You are viewing your 1 free article this month. Login to read more articles.
Copyright, piracy and DRM (or rather, the anti-DRM argument); the need for publishers to refocus into narrower verticals; tipping points, pricing, and lessons from the music business and from early attempts at e-books were the dominant themes at Tools of Change (TOC) in New York.
The TOC conference was sold out again, with more than 1,000 attendees, and remains the techiest, the big kahuna of digital meetings. It is now a three-day event, though some skipped day one which was give over to workshops.
Day two saw the big names take the podium. "Law is not a business solution; it should only be used to solve problems that are uniquely legal," lectured Google senior copyright counsel William Patry in one of several keynotes. Patry spoke as an individual: "if I was a Google spokesperson, I wouldn't be permitted to talk." He made no overt comment about the settlement, although it hovered, shall we say, in the cloud.
Washington-style "regulatory capitalism" implies a failure to innovate and a fear of the market as a dynamic process, Patry asserted. "The US has become the fat complacent Detroit of nations. Copyright law has become a way to milk an ageing cow that is on the way to going dry." Too many people rely on copyright law as "their business plan." Yet as Kirk Biglione said later about lessons learned from the music business, "litigation won't stop the future."
Ingram's Skip Prichard answered the question "Are e-books dead?": "There is no fundamental right to survive,". Given the "speed of innovation," the e-books of today will be gone tomorrow. As a company, forget about focusing broadly and instead refocus on your core, your "unique differentiator"- limit variables for yourself and your consumer, he said.
Sourcebooks founder and chief executive Dominique Raccah produced some data from the music biz: despite what we may perceive as true, during the first half of 2009, CDs still accounted for 65% of all music sales. The lesson: "the mass market responds a bit more slowly than we think. . . I believe that working with retailers will still be a huge part of marketing in future." She advised "defining narrow verticals‚ and competing harder in fewer categories." Like Prichard, she urged, "think what you are expert at, what communities you're an essential part of. Think through the content you own and ask if there's an opportunity to create something different. Category leadership enables you to extend the brand," as Sourcebooks has done with baby-naming books and now baby-naming iPhone apps.
Magellan Media's Brian O'Leary, who has been studying the impact of peer-to-peer file sharing on paid content for O'Reilly, tracking their 2008 frontlist, also had a few eye-openers. What he found was "a low volume of seeds and leeches" rather than widespread piracy, and piracy that "peaks early and falls off fast".
Most interestingly, perhaps, there was "an unexplained bump in sales at paid sites after piracy was noted". O'Reilly sells content without DRM, yet fully a third of the list wasn't pirated at all. But "correlation is not causality," O'Leary cautioned. The only way we will know if there is causality is to do a much bigger study involving more publishers, he said repeating a call he made the Frankfurt Book Fair.
He was sure, though, that "You create piracy by the failure to release digital content. Don't try to solve piracy: think about managing it." He warned against buying into the "urgent-call-to-do-something" mode, which can easily result in doing the wrong thing.
Last autumn O'Leary also began studying Thomas Nelson, which uses DRM, for P2P sharing, but he's found no Nelson titles on monitored sites as of this month. "DRM has no impact on piracy, it has an impact on what readers do," he flat-out asserted, in a message that was repeated in a later session by Biglione. The music business went wrong by "mistaking consumer demand for piracy," and Biglione demonstrated how that happens today with books: he's a fan of Thomas Pynchon, whose novels are not currently available as e-books—unless you go to file-sharing site.
The music business, Biglione reminded us, made a ton of money out of CDs in the 1990s; publishers should "forget the iPod moment in music. If they got on the digitisation bandwagon, they have the potential for a CD moment."
He demolished the argument for DRM by reminding listeners of Microsoft's disastrous "PlaysForSure" DRM standard, launched in 2004. The company pulled the plug on it two years later. "The iPod worked, it was cool, people wanted it. Apple never licensed PlaysForSure." He likened the situation to using ePub "wrapped in propriety DRM"; it is "no longer ePub. I think this story will end like PlaysForSure. People will realise that DRM-free is the only way to go."