Wednesday, May 13, 2009

The Digital Revolution is Already Here

by Michelle GagnonKindle DX

During a press conference last Wednesday to celebrate the release of their latest Kindle reader (more on that in a bit), Amazon.com CEO Jeff Bezos made a startling announcement: for books available in Kindle format, more than 35% of their total sales were for the Kindle editions. Considering the fact that the Kindle is still in its nascency, introduced a little over a year ago, that's an astonishing statistic (especially since it was basically mentioned as an aside during the introduction of a new product).

Granted, there are still only around 275,000 books available in Kindle format (in addition to numerous newspapers and magazines, which the new "DX" model is supposed to ease the reading of). Major writers like J.K. Rowling have yet to jump on board the Kindle bandwagon, so you can't read their books on the device (not a legal version, at least). But it certainly shows the tide is turning.

I also have it on good authority that a major online publishing site which already has more than 50 million users a month (that's right: 50 million) is about to jump into the fiction game. They're hoping to recast themselves as the YouTube of online publishing. Authors will be able to release their own books directly to the public, and the split will be 80/20...for a change, that 80% will be going to the author, not the publisher. Some publishers have already begun releasing new books-for free-on the site. This could potentially open the flood gates, hopefully having an impact on how major houses split royalties. In my first contract, e-book royalties (which were still a blip on the horizon) were split 50/50 between me and my publisher. The last contract, it was down to 15% of the digital list price. As a friend of mine said recently, it's tough to fathom the reasoning behind that split when the bulk of the publishing costs will have been completely eliminated. And why would already established NY Times bestselling authors continue to hand over such a significant chunk of their profits when they could release a book online, for free, and take that 80%?

It was particularly interesting that Amazon announced this during the release of a pricier Kindle model, not the cheaper one I would have anticipated. It could be a brilliant move- college students are traditionally early adopters, and a e-reader that seems perfectly tailored to reading textbooks could be a huge seller, despite the price tag (you can buy a laptop for less than the $489 a new Amazon DX costs). But surely they have a more reasonably priced Kindle on the horizon.

kindle appRumor has it that Apple has an e-reader in the works that will likely be as elegant and user-friendly as their iPod line. I'm willing to bet that by the end of the year, we'll see e-readers in the $100-200 range, just in time for the holidays.

Getting back to Apple...what Bezos neglected to mention (again, surprising- clearly he needs to hire me for his marketing team) was a free application released in March that enables iPhone users to order and read Kindle books. Last October, an independent firm estimated that Apple had sold more than 10 million iPhone 3Gs; and that was before the Christmas rush. They have yet to say precisely how many Kindle units have sold, but when you start adding up those numbers, it's already a significant chunk of the market.

I have both a Kindle and an iPhone, and the really cool thing is that I can be reading a book on one device, switch to the other, and it updates to the page I was on. The backlit screen can be tough to read for long periods, but for the length of a subway or bus commute it works great. The font size is large enough to read comfortably, and the pages are even easier to turn than they are on the Kindle. (However, you can only download Kindle books to the iPhone, not manuscripts sent in pdf format. Or if you can, I haven't figured it out yet).

I'm going to argue, once again, that all of this is a good thing. I find that I buy more books now that I own a Kindle, not fewer-the Kindle editions are cheaper, and so easy to download, I make impulse purchases that I would never make in a store. Especially now that my bookshelves are threatening to overtake the house, Kindle editions are a guilt-free option that go a long way toward maintaining domestic harmony. And that's always a good thing.

10 comments:

  1. I agree e-publishing is the future, for all the reasons Michelle lists. Amazon is now paying a 35% royalty rate, so my question to my published brethren is, why would you ever sell your ebook rights to a publisher to get 15% when you can simply post your book to Amazon and earn 35%? Or if you're getting 80% on this other site (which I'm dying to know the name of; is it Blogger?)? Is it because they will buy your other rights only if they get the digital rights, too? Given how much I can make by selling my books myself on Amazon, it would take a pretty good deal to get me to sign over my digital rights.

    Remember that Amazon's Kindle proportions can be seriously skewed by the free promotional books and low-priced public domain books that they have on the site. If you look at the top 100 books, many of them are free or cheap. Since Lee Child's Persuader is free for the Kindle, I'm sure that the e-version is outselling the paperback version 100-1. What I'd be interested to know is how the $9.99 releases are selling compared to the same books in a $25 hardback. That would give us a much better picture of how powerful the Kindle is.

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  2. Hmmm...maybe I need to get one of the Kindle thingies. But not till they're cheaper, maybe I should start hanging around UAA on party weekends and trade one for a case of beer to a desperate under-grad.

    My serious question though, what is to stop a writer from publishing their own pdf version of their book and selling it via their website and keeping the whole amount? I mean Adobe Professional is only about $400. If one sell's only a hundred copies of an ebook for even 7.99 they've made double their money. Is it the marketing power of Amazon or a publisher?

    Just how many e-books have top name or new authors sold via Amazon?

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  3. I too think e-publishing rights are going to be the next battleground between authors and publishers.

    As for Kindle, I have a couple issues. One, I've never seen one in the wild. (I don't get out much, but still...) and I'm unwilling to shell out that kind of money for a product I've never tried.

    Two, no color. Yes, I know, yet. But why get a reader you can read newspapers or magazines on that doesn't have color?

    Three, cost. Ouch. These things are pricy.

    Four, I am inclined to wait for the rumored Apple e-reader. I own an iPhone and think it's great (it's a so-so phone, but as a multimedia device it's awesome). Apple has a tendency to reshape technology, so I'm curious to see what they come up with. (But it will probably still be too expensive).

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  4. I have a fervent hope that e-publishing will see the end of the current stupidity that means each book has different rights sale process in each country. It's moronic in this day and age. And until it does get sorted I can't buy a kindle :(

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  5. Great post, Michelle. The online publisher you mentioned (http://www.scribd.com/) with the 50 million monthly users is aggressive, innovative, and a force to be recommended with. I'm currently working with them to establish an exclusive ITW section of their site that will feature fellow International Thriller Writer authors and our publishers. This is just one of many mega publication sites that I expect will emerge over the next little while. And with their emergence will come new and unique opportunities for all writers.

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  6. Good stuff, Michelle.

    I've been telling the traditionalist naysayers that e-books are in our near-term future.

    I remember when photos first went digital and I thought WTF! What can you do with a digital photo.

    Then I remember when the MP3 was launched and wondered what good they served.

    Digital video made little, if any splash, because it really didn't affect how the masses watched it. Well, not at first anyway. They still went to movie theaters and turned on their TV.

    With all the cool things about e-books comes the dark side. Just as in movies and music, there is the piracy concern. And it could be a big concern.

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  7. Yes, piracy:

    http://tinyurl.com/pasehz

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  8. That's a good question, Basil. I think having a central clearinghouse is key for most of us (although you make a good argument for top tier authors- why wouldn't Stephen King just sell books through his own site?)
    And Mark, check out the iPhone Kindle app if you get a chance-it's free, after all.
    I don't really understand why the Kindle hasn't gone international yet- although I've heard it has something to do with infringing on foreign rights. That remains to be worked out. Pretty soon this will likely make "world rights" the norm, another potential interesting change in the industry (I suspect that might put a lot of foreign rights agents out of business!)

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  9. Thanks Michelle - I get very excited about the prospects with e-readers - now I just need to plunk down the money and buy one. I like the idea of reading the newspaper on it but the DX is pretty expensive...but I'll hang out until Christmas and see what looks good. As you can tell I'm not one of the early adopters!

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  10. I'm very excited to discover scribd. It's an amazing publishing site. And Joe, how fabulous that you're working with them to establish an exclusive ITW section! I can't wait to see how it develops.

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