Tuesday, January 24, 2012

Response to Claims that Apple Will Dominate Future Book Publishing

A little over a week ago, an article on a popular Apple Fansite, CultofMac.com, entitled "Apple's War on Amazon Starts Thursday" made the case that Apple Inc. is poised to not only overtake Amazon in the world of digital publishing but dominate both the creation and the consumption of digital books. In this article, we'll be examining their argument in light of recent publishing developments at both Amazon and Apple and determining that not only is Apple unlikely to make much headway in this "war," but that it has actually already lost.
First of all, I don't like to use the words "war" or "attack" to exaggerate and sensationalize the competition between companies, not matter how intense or pointed their endeavors are. No one's fighting and no one's dying, and it's unnecessary to bring that into this, but the Cult of Mac article asserts that with the Kindle Fire, "Amazon.com declared war directly on Apple’s core business model, which is to sell integrated solutions for the consumption and creation of digital content. Starting Thursday, Apple strikes back."

The article then goes on to clarify how exactly Apple should go about overtaking Amazon, "In a nutshell, Apple’s goal is to do for all content what it did for digital music — control it. In order to control digital content, that control must be wrested from established players. But the future of books — self-published authors selling electronic books to be read on digital devices. Well, that’s an Apple business. In other words, Apple won’t compete with Amazon for the present of book publishing, but for the future."

So the goalposts for the competition between Apple and Amazon is to see who can secure exclusive content for their e-bookstores and sell that content to the most people. Here's what readers see when we look at the two bookstores. Amazon's Kindle Bookstore makes it effortless to find more interesting books than you could ever imagine. Apple's iBookstore is like navigating a grocery store in the dark. To call it crude and rudimentary is a compliment for one of the world's most profitable companies, and the article admits as much when it says the iBookstore "hasn’t been exactly what you might call successful." If Apple were really serious about selling ebooks, it's e-bookstore would be light-years ahead of where it is now.

But let's look at these new publishing development's that are going to wipe Amazon off the map by locking self-published authors in with Apple. Their attempt to do this is a new program called iBooks Author, which is essentially a word-processor with some special features for textbooks and images. How does a word processor gain your company exclusivity? Why, with restrictive clauses in the Terms and Conditions! The guys over at ZDNET call it mind-bogglingly greedy and evil when Apple requires you to agree to clauses like this: 

"If you charge a fee for any book or other work you generate using this software (a “Work”), you may only sell or distribute such Work through Apple (e.g., through the iBookstore) and such distribution will be subject to a separate agreement with Apple."

There are other howlers as well, but another Cult of Mac article is right when it says this is overblown. There are lots of cases where content providers must choose a specific venue for their work depending on the tools they use to make it. Cult of Mac response, "Is it too obvious to point out that Apple’s terms are optional? Nobody is forced to accept them. Apple’s iBooks Author is just an offer. Take it or leave it."

And leave it they will. Find any indie author hangout on the internet and you'll find a pretty much universal rejection of the software. These terms are a complete non-starter. There is no benefit for authors to sell exclusively with Apple, where even the top-selling indies are getting no more than a drop in the bucket compared to their Amazon sales. They are being forced to make a decision before the book is even put up for sales. Who is using this software? People putting all the care of 90 seconds into their books. Scary.

The other argument they put forward is because "a disproportionate percentage of authors use Macs." Other than that this is an unsubstantiated claim, there's a complete disconnect between how an author makes a book and how they sell it. To think that authors are going to be so beholden to their computer that they'll willingly stick their work in a smaller market is to completely ignore the all-important bottom line.

Let's compare that with Amazon's recent publishing development, the Select Lending Library that allows people with Amazon Prime to borrow 1 book per month. Self-published authors can opt into this program if they make their books exclusively available on Amazon. The benefit? Books like our Kindle Fire Department Compendium can earn almost as much revenue when borrowed for free as from a purchase. Amazon's method of gaining exclusivity is to go straight for the wallet, paying their authors to give their books away for free. Authors are earning more, readers are saving more, and Amazon is benefiting. Right now almost 90,000 books have joined, most of which you won't find anywhere else.

It's the simple difference between giving authors the carrot or the stick. Amazon knows how to catch more flies with honey, rather than try to pin down authors in the fine print. That's why Amazon will continue to attract authors and readers, instead of turning them away, and they are poised to dominate the future of digital publishing.

Right now your favorite authors might be struggling with the decision over which market is going to be the best for their books. They want to have the best visibility, the best presentation, and the maximum return on their writing investment possible. They are choosing Amazon.

9 comments:

  1. If I was a writer, I wouldn't do exclusive to Apple or anyone. I understand if it were Bantam Books, or other publishers like that, for the sake of putting my book out for the masses, which would include Apple and Amazon.

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  2. Yes, there's definitely that too, Samantha. No one has to sell exclusively through anyone, though it's a matter of weighing the tradeoffs.

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  3. Gosh. I didn't even know Apple HAD an iBookstore. Guess their promotion of it needs work. Doesn't matter. I am Kindle all the way. I tell everyone how great it is. Even strangers looking at eReaders at Target! Several have told me I sold them on Kindle. By my count I have directly resulted in the purchase of 10 - 15 Kindles. Maybe I should get free books for doing this. OH WAIT! I DO get free books at Amazon! You guys are great. Never doubt it for a minute.

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  4. Haha, I think you deserve another free book for that. Good work helping people find out about Kindles! And thanks for your support!

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  5. It should be pointed out, of course, that none of this seems to address textbooks, which is what the Apple software is designed to produce. Those who thought Apple would soon take over the entire ebook publishing world were wrong. Those who thought they might soon dominate (again) the education market, may just be right.

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  6. That's a good point, Tim. Much more credence should be given to Apple when it comes specifically to textbooks, where the two companies are more evenly matched. Though it's not hard to see that Amazon is working toward the same market with their Amazon Textbooks promotions and their Kindle Format 8.

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  7. Thanks for this very well-written article, Gadget. Like Leighfirst, I didn't realize Apple had their own version of a bookstore, but I find it hard to imagine Amazon ever losing popularity to such a degree. I know many published and self-published authors, and they are not about to limit themselves to only one venue. It wouldn't surprise me at all, however, for Apple to more than dominate in the textbook arena. Schools are already highly invested in Apple products.

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  8. Both Apple and Amazon have great customer service so they are equal there. Both products have their pros and cons and quite frankly, in the Kindle's case, the pros out weigh the cons by a mile. I can't say the same about the Ipad. And when it comes to pricing on the devices or the books and various accessories, then Amazon again wins by miles!! The only thing for me that would make the ipad win over the kindle would be the large screen but that is not worth the $300 extra I would have to pay for it. Never mind the extra money on books. The war was won by Amazon before it even started

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  9. Thanks for sharing your thoughts, Shannon and Barbara!

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