costs forty to seventy-five dollars. I had to pay $103 damn dollars for one computer textbook a few years for a course at City College. It's insane.

Back in the '70's, when I was in college, I would buy the textbooks, then have them microfiched by a friend who had one of those big gray Kodak microfilm cameras you used to see in libraries. Then I'd sell the books back to the bookstore. The teachers would say, "Open your books", and I'd pull out this sheet of plastic, and start peering at it through a handheld fiche reader. Hilarity ensued.

Posted by Richard Steven Hack | May 10, 2008 8:35 PM

The price will inevitably come down. The current price is too high. Once it's around $50 (any reason why it shouldn't be?) and gone through a couple improvement cycles I might consider it. That should be the price withig 3 years. Until then, good 'ol books will continue to work just fine.

Posted by Tim | May 10, 2008 8:36 PM

The price will inevitably come down. The current price is too high. Once it's around $50 (any reason why it shouldn't be?) and gone through a couple improvement cycles I might consider it. That should be the price within 3 years. Until then, good 'ol books will continue to work just fine.

Posted by Tim | May 10, 2008 8:37 PM

Note that the iPod is also made good by the fact that you can upload all the music you already own on CDs onto it. Obviously, you cannot upload all your printed books onto your kindle to read at your leisure.

Posted by John | May 10, 2008 8:40 PM

I think they should take a hint from video game controllers. It looks like it could use a handle with a thumb controller so you can hold it and operate it with one hand while straphanging.

Posted by Tim | May 10, 2008 8:54 PM

Matt, you're plugging the wrong book...

Posted by CB | May 10, 2008 8:54 PM

But at $399 it seems a bit pricey. Or, rather, at $399 the books should be cheaper. After all, distributing a digital text is way, way, way cheaper than than manufacturing, storing, and shipping a hardcover book.

The old razor-and-blades business model. Not saying it makes sense or we should accept that those are reasonable prices; all I'm saying is that it's not unprecedented.

Posted by anonymous 37 | May 10, 2008 9:03 PM

About the pricing of iTunes albums/real CDs vs. Kindle books/real books:

iTunes' FairPlay DRM actually allows you to burn a CD from the files you get when you download an album (several times, in fact), so you can indeed get a physical copy if you so desire (and re-rip it to iTunes to get rid of the DRM!). How in the heck do you make a real book out of a Kindle book? Print out the hundreds of pages and glue them together? This is what makes the similar price of a Kindle book vs. a physical book seem very off to me. A Kindle copy should be very cheap since one can't do anything but read it on the Kindle. iTunes' DRMed songs can be output to anything that accepts input from an iPod or just a cord from a computer.

What I don't get is that Amazon sells MP3s, which obviously don't have any DRM on them at all so you can make copies 'til your heart's content. What makes books special?

Posted by blahblah | May 10, 2008 9:52 PM

Anon 37, if the Kindle were like $50, the analogy would work. The idea is to price the "razor" artificially low to gain marketshare and raise the price on its necessary attachments. But when the Kindle costs as much as an iPhone, how does the analogy apply?

Posted by blahblah | May 10, 2008 10:04 PM

After all, distributing a digital text is way, way, way cheaper than than manufacturing, storing, and shipping a hardcover book.

*sigh.* Not that anybody's ignorance here is going to make a damn bit of difference in how this all plays out, but... Printing and distribution expenses for books are not the primary determinant of end-user price.

You've got a book, now, Yglesiot. Ask your publisher to school you on printing and distribution costs.

Posted by RaeF | May 10, 2008 10:22 PM

RaeF:

Actually, I'd think the "cheapness" claim is correct, if we're talking about the marginal cost.

EBooks are already in existence as regular books, so there's no extra cost for author advance, editing, graphic design, advertising, etc. And I'd assume that the conversion technology is automatic and very cheap.

I think a very large chunk of the *marginal* cost of each additional printed book is printing, shipping, bribing bookstores to carry them, etc. All of that goes to zero for an EBook.

If the marginal production/distribution/storage cost of each EBook is much above two cents, someone's doing something wrong.

Posted by RKU | May 10, 2008 11:24 PM

What I really want to know is, is "Heads in the Sand" available for the Kindle?

Posted by Dilan Esper | May 11, 2008 1:23 AM

RKU,

I think a very large chunk of the *marginal* cost of each additional printed book is printing, shipping, bribing bookstores to carry them, etc.

So what? The marginal costs do not dominate the end-user price for published media except for advertising-supported vehicles like newspapers. Yglesias is wrong to think that because the marginal costs are many times lower, then end user price should drop precipitously -- recall that he was dissatisfied with a difference of $9.99 vs $16.47.

But whatever. Judging from your this calculation of yours...

Net profit to everyone except author = $8.47 = 85%

... you have zero understanding of the publishing business. You're just a hater.

My beef is with Yglesias. If authors don't educate themselves and stand up for the value of IP, who will?

Posted by RaeF | May 11, 2008 3:10 AM

Yes, the price will be whatever the market will bear, but no, the marginal cost is not irrelevant. People aren't stupid - the near-zero marginal costs are built into the price they will pay. Nobody likes feeling ripped off.

I'll never buy a DRMed book. A paper book will be readable in 20 years time, but a DRMed book will only be readable until the my reader breaks and they're not making them any more - and judging by the mlb.com and Microsoft music service fiascos, that might not be quite as long as you might think. A lot of people ended up with useless chunks of unreadable data.

Posted by Keith W | May 11, 2008 5:54 AM

Returning to the core topic, tho:

I and most of my friends make decent salaries and are regular readers not only of books but of pdf files and similar media (technical papers, etc). I know exactly one person who owns a dedicated ebook reader.

He uses the Sony because he works for that company; he's also made enough money to have asked me the question "Why be frugal?" in a non-rhetorical fashion.

Conclusion of my little focus group: current pricing point doesn't work, IP issues or no.

Re the ipod comparison. I bought our ipods from apple refurbished for fifty bucks each, and we use them primarily as portable playback devices for previously purchased CD music. Not sure how that analogy holds... but if I could get a fifty-buck Kindle that would easily scan in anything I currently own in hardcopy, THAT might get my attention. It still wouldn't do for books what the ipod has done for music, because the ipod (like the walkman before it) has fundamentally enlarged the market for music by allowing many people to be cocooned in it 24/7. Reading is less passive than listening to music, and so it doesn't admit of the same expansion of use (however light the style of "Heads in the Sand", I can't read it while biking or programming).

@RaeF: OK, I *know* I don't understand the publishing business, but when you say that "marginal costs do not dominate the end-user price", you're saying it's an inefficient market. Are you saying the gap is entirely an IP issue? If MY is making even half of $10 per copy of Heads in the Sand, then he's a truly amazing negotiator. If you mean that most of the $10 goes to maintaining a political and legal apparatus that will bite the heads off of anyone who uses the text outside of tightly circumscribed conditions, then even authors like MY must wonder if that's a good deal. Partly because political authors/public intellectuals/typo manufacturers like MY are not simply looking to maximize income from any one book; they're looking to publicize a point of view and to build their reputation. This holds in particular for academic authors - which is one reason that so much of real academic publishing has leaked onto preprint servers, so that printed journals in the mathematical sciences are important mostly for people trying to get tenure or for archival purposes.

Posted by ask2 | May 11, 2008 6:08 AM

If you buy a lot of books it pays for itself in a year of less. You can have your newspaper on the Kindle. Most books are only read once if we are honest. You can redownload it if you delete it so Amazon does your storage. The decrease in book clutter is awesome. When traveling it is nice to carry 50 books in one little package. Free wikipedia and internet access even if it is a bit slow.

I think it is pretty awesome.

Steve

Posted by steve | May 11, 2008 9:59 AM

ask2,

• The fixed costs for publishing a book are high.
• Economically speaking, most books fail.

Publishers make the vast majority of their money on a small fraction of their published titles. The successes must subsidize all the failures.

That's where your money goes.

Posted by RaeF | May 11, 2008 10:24 AM

RaeF, you're either deliberately missing the point or you just want to pretend you're smarter than everyone else.

One of the vast and unpredictable parts of publishing (as I'm sure you know, RaeF,) is the issue of returns. Publishing is one of the few areas where unsold merchandise can be returned from the retailers. This is a huge expense and also results in some of the big-loss books-- because if bookstores greatly over-order a book and it doesn't sell, the publisher ends up holding the bag, not the retailer. Electronic distribution eliminates this problem-- along with the increasingly high cost of shipping-- altogether.

On another note, I think for the Kindle or the next version of the Kindle to really take off will be more flexibility-- or at least the illusion of more flexibility. "You can read PDFs if you throw them through a converter" is not what people want. People want "You can read almost anything, easily!" Half of those people will never even bother reading a damn PDF, but they want to know they can.

Posted by Persia | May 11, 2008 10:48 AM

RaeF, you're either deliberately missing the point or you just want to pretend you're smarter than everyone else.

One of the vast and unpredictable parts of publishing (as I'm sure you know, RaeF,) is the issue of returns. Publishing is one of the few areas where unsold merchandise can be returned from the retailers. This is a huge expense and also results in some of the big-loss books-- because if bookstores greatly over-order a book and it doesn't sell, the publisher ends up holding the bag, not the retailer. Electronic distribution eliminates this problem-- along with the increasingly high cost of shipping-- altogether.

On another note, I think what's needed (among other things) for the Kindle or the next version of the Kindle to really take off will be more flexibility-- or at least the illusion of more flexibility. "You can read PDFs if you throw them through a converter" is not what people want. People want "You can read almost anything, easily!" Half of those people will never even bother reading a damn PDF, but they want to know they can.

Posted by Persia | May 11, 2008 10:48 AM

James:

I wouldn't get too excited about DRM if I were you.

I respect copyright in practice if not theory, but I won't buy any digital text unless it's in an open, cross-platform format, with no timeouts, and I have full cut-and-paste capabilities.

It's pretty much in the nature of DRM not to offer that.

Posted by Doug Lay | May 11, 2008 10:49 AM

I've said it before and I'll say it again: if the iPhone had a good PDF reader where you could customize the view (black background, white font) it would blow away book readers. You could go to project Gutenberg and get all sorts of good reading for free. You'd have an entire library on your phone. You could even make dorky playlists like "Kant mix vol 2".

Posted by freddiemac | May 11, 2008 11:03 AM

I think most everyone is missing the point. Nit pick all you want, and sure you are RIGHT, the Kindle won't last or be the silver bullet, but nobody can deny that it is the tip of the iceberg. It is now more possible, and likely that someone will break through to the other side of pricing. And for the first time it is fairly inevitable that at some point most things WILL actually be digital and not just theoretically so. This coupled with on demand printing makes the future much more clearer than it has been.

Posted by coomaraswamee | May 11, 2008 11:05 AM

"And for the first time it is fairly inevitable that at some point most things WILL actually be digital and not just theoretically so."

And then they can get started on that "paperless office" they promised use a couple decades ago.

The Kindle or any other book reader only has two advantages over actual books. Price, which everyone acknowledges is a only a potential advantage now, and storage. So, as of right now, the Kindle's only practical edge is its appeal to people who read a heck of a lot but don't want to keep their old books are too lazy/civic minded to donate them to the public library.

Get back to me when someone does an analysis of the economic differnential of leaving a book vs. leaving a Kindle on the bus, dropping them down stairs or in the bathtub and the aesthetic chasm between a shelf full of books and a plastic slate sitting on your coffee table.

Mile

Posted by MBunge | May 11, 2008 12:57 PM

RaeF is totally on target. For a very efficient publisher, COGS are around 20 or so percent of revenue. With efficiencies, fulfillment distribution adds another 5 to 10 percent. (And we're talking revenue, not price, kids. And that's AFTER discounts to retailers and the red herring of returns.)

Even if the product has zero inventory and fulfillment cost (and the publisher may have to bear storage or conversion costs for an ebook that are the equivalent of some of the inventory cost for a printed book) that would imply what kind of discount in the price?

Do it on your fingers, kids. The answer is 20 to 30 percent.

If the author has anything like a standard royalty contract, he splits Kindle revenue 50-50 with the publisher.

Depending how deeply Amazon discounts the publisher's price, and depending what discount Amazon asks of the publisher, the revenue split is likely to be roughly one-third Amazon, one-third publisher, one-third author.

The author does pretty well with this deal. Amazon, I can't say. In the best case, the publisher ends up getting his margin squeezed by at least 10 percent.

Anyone who thinks that publishing is a high-margin business ain't been paying attention in class.

None of this matters a damn if Amazon can't get a lot of Kindles into the world. Right now, the industry projection is ebook revenue may grow to 1 to maybe 2 percent of total revenue. For most publishers, that's pretty much chump change.

Posted by praxis | May 11, 2008 1:38 PM

Matt,

I find this to be shameless promotion. Wait: What if you were GOP, and your bossom-pal, Klein was also a GOP. Would not you, Sully and all go after GOP. You would be on Olbermann and screaming about GOP.

But, you are not GOP. You have him as a blurb. In the Kindle essay, he writes you as a the best blogger in the world (what a laugh). He promotes you. You promote him.

Will you lefties ever acknowledge that you are not so different than GOP (Fox news, etc.).

What a sham?

Posted by eorse | May 11, 2008 2:38 PM

Mile,

At some point the real pivot point won't be in your pocketbook, but instead in the pocketbook of publishers etc. Printing and shipping etc. will not be getting cheaper anytime soon. Yes, it has to become more "universal" by people buying in, but its already changing things like newspapers. How much longer will it be feasible to run everything it takes to produce a paper like the Dallas Morning News (versus something like Proquest press display)? I'm actually a librarian and LIKE books so you are barking up the wrong tree by being defensive (like most that get involved in this discussion), but I am sorry the amount of resources that go into printing and shipping are a huge waste. (and I know newspapers aren't the same as books)

Oh, I always hear this paperless office argument. I would love to see the amount of paper data produced in a pre-computer office compared to the ratio of printing versus the amount of data produced now. It might still be more but the shear volume of data now would not even be comparable.

Posted by coomaraswamee | May 11, 2008 3:46 PM

I'd only be interested in a Kindle if it allowed me to read standard document formats (PDF, HTML, ASCII text and maybe ODT). Since I'd need to convert everything by hand, I'm not interested. Ebooks will inevitably become standardized, so I won't invest in Amazon's proprietary format. In any case, 10 USD is way too much, since I can buy great books for less than half that money. As my wages aren't in US dollars, I can't afford that much for most books, particularly in electronic formats.

Posted by Alejandro | May 11, 2008 3:54 PM

I won't dispute the business analyses of publishing here; I don't know how publishing works.

But consider. I can start my own blog for free (if I'm willing to put up with sidebar ads) and with a little extra effort, typeset my own work and put it in front of a million eyeballs. Yet it costs a publisher 70-80 percent of the cost of a hardcover book to deliver the same thing in PDF form? No wonder the print industry's dying...

Posted by ask2 | May 11, 2008 6:05 PM

"(and the publisher may have to bear storage or conversion costs for an ebook that are the equivalent of some of the inventory cost for a printed book)"

Ridiculous statement.

This is the same crap the music industry tried to sell musicians by charging 15% for "record breakage" when the industry went to CDs - which have far less breakage than vinyl.

There's no goddamn way it will cost anywhere near the cost of ANY physical storage of a book inventory to produce or convert an ebook from an existing text.

If that is the case, the publisher has an IT staff full of idiots - and is probably running Windows to boot.

As to the argument that publishers have to charge what they do to offset the losses from books that don't sell - well, that's WHY the entire industry is doomed. Ebook PRODUCTION and distribution eliminates that entire problem by cutting the publisher out completely - which is the same as what is happening in the indie music business.

The ONLY thing slowing this down is the attachment of the older generation to physical books - and the lack of a really decent, cheap ebook viewer to allow the younger generations to convert over.

Well, the old farts will die and the technology will improve.

The publishing industry (in its present form anyway) is doomed, as is the music industry and possibly even the movie industry. Deal with it.

Posted by Richard Steven Hack | May 11, 2008 6:53 PM

Ask2: it's nice that you work for free. But slapping up some deathless prose on a blog somewhere and paying for it by selling some ad space ain't a workable model unless someone, somewhere, actually has a product or a service to advertise and sell. Those of us who do sell real products have marketing and promotion costs and the costs of scouting out new authors and developing projects that may not pan out and accounting and collections costs and customer service costs and facilities costs and lots of other costs that most real businesses have. People work at all those activities and most of 'em like to get paid for it. Oh yeah, and the authors expect their royalties, too. Which is, no doubt, why the entire country is a dying industry.

Richard Steven: Well, "hack" is just about right. Check out the storage and conversion charges at LibreDigital or Ingram Digital and then get back to us, chump. Or, of course, a publisher can add IT staff to deal with ebooks on their own. And, of course, that won't cost them anything in salary or benefits.

And, blithely unnoted by our "same crap" expert, the costs of conversion and storage were assumed to be zero (for the sake of argument). Hack away, hack away, old chum.

But I guess someday the new farts who are still floating in their somewhat retro internet bubbles will come up for air and finally show us old farts how to run a business on nothing but that.

Posted by praxis | May 11, 2008 9:16 PM

Ask2: it's nice that you work for free. But slapping up some deathless prose on a blog somewhere and paying for it by selling some ad space ain't a generalizable model unless someone, somewhere, actually has a product or a service to advertise and sell. And those of us who do sell real products are going to have to bear that advertising cost that keeps you going, plus other marketing and promotion costs. If that someone is a publisher, then they have the uncapitalized costs of scouting out new authors and developing projects that may not pan out, plus accounting and collections costs (not a small factor in publishing) and most likely customer service and facilities costs and lots of other costs and fees and taxes that most real businesses have. People work at all those activities and most of 'em like to get paid for it and have some insurance for when they’re sick, and if they’re talented they go with employers who put away a little something for them for their retirement. Oh yeah, and the authors expect their royalties, too. Which is, no doubt, why the entire country is a dying industry.

Richard Steven: Well, "hack" is just about right. Check out the storage and conversion charges at LibreDigital or Ingram Digital and then get back to us, chump. Or, of course, a publisher can add IT staff to deal with ebooks on their own. And, of course, that won't cost them anything in salary or benefits.

And, blithely unnoted by our "same crap" expert, the costs of conversion and storage were assumed to be zero (for the sake of argument). Hack away, hack away, old chum.

But I guess someday the new farts who are still floating in their somewhat retro internet bubbles will come up for air and finally show us old farts how to run a business on nothing but that.

Posted by praxis | May 11, 2008 9:32 PM

Praxis:

Look, a huge fraction of ALL in-print books are *already* in digital format. For example, I think that several hundred thousand or more are "readable" up on Amazon.com.

Running a program to convert one electronic format to some other electronic format is a one-time operation, and converting even 500K books probably wouldn't take more than 100 hours on a fast PC. Once they're converted, the only "storage" cost is hard-drive, and you could probably fit them all on a $500 drive.

Please enlighten me as to why these "conversion" and "storage" costs for 500K books should run more than something $1,000 as a one-time fee.

I'll bet if the computer people who work in your publishing company are just too stupid to do this, you could just hire RSH.

Posted by RKU | May 11, 2008 9:34 PM

Steve Jobs on the Kindle :

“It doesn’t matter how good or bad the product is, the fact is that people don’t read anymore,” he said. “Forty percent of the people in the U.S. read one book or less last year. The whole conception is flawed at the top because people don’t read anymore.”

Posted by judson | May 12, 2008 10:07 AM

Dear RKU,

Well, I could mock you for thinking that "several hundred thousand" is a "huge" fraction of in-print books. But even if that were so, it wouldn't really prove any relevant point.

Yes, of course, my computer "people" are smart enough to convert a print title to an electronic version. Problem, though: all three of them already have full-time jobs, doing work that brings in money for us, or work that allows others in the company to bring in money for us. Diverting them to chase the mostly at this point imaginary dollars in ebook publishing just isn't a smart business decision at this point.

Also, you seem to mistake "storage" for the cost of physical storage alone. An ebook on a hard drive somewhere isn't much of an asset without some mechanism for downloading the ebook reliably to customers, getting paid for having done so, dealing with customers when the download goes awry, and getting the data about the sale you've just made into your accounting system. For a one-book author with nothing but time on his or her hands, those may be issues that sweat equity can handle. But for many small publishers with several hundred titles in print, the complications involved may mean that those will be tasks that it is ultimately simpler and possibly cheaper to outsource to some digital book provider or software provider who has already invented the wheel. If you doubt that those providers exist, walk the aisles at the BEA and you'll see packs of them following publishers around. Naturally, they want to get paid for their services -- as, I'm sure, you or RSH would. Some model the cost as a storage fee, others ask for a percentage of every download. In any case, those publishers who choose to outsource the problem will end up paying something to someone to handle at least some part of those tasks for them.

Kindle is, in fact, one such provider. They don't charge storage or conversion fees, check. But they do ask for a hefty discount on the cover price for participation in their program. That's not something I need to argue. That's just a fact, and facts count for something in the world where I live.

But this is all moot. The issue isn't storage and conversion, as I've said from the beginning. Assume, unrealistically, that those costs are zero. For a publisher, you still end up with an ebook that is no more than 20 to 30 percent cheaper than a printed book.

What I understand from this stream is that a price that high is a barrier to at least some potential readers. That suggests that ebooks aren't likely to flood the marketplace in the near future. I hear you, and I take note.

Posted by praxis | May 12, 2008 11:56 AM

"The ONLY thing slowing this down is the attachment of the older generation to physical books - and the lack of a really decent, cheap ebook viewer to allow the younger generations to convert over."

Uh, no. What's slowing it down is the lack of real advantage to the ebook reader. Most popular technology become popular because it enables people to do something they want to do, but makes it easier. Outside of students, how many people carry around more than one book with them? How many people read so many books that storing them all becomes a physical problem? The problem with ebooks is that they don't provide a great enough advantage over physical books to justify a mass changeover.

Mike

Posted by MBunge | May 12, 2008 2:56 PM

I currently use the O'Reilly Safari service for many of my technical books. But, not all of my tech books. At work, selecting a new volume from Safari is much quicker than going through the purchase agent, and the cost differential doesn't affect me. Stuff that I wish to use at home as a reference, I buy hardcopy on my own dime. Why? Because I know it will be there tomorrow, even if the web is off-line or O'Reilly gets into a pissing match with the IP owners.

I wish I had the same service for my school texts, provided that the publisher's cost savings were passed on to me.

The DRM angle disturbs me. I'm OK with the iTunes DRM, since I can back up to CD and take what I have bought with me, should iTunes and I part ways for whatever reason. But, as it stands, ebooks are a rental service, which I'm opposed to making the standard model to read on general principle. Thanks to the (mis-)use of the Digital Millennium Copyright Act, I've been disabused of the notion that Richard Stallman is just a whack job (although he still looks the part).

Posted by cmholm | May 12, 2008 6:49 PM