It looks like Kiwi Christmas shoppers will be spoilt for choice this year on the ebook reading front. The much-delayed Sony ebook readers will ship sometime in October, according to an NBR report. This follows the arrival of the also-much-delayed Kindle last month.
And unlike the Kindle, which shipped to Australian buyers almost a year before New Zealand customers got it, the Sony range has been absent from both markets until now. It’s a delay that will cost Sony some momentum but it’s certainly good news for the Kobo-powered ebook stores on both sides of the Tasman (Whitcoulls in New Zealand, Borders and Angus & Roberston in Oz).
Sony’s offering provides a premium brand name reader that will be tuned for easy access to these Kobo-powered ebook stores. Sony has been an early champion of the book industry’s open ePub ebook format in contrast to Amazon with its proprietary Kindle format.
Sony will release two of its units, the Sony Reader Touch Edition which sports the same 6-inch diagonal eInk screen as the Kobo and Kindle, and the smaller Pocket Edition with a 5-inch screen. Both editions have a touch screen which many people prefer for navigation though usually at the slight expense of lower contrast.
Neither Sony model sports wireless, either via WiFi or 3G, so like the Kobo will need to be connected to a PC to load up on ebooks. Sony does have such a model, the Daily Edition, a slightly larger 7-inch model with both WiFi and 3G (cellular) wireless access but there are no plans at this stage for it to come to New Zealand.
The Pocket Edition will be NZ$299 and the Sony Reader Touch Edition will be NZ$399. NBR has a good comparison table showing how Sony’s line-up will compare with the new Kindle and Whitcoulls’ Kobo eReader.
It’s August 27, and here in New Zealand we’re first to see the new day and last to see the Kindle. But finally it’s on its way. Almost a year after its global release, and as the third generation Kindle rolls out, Kiwis can finally order theirs here with delivery slated for mid September.
Vodafone—the accused-but- never-admitted cause of the hold-up—will be the mobile carrier, providing local 3G support for Amazon’s Whispernet system by which Kindle books can be delivered wirelessly over the cellular network with the communications cost built into the price of the ebook. As well as downloading ebooks wirelessly, Whispernet is a boon if you’re reading on multiple devices as many of us do. It synchronises gadgets so that when you later fire up your book on your iPhone, for instance, it will take you to the last page read. This is a major time saver, especially on slower eInk devices.
New York Times bestsellers are mostly US$11.99 (no NZD pricing but it equates to about NZ$17). This indicates an international download charge of about US$2.00 a book added to the typical US domestic price of US$9.99 for the same bestsellers. That’s still pretty good value and, of course, ebooks from Amazon currently escape the 12.5% (soon to be 15%) sales tax levied here, a tough reality for local booksellers who must charge it.
Notwithstanding the benefits of 3G, especially with no monthly charges, I’d guess most New Zealand buyers will opt for the new US$139 WiFi model rather than the more expensive US$189 3G + WiFi model. At about NZ$200 plus NZ$30 freight, the WiFi model is cheaper than the $295 Kobo unit sold by local bookstore chain Whitcoulls. That gap might narrow if buyers are hit with sales tax at the border but the Kindle’s low value makes it likely it will slip through Customs without a whisper.
More here from NBR’s Chris Keall who also promises a review shortly.
I’ve reproduced the article I wrote for the Australian Booksellers Association magazine on the subject of what you have to do to set up an ebook store. This is truly a moving feast but the article below should give you some insight into what’s involved right now.
From the August 2010 iss ue of News on Bookselling: The Official Journal of the Australian Booksellers Association.
By Martin Taylor
Most booksellers I speak to are keen, or anxious, to get into the ebook market. So how do you do it? Here’s a quick guide to the issues and challenges you’ll face today as you set up your online ebook store. As you’ll see, it’s no walk in the park and you’ll have to get technical. It will certainly get easier as time goes by but the trade-off, of course, is that the easier it gets, the more competitors will jump into the game.
The website
Booksellers’ natural inclination is to add ebooks to their existing website. This might be right, especially if your current web operation is very successful. But there are fewer things in common between print and ebook sales than you might think so consider starting with a clean slate.
The first place to start in either case is with the user experience. If your site has printed books as well as ebooks, mixing them up can leave ebook buyers sifting through irrelevant listings and search results. Cross-selling from your printed book site should be done carefully and its value not overplayed. If it’s a combined site, it should still have a distinct ebook section with separate stock items for ebook editions (and separate ISBNs for each digital format), and it must have its own merchandising. Ebook bestsellers and attractive offers won’t always match their print stablemates and you’ll almost certainly find the profile of your online shopper is different from your in-store shopper profile.
Ebook buyers will increasingly buy ebooks using mobile devices rather than PCs so your site should work on smaller screens: browsing, searching and buying on an iPhone or ebook reader can be frustrating on websites designed for a big PC screen. The way to do this is with a range of style sheets tuned to the different browsers.
A very important issue is the online payment process. This is often overlooked but a poorly executed check-out will make it hard to draw users away from the top sites. While a PC user might put up with a clunky payment system and extensive form-filling, mobile users will abandon sales at the checkout and be reluctant to return to your site. Amazon has patented the ’1-Click’ ordering technology behind its check out (and Apple, whose own online payment systems are legendary, has licensed it.) You’ll need to compete with this but help is on the way through companies like PayPal whose payment technologies are becoming simpler to use.
Finally, your website is just a part of your total online marketing programme. You’ll have to get really good at internet marketing to succeed with ebooks. The good news: it won’t be wasted, you’ll need to be really good at internet marketing to sell printed books too.
Getting ebooks to sell
The website is only a part of the business of selling ebooks online. One of the trickiest aspects today is acquiring rights to the ebooks themselves so that you’ll have a meaningful collection to sell. Since the ebook is a file that can be endlessly copied without trace, publishers understandably keep a tight rein on them. With printed books, if you sell one, you have to reorder it from the publisher before you can sell another but not so with digital files. So when you try to acquire inventory for your ebook store, you’ll be confronted with lengthy and onerous contracts. Typical matters covered will be:
Security. You’ll need to satisfy nervous publishers that the physical and IT security measures you’ve taken will stop any hacking or break-in that could see master files stolen.
Audit. You’ll also have to satisfy publishers that you’re honest and competent by agreeing to a random audit. Among other things, this shows publishers that you’re meticulously recording, and paying for, every ebook downloaded.
Restrictions on sale and use. There are few restrictions publishers can place on how and to whom you can sell a printed book. But ebooks are not sold, they’re licensed for use and the terms of usage are controlled through contract by the publisher. The bookseller must adhere to these terms. If you can’t, or are less than scrupulous in following them, it won’t be long before your ebook supply dries up.
Territorial restrictions. For the foreseeable future, you can throw away those notions that an ebook store will open up your neighbourhood bookshop to the world. You’ll have to follow the territorial restrictions imposed by publishers, most of whom won’t grant worldwide rights. This often frustrates consumers and will certainly add a pile of complexity to your own budding ebook operation. But rather than curse it, keep in mind that if the industry can make it stick, it’s likely to be one of the best tools to help the survival of local independents against the forces of global megasites.
Customer restrictions. Unless you can make special arrangements with publishers, your retail customers will be restricted to buying (actually, licensing) their ebooks for personal, non-commercial use. In particular, libraries will be excluded from your customer base since terms will generally restrict the lending, transfer or resale of ebooks. Your website’s terms of sale must make these restrictions clear to customers at the time of purchase.
Pricing. The usual process is to set a wholesale price based on a discount off the suggested retail price of the ebook or the printed book equivalent (expect smaller discounts than you’re used to). Retailers then set their own selling prices. This well-trodden system was recently complicated by the arrival in some markets of the so-called agency model. So far, it’s being trialled by a handful of major publishers who enforce fixed retail prices and pay the retailer a commission. As the name implies, the retailer doesn’t make the sale, the publisher does for which the retailer receives a commission. If it takes root and spreads to this part of the world, it will create its own issues for budding ebook retailers, not just by restricting their ability to set selling prices and margins but by greatly complicating operations so that sales, taxes etc can be attributed directly to publishers.
On this face of it, the agency model seems to be unfriendly to retailers, removing a key competitive tool. But, like territorial restrictions, it could lead to a much more diverse marketplace by ensuring that a handful of global giants can’t use deep discounting to squeeze smaller retailers out of the market.
Digital Rights Management (DRM). The retailer is generally responsible for encrypting files with DRM before they are delivered to the consumer. You’ll have to offer this service, either directly or through a trusted third party supplier (if you can find one) since most major publishers require it. Several online retailers have developed their own DRM systems but it’s not for the small or faint-hearted. For the rest of us, an increasingly popular solution is Adobe’s Content Server 4 (ACS4). Anyone can purchase a license for this system but again, installing and operating the service is not for the faint-hearted. One problem: there’s still no freely-available ebook reading app for smartphones and the iPad to read the Adobe-encrypted files. For the foreseeable future, though, you won’t get into the game without it.
Metadata. While the ebooks get the attention, expect to spend a lot of time acquiring and massaging the metadata that surrounds them. This includes the basic bibliographic data but extends well beyond it to include information about ebook usage and terms (geographical restrictions, DRM requirements, etc) and, most importantly, comprehensive selling information, an essential part of any online store and a key competitive issue.
Distributors and turnkey hosted systems
Like its print equivalent, the digital world is seeing the emergence of wholesale aggregators. They can simplify the job of connecting a diverse group of digital publishers to an increasingly diverse group of retailers. Distributors offer a fairly large range of ebooks, though not enough to match any of the large, dedicated ebook retailers such as Amazon or Kobo. Be aware that their quoted ebook numbers are frequently inflated by inclusion of ebooks in legacy formats that are irrelevant in new markets such as Australia and New Zealand. And at this time they offer minimal coverage of local titles.
If by now you’re despairing at the scale of the project to assemble a well-stocked, competitive ebook retailer, help may be at hand. Many of these distributors can supply not just a collection of ebooks but a customised website, payment system and DRM to get those ebooks to your customers. With a turnkey, hosted service you’re effectively acting as a shopfront for the distributor’s ebook collection. And there’s room to customise the look and feel of the hosted service so that visitors will think they are still on your site.
This comes at a cost that can still be quite steep, especially if you want extensive personalisation. But it’s a way to dip a toe in the digital water. Some drawbacks include dependence on a single distributor’s limited ebook range and dependence on them for feature upgrades. This can be especially vexing for customers in smaller markets whose local needs are low priority. Among the established names offering turnkey services are US companies Overdrive, Ingram Digital, and Libre Digital.
The elephant in the room in this space is Google which has been leaking scant details of its planned Google Editions ebook store. Unlike Amazon, Apple and other major retailers, Google plans to provide a wholesale option as well as selling directly. If it delivers good technology, and a substantial catalogue of commercial ebooks, it could change the landscape for booksellers. At the time of writing, Google Editions’ detailed capabilities and roll-out dates were still to be announced.
Is it worth it?
For a lot of booksellers, especially indies but also many chains, my guess is the answer to this should be, “No”. It’s tempting to think that, if you’re in the business of selling books, then selling ebooks is a natural extension and an essential one at that. But the reality is that there are probably more differences than similarities between traditional bricks and mortar book retailing and ebook e-tailing. It’s really a new business. Given the challenges today of starting and operating a credible ebook operation, it’s legitimate to ask whether that stretched cashflow and those hard-earned reserves should be applied to ebook retailing or invested somewhere else where the return might be better, including your bricks and mortar bookstores.
Another option to consider is picking a niche rather than trying to compete on a broad range. Even some of the big ebook retailers can be fairly sparse in their offerings as you drill down. We’ve yet to see solid bookseller (as opposed to publisher) examples of this strategy but there’s plenty of smart opinion favouring this route.
My advice is that, if you’re getting into the market reluctantly as a defensive strategy, you’ll probably do it badly and are better off skipping ebooks and doing a great job in bricks and mortar. On the other hand, if you’re serious about getting a stake in this market, you should tackle the challenges head on and get started soon.
- By Martin Taylor. Blog: activitypress.com/ereport; Twitter @nztaylor
Kindle boss Jeff Bezos told USA Today that he expects Kindle ebook unit sales to exceed paperback sales on Amazon within 9-12 months. Says Bezos about the speed of ebook take-up, “It stuns me. People forget that the Kindle is only 33 months old.”
A somewhat more dubious part of the same interview was Bezos’ reply to the question of why Amazon still doesn’t support the industry standard ePub format.
We are innovating so rapidly that having our own standard allows us to incorporate new things at a very rapid rate. For example: Whispersync (which uses wireless connections to sync your place in a book across devices) and changing font sizes.
The innovate argument might work for Bill Gates or Steve Jobs but it sounds glib in Amazon’s case. Kindles are not high end technology and it’s hard to see how control of the Kindle’s mobi format has been essential to the innovations he cites. Changing font sizes is hardly unique to Amazon. And, given that both ePub and mobi formats use an underlying, easily accessible XML structure, it’s hard to see how Amazon’s Whispersync technology, or something doing the same job, wouldn’t have happened in an ePub world (latecomer Barnes and Noble is rolling it out, for instance).
The third generation Kindle has just been announced, due for delivery 27 August. There will be two variations of the new Kindle – a US$189 3G version like the present model, and a US$139 WiFi-only model.
And according to this NBR story, the Kindle will finally ship to New Zealand with the new device’s release. We’ve been mysteriously Kindle-free for almost a year since Kindle’s widespread international release.
The Kindle ebooks have been available to New Zealand buyers since late last year. I’ve been a regular buyer via my iPod Touch and now iPad.
The new Kindle is 21 percent smaller and 15 percent lighter than the previous model. It has a 20 percent faster refresh rate on its E Ink screen, longer battery life (1 month without wireless, 10 days with wireless on), and a larger 4GB storage. It comes in white and a slate grey. Endgadget briefly got their hands on the gadget and report that:
… the Kindle is still very much the reading device you know and love (or hate, depending on your preferences). The build quality and materials used did seem slightly more polished than the previous version, and we really liked the new, more subtle rocker. We can also attest to screen refreshes and overall navigation feeling noticeably more responsive and snappy compared with the previous generation.
The US$139 price point of the WiFi model might be the final push the market needs to get below the US$100 mark for basic models such as the Kobo or BeBook One. The latter is still a ridiculously expensive A$449 for a non-WiFi e-Ink reader. It’s a perfectly good eReader but it’s hard to see how the smaller independent makers like BeBook can survive when they remain so far out of line with market trends.
Martin Taylor has been involved in the publishing, technology and internet fields for more than 20 years. He is director of the New Zealand Digital Publishing Forum and publisher and managing director of Addenda Publishing. In a former life, he published technology and business magazines, and has been involved with the internet almost as long as Al Gore.
last to see the Kindle. 
months old.”
