Spanish publishers form ebook distributor, hope to set market’s direction

Spain’s three biggest publishers have joined forces to form a digital distributor with the aim of influencing how the Spanish-language ebook market develops.

The three companies — Planeta, Random House Mondadori, and Santillana — collectively control 70% of the Spanish book publishing market and hold worldwide digital rights to most of their Spanish language titles. They’ve launched this initiative in conjunction with the Association of Spanish Literary Agencies (ADAL). What’s particularly interesting is the terms they’ve collectively agreed in an effort to control the direction of the market early. Among them:

  • They’ve agreed to price ebooks at 80% of the standard paper book cover price and are intent on enforcing this as far as they can.
  • Authors will receive a standard 25% royalty (I presume based on net receipts but this is not clear in the article reporting the initiative).
  • Booksellers will receive a maximum discount of 50%.
  • Publishers plan to apply DRM to books but hope to soften the impact by providing the consumer-friendly right to download to multiple devices.
  • They hope to be publishing all front list titles simultaneously in ebook and pbook editions by mid 2011.

They are looking at the market for smartphones as an early target — no talk of sitting on their hands waiting for Sony or Amazon’s readers to appear. In fact, the initiative is positively hostile to Amazon based on Amazon’s heavy discounting strategy. The Spanish market, it seems, has a policy of selling books at fixed retail prices and the publishers are hoping to bring some of that order to the digital marketplace. This would be music to the ears of this English language publisher who has taken to delaying ebook releases in order to retain the premium associated with the first hardback edition of new books that is common in US and UK markets.

I find this Spanish initiative really interesting because it’s trying to tackle the key challenges that all book publishers are facing as they migrate to the often free-for-all internet. Their actions won’t please the “internet should be free” believers (‘free’ in the sense of uncontrolled as well as unpaid).

On a related topic, I’m currently listening to the excellent Reith Lectures from the BBC (try here if there’s still not online on BBC Radio 4). The present lecture series from Harvard’s Professor of Government Michael Sandel is on the topic of a ‘new politics of the common good’. There are some interesting parallels between our present faith in the internet to manage itself for the common (global) good and our faith in the markets to do the same in the economic sphere, a faith that has taken a battering.

We have some difficult issues to work through about how we keep what’s good about the global internet while trying in rein in some of its excesses. The issues book publishers are grappling with as they migrate to digital forms bring a lot of these challenges into sharp focus.

One of these is the propensity of the internet to create huge, globally dominant players like Google and Amazon whose scale can create serious problems. For instance, they can be price setters rather than takers, imposing a pricing regime that might not work in some markets. This will be part of the Spanish publishers’ challenge with Amazon. It’s also a big problem that Google has created for the advertising-supported media industry such as newspapers. Unlike ‘old’ media companies, Google doesn’t itself create content, but by selling advertising impressions so cheaply the income flowing back to content creators will no longer cover the real costs of producing that content.

My guess is that anti-trust actions that have characterised each wave of information technology (AT&T in the US phone market, IBM, Microsoft and probably soon Google) will be played out across many sectors as these mega-sites begin to infringe on the viability of local and national economic and social interests. It’s certainly something that all publishers, politicians and the wider public — among many other groups — will need to do some hard thinking about. Another pick: copyright (in particular territorial rights) and taxes will be two of our allies in the forthcoming battles for national and local sovereignty and sustainability.

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