Amazon Strings And Unified Publishing Theory

In the bricks-and-mortar world, competition and pricing are relatively straightforward relationships. If you spend the money to open a supermarket sized bookstore next to a competing supermarket sized bookstore, casual customers are as likely to enter your store as the long established competitor and to shop on price. More frequent buyers may be enrolled in various customer loyalty programs that offer them discounts or other perks for remaining loyal, but even they are fairly likely to stick their heads in the door just to see what you have to offer. There’s very little tying the customer to the retailer because the product, a book, is a self contained platform for delivering content. The only physical tie between books and retailers comes if a retailer has exclusive rights to a printing, and the customer wants to purchase a series of books that will create a particular aesthetic on the shelf.

Unified publishing theory has always been based on the notion of customer loyalty. Many of the assumptions that go into publishing business models assume customer loyalty to the author, to the brand, even to the press in special cases. A publisher’s backlist played the role of gravity, bending space around the publisher’s frontlist and making it easier to introduce new titles and authors, therefore drawing in the authors who attract readers. The forces that held the publishing universe together worked with large numbers, averages, digesting and smoothing out trends and shooting stars. Then along came Amazon, and the picture began to change radically. The Amazon model of cookie based one-click buying, free shipping with a premium option for serious shoppers, a robust platform for reviews and aggressively matching competitors prices without being asked, has altered the publishing universe. Amazon has successfully tied billions of strings between itself and its customers, giving it tremendous leverage with publishers and putting incredible pressure on competing book retailers. While unified publishing theory described the static publishing model of the 20th century. Amazon string theory describes the publishing business of the Internet Age.

With Amazon, we have a terrific example of a company that looked to the future and decided that the way to protect their own near-monopoly was to be first out with their own displacement technology. In one sense, the endgame for Kindle is to be an Amazon 1.0 killer, to disrupt and eventually push aside the core Amazon model of selling paper books by mail. The Amazon 1.0 model was so effective that it changed the economics of publishing for all of the major players: authors, publishers, printers and retailers. The Amazon 2.0 model, Kindle, didn't have much potential to financially impact the publishing landscape in its first two years of life because whatever you thought about the technology, its market penetration was relatively low. While publishers, early adopters and some heavy readers flocked to the device, there was never any reason to assume it would become popular with the general public who account for the majority of book sales by purchasing a few books a year. The economics of a dedicated hardware reader just don't make sense for the infrequent book buyer.

But the release of the Kindle reader for PC and Mac changes the economics of Amazon's eBook effort in a fundamental way. Today, customers shopping for books will have to consider price and convenience in every purchasing decision when a Kindle version is available. Since Amazon customers are all computer owners, or at least have access to a computer, they are now only a brief, free software installation away from being able to choose a Kindle version. That installation will tie a whole new generation of strings between Amazon and its customers, but it’s a problem for publishers. The only real competition Amazon has in the unified publishing space is Barnes&Noble, whose new eReader, brand, and existing platforms give them a chance to convince publishers and customers that they at least remain an option. Barnes&Noble also surpasses Amazon in at least one direction, that of publishing their own original books for sale in their stores, and that doesn’t earn them any brownie points with competing publishers.

I began running a Kindle experiment a few months ago, “giving away” the Kindle version of my publishing book for $1.95, and it tripled the sales over the last three months (my apologies to the correspondent I told it had little impact, I hadn’t been paying attention). But that tripling of sales led to a 40% decline in Kindle revenue for that eBook, and worse, it seemed to have had a negative impact on paper sales. Now that Amazon is making that “give away” available to everybody, I’ve submitted a price increase back up to the paper book price, though a few days have gone by without the change taking effect. Publishers of newspapers and magazines who adopted the Kindle platform and priced their publications in accordance the assumption that Kindles aren't common enough to eviscerate their print economics are so far excluded from the new PC and Mac reader programs.

As I wrote back in 2005 when I first noted that Amazon was on the way to competing directly with publishers on public domain books in print-on-demand, "Now that they own the cow, the milking machine and the distribution, the economics would be interesting." With Kindle, Amazon has taken it a step further to own a space in your home, be it the Kindle reader or the Kindle application on your computer, for the exclusive use of Amazon products. I tend to believe that gravity is working in Amazon’s favor, I just hope they don't turn into the black hole of publishing. In the meantime, keep your eyes peeled for publishing supernovas, companies throwing every last dollar into one brief burst of unsustainable activity before collapsing in on themselves and their industry creditors to become white dwarfs of bankruptcy.

Publishing Interactive Books And Smart Textbooks

Publishers seem to have forgotten that evolution can only work if every intermediate step is viable. There’s a rush on to bring out pointless “next generation” eBooks in the hope that they will be a stepping stone to a new type of interactive book that publishers can’t quite describe yet. Sorry, it doesn’t work that way. The reason people put up with mainframe computers programmed by stacks of punch cards is that the mainframes replaced large numbers of clerks doing work on mechanical calculators and filing by hand. Mainframes were cost effective, time saving devices. Yet publishers seem intent on bringing out ill-conceived book hybrids with video or a gloss of glitz added by designers simply to demonstrate that it can be done. Whether books are read out loud, on paper, on screens, or written in the clouds, the essence of the book is to be read. Slipping in some multi-media isn’t an improvement or an evolutionary step for books. It’s way to grab headlines and raise money from gullible investors.

I started with the bean counting mainframe example for a reason. The closest thing I know of to a mass market interactive book today isn’t a book at all, it’s tax preparation software. Every year tens of millions of Americans spend a couple hours reading screen prompts and answering interview questions for a simple piece of software to complete their tax filing. Tax interview software is a compelling model for interactive books because it works well, is widely accepted, and performs a critical task. If people are willing to use what is essentially a simple interactive eBook to keep the IRS at bay, it’s a proven foundation to build on. Math performed by the tax software is trivial in most cases, primarily addition and subtraction. The interview questions save users from having to read through large piles of puzzling IRS publications, and having read plenty of them in 17 years of filing my own business tax returns, I can understand the savings. So I would define non-linearity as the first evolutionary step for smart books, a form of addition by subtraction. There’s tremendous value in a reference text that doesn’t make you read through the parts you don’t need to get the information you want, and that requires a new level of interaction between the reader and the book. A traditional index doesn’t do the job because you can only use an index if you already understand enough about the subject to make meaningful choices.

I’ve been working on ways to make my books interactive since I started publishing online back in 1995. Since paper books lack the built-in processing power of computers, the only way for readers to interact with a paper book is for the processing to come from their brain power. The first edition of my smart textbook was published in 2003, and used flowcharts to guide the reader through a troubleshooting process, with a nonlinear text offering additional information on-demand. The figure below shows a basic flowchart:



And the next figure shows how the flowchart decision points are used to navigate the nonlinear text by repeating the flowchart symbols in the margins.



The result is an interactive book that offers some of the advantages of an expert system without requiring a computer processor. Today, with readers and publishers pushing to move eBooks into the mainstream, the opportunity to introduce interactive books and living texts on all available platforms is wide open. Although Wikipedia defines “rich media” as “interactive multimedia,” in current practice I see publishers using rich media for anything that offers text plus. The plus can be audio, video, pictures, hyperlinks, but the only richness I’ve seen provided is through the reader starting things in motion by clicking. Well, a light switch is interactive because you flip the switch and the lights go on or off, but it’s hardly innovation at this point in history.

A book can be interactive in several different ways. A paper book can interact with the reader powered by the reader’s brain as with my flowcharts or any other nonlinear schema. An eBook can drive the interaction through a computer program conducting an interview process or otherwise reacting to reader input, and a living book can also interact with data sources by way of the Internet. One critical element for future books read on any dynamic surface will be live updates. Why should a financial planning book be full of obsolete information about interest rates, stock prices and bond spreads, when all of that information can be updated each time the book is opened? Why should a tour book leave disappointed people standing in front of buildings that are closed for renovation or which have doubled the cost of admission? Tour guides are also a natural for integration with GPS enabled devices. Adding a little programming and an interview process could produce tailored tours that get people to the places that interest them and don’t strand them at noon a two hour walk from the restaurant where they want to have lunch. By asking the right questions, a truly interactive book will leverage the knowledge of the author so that the reader doesn’t need to master the subject before getting any benefit from the book.

Creating useful interactive books will require close cooperation between the author and publisher, though I’m sure plenty of publishers will settle for adding a gloss of interactivity that’s all smoke and mirrors. Hyperlinking all the proper names or paying contract designers to add rich elements will create a distraction rather than true interactivity. All of this translates into an advantage for self publishers who can choose their platform without regard to some overarching corporate strategy and quickly take advantage of new devices for reading interactive books. Self publishing also allows the author to control every stage of the publication process, and to react on the fly if the experience of the real-world reader doesn’t work out as planned. A model for interactive fiction might look less like today’s novels than like computer game games, primarily role playing fantasy games, as opposed to shoot-to-kill video console stuff.

My first foray into smart textbooks was creating an educational multimedia CD back in the early 90’s. Based on a local author’s natural history textbook for K-12, it started with the idea of using simple animation sequences along with narration. But I quickly found myself adding true interactive features, quizzes and matching games, such as identifying birds by their calls or classifying trees by their leaves, bark or silhouette. The program could keep track of right answers and wrong answers, so as the “game” went on, it would naturally focus on whatever the child was having trouble learning. The amount of useful interactivity you can add to any smart textbook along these lines is limited only by your budget and the available technology. For the time being, I don’t see any way to do this with Kindle or the other eBook readers which seem focused on presenting dead texts, but it would be easy to implement with netbooks, iPhone apps or other smart devices being used to read eBooks.

The ultimate model for smart textbooks and interactive books will be “always on” connectivity with the Internet, though it will be entirely transparent to the reader as a cloud computing application. All that’s required is a device capable of displaying text or playing an audio book to the reader, and some way for the reader to physically interact with the device (touchscreen, buttons, movement sensors, etc.) It’s the direction I’d like to move my publishing business, and I’m ambitious to expand beyond the areas I’ve been publishing in to date. This week I’m trying to decide whether or not I want to work with partners on projects that I wouldn’t want to take on alone. For the time being, I think the simplest platform for developing, marketing and selling interactive books remains a website, and a website optimized for cell phone display may be the way that I end up going. I hope some of my blog readers are thinking about similar projects, because the time is now.

Niche Publishing Math And Trashing Art

Not too many years ago, the rule of thumb said that trades publish around seven times as many nonfiction titles a year as fiction titles, but that the aggregate sales of nonfiction vs fiction titles are about the same. These numbers referred strictly to trade publishing, which roughly means books intended to be sold in general bookstores, as opposed to textbooks, professional books and religious books. I don't remember the source for this relationship between fiction and nonfiction, but it agrees with observations on the nature of niche publishing. For fiction and nonfiction books to sell the same total when there are seven times as many nonfiction books published by substantial trades, the average fiction book would need to sell seven times as many copies as the avergage nonfiction title.



So why do most self publishers make their living writing nonfiction, and why do most successful boutique publishers focus on nonfiction as well? Even though the seven-to-one rule doesn't include self published books, you might think that the relative lack of competition would make fiction the low hanging fruit. It doesn't work that way because fiction is dominated by bestsellers that pull the average sales for fiction titles way up, and persist year after year as backlist titles long after most nonfiction books have become obsolete. While there are niches in fiction as well as nonfiction, they are not as sharply defined in fiction, and therefore serve a wider audience.



Take a large fiction genre, like Tolkien style fantasy books. Some readers might like stories with lots of dragons in them, some may prefer heroines over heroes or magic over swashbuckling. But the mainstream of that audience will read any well written adventure tale set in a distant past or future earth where there are no cars, some seemingly unremarkable young villagers destined for greatness, and plenty of good and evil. Yes, I'm sure there are subgenres where everybody is naked and the plot lines are little thinner, but even there, readers are paying for the author's story telling ability. Most fiction readers would rather pay a premium for "Book The Sixth" of a twelve book series than a read a free copy "Book The First" from an unknown, and that's a fact.



Now take a large nonfiction genre, like diet books, though many dissapointed readers may conclude that diet books should have be sold as fiction as well. While every year does yield a few bestsellers promising weight loss, there's an even larger market for specialty diet books, which promise everything from low environmental impact to longer life and cures for whatever ails you. And these diet books don't just give a chapter to each subject. Whole books, even series of books, are written about systems of selecting food, cooking and eating, that essentially target converts to the system. Most are from boutique presses or self publishers, their print runs are short and they are usually sold at lectures, in specialty food stores or by mail order rather than through bookstore chains.



The math is really pretty simple. The smaller the niche, the less likely a commercial trade publisher will have any interest in targetting it. While a large trade may not automatically fire an acquisitions editor for sponsoring several books in a row that sold less than 5,000 copies, they'd be within their rights to do so since they need higher sales to make their overhead. So access to the true niche markets is basically restricted to small trades, boutique presses and self publishers who have very low overhead, long time horizons, and a deep understanding of the market they are targetting. Large trade publishers can't afford to develop a deep understanding of a market that won't support the salary of the editor assigned to learn it. And niche publishing is ideal for website marketing, something the large trades seem incapable of learning.



So what about the fiction authors, graphic novel and comic book writers who do the convention tours and starve for their art? I've seen some really beautiful self published comics and graphic novels over the years, some were even critical successes, but I don't personally know anybody making a decent living at it through self publishing. There simply aren't the sort of natural audiences for creative art that exist in nonfiction for self identified cultists, do-it-yourselfers, and fanatics for every obscure branch of learning. The artistic markets are driven by popularity, and popularity is that funny thing that once it's acheived, you're no longer in a small niche.



Because popularity is the coin of the realm for fiction writers, and because that coin has much more value in the Internet age than it had just a dozen years ago, I believe that trade contracts for fiction authors will become much more restrictive in the future. In the days before POD and eBooks, large trades primarily worried about their authors moving to a different large trade. Today, it's becoming apparent that many of those authors, particularly those who scratch out a living but aren't getting rich, would do better cashing in their popularity by self publishing or forming co-ops. The large trades will figure this out, and will start moving all new fiction authors in the direction of romance writers, where contracts often give the publisher rights to the author's pseudonym, characters and brand. It also means that much of the advice aspiring fiction authors receive from established fiction writers will be of limited use. The world won't change that much for those authors who have already established and own their brands, but new fiction writers, even those with agents, simply won't get the same opportunities.

The artwork in this blog post comes courtesy of curbside garbage on a public street that I happened to walk by just as the rain was starting. It's always bothered me to see people trashing art, and when it's framed art behind glass and you know somebody who needs picture frames, it looks like a crime. I rather like the top one, can't make out the artists name, though it may be something like Ruhl. If it will separate from the mat, I'll bring it home in a mailing tube. The third one is a numbered print by a Giora Oppenheimer, if I'm reading the name correctly, and I believe they are all works from students of the Bezalel art and design academy done in the 1970's.