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October 18 2012

Commerce Weekly: Targeting Amazon

Here are a few stories that caught my attention in the commerce space this week.

Strategic maneuvers aimed at Amazon

Best Buy LogoBest Buy LogoRetail competition against Amazon is starting to heat up coming into the holiday shopping season. On the heels of Wal-Mart’s recent moves to square off against Amazon, two other big box brick-and-mortar retailers have announced strategies targeting the Internet retail giant.

Ann Zimmerman reports at The Wall Street Journal that Best Buy not only will price match with Amazon this holiday season, but will also offer free delivery for products that are out of stock. Target has its sights set against Amazon as well. In a report on Target’s planned holiday strategy, Natalie Zmuda at AgeAge notes that tactics include “a price-match guarantee against a group of competitors that includes popular online retailers such as Amazon.” Target also is using QR codes in its holiday campaign to combat “showrooming” on the top 20 selling toys.

In somewhat related news, the US Post Office also is making moves into the e-commerce market. Victoria Stilwell reports at Bloomberg that starting in November, the US Post Office will begin testing its same-day delivery program, called Metro Post, in the San Francisco market. The service is aimed at local physical retailers, which could in turn give them a leg up against Internet retailers like Amazon. Stilwell reports that to participate in the Metro Post test, retailers need 10 or more physical locations throughout the US, with one or more within the test market boundaries.

Square exits taxis

New York City’s Taxi & Limousine Commission (TLC) spokesman Allan Fromberg this week unequivocally dismissed rumors from last week that Square was negotiating an official partnership with TLC, alongside news that Square has ended its pilot payment program with the TLC.

Garett Sloane at The New York Post reports that a letter (PDF) sent by Square’s general counsel Dana Wagner to the TLC on Friday “indicated that [Square] needed to overhaul its payment system in light of new rules the commission is drafting to govern credit-card payments in cabs.” Wagner writes in the letter:

“Square has determined, in light of developments in prospective taxicab regulations in New York and other markets, and based on what we have learned conducting the Pilot Program to date, that we wish to pursue a different hardware and software solution for our TPEP [taxicab passenger enhancement project] offering. It would be commercially unreasonable for Square to pursue a new hardware and software solution for a future TPEP offering while at the same time continue to support the software and hardware solution we rolled out in the Pilot Program.”

Ryan Kim at GigaOm says it’s likely that Square will continue working on a taxi-payment product, quoting Wagner’s letter: “… Square looks forward to further improving our product and making commerce and transportation easier for millions of riders and drives in New York and around the country.”

In other Square news, company CEO Jack Dorsey announced that Square would no longer refer to its customers as “users” and appealed to others in the technology industry to follow suit. He writes in a blog post: “The word customer, given its history, immediately sets a high bar on the level of service we must provide, or risk losing their attention or business.” His post includes a letter he sent to his team that explained: “We don’t have users, we have customers we earn. They deserve our utmost respect, focus, and service.”

Isis is gearing up for launch

Google Wallet competitor Isis is finally gearing up to launch its wallet, after a series of delays this summer. The company confirmed it would officially launch in the Austin, Texas and Salt Lake City, Utah markets October 22.

Nathan Olivarez-Giles reports at Wired that the Isis mobile app has shown up in Google Play, but notes that the Wired team had yet to find a compatible phone. Isis head of marketing Jaymee Johnson told Olivarez-Giles, “By year end, as many as 20 Isis-ready handsets are expected to be in market …We look forward to sharing more details on Oct. 22.” Those details likely will include partnering retailers as well. Isis announced partners in May, but as Olivarez-Giles notes, it’s not yet clear which ones will be part of the initial launch.

Tip us off

News tips and suggestions are always welcome, so please send them along.

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April 13 2012

The sorry state of ebook samples, and four ways to improve them

This post originally appeared on Joe Wikert's Publishing 2020 Blog ("Rethinking Samples"). This version has been lightly edited.

I'm bored with ebook samples. I feel like I'm collecting a bunch and then forgetting about most of them. I'm pretty sure I'm not alone, and I'm even more certain this adds up to a ton of missed sales opportunities. Although this would be impossible to prove, my gut tells me the revenue missed by not converting samples into sales is a much larger figure than the revenue lost to piracy. And yet, the publishing industry spends a small fortune every year in DRM, but treats samples as an afterthought.

Think about it. Someone who pulls down a sample is already interested in your product. They're asking you to win them over with the material you provide. Far too often, though, that material is nothing more than the front matter and a few pages of the first chapter. Some of the samples I've downloaded don't even go past the front matter. I'm looking for something more.

Let's start with the index. Would it really be that hard to add the index to ebook samples? No. And yet, I've never seen a sample with the index included. Sure, many of these books have indexes that can be viewed separately on the ebook's catalog page, but why not include them in the sample? Give me a sense of what amount of coverage I can expect on every topic right there in the sample.

How about taking it up a notch? Give me the first X pages of the full content, include the entire index at the end, and in between include the rest of the book but have every other word or two X'd out? That way I can flip through the entire book and get a better sense of how extensively each topic is covered. By the way, if the entire book is included like this, then the index can include links back to the pages they reference.

Next up, why do I have to search and retrieve samples? Why can't they be configured to automatically come to me? After a while a retailer should be able to figure out a customer's interests. So why not let that customer opt in to auto sample delivery of ebooks that match their interests? I love baseball. Send me the samples of every new baseball book that comes out. I've got plenty of memory available in my ereader, and I can delete any samples I don't want. Also, I've mentioned this before, but it's worth saying again: How about letting me subscribe to samples from specific authors? Again, it would be an opt-in program, but I wonder how many interesting books I've missed because I didn't discover the sample.

Finally, this problem doesn't appear until after the sample is converted into a sale, but why can't the newly downloaded ebook open up to where I left off in the sample? Seriously, this has got to be one of the easiest annoyances to fix, so why hasn't anyone taken the time to do so?

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January 05 2012

Strata Week: Unfortunately for some, Uber's dynamic pricing worked

Here are a few of the data stories that caught my attention this week.

Uber's dynamic pricing

Uber logoMany passengers using the luxury car service Uber on New Year's Eve suffered from sticker shock when they saw that a hefty surcharge had been added to their bills — a charge ranging from 3 to more than 6 times the regular cost of an Uber fare. Some patrons took to Twitter to complain about the pricing, and Uber responded with several blog posts and Quora answers, trying to explain the startup's usage of "dynamic pricing."

The idea, writes Uber engineer Dom Anthony Narducci, is that:

... when our utilization is approaching too high of levels to continue to provide low ETA's and good dispatches, we raise prices to reduce demand and increase supply. On New Year's Eve (and just after midnight), this system worked perfectly; demand was too high, so the price bumped up. Over and over and over and over again.

In other words, in order to maintain the service that Uber is known for — reliability — the company adjusted prices based on the supply and demand for transportation. And on New Year's Eve, says Narducci, "As for how the prices got that high, at a super simplistic level, it was because things went right."

TechCrunch contributor Semil Shah points to other examples of dynamic pricing, such as for airfares and hotels, and argues that we might see more of this in the future. "Starting now, consumers should also prepare to experience the underbelly of this phenomenon, a world where prices for goods and services that are in demand, either in quantity or at a certain time, aren't the same price for each of us."

But Reuters' Felix Salmon argues that this sort of algorithmic and dynamic pricing might not work well for most customers. It isn't simply that the prices for Uber car rides are high (they are always higher than a taxi anyway). He contends that the human brain really can't — or perhaps doesn't want to — handle this sort of complicated cost/benefit analysis for a decision like "should I take a cab or call Uber or just walk home." As such, he calls Uber:

... a car service for computers, who always do their sums every time they have to make a calculation. Humans don't work that way. And the way that Uber is currently priced, it's always going to find itself in a cognitive zone of discomfort as far as its passengers are concerned.

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Apache Hadoop reaches v1.0

Hadoop logoThe Apache Software Foundation announced that Apache Hadoop has reached v1.0, an indication that the big data tool has achieved a certain level of stability and enterprise-readiness.

V1.0 "reflects six years of development, production experience, extensive testing, and feedback from hundreds of knowledgeable users, data scientists, and systems engineers, bringing a highly stable, enterprise-ready release of the fastest-growing big data platform," said the ASF in its announcement.

The designation by the Apache Software Foundation reaffirms the interest in and development of Hadoop, a major trend in 2011 and likely to be such again in 2012.

Proposed bill would repeal open access for federal-funded research

What's the future for open data, open science, and open access in 2012? Hopefully, a bill introduced late last month isn't a harbinger of what's to come.

The Research Works Act (HR 3699) is a proposed piece of legislation that would repeal the open-access policy at the National Institutes of Health (NIH) and prohibit similar policies from being introduced at other federal agencies. HR 3699 has been referred to the Committee on Oversight and Government Reform.

The main section of the bill is quite short:

"No Federal agency may adopt, implement, maintain, continue, or otherwise engage in any policy, program, or other activity that

  • causes, permits, or authorizes network dissemination of any private-sector research work without the prior consent of the publisher of such work; or
  • requires that any actual or prospective author, or the employer of such an actual or prospective author, assent to network dissemination of a private-sector research work."

The bill would prohibit the NIH and other federal agencies from requiring that grant recipients publish in open-access journals.

Got data news?

Feel free to email me.

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November 30 2011

The paperless book

Stephen Colbert opened his October 25th, 2011, show with his normal exuberance. He bragged about his special early access to the iPhone, the iPad, and the iV (a product that feeds the Internet directly into your veins; he assured us a short wait of six months before its release). The release of Walter Isaacson's "Steve Jobs" would be no different, as Colbert pulled the 600-page biography from behind his desk. But Colbert immediately became perplexed.

The single finger touchscreen swipe on the cover didn't turn pages. When you turned the book upside down, the picture didn't reorient. Colbert complained there was no place to plug in his headphones so he could listen to it. And then he tried to activate the voice recognition by touching the bottom of the cover, "Tell me about Steve Jobs. Where is the nearest church or camera store?" He ended the segment saying that the device would soon be released with "a revolutionary softcover." The jokes played well to the geekish sensibilities of the studio audience, but I am not sure even the show's writers knew how well the sketch described the confused state of book publishing.

"Steve Jobs" will serve as a prominent road marker on the path from atoms to bits. The decision for Simon & Schuster to hold the digital release of the biography for two weeks to match the physical release even after the death of Jobs is worthy of a Harvard Business School case. And at the same time, even as computers now interface with us in almost every aspect of our lives and Jobs' critical role in that proliferation, the majority of people will read his life story on paper.

Colbert poking fun at the Jobs biography repeats, again, a meme that we in the publishing industry should be gravely concerned about — our customers don't know what a book is anymore.

The consequences of book updates

In July 2011, I launched an experimental project with O'Reilly called "Every Book Is a Startup." The project is meant to poke at the boundaries of traditional publishing. The book was created around the idea that new material will be released over time, culminating in a finished work early in 2012. Readers are encouraged to constantly give feedback about the material. The pricing is dynamic, increasing slowly to match the amount of material released, but once purchased, a customer receives all future updates for free.

We are only using one distribution point at the start of the project, oreilly.com, because the distribution system for electronic books is not designed to allow an ebook to be updated and released again. You might remember one of the side effects of Amazon's 2009 recall of "1984" was that after the book was restored, customers found their bookmarks and notes had disappeared.

We, unfortunately, found the same problem with our release strategy. Wonderful publishing startups like Readmill and SocialBook have created the possibility for readers using EPUB files to highlight important passages and share those with others back through the web, but when a reader of "Every Book Is A Startup" loads a new edition, their digital artifacts suffer the same fate as the readers of "1984" — the loss of their old thoughts as I present them with my new ones.

I have been hesitant to call "Every Book Is A Startup" a book because of the expectations people hold for a book: a finished work, written from a position of singular authority, available in some way in a physical form. What I never expected was how strongly the qualities of a book would be brought forward from the physical to the digital. Digital books have been designed to carry forward the same atomic quality of immutability of physical books. As I reached out to my colleagues working in the world of ebooks, the consensus was that no one had considered a reality where an author, given the ability to distribute directly and virtually cost free, would consider updating their work and the consequences that might have.

Bits and atoms don't behave the same way, but we have built the next step forward in publishing as though they do.

Possibilities arise from a new name

The trouble to this point is that a book is a book. Stacey Madden used precisely those words to title an essay in the inaugural issue of "Toronto Review of Books" that describes this predicament. "I do not mean to argue the advantages of paperbound books over their electronic counterparts," wrote Madden. "The contents of both are, for the most part, the same, and the differences lie mainly in medium. I am simply pointing out a semantic fact. E-books are not 'books' but digitized compositions." She firmly believes the book's 550-year-old meaning that connects both form and format should be maintained. "Before a collection of human thoughts is transformed into what we call a 'book,' it is merely a story, a manuscript, a document, or a text." Madden points to the need for more of us to see the difference between a book and its electronic counterparts.

Now, Madden writes further about the poetic qualities of the book and declares the superiority of the bound volume for its weight, smell, and ability to act as apartment furnishing. This judgment undermines the broader point and shows from another perspective the real trouble we are in.

The people who love books for what they are and what they have been are grabbing for their hardcovers and their paperbacks and saying "This word belongs to us." The digerati paving the way with wireless tablets and social networking recommendation services are trying to say, "You don't understand, we have books and we have made them way better." This is messy and leads to confusion.

We are living through a time in book publishing where words fail us, a situation that we should all find some irony in given the products we sell. We need some new language that describes what happens and, more importantly, what is possible when the words are separated from the paper. Those two things need to be separated so we can build systems and infrastructures that support the new capabilities of the technology.

For several decades, what we know today as a "car" was referred to as a "horseless carriage." It was easier to describe this new invention as what it was not, rather than what it was.

Maybe there are books and there are paperless books. I know it is a little awkward, and you want to ask yourself, "What does that mean?" — but when you remove the paper from a book, it becomes so much easier to see the possibilities.

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Photo credit for associated book picture used on home and category pages: Old book (1882) by VanDammeMaarten.be, on Flickr

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November 28 2011

How Twitter helps a small bookstore thrive

Omnivore Books in San Francisco looks like a traditional bookstore. Opened three years ago in a former butcher shop, the small, bright room is stocked floor to ceiling with new and vintage cookbooks. Locals and tourists come by to browse, or they're on a mission to buy the latest installment of Canal House or Lucky Peach. The proprietor, Celia Sack, is the person most often behind the counter.

Sack is also the person behind @OmnivoreBooks tweets like:

Omnivore Books tweet 1

And:

Omnivore Books tweet 2

Sack, who has been in retail for years (she and her partner opened Noe Valley Pet next door to Omnivore in 1999), believes that integrating her personality into the shop is a key part of its success. For the store's Twitter account, she follows this rule: one third personal, two thirds professional. "You don't want people to feel marketed to all the time," she said. "It's so important that I'm the face of the store — and that's important digitally, too."

So, while the majority of her tweets are, in fact, about store business — particularly the author events she holds almost nightly — her personality tends to come through in those posts, too:

Omnivore Books tweet 3

And:

Omnivore Books tweet 4


And:

Omnivore Books tweet 5

The Omnivore Books account has more 7,000 unusually enthusiastic followers, and Sack says that people who come into the shop commonly introduce themselves by their Twitter handles. Often, they have stories that relate to something she posted, and though she's careful not to divulge too much personal information, she readily shares enough of her sensibility that, as she puts it, "people feel warm and loyal."

Interestingly, connecting with customers isn't what Sack considers the biggest benefit of Twitter. When she opened the store in November 2008, she knew she wanted to hold a lot of author events. She figured she could build on her small circle of food-world connections to draw in speakers — chef Traci des Jardins (@chef_traci), for example, is a long-time friend. Plus, Sack could reach out to publishers who might be sending their authors on book tours. The first part of the strategy worked; the second part, not so much.

"Early on, I really wanted to have Flo Braker speak here, and I kept trying through the publisher," Sack said. "They'd repeatedly say, 'We're trying to reach her,' but nothing would happen. And then Flo contacted me and said, 'I'd love to speak at your store.' Of course, she hadn't heard a word from the publisher." Sack started to think that contacting authors directly would be a better way to go, but they weren't always easy to find.

Then, in April 2009, a friend introduced Sack to Twitter. Sack took to it right away. She enjoyed the brevity, she liked posting observations from the store, and it fit with the intermittently busy-slow rhythm of retail. And here's something special: Sack is not at all technical; she didn't then and doesn't now own a cell phone. (She tweets from the store's desktop computer.)


The Twitter Book — Omnivore Books (@OmnivoreBooks) is one of dozens of accounts whose tweets are used as examples in the fully updated "Twitter Book, Second Edition."

Although Twitter was Sack's "only technological milieu," it didn't take her long to figure out that she could use it to connect with other people. Food writer David Lebovitz (@davidlebovitz) was an early inspiration. "I wrote him [an @Message] and said, 'I know you don't have a book now, but if you're ever in SF, I'd love to have you come give a talk." He responded enthusiastically, and the proverbial light bulb went off for Sack.

She began using Twitter to reach out to authors directly — whether they had books coming out or not (she included her email address so they could follow up easily). The outreach had two big benefits. First, authors would turn around and tell their publishers about Omnivore Books, which put the shop on the map. Cookbook publishers now routinely contact her (though Sack notes that it's important for her to maintain a personal relationship with authors, in part because there's a lot of turnover among publishing house publicists). Second, when she wrote to authors — Dorie Greenspan (@doriegreenspan), for example — people who followed them both would see the notes and chime in with comments about how great Omnivore is for readings. "Having that backup is powerful," said Sack.

Sack wins over customers and authors alike with her idiosyncratic voice (I was surprised to learn that people ask all the time if she writes the store's tweets; who could you pay to use the hashtag #BadLesbian in reference to yourself?). She emphasizes the importance of putting your personality into it and being interesting because that's who you are, not because you want to draw followers for the sake of a higher number. And she adds, "The strategy is to make people feel included not excluded, to make them feel part of your world."

She recalls a recent example: A guy planned to surprise his girlfriend with a marriage proposal in the store. Sack was nervous but excited and live-tweeted the episode, beat by beat. Her followers were riveted. "Tweeting about it was personal and spontaneous, and I happened to take out my camera — and it worked! I showed the couple all the responses. 'Congrats from London.' 'Crying at our desks in Chicago.' They were so overwhelmed. It was totally fun." Later, she mentioned to me that she'd picked up 100 new followers that day.

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November 23 2011

Ebook refunds and absolute satisfaction

This post originally appeared on Joe Wikert's Publishing 2020 Blog ("What if Every eBook Could be Returned for a Full Refund...At Any Time?"). It's republished with permission.

The land of NO by Unlisted Sightings, on FlickrAmazon's Kindle Owners' Lending Library has been getting a lot of buzz since it was announced recently, and rightfully so. I posted my own thoughts about it as a publisher here. Some supporters of the program have mentioned it will be a great way to try before you buy. In other words, borrow the book for a week or two and if you like what you read you'll probably want to buy the book, not just borrow it. I can see that happening ... sometimes. But I don't think that's the best way to encourage more ebook sales.

First of all, each of the ebook vendors offers samples of books. I always download and read the sample before I make a purchase. Samples have saved me from making a number of bad purchases. But I've often found the samples are way too short to tell whether the book is right for me. That's where an unconditional, money-back guarantee should come into play.

That's right. Why not have a no-questions-asked, complete refund option for all ebooks? I'm not talking about the return-it-within-seven-days-of-purchase option Amazon offers for Kindle content. That's not good enough. I want the reassurance I can get a full refund if I buy it today and don't even start reading it until a year from now, but then decide it stinks.

Is that crazy? We don't think so at O'Reilly. Here's a link to The O'Reilly Guarantee. You won't find any fine print with exclusions that limit your right to a full refund.

By the way, as the publisher at O'Reilly I can tell you I see all the email exchanges between customers and our customer service team. Very few people ever ask for a refund. In fact, our customer service team sometimes offers refunds when customers don't even ask for them and most customers reject the offer.

It's interesting how this works. We stand behind our product with a very simple "absolute satisfaction" guarantee. And believe it or not, customers aren't banging down our doors asking for their money back. Why? I think it's the same reason why we've been so successful with our DRM-free stance: We trust our customers. Pretty novel concept, isn't it?

By forcing you to make your product return within seven days of purchase, a retailer is telling you they don't trust you. Perhaps they assume you're a speed reader and are just looking for a free ride by gaming the system and reading a book in less than a week. That's too bad. A little trust goes a long way. Will some customers abuse the system? Absolutely, just like they do with DRM-free content. But the vast majority will not only do the right thing, they'll also become more loyal to you because you trust them.

Photo: The land of "NO" by Unlisted Sightings, on Flickr

TOC NY 2012 — O'Reilly's TOC Conference, being held Feb. 13-15, 2012 in New York City, is where the publishing and tech industries converge. Practitioners and executives from both camps will share what they've learned and join together to navigate publishing's ongoing transformation.

Register to attend TOC 2012

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April 18 2011

Utility attracts customers but fun creates evangelists

light_connected_freddie.pngCustomer loyalty is the holy grail of most business ventures, and reliability and dependability are important qualities that lead to that end. But what about emotional engagement? Adding a bit of beauty or laughter to the customer-product relationship can turn loyal customers into passionately loyal customers, says Stephen Anderson, consultant and owner of PoetPainter.

In a recent interview, Anderson talked about how surprising survey results gave him fresh insights into how consumers perceive products:

I draw a distinction between loyal engagers and passionate users or customers. I think if we look at product design or environmental design, there are definitely products I could ask you about that would make your eyes light up — you'd get excited, tell me how you love it and how it's part of your identity.

When I started surveying people and asking about products — startup web apps — that they've used for more than two or three years and why, it was a bit surprising. There were a lot of very utilitarian products that people use, but they're not excited about them. They're loyal, but their reasons were things like, 'it's reliable,' 'it always works,' or 'it's what my friends use' — it's all these very boring reasons.

What I was looking for was, 'I love it,' or 'it makes me smile,' or 'it makes me feel complete.' Deeper things, and I didn't see any of that. It's not that there's not room for it because there definitely is if you look at product design, industrial design and those spaces.

So that's really where I'm keeping an eye out for web apps that engage people in an emotional way. If you look at a company like MailChimp, for example, I think they're doing that — it's a mail management system, a business app — but I laugh every time their mascot has a little quote or does something. They're engaging me in an emotional way, and I think there are very few sites or businesses doing that.

I think that's really the next thing we're looking forward to — apps that people still use after three, four, five, or 10 years that they still love, enjoy, talk about, and share with others.

For more on Anderson's thoughts on how play and exploration apply to businesses, check out the full interview in the following video:



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March 22 2011

Ebook pricing power is undermined by perceived value

Much discussion (and some dismay) surrounds the current upheaval in the ebook pricing model. As $0.99 ebooks sit "shelved" next to $19.99 ebooks (whose print counterparts might be discounted to $11.99), one of the larger issues surrounding the pricing problem is the perception of value from customers.

EbookPricing.png

Jane Litte at Dear Author argued in a recent post that value is based on the reader's "willingness and ability to pay":

Every reader has a different price they are willing and able to pay for a book. I believe that price represents the value a reader places on a book at the time of purchase. However, value can vary over the course of time from when the reader first becomes aware of the book to after the book is read, increasing and decreasing based on different variables. When readers speak about price, they are talking about the amount that they are willing and able to pay at the particular time that they are expressing the opinion about price. Willingness includes the measurement of time.

I asked Todd Sattersten, author and owner of BizBookLab, to chime in on the pricing issue. In an email interview, he argued that print book pricing actually is the larger contributing problem to the perceived value of ebooks (mainly, ala Amazon) and suggested that serialization might be the right model for ebooks.

How are customer perceptions of ebook value influenced?

Todd Sattersten: There is only one factor that matters right now — what print books cost. Customers compare ebooks to their paper-based ancestors, and they long ago concluded they should be cheaper because everything else in their digital lives is cheaper than their physical lives.

Publishers don't want this to be true and, with the power to control ebook pricing through the agency arrangements, are pricing the vast majority of ebooks like they are print books. I co-wrote a book two years ago called "The 100 Best Business Books of All Time." The hardcover retail price is $25.95. On Amazon, you can buy that version for $16.61 or a remaindered edition for $10.38, while the Kindle edition is $18.99. That creates a short circuit in customers' brains. You don't pay more for things that are more convenient. You pay less.

What's interesting is that Amazon is actively discounting books in the 40% to 50% range, and in many cases putting the price of the print book very close to the price of the ebook. There can't be any margin left at those prices. Amazon, having lost the ability to control ebook pricing, is saying to customers "ebooks and print books are the same." This drives more people to ebooks (who doesn't want to download their book now?), sells more Kindles, and further cements their place in publishing's future — both provider of new and destroyer of old (what bookstore can compete with 49% off?). Also, notice how Amazon is redefining short writings with their Singles program. Fewer words, lower prices and, most importantly, a new (not very good) term to attach to the new value proposition.

Is there a disconnect between publishers and readers that's influencing the developing price model?

Todd Sattersten: The biggest disconnect is that mainstream publishing's $9.99 to $19.99 ebooks are now sitting next to Amanda Hocking and J.A. Konraths' $0.99 ebooks. There was never that risk in the bookstore channel because of the cost of scaling atoms. The wide range of pricing destroys pricing power.

Are ebooks destined to be priced at $0.99?

Todd Sattersten: Yes, they already are. Is everything going to be $0.99? No.

What do publisher need to do to take control of the perceived value of ebooks?

Todd Sattersten: I am not sure we've figured out what the reader should get for $0.99.

The biggest play for publishers in digital is to shorten book length. Everyone will admit that books both in fiction and non-fiction are driven by a page count rather than what is the appropriate length for material. I would like to see more experiments with serialization on the fiction side and an "album" of chapters on the non-fiction.

Here is an example of what I mean from the app space: 1337 Game Design released a game app for the App Store called Dark Nebula. It was $0.99 and had a light narrative that pushed you into Episode 2. So, rather than putting a bazillion levels in a single $0.99 game, ala Angry Birds or Cut The Rope, they divided 35 levels across two $0.99 apps.

Adapt the product to match what pricing will support. Every other industry does it. Why not publishing?

Our biggest problem is that we keep hanging onto the idea of a book. The word itself is laden with 500 years of meaning. In my world, a book is made of paper, bound on one side and it does an awesome job of delivering words and images. We need some new terminology for electronic products so we can get more creative about what publishing creates and what we can offer readers.



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