Moderator’s note: Joe Wikert, a VP and executive publisher in the Professional/Trade division of John Wiley & Sons, is our newest contributor. We’ll be picking up goodies from his Kindleville blog and his Publishing 2020 blog, where, as you’ll see below, Joe is most open to new business models. Welcome, Joe! – D.R.
When it comes to progress on the e-learning curve, one could easily argue that the music industry is well ahead of the book publishing industry. Napster and other illegal file-sharing tools forced the music industry to wake up and smell the coffee. Apple then stepped in with the iPod/iTunes combination and promptly ruled the world…for awhile…
As this BusinessWeek article notes, the pay-per-song model might be living on borrowed time. All you can eat subscription models like Rhapsody are gaining popularity. It makes sense to me. After all, I don’t care how much music I “own”; I just care how much I have access to. Would I pay $12.99/month for the right to fill up a 30-, 40- or 80-gig MP3 player with all the music I could possibly want? You bet, especially since I’ll know the door is always open to download even more as my interests and tastes change.
Kick-start for E?
Now stop and think about how this applies to the book publishing world. Could you imagine a model where you pay $X/month for access to an unlimited number of books? It’s never going to happen in the print world but I think this could be the killer app for the Kindle, a world where manufacturing and distribution costs are zero. Access to every single book in the entire Kindle library could be yours for a monthly fee. Assuming the monthly fee is reasonable this could be the model that really kick-starts the e-book industry.
How would publishers and authors get paid in this model? One option is to go by pageviews.
Although the capability doesn’t exist in Kindle 1.0, there’s no reason version 2.0 couldn’t be built to track pageviews of every book downloaded and read. At the end of the month the device could upload the customer’s viewing history back to Amazon so that the monthly fee could be split among the publishers whose products were downloaded and read. Publishers would then pay authors their contractual share based on that same data.
Model already in use
Sound complicated? It’s a model that’s already in use today. Consider Books24x7, a great organization with a platform that “enables users to search, browse, read and collaborate with other users of these vast professional libraries.” It’s a very useful model and one that quite a few publishers are already participating in. A next logical step is to offer a library that’s much, much larger and available on a device like the Kindle.
Would this mean the end of physical, printed books? Of course not, but it’s a very interesting model that could be an excellent option for a lot of people (including quite a few who see no reason to buy a dedicated e-book device).
Another moderator’s-note: The original TeleRead proposal in 1992 mentioned the possibility of the subscription model. I heartily approve of Joe’s thinking. I’m not saying the subscription model should be the only one. But it’s well worth considering—for individuals and institutions alike. We need to reduce the effort needed to buy and enjoy books; this is one way to do it. Given how little Americans are spending on books right now, the only direction we can go is up!
While subscriptions may be a useful model to try (though unlikely to succeed on a large scale unless the price is low), the history and page tracking are such dumb features with the potential of abuse that I could not believe someone would make those proposals seriously.
I really despise subscription models like this. Personally, I do want to own the content (and I mean literally own, not the Kindle version for its native format which is essentially *licensed*).
The other problem (and I’m surprised to see the positive moderator’s notes *only* for this reason) — is that a subscription model would permanently embed DRM in the system. We’ve already seen very clever successful attempts to route around DRM in subscription models, which seriously undermines their profitability.
What I wouldn’t mind are subscriptions models that are essentially ownership models as well. Once again, Baen has shown how to do subscriptions.
Thanks, Liviu and Brian…
L. I want to see large-scale. As for tracking, yes, I’m aware of the dangers, but one way to mitigate this would be what I suggested: multiple models. That way, if a book might be problematic in the future, there would be no record, even at the title level; I believe in the right to buy books anonymously, with digital cash and surrogates involved. Also, if I had my druthers, there would not be page-level tracking.
B. I’d love for the subscription model to happen without DRM or with social DRM in use. A Baen-style solution would be great. It’s a question of seeing how far the publishing establishment would go without DRM. The other issue is to make sure that people have an ample choice of titles. Shouldn’t be a problem with a large enough scale. Perhaps you could even subscribe within certain subject/genre areas. I love the fact that Baen apparently doesn’t require you to buy access for each month. As for ownership, that option MUST remain. People mustn’t be limited to the subscription model.
Anyway, it’ll be great to consider all the possibilities. Keep commenting on them!
Thanks,and happy holidays, both of you!
David
All good points. For the record, I’m not suggesting that this subscription model will be the only one available. One size does not fit all, so I would fully expect this to be just one of several choices Kindle owners could select from.
FWIW, I think the music subscription model was laughed at initially but it appears that it’s picking up momentum. I know I wasn’t a fan of it at first but I will definitely go that route when I get my next MP3 player (my current one doesn’t support any of the existing subscription models).
It is great that Joe Wikert is thinking creatively and constructively about allowing access to large libraries of content!
Some people dislike subscription models because the termination of the subscription period leaves the purchaser with nothing. Many college students who were given free access to a subscription music system did not even bother to register. When the students were asked about this curious behavior they said that they did not want all their music libraries to “disappear” at graduation. So they continued to use peer-to-peer (P2P) networks and other music sharing methods that allowed for the “permanent” acquisition of music.
Some people fear the possibility of a future dramatic increase in the subscription cost. The subscription service and publishers would have enormous pricing power. Subscribers would know that carefully constructed and annotated libraries of personally selected music were, in essence, “held hostage” by publishers.
There is an alternative model that might allay these fears and achieve great success. A hybrid model would give subscribers access to a massive library of music each month. Subscribers could download freely from the large collection but each item would have DRM with a built-in timer. However, subscribers would also be allocated a fixed number of songs each month that they could download for a permanent collection without DRM. These DRM-free songs could have watermarks and embedded ownership tags (I think David Rothman and others are calling these tags and/or watermarks “social DRM”. But that name might be confusing to some readers.)
The “marketing” goal is to ease fears of dependency and to emphasize positive feelings of accumulation and empowerment. A similar idea can be used for e-books and other electronic objects. Subscribers should be allowed to “roll-over” DRM-free credits and should not be forced to use them all each month. This would enable superior choice flexibility. (Also pseudononymous ownership and/or proxy ownership should be allowed for privacy sensitive owners and objects.)
Subscriber growth would skyrocket if Rhapsody and other services moved to a hybrid model by adding a sizable number of DRM-free downloads while maintaining the same subscription price. “But why give more music away?” some music sellers might complain; because the paid music system is collapsing. Electronic revenues are growing but they remain very small compared to the shrinkage in CD revenues. Creative thinking and risk-taking is needed.