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Every single day there are 60,000 cruise, cargo and oil rigs in operation globally. The vast majority of staff that keep these operations running properly are workers from the Philippines, Malaysia, Russia and India. Many of the corporations that bankroll everything are putting a new emphasis on crew welfare and retention. This has opened up a new market for digital publishing companies to keep the staff entertained and use it as perks to keep trained personnel from going to the competition.
Maritime operations, whether its a cruise ship, oil rig or cargo vessel often do not have reliable internet access. The companies often deal with satellite internet providers such as VSAT and IMTECH. Internet access is purchased in blocks, where ships have very specific limits on how much data is available. In order to download eBooks, magazines or newspapers they have to be accessed in off-peak hours, when the internet is more reliable and not congested.
Cargo vessels and oil rigs often have staff that are on the vessel for up to six months at a time. Keeping them entertained is a top priority to keep them loyal and happy. This has opened up a tremendous niche in the marketplace where some companies are taking advantage of the sparse options currently available.
Vancouver based PressReader currently has a catalog of over 2,000 newspapers and magazines. They have developed a new offline system that will allow vessels to download content in non-peak hours and distribute it to smartphones and tablets via a shipwide WIFI network. Maritime companies are starting to select publications that are relevant to the nationalities of their workers and getting the top three or four titles from those countries. This would allow a boatswain from the Philippines to get free access to the Manila Times, UNO Magazine, and Daily Inquirer to read at their leisure. Providing perks like free newspapers and magazines gives workers and officers a taste of home, without having to spend any of their own money, its the corporate cash after all that pays for it.
Getting your staff to read safety guides, regulations, weather reports and orientation information is a trial and tribulation. The print editions are often destroyed in the heat and humidity or lost amidst the huge vessels. This has warranted digital distribution, and PressReader Offline supports the ability for companies to upload their documents in PDF form, to be downloaded to tablets and phones on-demand.
PressReader offline has been in a year long pilot project and the system was co-developed by Silver Seas Cruises. It was trialed on a number of vessels to get feedback on how it could be integrated, using existing systems and the limitations of satellite internet. The offline capabilities have been a big hit and is now being used on vessels globally.
Established satellite internet providers are also leaping at the oportonity to fill this burgeoning entertainment niche. InfoSat is currently developing a new system that will allow vessels to have unlimited satellite internet access and offer a wide array of media. Maps, music, Videos, Newspapers, magazines and eBooks will be a top priority for the global launch.
If you are a crewman on a military submarine, your options to access leisure content is severely hampered. Internet access is non-existent, due to security reasons, which traditionally made reading eBooks unfeasible. This has prompted the US Navy to partner with Findaway World for the NERD e-Reader. It comes with 300 eBooks and audiobooks and has no USB port or WIFi internet access. In essence, it is a tremendously low security risk and provides an alternative to movies or the XBox.
I think this is the perfect time for the maritime industry to embrace audiobooks, ebooks, magazines and digital newspapers as an avenue to retain staff and keep everyone entertained. After all, most just rely on mindless activities such as video games, movies or sports. Reading gives them a taste of home and a widened mind.
Sony opened up their first eBookstore in 2004 and was selling e-Readers before Amazon released their first generation Kindle. In early 2014 Sony got out of the eBook business and closed up shop in North America, United Kingdom, Europe and Australia. They encouraged all of their customers to switch to Kobo, as an avenue to continue purchasing content.
There is a long storied history of Sony being involved in the e-Reader sector and they released more models than anyone in the entire industry. Today we look at the evolution of the Sony brand, from the first device, until their last. Incidentally, if you like this evolution piece, check out the ones we did on Amazon and Kobo.
The Sony Librie was otherwise known as the EBR-100EP and was originally released in April 2004. It was the very first commercial e-ink device, and was sold only in Japan, but many devices were sold in the US through online retailers and with a third-party English OS upgrade. This reader was the result of a three-year collaboration between Sony, Philips, Toppan printing and E Ink Corporation.
The resolution was 800×600, which was amazing at the time and many modern e-readers still adhere to this old standard. People were surprised this could hold over 10 books with the 10MB of storage and were able to listen to music and audiobooks via the speaker and headphone jack.
The Librie was interesting historically because Sony developed their own proprietary eBook format, LRF. This model basically only read books that were purchased from the Sony Japanese book store and had no support for PDF or other popular formats at the time, such as Microsofts, Nokia, or Palm.
The Sony PRS-500 was known as “A Reader” in their promotional and marketing campaign. This was the first device that Sony marketed outside Japan and was released in September 2006. This was one year before Amazon unveiled their own Kindle reader.
Sony streamlined this e-reader and discarded the physical keyboard that was on their first device ever made. Instead, they went with a unique controller system that was in essence two joysticks. One was for page turns and the other for accessing the menu, settings or dictionary.
The first Sony reader could only store 10MB of data, and this model was upgraded to hold 64MB, which drastically increased the amount of books that could be loaded on it. No longer were customers forced to delete books they finished reading, but could store over 80.
This reader had the same e-ink screen as the Libri, but had a faster processor. On November 16, 2009, Sony announced that a firmware update is available to support the ePub and Adobe DRM format and add the ability to re-flow PDF documents”. Owners must send the reader into the Sony Service Centers for the updated firmware. You can obviously tell how infant the e-reader industry was during this era, when you had to mail away your e-reader for over a month for them to load in the new firmware for you.
The Sony PRS-505 was originally released in October 2007, the same year Amazon unveiled their first generation Kindle. This model used a new e-Ink Vizplex display screen, which provided faster page turns than the prior models. Although the overall performance was enhanced, Sony still abided by the 800×600 resolution. This also marked the first time that you could charge a Sony reader via the USB cable.
Sony increased the internal storage yet again on this model, which saw a dramatic leap to 256MB and over 500 books available to be stored. Also, adding books to “Collections” (a feature to organize and group book titles) is now possible on the SD card, unlike the PRS-500 model.
July 24, 2008 marked the first time this model received a firmware update to support the fledgling ePub format Adobe Digital Editions 1.5 and Adobe DRM protected PDF files, automatic reflow of PDF files formatted for larger pages enlarges the text to improve readability, and support for high capacity SDHC memory card. This time, instead of sending the reader in to get the update, it was provided as a free download, along with written instructions.
The Sony PRS-700 was a benchmark e-reader and broke the mold on several fronts. It was the first touchscreen e-reader and the first model to feature an illuminated screen to let you read in the dark.
Sony heavily invested in touchscreen technology with their e-readers and this was the first of many to fully adopt it. Moving in this direction eliminated the D-Pad and most keys, minimizing the footprint and making it easier to hold. This was also the first e-reader that allowed you to make highlights, annotations on the fly and take advantage of the new virtual keyboard.
The LED lights on this unit was a precursor to the front-lit technology we see on the modern 2014 readers, such as the Nook Glowlight, Kobo Aura and Kindle Paperwhite 2. It all started with Sony making in-roads and taking the risk of developing technology never seen before on an e-reader. The overall experience was really lacklustre and jaded executives so much that they said they would never make a LED reader ever again.
Sony Touch Edition PRS-600
The Sony PRS-600 was known as the Touch Edition and was released the very same day as the five inch Pocket Edition on August 2009. This reader continued the trend of having a speaker and 3.55 headphone jack and relied on the touchscreen as a way to take notes and highlights.
The Touch Edition was the first time Sony marketed their readers in three different colors, black, white and red. This model also increased the storage from 256MB on the prior model to over 512MB. It had the same resolution as the older models, so did not break any new ground on the ePaper front.
Up until the launch of the Touch Edition all Sony e-Readers were unable to read PDF or EPUB files out of the box. You had to either send them to Sony via snail mail for them to manually patch or do it yourself. This was the year that Sony firmly switched over from their own LRF format to EPUB and native PDF support.
The move to firmly embrace EPUB and PDF allowed a new generation of users to be able to not exclusively shop at Sony anymore for their books. Instead, they could deal with other retailers and use Adobe Digital Editions to sync up the purchases.
This was the first e-reader that Sony really stepped their marketing efforts on. They made a number of stock images for bloggers to use in their writeups and started blitz campaigns in the Sony Style stores and also expanded their retail distribution into countries like Canada.
Pocket Edition PRS-300
The Sony Pocket Edition was released on August 2009, the same day as the PRS-600. Sony went back to their roots by offering an entry level reader for a solid $199, which made it one of the cheapest models at this point in time.
One of the ways Sony saved many was abandoning the costly touchscreen technology and instead went with physical page turn keys, D-Pad and manual page turn buttons. It also had no MP3 audio or expandable memory. It has a similar interface to the PRS-500 and PRS-505.
Sony Daily Edition PRS-900
When the Sony Daily PRS-900 was first unveiled in December 2009 it bucked the trend of the standard six inch device and incorporated a 7 inch screen. Sony also borrowed a page out of Amazons playbook and offered free 3G internet access to the US version of the Sony bookstore.
Sony increased the memory yet again to a whopping 2GB, which allowed over 1700 books to loaded on it. It also boosted up the resolution, making it the best on the market at this time. It had 1024×600, which was ideal for reading texts in landscape or portrait mode.
The Daily Edition was the first time there were no hardware buttons at all. It was completely reliant on the touchscreen and Stylus for all of your inputs. 2009 was a big year for Sony with 3 new devices hitting the market months within each other.
This model was really expensive and set you back US$399 at the time of release. This was mainly to offset the costs in the internet access, which at the time was a pricey value proposition. It was considered to be the very best e-reader on the market and was more accessible than Amazon.
Setting The Stage for the Next Generation
August the 10th 2010 was a milestone for Sony as they released the second generation Pocket Edition, Touch Edition and Daily Edition. The company really refined all of their technology and this lineup of devices was at the height of the e-reader and eBook boom period.
2010 was the year that competition really started to heat up between Amazon, Barnes and Noble and Kobo. E-Ink, the Taiwan company responsible for all of the e-paper displays made over 3 billion in this year alone and even NEONODE, the company responsible for the IR touchscreen tech was making millions.
Sony used their advanced e-readers as an avenue for growth. They opened up online bookstores in the UK, Europe and Australia. All of these models were highly visible in the retail sector, but it was costly. Australians were paying almost 2x the retail cost in North America and most flocked to eBay or other online merchants to save a bundle.
This was the final year that e-Reader revenue was expanding at a geometric rate and it started to decrease in the following years. This was also the last year Sony released three new devices annually and only did one, focusing their efforts on the more lucrative smartphone and tablet market.
Sony Pocket Edition PRS-350
The second generation Pocket Edition was launched on August 2010. This was the first modern line of Sony readers to adopt E-Ink Pearl, which provided a better experience than the antiquated Vizplex technology.
The Pocket Edition continued to be Sony’s smallest ever Reader, clocking in at five inches. It hit the market cheaper than the previous PRS-300 at US$179. Unlike the first generation model it incorporated a touch screen, and two GB of Memory but lacked an SD Card Slot and does not support MP3 playback.
Sony PRS-650 Touch Edition
The Sony PRS-650 was released August 2010 and was announced at the same time as the touch-screen PRS-350. It is Sony’s mid-range device, priced at US$229. As the replacement for the PRS-600 model, it is Sony’s higher-scale, touch-screen edition of the reader. It has a similar interface to the PRS-350.
This reader was fully touch screen but brought back physical buttons, such as the settings, options, home and manual page turn keys. The Touch Edition is a compact and lightweight e-book reader; responsive touch-screen interface with no glare or contrast issues; high-contrast E Ink Pearl display; zippier performance than its predecessor; integration with Sony e-book store; good battery life (up to two weeks); supports EPUB e-book standard, which allows for e-book downloads from libraries; audio playback; SD and Memory Stick Duo memory expansion slots.
Sony was unprepared for the Q4 demand for the 650 e-reader. There were a few key reasons why this model in particular is so hard to purchase anywhere in North America, UK, Australia and other countries. Sony in early December recently did a relaunch of their new e-readers in Japan. This was the company’s second attempt to penetrate the often fickle Japanese market. Sony actually diverted shipments from all over the world to Japan, creating an international scarcity.
Sony Daily Edition PRS-950
The PRS950 model of the Daily Edition was released August 2010 and adds Wi-Fi to the free 3G wireless access to the Sony eBook store. The Reader Daily Edition features a high contrast E Ink Pearl technology on its anti-glare touch screen. It is otherwise similar to the older PRS 900 model.
This was the last 7 inch model that Sony sold and many users still have this model in 2014. One of the downsides is that the 3G internet has been shut off, because Sony closed their bookstore in North America. The only way to be able to connect up to the internet and use the web-browser is to utilize your personal or public WIFI. It retailed at the time for US$299.
The Sony PRS-T1 came out in October 2011 and marked the first time Sony only released one new e-reader model. The T1 was also known as the Reader Wi-Fi and was billed as the world’s lightest 6″ e-Reader with a glare-free, paper-like display designed for hours of comfortable reading, even in direct sunlight.
The big hyping factor behind the T1 was the new product design, that would shape the next two iterations of the PRS-T product line. It was the first Sony branded device to have built in WIFI to purchase books, magazines and newspapers at Sony Reader Store. Customers could also browse the internet with the built in browser. It also had a built in Overdrive APP, to allow customers to borrow books from the public library.
Sony adhered to the 2GB of memory size, which they found to be enough for your average user. They have also used the same resolution 800×600 that they employed for the last five years.
The T1 was very internationally friendly with 12 Built-in Dictionaries with 2 English and 10 others, such as French, German, Spanish, Dutch and Italian.
The Sony PRS-T2 was released September 2012 and mirrored the PRS-T1 in almost every single way. One of the most striking differences was the home, settings and manual page turn keys. The T1 had long rectangular buttons, which was a bit unwieldy. The T2 has really small buttons that actually had a ton of torque, it made interacting with them more intuitive and made the device more streamlined.
One of the big deals Sony trumpeted was their business relationship with Evernote. You could save your notes, highlights and annotations directly to your Evernote account, which made students and academics lives a bit easier. The average person really did not care and the T2 update really felt like the iPhone 4 and the 4S, in terms of a very incremental update, not really needed.
The Sony PRS-T3 is the most current generation commercial reader that is still being sold online and in many retail stores. Currently it has no built in store, but a firmware update will be adding the Kobo Store as an avenue to purchase content.
The Sony T3 was released September 2013 and bypassed the US to be launched in Canada, then the UK, Europe and Australia. This was the first true high-resolution e-readers that mirrored what Amazon, Barnes and Noble and Kobo were doing at the time. 1024×758 is currently the gold standard for e-Reader resolution and it is hard for text to be anymore crisp.
Sony sold two different versions of the T3 e-reader line, the second many just came with a case and reading light, it was an extremely limited release, mainly just in Canada.
Sony Digital Paper
The Sony 13.3 inch e-Reader is going to usher in a brand new era of high quality e-Paper that allows for a true PDF experience. Sony has exclusivity over this brand new technology called Mobius, which they developed with e-Ink.
The screen itself is quite respectable in terms of resolution and pixel density. The resolution on the display is 1200×1600 with 150 PPI. The main attraction is using the active digitizer and interacting with complex PDF documents. You can edit documents by jotting down your own handwritten notes, or even highlight passages to go back to later. You may elect to save your notes as independent files, which makes referencing them in the future easier.
The large screen display will simply give you the best PDF experience you have ever had on an e-reader. I have personally reviewed over 83 different e-readers since launching Good e-Reader in 2009, and this was the first one to give me a quality PDF experience. It is only available at two online retailers, both who have been sold out for over a month. You can take your luck with Amazon, who sell it for a cool $1400.00.
Sony was once the most dominant player in the e-reader revolution and was the primary mover in selling hardware and eBooks. Rising competition from small companies such as Pocketbook, Onyx and Ectaco slowly whittled away market share in Western and Eastern Europe. North America and the UK saw Amazon, B&N and Kobo take them to the cleaners and eroded the profitability of the e-reader division.
Sony now intends on only marketing their phones and tablets and has given up on e-readers. The company has signed a longterm agreement with Kobo, to have their eBook app preloaded on any future Sony branded Android device. Each book customers purchase will pay Sony a small commission, similar to how Kobo cuts in indie bookstores all over the world.
The current e-reader industry would not be where they are today if it weren’t for Sony. The made one of the first mainstream touch screen e-readers and the best with LED lights to read in the dark. The 3G Daily edition inspired Barnes and Noble to offer a similar service with their first Nook 3G model. Sony may have lost their shine, but historically very significant to a billion dollar publishing industry.
Neonode is best known for their IR touchscreen technology that mainstream e-readers employed, before most of them gravitated towards capacitive touch. The Amazon Kindle Touch, Kobo Glo, Sony PRS-T1 and similar models all employed Infrared sensors alongside the bezel. This provided these companies a dramatically affordable way to incorporate touchscreen technology into e-readers that were at war with each other over lower prices. The rise and fall of Neonode reads like a textbook of the e-reader industry as a whole.
Neonode is a publically traded company and files all of their financial information on a quarterly and yearly basis with the SEC. Their accounts receivable info reads like a textbook on the rise and fall of the e-reader industry. In 2010 the company garnered a paltry $200 thousand and the companies fortunes spiked dramatically in 2011 with over $3.3 million in licensing fees. Revenue dropped by over a million in 2012 when they earned $2.1 million and in 2013 they received $1 million.
This yearly financial returns are not indicative to just the eBook reader industry, as they have their hands in cell phones, tablets and a number of other enterprises. When it comes to e-readers in 2011 they had eleven contracts signed with the whos who of industry. This included the Sony Pocket Edition, Sony Touch Edition, Daily and the PRS-T1 model. Other notables include the Kobo eReader Touch and Barnes & Noble Simple Touch Reader. In 2012 Amazon accounted for 46% of their revenue, followed by Kobo at 16% and Sony at 14%. During 2013 Neonode lost Amazon as their primary customer and instead is leaning on Kobo (19%) Leapfrog (16%) and Sony (15%) for their e-reader revenue. Finally in the first quarter of 2014, Leap Frog is their biggest customer (30%) followed by Sony Corporation (16%) and older Kobo devices (11%).
Kobo is using their older Glo and Touch Screen e-readers in their efforts to expand into international markets, because of the lower price point on outdated components. Sony on the other hand have all but bowed out of the e-reader industry with the total abandonment of their Sony Reader bookstore in North America, Europe and Australia, but still sell the PRS-T3 in many retail environments. Leapfrog primarily sells kids tablets in retail stores like Toys R US and bigbox stores.
Neonode Z-Force technology is currently being phased out by many of the other eBook vendors in the world. Amazon, Kobo, and Tolino are all employing capacitive touchscreen technology and therefore not paying Neonode licensing fees. The lack of income is not stopping them from spending $1.8 million in the last three months, compared to $1.6 million for the same period in 2013. This has led to contracts with HP for multisense touchscreen printers and developing patents for virtual keyboards.
What is the future of Neonode in the e-Reader industry? Likely they are abandoning innovation in this sector and instead are focusing on zForce AIR Technology for phones, zForce NEMO Technology for 100% Waterproof Devices and MultiSensing technology for in-car systems.
Kobo has been making e-readers since 2010 and diversified into tablets in 2011. Their earliest e-ink devices were fairly basic and through dedication to reading their latest models are very solid. Today, we look at the evolution of the Kobo brand and how their e-Readers have changed overtime.
The first Kobo e-Reader became available in Canada and the US on May 1 2010. It featured a 6 inch with a resolution of 600 x 800 pixels. This translates to a display pixel density of 170 (dpi), which is quite impressive at the time. It did not have WIFI or a built in store. Customers were encouraged to load in their own books manually, which hampered its ability to compete against Amazon. The pricing strategy of the original Kobo, at USD$ 149, was to rival the Amazon Kindle, which was USD$ 110 more expensive. However, in June 2010, just after the Kobo was released, Amazon dropped the price of the Kindle to USD$189.
Chapters Indigo was an early investor of Kobo, contributing close to $150 million to assist them in developing e-readers and an online bookstore.
The Kobo WIFI edition was released on October 15th 2010. This was only a few months after the original Kobo e-Reader launched and the company had to bow to customer demands to buy eBooks right on the device. It featured a slightly improved processor and support for a 32 GB SD Card. This marked the first time Kobo experimented with different colors, offering a white, black and lilac version with a quilted cover on the back.
The e-reader visually was a carbon copy of their first e-reader. It had a rather flimsy D-Pad that was used to navigate settings menus. It also had physical buttons all over the unit. The addition of wireless internet access allowed people to buy books from Kobo directly, which simplified the process.
When I reviewed this unit the week it came out I summarized “The one drawback of this device, is that it feels sluggish and unresponsive when you are navigating all of the menus and eBook store. You might click down, and it won’t refresh for over 8 seconds. This makes it so you end up double clicking, then your e-reader will jump menu to menu or screen to screen. This is one of the most frustrating aspects of both iterations of the Kobo reader. For us, its a deal breaker.”
The Kobo Touch was released in June 2011 and was the first time a touchscreen was employed in a Kobo e-reader. The Touch had a resolution of 800×600, which was the exact same as prior models. When it came to interacting with the screen, things were slightly more robust with the inclusion of an e Ink Pearl display.
Aside from the touchscreen which was the major selling point of the Touch, a number of software improvements were quite evident. Kobo really marketed their new social media platform called Reading life. It allowed you to share book passages via Twitter and Facebook. It also gives you statistics of your reading patterns, how much you read, how often, and how many books you have read. There was also a reward system where you earned badges and achievements for reading.
When the Touch first came out my summary of the hardware review stated “Kobo hit a homerun with the Kobo Touch due to the quality build design and the robust functionality! I had the original Kobo e-Reader and the Kobo Wireless. This model seriously puts those two to shame! The touchscreen display should be easier for your average user to wrap their heads around, since almost all hand held mobile devices are touch screen. I found the older Kobo models to have flimsy design and the DPAD was awful, not to mention you would hit a key and 12 seconds later the command would go through. I hardly experienced ANY LAG at all when using this e-reader extensively.
The Kobo GLO was released in September of 2012. This was the first e-reader that really really hit the mainstream. It surpassed their prior models in responsiveness and design. The big selling point was the illuminated display screen, which borrowed a page of the Nook Simple Touch with Glowlight and the Kindle Paperwhite.
The Kobo Glo eliminated all physical buttons and relied in a capacitive touchscreen with a resolution of 1024 x 758.. This marked the first major advancement in resolution, which really made text and PDF files look amazing. It was hampered a bit by the same processor used on the Kobo Touch, a year prior. Kobo also amped up the processor, which raised it to 1 GHZ, over the 800 MHZ of the Touch model.
When this first came out, my review summarized “This e-reader feels like a modern device and has solid hardware. The back of the unit has a different quilted pattern than previous models. Advanced users may dig the fact that there is a ton of control over your reading experience and it allows you to load in your own fonts. The Kobo development team is also fairly active on the MobileRead forums and often directly answers questions and employs many people in testing out beta firmware builds. They also use this fiendishly obsessed e-Reader community to farm ideas on future features they might employ in automatic firmware updates.”
The Kobo Mini was originally launched the exact same day as the Kobo Glo at the first major unveiling Kobo produced in Toronto. In 2012 Kobo really stepped up their promotional and marketing campaign as the intention was to be the #2 ereader and eBook company in the world, next to Amazon.
The Mini bucked the trend of the standard six inch e-Reader and instead went with a more pocket friendly five inch model. It used e Ink Vizplex technology and had a resolution of of 800×600 pixels. Underneath the hood was a 800 MHZ processor, which was the exact same as the Kobo Touch employed years prior.
The intention behind the Mini was to offer a cheap and cheerful device at $99 and was discounted heavily during its lifecycle to $29.99. When the e-reader first came out I mentioned “It will be interesting to see how the market responds to a strongly marketed five inch ereader. For the last four years all of the major players have released six inch or larger e-readers. Other companies have released smaller models, but never saw any traction because of poor retail distribution channels and brand awareness. The Kobo Mini is one of the best bangs for your buck if you are on a budget and still want a fully featured e-reader. The company does a great job in appealing to international customers, something the other major players don’t do very well. Most lock you into specific regional variants of their stores and exclude anyone living outside a specific geographical region.”
The Kobo Aura HD was billed as a limited edition e-reader that was released April 25th 2013. It featured a 6.8 inch screen with a tremendous resolution of 1440×1080 with 265 ppi. The front-lite technology also received an elevated boost and put Kobo on par with Kindle in terms of screen technology.
The Aura HD was a runaway success and quickly accounted for 25% of Kobos international hardware sales. Readers loved the fact they had almost an extra inch to read their eBooks, magazines, newspapers or PDF content.
One of the best aspects of the Aura HD was the responsive main menu. The new screen has three main segments that displays icons for everything you have done in the last 12 processes. This gives you shortcuts to your most commonly accessed features, such as the web-browser, custom shelves, Reading Life, and ebooks. The Sync feature to fetch new content is now on the main screen, too, which is the only element that remains persistent. I actually like the more effective use of screen real estate. Rather than browsing four different sub-menus to access the internet browser, it will appear on your main screen if you have recently used it.
When this first came out, I mentioned during my review “When it comes to high resolution displays, customers often gravitate towards full color tablets instead of e-readers. This has been the growing trend in the last few years, and it’s completely amazing to see a brand stay loyal and committed to its e-ink line of devices. Simply put, the Kobo Aura HD has the highest resolution out of any six or seven inch tablet or e-reader in the world. If images and clarity of text matter to you, this is a must purchase.”
The AURA HD is still currently the flagship e-reader from Kobo and is currently my favorite dedicated e-reader on the market. It taps into an ecosystem of over 3 million eBooks and is relevant in every major country in the world. Simply put, this was the best, most complete product Kobo produced in their entire company history.
In September 2013 Kobo released a six inch iteration of the Kobo Aura. It featured a 6-inch e-ink ClarityScreen display with 1014×758 resolution, 16 level grey scale and a built-in LED front-light. It has 4 GB of storage, weighs 6.1 ounces, has 2 months of battery life, a Freescale i.MX507 1 GHz processor, and a microSD expansion slot.
Kobo employed a new PDF rendering engine in the Aura HD and the Aura. It allowed readers to have better navigation on the document by giving a small preview window to help keep you oriented.
When the Kobo Aura was released I stated “The Aura is amazing, one of the best e-readers ever released. One of the best features is the capacitive multi-touch display and the ability to really make reading shine. The screen is flush with the bezel and not sunken like every other e-reader currently on the market. The internet and PDF experience is the best you will get on a six inch device, trouncing Sony.”
News Corp announced the purchase of Canadian based Harlequin from Torstar on May 2nd, 2014. The entire deal was a cash purchase of $455 million dollars and the romance publisher will be a division of HarperCollins. What does the future hold for readers of their beloved brand? Why was Harlequin even available to purchase in the first place? What is the future of digital and softcover titles?
Harlequin was originally purchased by TorStar in 1975 and saw massive success in their affordable softcover books that were a staple in bookstores, grocery stores and supermarkets all over North America. When you envision the quintessential title from Harlequin, often shirtless hunks abound. In the 1980s and early 1990′s Fabio was a household name.
What made Harlequin an attractive acquisition target? It was one of the most profitable aspects of TorStar Corp, a Canadian media company. It currently publishes 110 physical and digital books every single month. The books are translated into 30 different languages and available all over the world. They have 1300 authors signed to publishing contracts and over 1,000 employees worldwide. Obviously the romance genre is still very popular with 24 of the top 100 bestsellers in April belonging to Harlequin.
Why is Torstor selling the largest Romance company in the world? TorStar is seeing a decline in their entire portfolio, primarily due to the newspapers. It owns popular brands such as the Toronto Star, Canada’s largest newspaper, and a equity stake in The Canadian Press as part of a joint agreement with the parent companies of the Globe and Mail and Montreal La Presse. TorStar was seeing decreased revenue from their newspapers and will use 158.5 million to pay off their current debt.
“We think we did the right thing in exiting,” David Holland, president and CEO of Torstar, said during a conference call to discuss the sale. “While making the decision to sell was difficult, we are confident that this transaction represents excellent value for Torstar shareholders and importantly further strengthens Torstar’s financial position and capital base as we continue in our evolution as a company,” Holland told financial analysts.
Harlequin’s chief executive, Craig Swinwood, said that the publisher would remain based in Toronto, and that it would continue to operate as a “distinct and successful brand” within HarperCollins. Brian Murray Chief-Executive at HC echoed those sentiments, saying that the “Harlequin rich name and heritage will be preserved independently.”
Harlequin as a company was stagnating under the ownership of Torstar. In 2009 they saw $493 million in revenue, $468 million in 2010, $459 million in 2011, and $426 million in 2012. One of the reasons the company was losing money was the decline of the softcover book and the rise of the eBook. In 2007 the big decline started when paperback sales took a 2% dip, bringing in a staggering $1.1 billion dollars. The landslide of decreased revenue continued, plummeting 68% from 2007 until 2013. Now, the entire softcover industry worldwide is $373.1 million.
One of the bright spots of Harlequin was the early adoption of eBooks. They were one of the first companies to digitize their new titles in 2007 and their backlist in 2011. Their cade of Authors were kept happy with some of the highest royalty rates in the industry, around 30% of each book sold. They also started one of the first digital first imprints, Carina Press. This program allowed authors to forgo book advances to get a higher revenue earned on their books. The saved money helped Harlequin remain profitable and still give authors marketing attention.
HarperCollins intends on leveraging Harlequins team of translators and tap into their international distribution pipeline. 95% of all HC books are English only, which limits their market penetration. Romance readers are also voracious readers, with the average reader consuming almost 100 books a year.
It is important to note that Harlequin will be a division of HarperCollins and will be able to conduct business autonomously. Unlike the Penguin/Random House deal where the two sides actually merged together to now publish 1/4 of all books in the world.
The audiobook industry is starting to undergo dramatic shifts in their content delivery methods and major publishing companies are now investing millions of dollars into expensive productions. The entire audiobook industry is currently worth around 1.6 billion dollars and that figure should climb further. The main reason? Audio book producers have been increasing their output. 13,255 titles came out in 2012, up from 4,602 in 2009.
The main reason audiobooks are starting to appeal to more readers is because of the sheer amount of mobile devices and tablets available. It was not too long ago that you had to purchase an audio edition on CD and Cassette. You would often have to pay $60 to $100 for a fairly good audio edition and now the prices have plummeted to under $40. Currently, digital audiobooks now account for over 60% of all purchases made. “Everybody has an audio book player in their pocket at this point,” says Anthony Goff, vice president of Hachette Audio, where sales have jumped by 31% this spring over last. “It makes that much easier for the masses to try it.”
“It’s one of the few times in history that technology has reinvigorated an art form rather than crushing it,” said Max Brooks, author of the zombie novel “World War Z,” which was released in May ahead of the Brad Pitt movie in an elaborate new audio edition with 40 cast members, including Alan Alda, John Turturro, and Martin Scorsese. It sold 60,000 CDs and digital-audio copies. “Now, because there is such demand and the production value is so inexpensive, it opens the door for more creative storytelling.” he said.
The most dominant content distribution platform for audiobooks currently is Amazon owned Audible. This company has the highest market penetration and has seen a 33% increase in sales in 2012. They have created over 26,000 audiobooks and adding close to 1,000 titles a month. Most of their success derives from their new technologies that allow readers a myriad of options. If you purchase both the audiobook and eBook you can have the book professionally narrated to you, as you are reading. Else, you can read a few chapters on your Kindle and pick up exactly where you left off on the audio edition. This type of synergy is fairly compelling for people who read at night and do things during the day. Matthew Thornton of Audible commented – “We’re seeing heavy growth among younger listeners, people in and getting out of college who are part of the emerging app culture.”
The creation of audiobooks are not only reserved for major publishing companies, but many others provide some low-cost options to get going. Audible offers the most expansive creation suite of tools for authors to get massive distribution and gain solid royalties. Indie companies are also making it easy for authors to create their own audiobooks. The most notable are www.acx.com and www.voices123.com who drive down the cost of audiobook production.
Audiobooks are normally synonymous with being a mirrored replica of the print edition. This is starting to shift, as publishers are starting to experiment with audio exclusive content. The Wall Street Journal recently talked a company called AudioGo, whom has produced about 25 works exclusively for audio, including “Baseball Forever,” a remix of radio broadcasts of some of the top moments in the history of baseball. One of their most successful is a property entitled “Dreadtime Stories,” a collection of original horror stories, and a series of apocalyptic zombie stories. They have also resurrected old fashioned radio plays and hired actor Val Kilmer to play Zorro in an audio dramatization titled “The Mark of Zorro.”
Audiobook consumption is certainly increasing and many pundits are debating on how this may adversely effect the way we consume literature. Print purists doubt that listening to a book while multitasking delivers the same experience as sitting down and silently reading. Scientific studies have repeatedly shown that for competent readers, there is virtually no difference between listening to a story and reading it.
There are a few unknown factors when it comes to multitasking, while listening to an audiobook. People who commute to work make up nearly 1/2 of all audiobook listeners and studies are still ongoing on how much is retained with not having 100% focus. Daniel Willingham, a psychology professor at the University of Virginia who has studied reading and listening comprehension, said that multitasking compromises a listener’s attention, unless the task is truly automatic. Jogging on a treadmill would probably be fine, but running on a trail might be too distracting to fully absorb the text, he said.
In the end, the audiobook industry is enjoying a boom period and is consistently increasing their market share. Customers have gravitated to digital downloads, instead of tangible goods. More companies are offering professional services to assist indie authors with getting an audio edition of their book out there and Audible continues to dominate the sales channels. Stay tunes for our next feature, as we look into the best companies out there to help indie authors get an audiobook made for them.
The Sony 13.3 inch e-Reader is going to usher in a brand new era of high quality e-Paper that allows for a true PDF experience. Sony has exclusivity over this brand new technology they created and worked on, in conjunction with e INK. On the first day of SID Display Week, we were walked through some of the core features, but was that really enough? We received hundreds of emails, comments and messages asking us to look deeper into what this has to offer, we have heard your pleas, and will show you mercy. I won’t rehash the specs of the hardware, you can read all about it HERE. There are some very exciting elements to this device, that no one but us has managed to capture.
The PDF experience is the main attraction of the 13.3 inch e-Reader and gives you a true, full page experience. Obviously you can take notes and make annotations by either writing with the stylus or the full virtual keyboard. If you make a note, you can save that page as an independent file. If you have a big PDF document and make all sorts of edits, you can save it as a “Workspace” into its own PDF document. This insures you have your virgin file, with no edits and then your changed document with all of your notes.
If you have a large document with many notes, you can actually initiate a new feature that will allow you to look up all of the notes or changes you made on the document. A search feature will bring up a list on the right hand side, listing every single change you have ever made. If you tap on any of them, the page will open.
There was some confusion over the Stylus or Digitizer that came bundled with the Sony 13.3 inch e-Reader. Some people were saying the screen would not work without it and there was an air of uncertainty. I found out that you can do everything via touch. The stylus is useful for drawing notes or making changes. You can turn the pages and interact with every single menu with your hand. There is a small button on on the stylus, that acts as an eraser. Click on a body of text or notes, and you can delete it.
There is a nice fully featured internet browser, that is accessible via a WIFI connection. Browsing the internet does not cause a massive amount of page-refresh issues, that normally plague lower-end devices. This might be perfect for people who check news websites, such as Good e-Reader!
e Ink was very clear that the firmware and overall design might change on the commercial release. I noticed it did not currently have EPUB support, which means you will not be able to load in your own books. Likely, we will see Sony’s own eBook store loaded on the device, and will allow users to purchase eBooks directly from their regions store. Currently Sony has been opening a number of new online stores in Europe, UK, Australia and many other markets. It would make sense for them to incorporate this into their technologies.
Currently, the prototype is at many different events during the next few months. Sony is listening to peoples opinions and incorporating changes into the firmware and hardware. My suggestions were to hot-key the stylus eraser button to do different things. As an example, it would be nice to turn to the next page with a click. I also suggested the ability to pinch and zoom. It seems that you cant make the fonts any larger or increase your zoom levels. This would be essential, as some people prefer bigger fonts or like to focus on specific bits of information.
The New York Public Library is one of the most successful branches in the USA and it has been one of the first to adopt a cohesive digital strategy. The library system has been distributing ebooks via Overdrive since 2004 and recently started doing business with the 3M Cloud Library. During the last few months, Penguin and Simon & Shuster have both launched their first US pilot projects at the New York Public Library. How does the library secure the rights to participate in the pilot and how do the underlying semantics work?
To answer this question, we caught up with Christopher Platt, the Director of Collection & Circulation Operations at NYPL. He mentioned that publishers often choose his library because of the sheer amount of visibility and internet ebook loans they get. The library saw over 753,000 loans in one calendar year just for trade-fiction, which was a huge jump from 173,000 three years ago. Overall lending in one year toppled 28,000,000 digital books, audiobooks, movies, physical books and music files.
One of the big reasons why Penguin and Simon & Shuster do business with the New York Public Library is because of the data the library receives. Chris said, “When you don’t pay attention to public libraries, you lose a large amount of data. Publishers aren’t being exposed to that reader’s behavior. Libraries aggregate data all over the place, funding agencies, government, and annual reports. There is big value in sharing data with publisher, but remember, no private information is given out.” He went on to elaborate, “For Penguin, we give them the circulation information and then they can compare it to the sales data.”
One of the drawbacks in participating in so many pilot projects is inevitably you will have to do more business with digital content distribution systems. Overdrive has been one of the most longstanding primer partners, but the company tends to ruffle publishers’ feathers by loaning out the library ebooks to Kindle e-Readers. This has promoted the NYPL to do also do business with the 3M Cloud Library System. This means there are now two completely different content systems being used to facilitate ebooks from many different publishers.
Obviously, it can get quite confusing with two massive systems, but Chris and his team manage the situation quite well. Chris told me “We used the Penguin pilot as a new competitor to Overdrive. We are making sure that we’re not overlapping content dealing with many different companies, keeping both separate, if we have a title in Overdrive, we are not buying it from 3M.”
One of the things Chris wants to develop is a new library checkout method that won’t take library patrons away from the main library’s website. As it stands, when you do business with Overdrive, you begin at your main library’s website, and then you are redirected to the Overdrive’s checkout portal, which creates confusion in the whole process. Chris told me that he wants to eventually streamline the entire process, so it’s easier and more intuitive. Chris and his team will most likely employ the new Overdrive API system that allows technical teams to do just that.
Running the most visited cultural institution in New York can can be quite taxing on the budget. Chris would not talk specific numbers, but 7% of the total money available is used to procure ebooks. The library has also been hit hard by budget constraints due to a rough patch in the American economy. This means the overall pool of financial resources is lower now than what it was five years ago. One of the ways the NY library offsets costs is by buying the ebook but not the physical book, to prevent duplications in the system. Chris mentioned, “With the new pilots projects by Penguin, Hachette, and Simon and Shuster, it is a very heavy drain on our materials budget for next year. We want to be careful around the system, because of the prices changing with the amount of loans.”
Penguin and the New York Public Library are not only running a pilot project, in which all front and back-list titles are available, but it is also experimenting with sales. If you consider the new Dan Brown book coming out in a few weeks, there are already 500 people on the waiting list. Your average patron might have to wait months to read the digital editions. To offset this, NYPL will be introducing BUY IT NOW links that will allow customers to buy the book from their favorite ebook store and the library will see a small royalty in return. Chris made it very clear that this program “is not looking to disrupt the traditional bookstore experience. It’s about giving our patrons more freedoms.”
One thing Chris and I agreed on was that every big six publishing company had different terms on selling their ebooks to the libraries. Some had increased the digital cost by over 300%, while others have adopted a 26 limit checkout before needing to purchase the book again. Still others have different pricing structures and different terms. Chris thinks “this whole situation will iron itself out in due time, as libraries start to work with publishers more directly.”
My take is that when the Justice Department came down hard on all of the big six publishers, it has soured them on defining a comprehensive library strategy. They are all really scared to be talking to each other on the record because of the global collusion cases levied against them for establishing “Agency Pricing.” You basically have all six companies doing completely different things, with no consistency in terms and pricing. It is illegal for them to come together and try and figure this out, so it is basically up to the the big libraries and the American Library Association to liaison across the world of publishing.
The New York Public Library System has seen massive gains in its digital platforms, due to the new CEO Tony Marx who joined the system in 2011. Since then, he instilled the belief that you should devise systems and plan for five to ten years from now, but also two years from now. He has been a driving force in getting these publishers to deal with this library in these pilot projects and giving them all the big data they need to gauge if it’s a success. Obviously, this approach worked, and after a few short months Penguin got out of the trial and decided to loan out their entire catalog of books in every library in the USA.
In the end, the digital future looks bright for the New York Public Library with Chris and Tony spearheading the digital initiatives. Soon the vast majority of ebooks will be available in the USA, Canada, and other major markets. If it wasn’t for hard work and the love of reading, likely the entire industry would see a major setback and we would still be wondering why the major publishers aren’t loaning their books out. Also, a special tip of the hat to the president of the American Library Association Maureen Sullivan for her tireless efforts.
Bookselling Data has been one of the biggest buzzwords over the course of the last few years. Some of the leading digital and traditional publishing companies have been speaking about some of the measures they employ at BEA, Digital Minds, CES, and Digital Book World. In essence, book data is the sales metrics, relaying who is buying your book, how many copies are being sold, and where they are buying it from. Indie authors enjoy unfettered access to most of this information via Kindle Direct Publishing, Kobo Writing Life, and Nook Press. Traditional publishers and authors find that even finding out how many books you have sold can often be an exercise in futility.
Traditional publishing companies often do not share metrics with the author and in many cases don’t have real time information to this sort of data themselves. Due to the pipeline of distribution companies, such as Ingram and the retail stores themselves, it is hard to get a sense of how many copies were sold. We have spoken with many authors who have had bestselling books, listed in the New York Times. When asked how many copies they have sold, or how much money they have made, they shrug their shoulders. Sure, you can gain access to Nielsen sales data on stores that participate in their reporting scheme, but the access costs a ton of money. It is not even a true indication on how many books are being sold at smaller retailers and internationally.
Indie authors on the other hand have way more access to their sales information. Kobo Writing Life is the most advanced self-publishing platform that gives authors the ability to see how many copies of your book has been sold and what cities/countries are buying them. This is useful when you are on a book tour and want to find out what cities are performing and what ones aren’t buying your book online. The data on sales is compiled every 24 hours, which is solid to gain insight on your overall metrics. Amazon Kindle Direct Publishing also gives you metrics on book sales, but does not give as much information as Kobo does. Nook Press only allows American authors to market their books, so is limited in scope.
Really, Self-Publishing dashboards give you a ton of book selling information that really keeps you informed on what is going on with your book. Traditional authors do not receive this kind of information due to many extenuating factors. Agents, distribution, retail, international, and many other factors make compiling this information take quite awhile and is a far cry from the immediate satisfaction of the self-publishing crowd.
As much data that is available to digital publishers and self-published authors, it is very general. Amazon, Kobo, B&N, Apple, and Google do not share their big data with anybody. No one really knows how many page views a book entry has had, the ratio of viewers and buyers, and how many people are clicking, even how many people type your book name into the search field. The big companies hoard all of this information for themselves and use it to play a game of one-upping each other for better search and a more intuitive buying experience and newsletters based on your searching habits.
When you visit any major online bookstore your privacy is wide open for whatever company your buying from to glean everything about you via cookies. They monitor every aspect of your experience while visiting the website and you basically sign your privacy away. Publishing companies need the real-time intelligence and data that these companies squirrel away. Every major company we talked to is deadlocked on what exactly they should do to negotiate terms or even approach Apple or Amazon. These two companies represent fortunes that eclipse most countries total GDP, bargaining with them over anything is hard.
When major publishers came together to fix the prices of ebooks to develop a standard of pricing, the European Commission and Justice Department smote them for collusion. The only thing the big six can do to have more bargaining power is to merge themselves and seriously takes years for the entire process to conclude. Penguin and Random House will form a super publishing company sometime this year and will account for 1/4 of all books printed. There are rumors of the other big six companies also merging, in order to compete.
Absolute Big Data and Sales Metrics on the whole, is simply not available to anyone. No matter who you are, how big you are, or how dynamic and savvy you are, you aren’t getting the information from the major online and offline retailers. In the rare instance you get some data, it is often very general and does not paint the entire picture. In the end, self-published authors have an easier time scoping out their sales data and analytics than the traditional ones.
Stay tuned for the next part of our feature that looks at some new digital start-ups that are seeking to bridge the gulf of big data and provide the metrics to publishers and authors alike for online and offline sales.
The Future of Digital Publishing question has been one of the most popular discussions at major conferences in the last few years. Publishers and ebook stores cannot come to a definitive conclusion on a singular delivery method that would appeal to everyone.
Over the course of the last few weeks we have spoke with major publishers, ebook companies, app developers, and thought-leaders to chronicle the future of publishing. This article is the last one in a three part series, you can check out Part 1 and Part 2.
You don’t have to follow the publishing industry closely to know that books these days tend to be packaged in dedicated apps or have interactive elements. Readers now have more choice than ever before when it comes to the process of reading ebooks. You can read them directly on the web with a new generation of Cloud Readers, such as the ones offered by Amazon, Kobo, and Overdrive. You can also download enhanced ebooks in the form of apps from Apple, Google Play, Sony, Kobo, and Barnes and Noble. These enhanced editions provide a myriad of interactive features, such as audio, video, maps, narration, and gaming elements. Finally, many e-reading companies deliver ebooks the way people have always purchased them, but the rise of tablet use has all the standard multimedia elements delivered right in the book itself.
Whether you are reading books on the web or reading enhanced ebooks on a tablet, smartphone, or computer, you are often reading them in a HTML5 or EPUB 3. Many people think these are singular entities with nothing in common. This couldn’t be further from the truth, as EPUB3′s backbone is actually powered by HTML5.
EPUB 3, which is the latest revision of the industry-standard XML ebook format, is firmly embracing HTML5 and CSS3. It retains its focus on XML-driven toolkits by requiring XHTML serialization and adding supplementary XML vocabularies, such as MathML and SVG. MathML is fairly interesting because it actually allows complex mathematical formulas to be displayed in a book, which is very useful for e-textbooks. EPUB 3 offers a variety of options for developing advanced, digital-native publications. The main positives about the blending of the two formats in a singular ebook format is the ability for publishers to display video, audio, interactivity, global language support, multi-column layout, embedded fonts, and the backwards compatibility with EPUB 2.
So you can say that HTML5 and EPUB 3 have a ton of synergy with each other. Right now, major e-reading companies like Kobo, Apple, and Sony have all introduced updates to their Android or iOS reading apps to display EPUB 3 books. The main factor is that most publishers seem to be bundling their content in dedicated apps or delivering it via HTML5 and still relying on the EPUB2 format. Amazon is doing its own thing with Kindle Format 8, which is basically just EPUB3 re-packaged to suit its line of Kindle Fire e-Readers.
What are your views on maintaining dedicated Reading Apps for iOS and Android as a method to view ebooks?
Marilyn Siderwicz, the Marketing and Communications Manager of W3C, whose company The World Wide Web Consortium (W3C) is the main international standards organization for the World Wide Web. She told me that “Digital publishing already is web-based. If you think about today’s ebooks, they’re really ‘frozen’ web sites packaged in a container. Readers today, however, are demanding more flexibility in how they access and use content. They want rich media and the ability to interact with more and different kinds of content. They want to choose how, when, and where to access stories or information. And they want to use media to engage others much like they share physical books with others to expand a conversation.
HTML5 is part of a larger set of technologies—which we call the Open Web Platform—that helps publishers do all these things while reducing the costs and complexities of cross-platform development. Many people don’t realize that EPUB3 is heavily HTML5-based. So what we’re seeing is a continued evolution of the user’s online experience both within and outside of the browser. W3C invites everyone in the digital publishing community to join the conversation as the industry continues to evolve Web technologies. Change will surely accelerate.”
Tom Waters, the CEO of Autography, runs a company that allows authors to autograph ebooks. He has his hands in many different cookie jars, delivering content to a myriad of platforms. He mentioned that “The basic hardware will mainly see changes in performance/size/resolution, but I think we’ll see a wider variety of applications that will be customized for very specific groups of readers. Not just in the accepted genres like romance or thrillers, but also very specific slice of demographics based on location, age group, and cross interests (18-22 year old women, residing on the West Coast, who like romances AND thrillers, etc). Book clubs could customize apps, event managers could customize apps, it goes on and on. They’ve got to embrace cross-functionality, easy upgrades, clean interfaces, and ease of library movement if they want to be successful long term.”
ThisNext originally rolled out Glossi in December, which is a platform that allows people to DIY publish digital magazines. There is no shortage of online ebook creation programs, but magazines really haven’t been done before. We spoke with Glossi CEO Matt Edelman, who knows what he is talking about. Before taking over the reigns of Glossi, he was in charge of Marvel’s Entertainment division. He weighed in on the question and answered “Apps are popular because they provide enhanced value. That isn’t going to change. Even though HTML5 remains a viable alternative, native apps will continue to raise the bar because app-based operating systems will continue to advance. It’s hard to envision a future in which HTML5 closes the gap entirely. That said, a publisher cannot rely upon one or the other to reach their target readers or maximize the size of their audience. Content wants to be wherever it can be consumed. That philosophy has guided the development of Glossi. We believe in hyper-distribution and are designing our platform to enable creators to publish content within whichever user experiences their audience prefers.”
David Burleigh is the chief marketing officer at Overdrive, whose company has recently revised its entire online experience to center on HTML5. This allows ebooks to be read on the web, tablet, fridge, or car screen. He simply said “We see a continuation of development for both apps and other methods, such as HTML5. We believe there’s more dynamic growth in HTML5-based ebooks.”
Finally Jim Ambach, Senior VP of Product Management at e-textbook company Coursesmart said, “At least for the next couple of years, we feel it will remain necessary to provide dedicated apps on iOS and Android mobile devices in order to offer the best possible reading experience both online and offline. Although mobile browsing is becoming more and more important (in some months, CourseSmart sees just as many user sessions from mobile browsers as it does from its native apps) due to the limitations of the browsers on mobile devices, there are things you can’t do without a dedicated app. For example, offline caching and significant data storage. Right now, we think that the optimal solution is to provide both native apps as well as a mobile-optimized browser experience, so we are currently providing both.”
There is a lot of talk about HTML5, EPUB3 and KF8 as future formats that allow for multimedia based books, what are the potential barriers stopping wider adoption and how could publishers adjust to the new formats and get them in something other than EPUB2?
Marilyn from W3C said, “W3C members are discussing a variety of new technology standard enhancements, including those for web typography, layout, metadata, video, and audio. But technology is only one piece of the puzzle. Industry business models will need to reassessed, too, including review of existing and new value chains, competitors, and monetization opportunities. An additional W3C member benefit is learning how other industry players are preparing for change—technologically, but also in the broader business sense.” She continued, “Many publishers are switching to ‘XML First’ content workflows to capture fluid, reusable high-quality content directly from authors. This change reflects a new way of thinking about primary assets, rather than just a technical switch. These publishers ultimately will have a competitive advantage by generating Web technology alongside, or in place of, print products.”
Jim Ambach of CourseSmart weighed in on the prospective barriers on adopting EPUB 3. “Barriers to widespread adoption of these formats include issues such as support for readers with disabilities; for example, the more types of media that are included, the more steps necessary to make sure the content is universally accessible. Also, proprietary standards for particular platforms such as Kindle or iBooks, might hinder widespread adoption as content producers debate about what formats they want to produce to. Lack of tools and design know-how are also considerations, although they seem to be less of an issue now that more and more authoring environments are being created.” She continued “As large publishers work these new standards and capabilities into their existing workflows, they can buy time today by working with third-party experts to convert existing titles and add interactive components to published work. Smaller publishers can take advantage of newer authoring environments and start generating new content right away. The trick will be learning what kind of media and interactivity can contribute to a more engaging reading experience. One of the things that we are starting to do at CourseSmart is provide publishers with analytics that describe how and what content is being used to help them determine what is effective and what isn’t.”
Tom Waters commented, “I think education is the biggest hurdle – people don’t know these formats, don’t know the pros and cons of them, and don’t like having to ask someone for help. They are already behind, and as a result, the changing technology is moving ahead of them even faster because they’re not learning and adapting quickly enough to keep up. It’s something publishers are accused of quite often, but I think as readers we are just as guilty.” What can publishers to to overcome these new technical challenges? “The toolsets for creating and maintaining content are usually the challenge. Currently, creating a feature-rich ebook for multiple platforms means you’ve got to maintain one toolset and document version for KF8, another for EPUB3, another for Apple’s iBook ePub format, and yet another for HTML5. Maintaining the toolsets and personnel qualified to use them is a burden.”
Matt Edelman from Glossi elaborated “The barriers will be based on what enables publishers to best distribute and monetize their publications. Amazon’s dedication to its own format, KF8, makes KF8 a requirement for book publishers. KF8 will only go away if Amazon moves to another format. At the same time, no one else is rushing to adopt KF8; they see Amazon as dominant enough already. HTML5 and EPUB3 have advantages for multi-media publishing and distribution, although they are not exactly analogous. You can have an HTML5 experience within an EPUB3 ‘container.’ HTML5 cannot offer everything in terms of ebook creation that EPUB3 offers… yet. However, EPUB3 faces two key barriers: lack of backwards compatibility with all EPUB2 readers and less support across platforms and devices. Any restriction on distribution threatens wider adoption.”
What do you think the industry needs to do to decide on a future unified platform, such as EPUB3, Apps, or HTML5?
Marilyn from W3C said “The question implies that EPUB3, apps, and HTML5 are in direct competition. Instead, it’s more helpful to recognize that the technologies already have a lot in common. EPUB3 is really a packaged HML5 Web site. And app development will be very similar whether someone is using the app inside or outside the browser. The approach is the same; differentiation is really a matter of the user interface design and overall experience. Digital publishing companies increasingly are getting involved with building Web standards, but more involvement is needed. Organizations like IPDF and W3C are reaching out. We welcome everyone in the industry to participate.”
Tom Waters was fairly negative about any consensus happening with wider adoption of a single ebook format. “I don’t expect to see a unified platform. We don’t see it elsewhere and I wouldn’t expect ebooks to be any different. There are multiple sizes, shapes, fonts, and layouts of physical books. There are DVD’s, Blue Rays, and various streaming video formats for movies. We don’t want or need just ONE format for content delivery because our needs are different at different times. Flexibility is key. The content and the container, regardless of how much we might complain about it, are inextricably linked.”
Jim Ambach from CourseSmart mentioned, “I think the industry needs to watch and understand how the majority of users will want to access that content, and then find the easiest most effective way to reach them. At CourseSmart, we strongly believe that the fewer impediments between a user and the content they need, the more willing they will be to use the services you provide. We are committed to working with publishers to provide access to their content using the most straightforward means possible. Whatever technology lends itself to that cause is likely to become that unified platform.”
Eric Hellman the President of Gluejar, maker of Unglueit contributed “There’s a vital, need to have a standard for distributing self-contained book-like websites. EPUB3 goes a good way toward towards that. Let me rephrase that. I think that our civilization will descend into darkness without a standardized distribution format for book-like things. I don’t want our civilization to descend into darkness. Apps, KF8, MOBI, EPUB3 are all attempts to make something like that. The process behind EPUB has the best chance, I think to get there. Maybe it will be EPUB5 before it reaches some level of maturity.
I fear that the “Book in Browser” approach (Kindle CloUd, Safari Online, etc Zola, too) will hook publishers on the narcotics of intrusive data collection and revision. No doubt it’s the best format for a cookbook or a travel guide. But it can’t work for a dangerous book, and the great books are dangerous. Ironically, the BiB approach is the best near-term solution for implementation skew, which is today’s biggest headache for EPUB publishing. So I see that as a key step along the way. I talk to a lot of librarians, and their deepest concern is for the future. What will happen to ebooks when the platforms go away? Companies will fail, governments will fall, and censorship is an ever-present and growing danger. Too much of the publishing world is focused on next year’s bottom line, to the detriment of the entire ecosystem.”
Finally, Matt from Glossi summed it up by saying, “I don’t think there is anything driving the various members of the digital publishing ecosystem to proactively choose a unified platform. Not even consumers would benefit from that. Just as some people prefer hard cover books over ANY digital alternative, so too will segments of consumers continue to gravitate towards publications that offer unique value specifically because of the platform on which they are published. And as long as there is a market for more than one alternative, there will be suppliers for that market.
What does seem clear though is that the web itself is becoming the publishing platform of choice as it matures. That suggests HTML5 may become the most dominant platform, largely because it would be the most economical one.”
The future of digital publishing in the years to come is filled with uncertainty. The entire industry has failed to unilaterally embrace a standard format and we are currently seeing fragmentation. HTML5, EPUB3, and dedicated apps are currently the preferred platforms to include a myriad of multimedia aspects such as audio, video, and interactive content.
Interactive features and cross-platform accessibility are two of the most important factors in the future of publishing. Users want to be able to view their books without having to use Adobe Digital Editions to manually transfer them over to their e-readers, tablets, or smartphones. Some companies like TOR, Pottermore, and LULU are making the conventional EPUB2 format more accessible by offering their ebooks without digital encryption, making them easy to transfer. Unfortunately, this is the exception and not the normal way companies tend to distribute their content.
Many people may ask the question, why should ebooks be interactive at all? The standard novel may not benefit from this directly, but kids books, cookbooks, and magazines do. Rolling Stone Magazine recently introduced a new App for iOS that allows you to listen to music and then make purchases for the artists’ albums and individual tracks via iTunes. Kids books often have the ability to play animations and have an author read the book to you. Barnes and Noble has an interesting feature in its line of Nook tablets that allow parents or grandparents to record themselves reading the book, instead of relying on the stock voice actor. Cookbooks will show you the entire process of cooking a recipe, which helps you gauge how it should look and offers guidance along the way.
During the coming weeks, we are speaking to the publishing industry’s leading innovators to weigh in on the future of digital in relation to ebooks. What will be the definitive standard in 2014 and the coming years: EPUB3, HTML5, or dedicated reading apps? Today we talk to Babur Habib – CTO of KNO, Michel Kripalani – President of Oceanhouse Media, Kathy Masnik – Director of Project Management at Ebrary, Allen Lau – CEO of Wattpad, Sol Rosenberg – VP Business Development at Copia, Rita Towes of Read an eBook Week, Evan Ratliff – CEO of Atavist and Chris Anderton – CTO of Bilbary. You can read our first installment of the series HERE.
HTML5 is the emerging internet standard that is slowly seeing wider adoption within the publishing industry. It has a number of enticing multimedia factors that allow for embedding music and video without needing third party plugins like Silverlight or Adobe Flash.
The most exciting aspect of HTML5 is that it is compatible with most internet browsers found on tablets, smartphones, and computers. It does not require an app and you can read a book anywhere at anytime. HTML5 has solutions for offline reading, so you don’t need to be constantly connected to the internet.
Amazon and Kobo both run dedicated Cloud Reading Apps that allow you to buy and read books. They have very advanced features that you would find on the Amazon Kindle Fire or Kobo Arc, in terms of the overall reading experience. You can make the fonts larger, change the margins, access the table of contents, or look at word up in the dictionary. Overdrive recently introduced its own HTML5 enhancements to its website and we saw books being read on fridges, cars, and even the Nintendo Wii U. You could say some major companies are investing in HTML5 as a content delivery platform for EPUB2 and EPUB3 ebooks.
Q: HTML5 tends to be more flexible in being accessible in most internet browsers. Do you think this will be a format that is going to be more widely adopted in the future?
Allen Lau the CEO of Wattpad weighed in on the issue and said “At Wattpad we use HTML5 as our default container because the value isn’t in developing a ‘book specific’ content format, but rather in ensuring that readers and writers can always access their books and get the full experience of our product. HTML5 is the most ubiquitous platform available right now. Technology platforms trend towards open, commodity-like solutions, with the value being delivered and created at the interaction or user interface layer. You’ve seen it in operating systems and hardware, as well as in things like audio and video formats on the web. Apple, SONY and Microsoft each developed their own proprietary standards for distributing content, and eventually everyone’s moved to a shared set of standards for the majority of content.
The customer doesn’t care about the format that’s used to transmit or store the content, they want to be able to choose the type of reading experience they want, and have their content “just work” on any device. HTML5, and all web technologies in general, are a fundamental part of the Wattpad experience – for discovering, reading, and most importantly sharing content.”
Kathy Masnik, ebrary director of product management told us, “We are already seeing a shift in the market toward using HTML5 to implement sophisticated ebook products. That said, the HTML5 technology is still not robust enough to support some of the functionality we need to support in our ebook product, such as downloading a protected copy of the ebook for offline use. The HTML5 offline cache functionality may not yet be robust enough to support this use case. The app based technology can still provide more consistent functional support than HTML5 based technology for our needs.”
CTO of KNO Babur Habib replied, “HTML5 holds a lot of promise for the future of building ebooks. However, it is still not there in terms of performance for mobile platforms. Native development is superior especially for sophisticated applications like learning platforms, and e-textbooks. Mobile platforms need to put in a lot more effort into enhancing browser technology so that apps can be built with web technologies.”
Chris Anderton CTO of Bilbary told us that “HTML5 will be more widely adopted – i expect we will see an increasing number of ebook related projects using this set of web technologies. We have already created a HTML5 based EPUB reader, and there are other projects such as Readium that are building tools in this space. It is also worth pointing out that, as usual, the flexibility of HTML5 comes at a cost – not all devices have an identical implementation, and performance will vary.”
Finally Michel Kripalani the President of OceanHouse Media explained “All of these formats are still lacking relative to the features that we can put into digital books delivered as apps. For example, we have a ‘record and share’ feature which is very deep, very intricate and very powerful for children, educators, families in the military, etc. The user can record their voice while reading a digital book and then share the custom audio file via email with anyone, anywhere in the world. With a single tap, the person receiving the file has the ability to seamlessly integrate the recorded audio file back into their personal version of the app. These types of robust features will most likely never be available with HTML5 or EPUB3. The bottom line is that we prefer to push the boundaries of dedicated apps and believe they provide the best user experience and customer value.”
Piracy Concerns with HTML5
Many companies are turning to HTML5 as a way to deliver content, the one problem is offline storage and localized content. The BBC, Microsoft, and Google have all petitioned the WTC to implement DRM to protect content. The BBC may not have the rights for a worldwide audience and currently that is what is happening.
Q: What are the piracy concerns you have with HTML5 as a way to deliver ebooks?
Rita Toews, the organizer of Read an eBook week, disagreed and said piracy isn’t even a problem. “I know that sounds a bit flippant, however books are meant to be loaned, traded and shared. Used book stores have been in existence for years. It wasn’t until ebooks came along and the major publishers saw them as a threat that a lot of effort was put into DRM, etc. Books aren’t music or videos.”
Chris Anderton the Chief Architect and CTO of Bilbary mentioned “I don’t have any piracy concerns due to HTML5 per se. The main point is that content platforms think smart about how to protect content within a HTML5 based service. It takes just a few minutes on Google to see how to easily remove the DRM from a ‘protected’ file – i think with a HTML5 (or native app) based solution it is actually easier to protect the content. While this protection may be through obfuscation or fragmentation rather then sophisticated encryption, the net result will make it harder for people to copy a whole book in one go. The other advantage is that unlike traditional DRM, with the HTML5 (or native app) approach then content providers can be much more agile about reacting to threats or breaches – we don’t need to wait for a large corporation to put a fix on their roadmap – we can master our own destiny and dance directly with any would-be pirates ourselves!”
Babur of KNO said, “One of the biggest issues with HTML5 is the lack of content protection. Publisher content is not like news or weather. It is reused multiple times and for long durations. That’s why any platform that delivers the actual content in HTML5 should be carefully evaluated. You may be able to obfuscate parameters like copy/paste limits etc., but only superficially. Browser technologies have to take this into account if ebooks are going to be widely adopted in HTML5″
Kathy from ebrary explained his company’s position, “DRM is a high priority for our market. We can provide sufficient protection for online reading of PDF-based ebooks using HTML5. The protection is not sufficient once we enable the ability to download that ebook to their HTML5 cache for offline use. Additionally, we have not found that HTML5 includes sufficient protection methods for EPUB format ebooks.”
Allen from Wattpad mentioned, “We don’t see HTML5 as being inherently better or worse for piracy issues. Any Digital Rights Management technology applied to content hasn’t been able to last long when put up against the Internet. What has worked is providing better ways for users to obtain content legitimately, and to be able to move that content between devices and avoid vendor lock in.”
Evan Ratliff CEO of Atavist said, “Personally, for our own publishing, I’m not particularly concerned about it. Some of our software users are, so we’re looking into various ways to secure their content. But unless you are a huge publisher pushing hundreds of thousands of copies of big name authors, I feel like your thinking should be: If we’re getting enough attention around our content for people to try and pirate it, we’re doing pretty well. Pirates are gonna pirate, it’s a losing game to spend a lot of time worrying about that instead of making great stuff.”
Jeanny Mullen from Zinio said, “Without any DRM support, HTML5 will continue to foster a good bit of piracy related activities. It will be interesting to watch how this topic is managed as companies like BBC attempt to find ways to have their cake and eat it too with DRM supported HTML5.
Amy Ross of Vitrium finally explained, “There are no perfect systems to prevent piracy, because the stronger the protection, the harder the product is to use. The challenge is to find the sweet spot where piracy prevention makes circumventing security a challenge, without interfering too much with the user experience. Today, piracy prevention systems built on HTML5 can get closer to this sweet spot than alternative solutions.”
The Barriers of EPUB3
EPUB3 is an emerging native ebook format that allows for tremendous flexibility. It can be integrated into e-readers, HTML5 Reading Platforms, and dedicated apps on Android and iOS.
Currently, Apple iBooks does the best job with EPUB3 creation with the iBooks author program. It allows for super flexible books to give you tons of media enhancements with Google Earth, Video, Audio, and links to external websites. All of this is accessed via the iBooks app, but is only limited to Apple products and not available via Blackberry, Android, or PC’s.
There is a ton of synergy between HTML5, CSS, and EPUB3. HTML5 has been adopted as the XHTML format to render text and MathML can render complex math and symbols. You could say that EPUB3 is an amalgamation of the best aspects of interactive web content and the traditional form of publishing.
There are tons of barriers facing the wider adoption of EPUB3 right now. Major publishers have not committed to producing content in this fashion. Hachette has been the only large publisher to really say it will begin a massive effort to produce a number of big name titles in 2013. Major ebook reading apps all have the ability to display EPUB3, but what good is it if publishers aren’t adopting it to release new material?
Q: There is a lot of talk about HTML5, EPUB3 and KF8 as future formats that allow for multimedia based books, what are the potential barriers stopping wider adoption?
Kath from ebrary said, “We believe that providing ebooks in EPUB3 to the research market is the direction of the future. That said, the DRM issues are a significant barrier that is stopping aggressive adoption of this standard in ebrary’s market. Our publisher providers require us to adhere to strict access limits that we are still working on supporting with the EPUB3 format. Many of our publishers are already providing EPUB2 content that we are able to ingest into our own systems. The barrier for us is primarily in displaying ebook content in a protected fashion.”
Babur from Kno mentioned, “We believe that EPUB3 is the way to go. It is an open format, which supports fixed layout as well as multimedia. This means that textbooks with sophisticated layouts can be published in EPUB3.” But what about the barriers between Kindle Format 8, or EPUB3? He provided a clarification. “EPUB3 and KF8 are formats/specifications for ebooks while HTML5 is a technology that can be used to build books in EPUB3/KF8 format. KF8 is a proprietary format, which is not a good way forward for wider adoption. An open format, such as EPUB3, holds the most promise.”
Michel from OceanHouse Media told us, “All of these formats are still lacking relative to the features that we can put into digital books delivered as apps. For example, we have a ‘record and share’ feature which is very deep, very intricate, and very powerful for children, educators, families in the military, etc. The user can record their voice while reading a digital book and then share the custom audio file via email with anyone, anywhere in the world. With a single tap, the person receiving the file has the ability to seamlessly integrate the recorded audio file back into their personal version of the app. These types of robust features will most likely never be available with HTML5 or EPUB3. The bottom line is that we prefer to push the boundaries of dedicated apps and believe they provide the best user experience and customer value.”
Allen from Wattpad had some great points. “The barriers to adoption are that, for the most part, readers don’t seem to want deep multimedia integration in their reading activity. You can see this in the market failure of interactive books, which haven’t really expanded beyond the children’s book genre. There needs to be a behavioral shift in how readers think of the very act of reading for the desire to be there. In many cases this is EPUB and MOBI/KF catching up to where HTML5 already is. The EPUB and MOBI formats were built primarily for text and print, and for devices that weren’t capable of being graphically intensive. As technology moves forward, and e-ink devices decline in popularity (being replaced either by LCD screens or e-ink/LCD hybrids) those formats needed to catch up to the times. Device fragmentation (different screen sizes, capabilities) is another issue here. The cost of production is high as custom development and testing is required across different platforms.”
Chris from Bilbary explained “KF8 is a curious format – the last time i checked it wasn’t compatible with all of Amazon’s own devices (even for just text) – but i’d need to double check that to know if it is still true. In edition, some say it is like EPUB3, others say it is EPUB3 with some additions and changes, packaged and combined with Amazon proprietary DRM. KF8, i think, will stay confined to Kindle devices – i don’t know of any advantages that it offers over EPUB3. I expect there will be some traditionalists that find it hard to move off PDF – this has always been important for those wanting complete control over layout – i am not sure how quick they will be to embrace the fixed layout elements of EPUB3. I also believe there will be a gradual transition overall to EPUB3 – though not all books will make full use of the feature set offered. This migration will probably be partially defined by the makers of publishing tools – the more they support the format, the more people will start producing content in it. Using HTML5 alone makes less sense – EPUB3 provides a framework and encapsulation for the creating of ebooks – so i would rather see consolidation around it rather than many disparate approaches.”
Sol Rosenberg the VP of Copia summed up, “The barriers are coming down quickly. First barriers were tools. Second barriers are the widespread adoption of epub 3 reader/viewer apps. All that will be history by the end of this year.”
Dedicated e-Reading Apps
Tablet computers are being forecast to overtake sales of PC’s by the 4th quarter of 2013. It is being estimated that over 145 million units will be shipped, which adds to the hundreds of millions currently in circulation. Many companies have devoted a significant amount of resources to developing a fleet of reading and ebook apps that will give users unique experiences.
Digital magazines, newspapers, and cookbooks often are responsible for many of the apps found on iBooks, Amazon, and Barnes and Noble’s ecosystem. If you have an iPad and download Rolling Stone, it acts as a dedicated app. Same if you download USA Today from Amazon, it is in essence an app.
Being able to bundle your content in the form of an app is very beneficial because you can customize the look and feel. You can include muiltimedia and customizable features. If you are a company producing lots of books, you can basically just mirror the same template and just interject new content.
One of the main problems is the fragmentation of the app experience. The New York Times looks very different than the Wall Street Journal, there is no consistency.
Many other companies make reading apps and sell books directly within them. You also have companies like Wattpad, Moon+, Aldiko, and others that hinge their bets on creating an expansive reading solution and allow people to import their own books onto their devices.
Q. What are your views on maintaining dedicated apps for iOS and Android as a method to view ebooks?
Babur from Kno explained, “We believe it is necessary to build native apps for each platform for the optimal consumer experience. Each platform has specific navigation and user experience paradigms that need to be followed. At Kno, we aim to make sure the technology seamlessly integrates with the user’s experience and the student is more engaged in the content rather than navigating the technology.”
Allen from Wattpad talked about his company’s position, “A big part of our mission at Wattpad is to build a ubiquitous reading experience. 80% of the time spent on Wattpad is already happening through our iOS and Android apps on both phones and tablets. So for us, developing for the iOS and Android is our main priority. It works with our vision for delivering a new reading experience that eliminates the distance between readers and writers.
We’re not trying to replicate the experience of print, we’re pretty different from most companies in the publishing ecosystem who are experimenting with things like dedicated book apps. At Wattpad we have a very different view of content, which is that the container format isn’t as important as the ability to share and connect with audiences through a new form of mobile-first reading entertainment.”
Kathy from ebrary mentioned, “Ebrary plans to continue maintaining dedicated apps for iOS and Android in the near future. In addition, we will be focused on implementing a web-based mobile-friendly design for our ebook, search, and bookshelf experience. Based on our current usage statistics, we find that most of our mobile users are using apps to access our ebook content rather than the mobile browser. Based on these statistics, we would like to provide all avenues for a customer to be able to easily discover and use ebook content, including both apps and web-based mobile experiences. As the market trends shift, we will also shift to meet the needs of our customers.
Additionally, the library and academic markets have uniquely stringent DRM requirements for some of our ebook publications. By using mobile apps, we are able to implement stricter protections on the ebook content (device based authentication) than we can implement using a browser based experience. This means we are able to provide less restricted access through the apps than the mobile browsers at this time.”
Chris from Bilbary elaborated “I expect there will be a place for dedicated apps for the foreseeable future – most publishers still require ‘traditional’ ebook DRM – namely that provided by Adobe Content Server – so the only way to display this content is with a native app developed using the Adobe RMSDK. This is not an ideal scenario and something that we hope we will see change – especially as there are question marks around support for EPUB3. DRM is not the only consideration – there are a number of other benefits to native apps that are currently well suited to ebook readers. For example, access to device specific features such as notifications or local storage to allow viewing content and reading whilst not connected to the internet. In some ways on the app stores are also an advantage – it provides an additional channel for discoverability.
Michel from Ocean House Media finalized, “From our perspective, we believe that the highest quality, most interactive children’s books can be built only as apps. So, we’re 100% committed to building apps for iOS and Android using our dedicated omBook (Oceanhouse Media digital book) technology foundation.”
Q: Do you see the infrastructure and internal resources spent on developing a fleet of apps as worth it?
Allen from Wattpad said, “Smartphone adoption across the globe is skyrocketing. Many people are being exposed to Wattpad first, and in many cases only, through our mobile experience. I can only speak for Wattpad, but for us it is absolutely worth it for us to invest in developing the mobile (app and web) experience.”
Kathy from ebrary told us, “Yes, the current level of investment is appropriate. Our customers have long requested mobile applications to read our ebook content. Our goal is to satisfy the customer needs and provide content access where our end users are most comfortable. Additionally, the level of investment required to support app development is not very high. It is appropriate given the rise in customer satisfaction levels that an app brings.”
Babur from KNO verified, “We do. Having said that, we have optimized the stack is such a way that we can leverage a significant portion of the stack across the apps. This includes both C/C++ libraries as well as features built with web technologies such as HTLM5.”
Michel from Ocean House has a ton invested in dedicated apps, “We do see the value of committing the internal resources required for developing children’s digital book apps. This is especially true now that we have over 120 apps available on a common framework.”
Chris from Bilbary finalized “While they should not be the only way of allowing users to interact with our service or to read our books, we will continue to invest time in ensuring our customers have the right tools to access our content. While our long term hope would be to have one ‘mobile app’ across all platforms, in the medium term i expect we will still have to maintain a number of different codebases – even if elements of them converge to create ‘hybrid’ apps – namely native apps containing HTML5 functionality, alongside a pure HTML5 access mechanism. There are a number of features that, at the moment, would be hard to provide in the pure HTML5 solution.
Q: What is the Future of Digital Publishing?
Michel from Ocean House mentioned, “We have been publishing digital children’s books as apps for the last three and a half years. We have seen fast, widespread growth and we expect the trend to continue as tablets and smartphones become more ubiquitous not only in the U.S. but also around the world.”
“This is an exciting time for digital publishing. A book is no longer a static piece that gets updated every 3 to 5 years. It is now a dynamic, living/breathing repository of information. When the first black president of United States takes the oath of office, publishers can update the book in real time and not have to wait for years to do so. At Kno, we have built tools for publishers to do just that!” said Babur.
Rita from Read an eBook Week informed us, “The future of digital publishing is ‘onward and upward.’ Nothing will stop it from growing exponentially. Even traditionally published authors want to be digitally published, something Warren Adler saw years ago when he acquired his complete list of books and short stories and published them in digital form. His contention is that he books will never go out of print. Publishing digitally has become much easier with the proliferation of programs designed to simplify the process. Diaries, family histories, how-to books, children’s books created by grandparents to gift to their grandchildren – these are all possible now with digital publishing. The public is taking advantage of the new media and they are loving the result.
Interactive e-books are not far in the future. It’s easy to imagine the old classics redone with interactive features. There are millions of traditional books that will have a new life once digitalized. Never again will a book be lost to readers because it is out of print.”
Allen from Wattpad was riveting with his comments “We’re always looking at ways to eliminate the distance that has traditionally separated readers and writers. Wattpad fundamentally changes the way people share and interact through stories. We see a future where readers are discovering, recommending and sharing stories as easily as they would a song or video. On Wattpad, content will be streamed to readers like episodes based on past likes and who they follow. This means readers are interacting with writers and other fans from all over the world as the consume the media together. So, the emotional, social hook that’s unique to our platform is getting to know the person who creates your favourite story.
We look forward to the millions of new connections that will be fostered on Wattpad along with the billions of new stories that will be written and shared by people all over the world in the coming years.”
Kathy from ebrary talked about what her company is doing with the future of publishing. “At this point in time, ebrary is in investigation for how to support both ingestion of EPUB3 content and display of this format. Our research is focused on how we can develop DRM protections that work with EPUB3. We hope to be able to support this format in the next 2 years. Additionally, Ebrary is just starting redesign of our Patron and Librarian products to a next generation product that incorporates EBL. We are still choosing our implementation technologies and we are strongly considering using HTML5 for our interface implementation.”
We hope you all enjoyed our second installment on the future of digital publishing and the potential barriers preventing more wide screen adoption. It is one thing to hear a singular mortal go on a rant about what the future may hold, but its another thing to hear about it directly from the movers and shakers of the publishing world, all with a vested interest in its continued success. I want to thank everyone who talked with me over the last few weeks contributing to this story, you are truly all stalwart heroes. Our final installment should be up late next week!
Digital Publishing is one of the fastest growing segments and most major publishers are now seeing 21% of their total revenues stem from it. Publishers cannot decide on what the future of publishing will entail. There are three main aspects that the vast majority of companies employing for their strategy. We are seeing strong growth with dedicated e-reading apps, HTML5, and ePub3/ePub2 as the main factors for content delivery. In the next three weeks, we will be talking to some of the leading digital publishers that are currently living in this space. They will be talking about the future and current state of digital publishing and how the industry will look in 2013-2014.
Dedicated e-Reading Apps
Android and iOS are two of the most dominant operating systems in the world. Apple, Amazon, and Samsung are currently the most popular brands in the tablet space. Together they reap the largest market share with 85% of all tablet users loyal to one of these devices. Most digital publishers maintain their own reading apps on both of these platforms and also develop on other niche operating systems, such as Blackberry and Windows 8. Maintaining updates, paying development fees, and issuing new features often has prohibitive costs for smaller publishers and ebook companies. It is often very hard to compete with the army of developers that Amazon, Kobo, and Barnes and Noble employ.
Dedicated e-reading apps come in two main forms. The all in one solution that allows you to buy and read ebooks or the standalone book, wrapped up in an app. In the last three years we have seen a rise in dedicated apps that give you a singular ebook experience. Instead of buying an ebook from a bookstore like Amazon, or Kobo, you are buying a book that is in a standalone app.
So the big question is, what is the future of digital publishing when it comes to standalone reading apps, or apps that have a singular book title? We talked to a few companies that outlined their thoughts and explained their digital strategy.
Brian Felsen the President of Bookbaby said “Currently, I’m more supportive of the idea of authors using the apps native to the most popular tablets as a way to consume books. App development can allow for beautiful functionality, but there’s often a high cost, slow time to market, and problems with discovery. (There are almost a million apps in the iTunes app store, and, unlike at store’s launch, it is much harder to discover new authors on there given the competition and audience expectations.”
Sol RosenBerg the VP of Business Development at Copia sounded off pessimistically “And your alternatives are? Since you still want to maintain off-line reading/viewing capabilities and DRM, you’re going to need something. The only other viable option is an HTML5 framework, which is a fancy way of saying ‘app running in a browser.’”
Evan Ratliff, the CEO of Atavist mentioned “It all depends on the publisher. eBooks have improved over the last couple of years. But there is still much you can do in an app (or on the Web) that you can’t do in an ebook, in terms of interactive components, video, tightly integrated multimedia. So it comes down to what kind of books you are producing, how elaborately designed they are, how you want to treat multimedia. Certainly I would say that apps are not generally the way to go unless you are publishing something fairly interactive. The other strength of apps, which some of our users have taken advantage of, is that you can utilize different payment and membership models: subscriptions, bundles, all sorts of things you can’t do well in ebookstores. As a publisher ourselves, we get a lot of value out of our flagship app on iOS, and the ability to sell renewable subscriptions in it.”
Fabrice Neuman is CTO of French Digital Publisher Le French Book explained “It all depends on the type of ebook. I don’t see any advantage in maintaining an app for a regular trade fiction book like a mystery or a thriller, or any book, for that matter, that is essentially just words. These books don’t need any bells or whistles, even if they include a few pictures. In this case, going the ebook way ensures the leanest production costs and the fastest time to market. And also the biggest potential market since anyone will be able to read the ebook, whatever device and platform they use. Creating an app, by its very nature, reduces potential audience. On the other hand, as soon as you need to include multimedia elements, for cookbooks or kids books for example, the need for an app becomes more apparent. Even in the latest versions, both ePub 3 of KF8 are not well suited to create heavily laid-out books, where you’ll want texts and graphics to intertwine and interact. And the cost of production of the actual app will not impact the overall costs anyway: video and graphics will take care of that. Apple is trying to join bridges with its iBooks Creator platform that lets you create multimedia books sold on the iBooks Store. But, if you look at it fairly, what it really does is help you create an app wrapped within a ebook “cover”. These ebooks will only be readable on the iPad, giving you no advantage as far as audience is concerned, and they are even less convenient to use than an app since you have to launch the iBooks app before you can read the book. The one advantage is price: in a strange twist of history, apps tend to be way cheaper than books, even though their production costs can often times be higher. So an app disguised as a book can be sold at a higher price. A company like Inkling goes a step further by giving the possibility to read their books on an iPad, an iPod or event your computer.”
Jeanniey Mullen the global chief marketing officer of Zinio told us “I can’t speak as eloquently about ebooks as I can about digital magazines, but I think this is critical to do at this stage. The difference between the interactive capabilities on the two platforms is large. Without defining the specific user experience and design so that you could be creating a negative brand impact if you continue to think in a one size fits all mentality.”
Finally, Doris Booth the Editor in Chief of Authorlink had a more positive outlook on the future of apps. “The best that device-independent apps (those that work on many devices, including tablets and smart phones) will ultimately win out in the marketplace.”
HTML5 is going to be the next generation of web-content. It is not standardized yet, which is a barrier for companies seeking to adapt this new multimedia form to their publishing pipeline.
In the last few years, we have seen a number of high profile HTML5 reading apps that have been released, such as the Kindle Cloud Reader and the Kobo Cloud Reader. These two platforms were originally established for Safari and Chrome because they wanted to give Apple users a way to purchase content on the web, and not give Apple a percentage of every sale. These two systems are the most well known ones and are more scalable then dedicated apps. Instead of paying the fees to develop 3 or 4 different e-reading apps for Android, Windows, Blackberry, MAC, or iOS, some companies are moving to working on a singular reading platform, that is able to be accessed on any smartphone, tablet, or e-reader.
HTML5 can be used for online and offline reading, which often has a number of benefits. One of the big drawbacks is Fixed Layout books, dictionaries, and indexes. Publishers have to create their own pipelines and systems in order to produce these sorts of things, because the platform does not have these things like ePub does by default.
We asked the question “HTML5 tends to be more flexible in being accessible in most internet browsers. Do you think this will be a format that is going to be more widely adopted in 2014?”
Brian Felson of Bookbaby said ” Yes, and the real challenge will be to make production easier and standardization of distribution and consumption more widespread.”
Meanwhile, Doris of Authorlink mentioned “Absolutely. We must move to HTML5 to meet users’ grand expectations for the digital world. The old HTML isn’t adequate to provide the kind of experience users now and in the future want.”
Evan of Atavist weighed in and said “Certainly. HTML5 is on the rise; we’ve been using it for a couple of years and it’s only going to get more prevalent. We built a system specifically to try and take advantage of both, publishing to both mobile apps and HTML5 web apps at the same time.”
Amy Ross of Vitrium told us that “The browser (the host environment for HTML5) will be a document viewer of choice in the future for two reasons. First, the browser offers greater access and ease-of-use for readers. Second, the cost of delivering content through the browser is lower than the alternatives. Of course, the current feature set in HTML5 cannot completely replace dedicated viewing apps, but most content producers will likely accept some limitations as a trade-off for greater accessibility and ease-of-use.”
Fabrice of Le French Book actually said this question might not be the most prevalent one to ask. “Are the readers, and more broadly consumers, ready to do everything they want to do through their browser? That’s all that matters and it’s all about perception. The “appification” of our daily life is growing rapidly. People are used to launching an app for each task, probably simply because it’s the way we function: we do things one after the other. So a browser is used to go on the Web. In addition, technically, the browser’s capacity to retain information while offline is still questionable. If you can’t be sure that you’ll have access to your book when you’re in an airplane, the approach fails. Of course, you can also consider using HTML5 within an app to optimize your production costs. But even Facebook reversed their thinking on this: they redesigned all their apps (iOS and Android) to be native instead of being wrappers around HTML5 code. Because HTML5 wasn’t capable of delivering the best performance. So HTML5 flexibility seems to be a gimmick more centered on producers’ needs than on consumer benefits.
Sol from Copia had a very interesting point on what his company is doing. “HTML5 is the next frontier of app development and it will probably come in the next few years as a replacement to dedicated apps (as the tools get better, the programming frameworks more efficient). Then again, HTML5 is just really an app running in a browser…”
ePub3 is the third generation of a standardized ebook format that is considered the next generation. The big hyping factors are the ability to display multimedia content and new CSS aspects that will allow more content to be interactive.
Currently ePub2 is the most widely adopted format of choice for digital books, and ePub3 significantly increase the format’s capabilities in order to better support a wider range of publication requirements, including complex layouts, rich media and interactivity, and global typography features. The expectation is that ePub3 will be utilized for a broad range of content, including books and magazines, as well as educational, professional, and scientific publications.
Sony recently updated its Reader App for Android to support ePub3, and Kobo and Barnes and Noble have also introduced functionality. Amazon has forgone this format and instead developed its own proprietary ePub3 alternative called Kindle Format 8, which has similar features.
Barnes and Noble and Kobo have both publicly started that all of their content will be optimized for ePub3 at some point this year, the only major publisher to announce a commitment to the new platform is Hachette.
We asked the question “How can Publishers adjust to ePub3 and what are the barriers of wider adoption?”
Doris from Authorlink said “It takes constant study. Gone are the days when you learn something that you can use for years. Most of what you learn has a life of about 30 days before you have to learn something else. Historically, publishers haven’t moved very fast. Speed and the willingness to embrace new ways is a requirement for publishers in today’s world. Publishers must learn to be flexible and must seek out a few experts who have deep vertical knowledge. Often, it takes a team effort with many disciplines coming together to produce a good product.”
Brian from Bookbaby simply said “When production becomes more cost-effective and adoption more widespread, as well as increased expectations for more functionality in ebooks, new formats and all of their associated functionality will be increasingly adopted. I think the industry has done well; now it’s up to consumers, as well as to the manufacturers of the best tablets, to adopt a truly common, open standard.”
Meanwhile Evan of Atavist does not even think EPUB3 will see any traction in the industry at all “The Web is going to become more important for books, that seems inevitable right now.”
The Future of Digital Publishing
Dedicated e-Reading Apps such as EPUB3, KF8, HTML5 all bring to the table great options that have virtues. There is simply too many different options and the industry simply can’t decide on what direction they want to move in. With tablets playing a more prominent role in the way we read and interact with eBooks, what does the future hold for publishing?
Amy of Vitrium outlined her thoughts “In the near term, publishers will continue to face the challenge of creating content in multiple formats in order to reach all segments of their markets. But in the longer term, the format will become less important as we see the emergence of cross-platform document viewers such as ours that will support different and legacy formats.”
Brian Felson was indecisive “It’s impossible to tell, as few could have predicted the growth spurred on by these devices. Still, while things will change dramatically within the next three years, there’s little public information regarding major industry developments this year to forecast. It remains to be seen whether the increasing functionality of the tablets will encourage content producers to make more interactive, media-rich works, or whether reading will become relegated to ‘just another app’ on these tablet computers, to compete for the consumers’ attention with email, social networks, and games.”
Fabrice of LeFrenchBook outlined his thoughts “The future is very bright for digital publishing as the market is growing rapidly. e-Readers and tablets get into more hands every day. It’s already there in the US and expanding rapidly in other countries like France. Still, there is a lot of work to do for ebooks to really become mainstream. One example would be simplifying even more how readers can get access to them. We also need to re-invent the ‘ebook social context’: for hundreds of years books have served a social role, because they were easy to share with your friends and easy to show on your shelves at home. The ebook is a step backward in that regard. There is a void that social networks alone won’t be able to fill. eBooks have to be able to flow from one reader to the next, just like paper books.”
Doris of Authorlink had a unique prospective “Digital publishing has a tremendous future. Printed books, as much as I personally love them, will become a smaller, but not totally extinct, segment of the market, simply because digital reading will be, or already has become, a way of life today. This is not a bad thing. Digital publishing brings us more information, faster. Now, I think we all must concentrate on delivering good, meaningful content.”
Sol from Copia said “One thing is certain. There will be thousands of new innovative experiments that people will try; much like the tens or even hundreds of thousands of websites and startups. Some will survive – and continue to evolve the future of storytelling in myriad exciting ways.
Jeanniey Mullen wrapped up this segment by saying “I think that we will see an interesting collision within the next 18 months between print and digital magazines. In this collision, the 2 distribution channels will merge and re-emerge as a super power of reading, where print becomes 20% or less of all circulation and digital innovates.”
We have heard a myriad of thoughts and different perspectives today on the future of digital publishing. Stay tuned later this week, when we talk to a number of other companies that outline their thoughts on these same issues and new ones, such as piracy, the synergy between HTML5 and EPUB3 and more!
Over the course of the last five years, e-commerce giant Amazon has definitively captured the vast majority of the ebook market. When Apple decided to launch its iBooks digital storefront in 2010, the company needed an edge to be competitive. Steve Jobs met with executives from Hachette, Macmillan, Penguin, Harper Collins, Random House, and Simon and Shuster. They ironed out a scheme that would level the playing field and establish ebook pricing that all resellers had to abide by. This allowed Apple to gain traction with its new digital bookstore and allowed smaller retailers to offer the same pricing as Amazon. The US Justice Department took exception to this collusion and a lengthy court battle has ensued. One by one, every single publisher has settled out of court and only Apple remains in a proxy battle against Amazon.
Amazon has long controlled the ebook market and stiffed competitors by offering electronic books cheaper than the competition. The company would buy digital books in bulk and sell it below cost, which ruffled the feathers of all the major publishers. The public started to ask “Why should I pay $30 for a hardcover, when I can buy the ebook for $9.99?”
What new company on the market could afford to sell books at a loss, in order to compete against Amazon? There is no way a small start-up could have the deep pockets to buy enough ebooks in bulk and not go out of business. Apple is playing the hero, saying it has no intention with settling with the court and reserves the rights to conduct its business the way it sees fit.
The EU and US Justice Department both stated that the agency model as a whole is not the problem, it’s how the process was established. Joaquín Almunia, Vice-President in charge of competition policy at the European Commission, said “While each separate publisher and each retailer of ebooks are free to choose the type of business relationship they prefer, any form of collusion to restrict or eliminate competition is simply unacceptable.” You can think of what Apple did as establishing a “price fixing cartel,” which is illegal in the EU and mostly in the US, too.
In 2013, the Agency pricing model is all but dead. The vast majority of the big six publishers have all re-negotiated contracts with Amazon, Barnes and Noble, Apple and Kobo. eBooks can be discounted once again by 15% of the cover price, but you won’t see the large gulf in prices as before. This is partly because the entire digital industry has really grown up in a short period of time. The entire global industry was said to have garnered over $854 million dollars in 2012, and many publishers now see 21% of their revenue stem from online books.
Do you know the real reason the agency model was implemented in the first place? Sure, Apple played a small role in putting all the major players in one room, but all of those companies were not doing it to help Apple or stop Amazon. The real reason, that no one talks about, is that drastically slashed ebooks were destroying public perception of the cost of digital vs. the cost of print.
The major publishers had all agreed that if the public perception was that ebooks were dramatically cheaper than their printed counterparts, then people wouldn’t buy them. Establishing a common ground for digital pricing meant that they could control the pricing for both the tangible and intangible and make sure the physical bookstore would continue to survive. Regrettably, this decision came too late to save the stores they were trying to protect.
The Death of the Modern Bookstore
Borders bookstore started its first location forty years ago in Ann Arbor, Michigan. The world of book selling and publishing was a very different place, and is a case study on what the entire industry was doing wrong. In the 1990′s, the chain was facing declining revenues and decided to spice things up by selling CD’s. This was around the same time the Apple iPod first came out and customers were gravitating towards the digital space. Borders was stuck with storefronts that were expanded to sell media that was not profitable and put a hefty financial burden on the company.
Borders heard about the whole ebook revolution that was occurring and decided to get in bed with Amazon to turn its fortunes around. When you visited the Borders eBook page you were re-directed to the Kindle Bookstore. This encouraged people to buy all of their content from Amazon, Borders would not really see any cumulative digital revenue from digital purchases. Next, they turned to Kobo, who was all to happy to give Borders commission for every digital copy sold. This put Kobo in bed with Borders and the two sides signed off on an exclusive distribution agreement for the US.
By 2011, Borders was on the verge of collapse and its attempts to turn its prospects around were futile. The company ended up filing for bankruptcy in late 2011, shuttering 300 stores and putting 11,000 employees out of work. The main contributing factors that destroyed the company were not developing its own e-reader (like rival Barnes and Noble did), and not developing its own ebook ecosystem. Borders instead relied on selling low-margin hardware and made next to nothing on ebook sales. The day Borders assets were auctioned off, news broke that ebooks have outsold print for the first time.
When Borders was going through liquidation, the exclusive contract it established with Kobo hung in limbo for almost a year and a half. This was the main reason the USA market never really opened up for the company. It simply could not legally do business with any other major retailers to put the Kobo WIFI and Kobo Vox on the shelves. This was the only confirmed occurrence of a bookstore going under and taking a digital company along with it.
The United States is not the only market that has felt the effects of the burgeoning ebook industry. All around the world, major bookstore chains have been going out of business. Whitcoulls, Angus & Robertson, and parent company REDgroup all closed up shop in 2011. Senator Sherry in Australia said at the time, “the dramatic growth of internet book sales had reached a tipping point that would soon leave just a few specialty bookstores operating in capital cities.” She also predicted that “Bookshops will be wiped off the map inside five years.”
Europe Largely Immune to eBooks Cannibalizing Tangible Book Sales
As much as people talk about the “death of the bookstore,” the problem is mainly contained to North America, Australia, and New Zealand.
In France, there are only 1.4 million tablets being used and most are used to consume media and not read books. The e-reader population is generally paltry with only 145,000 registered devices. Kindle and Kobo currently dominate the landscape and it is much easier to procure the Kobo Touch, which is distributed by Fnac. In 2010, e-readers never really gained much traction due to an influx of substandard ones from Cool-ER, Bookeen, and Cybook. Major publishers such as Hachette have claimed that only 2% of their digital sales stem from France. Bookstores, such as Fnac, Gibert Joseph, and Flammarion, do quite well and have over 400 stores combined.
The German market is facing a lot of the same issues as France. e-Reader and digital publishing companies are finding it hard to get one of the largest markets in Europe to adopt ebooks. This is not from a lack of trying, both tablets and e-readers first hit Germany in 2009, but they have remained a fringe niche. The biggest challenge is that 78% of the population claim not to want to read from a screen, while 85% say they love printed books too much. The entire country has a very established publishing industry, and the second largest book market in the world. It was estimated that in 2011 that the entire book industry was worth 9.73bn Euros. Chains like Thalia, Verlagsgruppe Weltbild, and Hugendubel account for over 700 physical stores.
Spain is seeing a wider adoption of digital publishing and over 75% of all publishers are employing an ebook strategy. There are an estimated one million tablets and e-readers currently being used in Spain, with over 285k e-readers sold in 2011. Libranda is one of the largest ebook distribution platforms that was founded by the big three publishers in Spain: Grupo Planeta, Random House Mondadori, and Santillana. One of the largest concerns in Spain right now is the price of ebooks in general. If you look at the VAT prices on printed books it currently sits at 4% while ebooks are much more expensive at 17%. The high taxes have been a large barrier in mainstream adoption of digital content. The entire Spanish bookstore scene is as vibrant as ever.
The ebook market was worth about 18m Euro in 2010 (0.6% of the industry), with no more than 90,000 ebooks in various formats – many PDFs included. Max 8% of printed books are available as ebooks, though many of the main European publishers have built content distribution platforms like Numilog (Hachette), ePlatforme (Editis), and Eden (Gallimard/Flammarion/La Martiniere).
The United Kingdom is one of the only European countries to see a profound change in the bookstore landscape because of digital sales. The main victims are small and medium sized stores, while the chains continue to do well. There are only 2,178 high street bookshops in Britain as of July 2011. Back in 2005 there were 4,000, and this has left almost 580 towns without a single bookstore. There were two major contributing factors, one was the shift to digital and the other was super market chains getting into the book business.
The major bookstore chains, such as Waterstone’s, Blackwell’s, WH Smith, and Foyles have largely been immune to the e-reader and ebook revolution. All of these companies started offering e-readers and ebooks when they first started getting popular in 2009. In recent years all of these shops have inked deals with Kobo, Amazon, and Barnes and Noble to sell devices and get a cut out of each digital sale. This has allowed continued digital revenue to be generated, rather then just the initial sale of the hardware.
Nielsen BookScan shows physical book sales in the UK have declined every year since hitting a peak of £1.8bn in 2007 – the year the final Harry Potter installment landed in bookshops. In the first 10 months of 2012, printed book sales were down 3.5% year on year in volume terms and 5.5% by value. Overall digital sales of general consumer titles increased from £30m to £84m between January-June 2011 and 2012. These increases reflect overall growth of 89.1% in digital sales (from £77m to £145m.)
Agency Is Dead, Now What?
There is no denying that ebook sales in most developed countries are consistently rising and some markets are enjoying robust sales. Now that major online retailers can once again establish discounts on new and backlist titles, bookstores will have to struggle even more. It is very hard for a mom and pop shop to have to sell a book at the listed cover price, while a competitor lists it online for 1/3 of the cost. Still, indie bookstores do have alternatives than just offering price.
The American Booksellers Association and UK Booksellers Association have all inked deals with Google, which never really worked out. In 2012, they started to do business with Rakuten owned Kobo. The essence of this program is that it allows small shop owners to sell e-readers, ebooks, and have access to marketing materials. Small bookstores have seen a rise in business with the sale of hardware and the commutative digital commissions they receive when a customer purchases a digital book.
If indie stores belong to each booksellers association, they can opt into this new program and it is in Kobo’s best interest to keep the bookstores alive, whether small or large. The company has quickly grown in market stature, partly due to all of the agreements they made with stores all over the world. Kobo’s success has been partnering with as many bookseller associations and getting hardware into as many stores as possible. This is the only company that has a vested interest in the survival of the bookstores, if they sink, so does Kobo.
Small stores all over Canada, US, and the UK are going out of business. You would be hard-pressed to go a few weeks, without one closing in your town. The trend I have noticed is all the stores that close resisted digital to their dying breath, or just wonder where all the people have gone. Small and medium sized bookstores HAVE to embrace digital if they hope to survive at all.
Digital Retailers are seeing record levels of business! Kobo reported 4 million new customers within the last six months to bring its total to more than 12 million. On the worldwide stage, Kobo now controls around 20% of the entire e-reader market and is poised to continue its accelerated growth patterns in 2013. Amazon sold $383 million worth of ebooks in 2012 and controls 45% of the global market. Barnes and Noble is thought to control 25% of the US market and generated over 3 billion dollars with Nook hardware and ebooks in 2012. B&N announced yesterday that the store sales were down 10% in the December quarter from the same quarter a year ago—driven in part by an 8.2% drop in store sales—and the company plans to shutter 30% of its retail stores in the next decade.
Industry Specialists agree that e-reader sales are on the downward trend, as the public is gravitating towards tablets. Research firm iSupply notes that e-reader sales hit their peak and are being outpaced by iOS and Android powered tablets. The hardware is changing from dedicated e-ink readers to multipurpose tablets. Aside from the shift in technology, the one consistent fact is that ebooks, digital magazines, and digital newspapers are seeing increasing profits, and will continue to do so.
There is no denying that the agency model is dead and online resellers can price war with each other in a bid for your digital dollars. The brick and motor stores in the US, Australia, UK, and New Zealand are all seeing declining print sales across the board. The bookstore, as we know it, is on the ropes and will see a dramatic scaling back in new stores opening. People are gravitating towards digital and the abolishment of the agency model effectively put another nail in the coffin.