Australian bookselling icon Dymocks last week launched a self-publishing service called D Publishing. While the service looks fine, its publishing contract is dreadful. Even if you’re not in Australia, you should look at it to see just how bad a publishing contract can be in the wrong hands.

The issue was exposed by The Australian Literature Review (AusLit) in a blog post headed, D Publishing by Dymocks Books – AUTHORS BEWARE. AusLit was concerned that, under the contract:

Authors grant an exclusive license to Dymocks for commercial rights worldwide for the duration of the copyright, including all subsidiary rights to the work.

While an author would have the right for their name to be attached to the work, they are essentially HANDING OVER CONTROL OF THE COMMERCIAL ASPECTS OF COPYRIGHT WORLDWIDE, INCLUDING ALL SUBSIDIARY RIGHTS, FOR THE DURATION OF THE COPYRIGHT.

Authors inexperienced in the business of publishing and in dealing with publishing contracts may not realise the implications of what they  are agreeing to.

What makes this grab for authors’ rights especially cynical is that the Dymocks service gets these rights for doing almost nothing. If Dymocks posts an ebook for sale on its website, it will have done enough under the contract to earn its exclusive right to the work worldwide for the author’s lifetime plus 70 years — and not just in book form: all subsidiary rights such as film, and other electronic forms are included.

AusLit’s criticism led to some minor changes to the contract. But Australian publishing contract expert Alex Adsett, who assessed the D Publishing contract after changes were made, told the Weekly Book Newsletter she thought it was ‘as terrible as some of the online commentary suggests’.

Other problems cited by AusLit and Adsett include:

• D Publishing has the right to amend the terms and conditions, including the royalties, at any time.
• Under the contract, this could entitle D Publishing to pay zero royalties for some rights.
• Signing up to it is as simple as clicking an online ‘accept’ button.
• There is no way for the author to terminate the contract, other than through a breach of contract by D Publishing — unlikely since the contract places almost no obligations on D Publishing. A copyright in Australia lasts for the author’s lifetime plus 70 years.

Adsett told Weekly Book Newsletter (WBN) that the aspects of the contract she was most concerned about were not replicated in commercial publishing contracts or in ‘common vanity press contracts’.

I’ve reviewed the Dymocks contract as it stands. It really is as bad as its critics allege and is not typical of publishing agreements.

The damage it could do is made worse by the use of Dymocks’ good name and the targeting of authors who are  inexperienced in the business of publishing.

Dymocks’ initial attempt to address the issues raised by AusLit failed badly. This is not surprising when Dymocks general manger of ecommerce Michael Allara, speaking to WBN, put the problems down to “how technical legal contracts can be interpreted out of context.”

Says AusLit:

The major change has been to bury key details in less direct language and disperse that key information piecemeal across more clauses. This may make key details less obvious to inexperienced authors until they have accepted the agreement but doesn’t address the problems.

I think it’s time for the Australian Society of Authors and the Australian Publishers Association to step in to clean this up. The Publishers Association especially should be concerned that the industry is not tainted by such a high profile abuse. This is not a typical publishing contract.

Dymocks also has a strong presence in New Zealand so it would be disappointing to see this contract pop up in other markets. It seems to be planning to expand the geographical reach of its digital publishing initiative.

The publishing contract is posted here. Hopefully it will be updated and quickly brought into line with reasonable industry practice. Given the inexperience of its target market, and the online self-service environment, this should include  a clear and prominent summary of the key terms, not just nine pages of legalise.

[Update: 12 January 2012. Dymocks revised its contract again, partially addressing some of the concerns raised and doing a slightly better job of explaining the contract terms. AusLit has produced a detailed account of these changes. Says AusLit:

I think this is a big opportunity being wasted by Dymocks. I also think most authors are not going to be prepared to license their rights to a publishing service which takes the rewards of an upper-end traditional publisher while taking on obligations similar to a hands-off self-publishing service or vanity press in return.

I agree with this conclusion. This remains a terrible contract which authors should avoid.]

Australian readers will have few reasons not to join the ebook revolution this Christmas as a host of offerings come on stream. The past year has seen major strides in the key areas of local availability, price, ease of use and ease of purchase.

“This Christmas will be a very important one for ebooks in Australia,” says Google’s eBook Partnerships Manager Mark Tanner. “Devices that are ebook ready will be a very popular gift item,” he says.

With barriers to ebook adoption coming down, this could be the Christmas that ebooks go mainstream in Australia. One thing that points in this direction is Amazon’s move in September to sell Kindles through Woolworths’ Big W and Dick Smith chains. Prior to that, the Kindle was only available online from Amazon’s US site though Amazon still managed to ship more than 370,000 units to Australia, according to a PriceWaterhouseCoopers (PwC) estimate.

Price drops open up market for eReaders

A look at the Kindle’s pricing also shows how much more affordable eReaders have become. The cheapest model this Christmas is the Kindle WiFi which Big W is selling for A$139, a little more than half the price of the cheapest Kindle last Christmas. Competitors like Kobo have followed suit with its entry-level model matching the Kindle’s price.

Dedicated eReaders have been a key to the ebook market’s rapid growth. Amazon’s continuing success with its black & white Kindles in the face of competition from Apple’s iPad shows it remains an important option, especially since owners of dedicated eReaders spend more on ebooks than those who use smartphones, computers, or other general-purpose gadgets. PwC estimates that Amazon has 70% of this market in Australia, a position it achieved without the benefit of a local retail presence.

A hot new product category this Christmas is the colour ebook reader, led by the 7-inch Kindle Fire and Barnes and Noble’s second generation Nook Tablet. These won’t reach Australia until next year but rumours are that Amazon alone could ship 5 million units by Christmas. The Kindle Fire’s compact size and US$199 price point look set to make it a serious competitor to Apple’s hitherto-unchallenged iPad in the tablet market.

While Amazon is delaying the Fire’s Australian release, competitors aren’t waiting. Kobo’s new colour offering, the Kobo Vox, arrived in time for Christmas with Kobo partner Collins Booksellers selling it for A$299, about half the cost of the entry-level iPad. And local ‘social eReading’ start-up ReadCloud is selling the Cumulus, a 7-inch colour device preloaded with its reading app, through indie booksellers including Mosman’s Pages and Pages.

The entry of colour eReaders coincides with new generation ebook formats – EPUB3 and Amazon’s Kindle Format 8 – that will soon lead to richer, more colourful designs and content. Expect to see these ebooks appearing in 2012.

Google Ebooks opens for business in Australia

If you’re reading ebooks on a general purpose device or a non-Kindle dedicated eReader, good news arrived in early November with the long-anticipated launch of Google Ebooks in Australia. Almost a year after it launched in the US, Google opened its ebook doors to Australian readers through partnerships with Dymocks and online bookseller Booktopia. Partnerships with university bookseller The Co-op Bookshop and bookselling chain QBD will follow.

Google’s ebooks use the industry standard EPUB format. The company doesn’t offer a dedicated eReader like Amazon and Kobo. Instead its ebooks can be read over the internet using a standard web browser, or by using an eReading app that you install on your smartphone, tablet or PC. Google offers its own apps or you can use one like Bluefire, a free app for Apple’s iPhone and iPad that Dymocks recommends its customers use if they want to read Google Ebooks purchased from the Dymocks site. The bookseller also offers a Dymocks-branded app for Android devices.

Given how important branded devices have been to the success of ebookstores, it will be interesting to see if Google’s partners follow suit – or, indeed, whether Google itself releases a branded eReader to support its retail partners. In the US and Canada, Google promotes a third party eReader from niche player iriver but has so far avoided entering this market directly.

Google claims its Australian store will bring “hundreds of thousands” of ebooks to local customers. A search of the Dymocks site at launch showed 148,000 titles already in the catalogue, including many from Australia’s top publishers. Dymocks has integrated Google Ebooks into its Booklovers rewards programme so that ebook purchases earn credits that can be spent online or in-store on digital or printed books. It also sells ebook gift cards in-store and online.

Australia is the third international market that Google has entered since its original launch in the US in December 2010. In October this year, it entered the UK market through partnerships with academic bookseller Blackwell’s and book wholesaler Gardners whose Hive network supports independent booksellers. In early November, Google launched in Canada, choosing as partners the Campus Ebookstore and leading indie bookseller McNally Robinson.

Australia’s indie booksellers have been enthusiastic followers of Google’s ebook plans with many voicing hopes that they would enter the ebook market with Google-powered stores. But the absence of a shared technology platform among Australia’s independent booksellers would have made it difficult to offer full integration cost-effectively so Google launched without this facility. In the US, the American Booksellers Association has the IndieBound platform and in the UK Gardners has its Hive network, both of which simplify the ‘deep’ integration of Google Ebooks into bookseller websites.

Independents opt for local initiatives as they enter ebook fray

Aussie ebook start-ups Booki.sh and ReadCloud have jumped in to fill the vacuum created by Google – and by delays in the industry’s own platform, TitlePage, which was set to offer an ebook service. That now appears to be on hold as the industry lobbies government for a $5 million cash injection it says it needs to support independent booksellers with white label sites, and to compete in range and functionality with the large international players.

Melbourne-based Booki.sh launched its white label service in January, spearheaded by Readings and since joined by Fullers, Mary Ryans, Gleebooks, Avid Reader and Books for Cooks. ReadCloud is new on the scene. Its first site, Pages and Pages, launched in early November. ReadCloud could be the big beneficiary of Google’s absence from the indie market, claiming it’s signed up 200 bookstores to participate in its programme.

ReadCloud and Booki.sh are ‘cloud’ eReading systems meaning that your ebook library is stored on the web. Both systems allow ebooks to be read online or offline but they differ in how they do it. Booki.sh is the simplest. All you need to read its ebooks is a modern web browser so there’s no software to install. And it uses a feature of new browsers called ‘offline caching’ to store a local copy that you can read when there’s no internet connection. One advantage of the Booki.sh system is that you can even read its ebooks on some Kindle models using their built-in web browser.

ReadCloud uses a different system. You must first download the ReadCloud software or app in order to read its ebooks. To read offline, you download the ebook in EPUB format with Adobe encryption. This also makes the ebooks available to eReaders such as Sony, Kobo and others that support the widely-used EPUB/Adobe DRM combination.

Interestingly, Google Ebooks is a hybrid of these two approaches: Like Booki.sh, it allows online and offline reading using just a web browser; and like ReadCloud, it offers eReading apps and the ability to download an EPUB file wrapped with Adobe DRM for offline storage and reading.

But there’s good news for Australian booksellers, bloggers and other website publishers who might want a simple ebook option to test the waters. Google opened its affiliate network – the same one it uses to serve ads on partner sites – to Google Ebooks. This means you can place links to Google Ebooks on your site and earn a commission if the visitor you sent ends up buying an ebook. At its simplest, this can just be a link to the Google Ebooks home page but other options are available to link to specific books or to lists of titles.

With local booksellers now staking out their ebook territory, will the readers buy?

We seem to have gone very quickly from famine to feast with many competing – and perhaps confusing – options now open to Australia’s reading public. So will they buy from bricks and mortar booksellers or will the international online giants like Amazon leave little on the table for local businesses?

Jon Page, of ReadCloud partner Pages and Pages Booksellers, thinks the public will support the locals. “We want to give our customers the same service and expert advice they expect from us for physical books. The response has been fantastic so far,” he says. Among Page’s initiatives to achieve this is an in-store kiosk that brings the ebookstore inside the physical store.

From selling and supporting eReader hardware, to various promotional tie-ins such as Dymocks’ Booklover loyalty scheme, to serving communities with specialist needs such as campus bookstores, the new players will be aiming to pick up market share points from the giants, a point at a time.

Readings’ Mark Rubbo is under no illusions about how tough this will be. “It is going to be pretty hard for anyone to compete seriously with Amazon’s clout and GST free prices. The best we can hope for is to build a niche that complements what we do physically,” he says.

Kobo’s Malcolm Neill thinks all of the activity is going to be good for the market. “With the independent booksellers establishing a couple of boutique ebook options and Google finally reaching the market, we think that the education of the consumer in digital reading will now move at a rate commensurate with the rest of the world,” he says.

And that consumer awareness and education spells good news all around. In a rapidly rising market, it should leave plenty of room for newcomers.

 [This story was originally published in the November issue of the Australian Booksellers Association magazine News on Bookselling.]

Almost a year after it launched in the US, Google has opened its ebooks business to Australian readers through partnerships with national bookselling chain Dymocks and online bookseller Booktopia.

The two sites went live today and will bring “hundreds of thousands” of ebooks to Australian customers. A search of the Dymocks site shows 148,000 titles already in the catalogue including many from Australia’s top publishers. Dymocks plans to integrate Google Ebooks into its BookLovers rewards programme so that ebook purchases earn credits that can be spent online or in-store on digital or printed books.

Google’s Australian launch will soon include partnerships with university bookseller The Co-op Bookshop and bookselling chain QBD. And it comes just a day before another offering comes to market. High-profile indie bookseller Pages & Pages kicks off a series of launches from indie booksellers who are adopting the made-in-Australia “social eReading software” ReadCloud.

Google’s Australian move follows its opening in the past month of UK and Canadian ebookstores. Its strategy is to sell through partners as well as selling directly from its own site, Google Ebookstore, and via its iOS, web and Android apps. In choosing its early partners, Google is focusing on quality operators with bookselling experience, making it a direct rival of Canadian operator Kobo.

However, in one respect they’re different: so far, we haven’t seen a Google-branded ebook reader backing its offer. Google has also been much slower than Kobo in doing deals with ebook manufacturers to make it their preferred ebookstore. So far, a deal with minor player iriver back in July is the only one that Google has done. This mirrors the cautious approach Google took with its Android smartphone where it initially worked with a single partner HTC.

We can expect things to change now that Google has bedded in its systems and is developing broader distribution. It will have an added incentive to quicken the pace with the announcement from US number two ebookseller Barnes & Noble that it will be rolling out its successful Nook internationally in 2012.

Meanwhile, in that far outpost of Australia, New Zealand, we’re yet to see Google Ebooks and Google representative Mark Tanner confirms there’s nothing to announce at this stage. Dymocks is active in New Zealand but its Australian store is off-limits to New Zealand customers and Google’s own app is yet to appear in Apple’s New Zealand App store. Indeed, we’re still waiting for Apple’s iBookstore to open to New Zealand consumers, a year after it reached Australia. So for now, Kindle and Kobo, the latter through local bookselling chain Whitcoulls, remain the only major players for Kiwi readers.

Amazon’s loving its Kindle owners. The retail giant is letting Kindle owners who sign up for its US$79 Prime service borrow an ebook each month for no extra fee. Prime is a premium service for Amazon customers that started as an offer of unlimited shipping for a one-time annual payment. That US$79 fee now includes the original shipping offer, a streaming video service with 13,000 movies and TV shows, and the Kindle Owners’ Lending Library.

The Prime service is restricted to US residents at the moment. In addition, to take advantage of the Kindle Owners’ Lending Library, you need to be — a Kindle owner. A Kindle app user won’t cut it. Amazon is clearly using this to encourage its users to support the full Amazon kit.

Members of the lending programme can choose from an initial catalogue of 5,000 titles. There’s no time limit on their loan period but they can only check out one ebook at a time and they can borrow a maximum of one ebook a month.

And it looks like it’s not just libraries who struggle to get ebook lending rights from publishers. Amazon has had to do some arm-twisting itself to get publishers on board. There are no titles from the US Big Six publishers and the company admits that in some cases it’s actually buying a copy at full wholesale price each time the ebook is borrowed. Amazon is clearly determined to prove its belief that lending will be good for everyone, not just Amazon. “Kindle owners will read even more, publisher revenues will grow, and authors will see larger royalty checks,” argues Russ Grandinetti, Vice President, Kindle Content.

The Kindle Owners’ Lending Library follows Amazon’s move in September to open up the Kindle platform to ebooks borrowed from public libraries.  This initiative, again for US customers only, is operated through a partnership with library ebook distributor OverDrive and shows Amazon’s determination that its Kindle owners won’t be penalised for their loyalty: library ebooks are almost universally now in the EPUB format which isn’t directly readable on Amazon gadgets.

While today’s move is great for Amazon’s customers, and might be good news for publishers and authors, it should prompt libraries to consider how it might impact on them longer term. It’s clear now that lending books on a commercial scale will no longer be a de facto library monopoly. Amazon and others (Google has already hinted at some sort of rental service) are determined to supply digital content to consumers in as many ways as they want it. And they are sure to do it in a way that makes commercial sense for both Amazon and the publishers and authors who, for now, can call the shots on how — and whether — these deals are done.

One thing is for sure, when it comes to doing deals to get digital lending rights, libraries are no longer the only game in town. If libraries aren’t feeling threatened, they should. Are we going to see something akin to the impact of cash-rich pay TV which routinely outbids free-to-air and public service broadcasters for premium content? If our libraries become repositories of second-tier content, we’ll all lose. This doesn’t have to happen but it needs big changes all round to give our libraries the chance to stay relevant.

A couple of weeks ago, the publishing industry’s EPUB3 specification was finally signed off. This was the cue for device makers and e-reading app developers to build it into their next releases and for publishers to start work on enhanced ebooks. Now Amazon has responded with its own next generation ebook format, Kindle Format 8 (KF8), complicating things for publishers.

Like EPUB3, the new Kindle format introduces support for the latest web standards, HTML5 and CSS3, and adds a host of new features that will allow development of much richer ebooks. From Amazon’s announcement:

KF8 is the next generation file format for Kindle books – replacing Mobi 7. As showcased on Kindle Fire, KF8 enables publishers to create great-looking books in categories that require rich formatting and design such as children’s picture books, comics & graphic novels, technical & engineering books and cookbooks. Kindle Format 8 replaces the Mobi format and adds over 150 new formatting capabilities, including fixed layouts, nested tables, callouts, sidebars and Scalable Vector Graphics, opening up more opportunities to create Kindle books that readers will love.

This is good news. But for those of us who had hoped that EPUB3′s arrival might prod Amazon into adopting direct EPUB support, this announcement is a pretty clear indication that, if it comes at all, it will be some way into the future. We’ll have richer, higher quality ebooks but we’ll have incompatible formats. For the time being, this probably won’t bother Amazon’s users who are a happy lot. Amazon has done a great job of pleasing them with an eco-system that’s easy to use, with the best selection of ebooks, and support for most of the e-reading devices they’re likely to want to use.

But for publishers, it could add challenges as the new features these formats offer mean ebook production requirements and costs will scale up. And for the newly-minted EPUB3, it poses a challenge to stay relevant as Amazon’s importance as the number one sales channel might tempt some publishers to bypass it.

Even where sales of EPUB ebooks lag behind Kindle sales, many publishers have now built their workflow around EPUB as their primary source files. These convert well into the current Kindle format, allowing publishers to maintain a single format. To keep this workflow, it will be important that Amazon supports error-free EPUB3 conversion in its Kindle Gen 2 toolset. But as complexity increases, so do the opportunities for things to break. We won’t know until Amazon releases more details whether EPUB3 can continue to serve as this reference format. Indications are that EPUB3 is a richer format so publishers might want to restrict themselves to a feature subset that’s common to both platforms. No mention yet, for instance, of JavaScript support, MathML, or EPUB3′s extensive accessibility features.

It will certainly be in Amazon’s interests to make sure that ebooks look and function as well on a Kindle as they do on an EPUB3-compatible e-reader. What we still don’t know is whether Amazon might use its current dominance to lead, rather than follow, the industry standard. We’ve seen this in the “browser wars” that for many years saw web browser vendors, especially Microsoft, introducing non-standard features to try to keep users in its camp and drive the standards in ways that suited their interests. Could we be in for the e-reader wars?

We might start to see the so-called “embrace and extend” strategy that’s familiar in the wider tech world. This tug-of-war strategy sees a dominant vendor selectively adopt an industry standard in a show of inclusiveness but extend it with unique features in an effort to draw developers and users into its ambit. We’ve already seen Apple filling the vacuum prior to the release of EPUB3 with its own ‘fixed layout EPUB‘, an extension of the EPUB standard aimed at the illustrated book market that only works with its iBooks e-reader app.  Here’s hoping EPUB’s dream of a single format isn’t stillborn and Amazon, Apple and others decide to play nicely this time. Otherwise, publishers and users will get caught in the cross-fire of another format battle.