Wednesday, July 28, 2010

10 Reasons E-books Will Not Eat The World (part 2)

The exciting conclusion of yesterday's discussion:

5.  Requiring hardware limits the audience.  Despite apps that make e-book content available on PC or cell-phones, most e-books are sold to people who have e-readers.  The subset of people who have e-readers is a small fraction of the total number of people.  Even if this number grows exponentially in the next few years as devices get better and cheaper, it will still be far smaller than the total number of potential readers.

If e-sales begin taking a big bite out of print sales bookstores become an endangered species.  There's no way publishers can achieve sales growth by focusing on the smaller audience of e-readers if bookstores are closing en-masse.  I think that the relationship between publishers and bookstores is symbiotic, and publishers likely need many people who are becoming e-book buyers to patronize bookstores, to keep the stores solvent to provide a forum to sell to more causal readers who will probably never purchase dedicated reader devices.

"I don't want to go to the mattresses. Tessio wets the bed."
There have already been discussions of delayed e-releases of frontlist titles, and publisher pushback on low e-book pricing. It's possible that e-books will become a genie nobody can stuff back into the bottle, but for now, the growth and spread of these devices is heavily contingent on support from major publishers.  There have been fights between publishers and e-vendors in the past, and there are big new feuds on the horizon.  Uninterrupted geometric sales growth of e-books seems unlikely if publishers push against it, and Amazon may not be as willing to go to the mattresses as the market becomes more segmented and its share of e-book sales shrinks.

4.  Multipurpose devices aren't good for reading books.  An LCD screen like the one on the iPad is back-lit.  It displays an image by shining light through the screen.  A lot of people don't like doing close reading on these kinds of screens for hours at a time.  E-distribution of books has been possible for years, but there was never a market before e-readers came out because people didn't want to read books on their computers. Now many analysts believe e-books will conquer the market by piggybacking on devices like cell phones and iPads.  But these devices use the same kinds of lit screens as laptops (and the screens on smartphones are very small).

These screens can also be difficult to view from certain angles, they're hard to read in sunlight, and they drain batteries pretty quickly.  The experience of reading a book on an iPad is significantly worse than reading on paper.  Even if these devices become ubiquitous, I think most users will continue to buy conventional books.

"Wait.  What happened?"
On the other hand, if you are reading this, you are probably reading on a backlit screen.  And screens have replaced a lot of paper in many office uses; e-mail has displaced a lot of fax printouts and photocopies.

Some people think advancing technology will fix all these problems; Shatzkin predicts an iPad that folds or collapses into an iPhone.  On a long enough timeline, anything is possible, but the magical device that is both LCD and e-ink, and both phone and pad is not coming anytime soon.

3.  E-readers aren't good for anything but books, and are worse than books at being books.  Dedicated reading devices like the Kindle use a screen technology called e-ink that "prints" the page onto a non-lit screen.  These screens come close to simulating the appearance of paper; they look good in direct light and consume very little power.

The screen contrast isn't great; instead of black ink on white paper, you get dark-gray text on a light-gray background.  But the screens are improving, and the delay when a page "turns" and the device draws in a new one is likely to shorten as well.

These devices bring some nice features; you can change the font size, and a text-to-speech robot voice can read books to you.  But you can't flip back and forth as easily as you can with paper.  And it's a technology device.  If you drop it, you break it.  If you sit on it or step on it, you break it.  If you fall asleep in bed with it and roll on top of it, you break it. If it gets wet or if sand gets in its guts at the beach, it probably breaks.  And if you leave it someplace you're out a lot of money.  A book can survive most of these stresses, and if you lose or destroy it, you're out $16 bucks at the high end.

E-distribution of books has some obvious potential business efficiencies, but from an everyday-use perspective, an e-reader is a flawed solution to a problem that doesn't exist.

Obvious exceptions to this rule:  literary agents and editors who have to schlep a lot of manuscripts around, and students who have to carry lots of textbooks.  E-readers can make such cumbersome tasks much easier.

2.  Author autographs.  Go ask Cormac McCarthy to sign your iPad and see what happens.

Actually, that would be hilarious.  If I ever meet him, I am going to do that.        

1.  Piracy.  Because books are an analog format, they have a sort of built-in copy protection.  You can't "rip" a book the way you can copy a music CD.  To upload a book for file-sharing, somebody must either scan every page or transcribe the text into a computer file.  Because of this structural difficulty, books have been largely spared the piracy troubles that music has struggled with over the last decade.

However, with e-books, if somebody manages to crack the encryption on one of these e-book file formats, then everyone's content will be available for free in clean, publisher-formated digital versions.  And hacker-types have a history of accomplishing difficult things.
"I've been listening to Ke$ha and reading 'Twilight' for free!"

It seems likely somebody will eventually crack one of these formats.  What will happen when that occurs?  How will publishers and vendors react?  We know Amazon can remove files from Kindles; they've done it before.  Maybe vendors will wipe all the devices to prevent books from getting ripped.  I think that would deal a serious blow to consumer confidence in e-books.  On the other hand if they don't take an extreme response, widespread piracy could quickly devastate legitimate sales.

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