Digital Business

I can quite see why Apple has sold over a million of them since March.

By chance, yesterday I had the chance to play with an Apple iPad. A colleague from the USA had bought one for himself and had it with him when he had flown over for an important meeting in London. Funnily enough, he said “I have good reason for justifying why I spent over $700 on the iPad, but I’m glad I did”. His version was the 32GB version with Wi-Fi and 3G.

My first impression of the iPad was the size. It was slightly smaller than I had expected. It’s more compact than a netbook and it is larger than a Sony Reader. The next thing I noticed that it has looks of simple elegance. The screen is clear and sharp.

When I handled the iPad it was heavier than expected but that was reassuring in so much as that it is well made and it would appear to have some ‘good kit’ inside the casing. Not being an iPhone owner (yet) I was not used to the ease at which you can navigate around it through the apps and in the apps.

The on-screen keyboard was a lot bigger than I had expected too. It is certainly usable. The only challenge is the angle at which you type compared to seeing what you are typing. Because it is flat, you will either need the purpose-made case to enable you to put it at an angle so you can see what you are typing, or you will need to lean the iPad up against a book!

The applications I was very interested to see were the book apps. The iBook app is slick, easy to navigate and a clear reading experience. The Kindle app was as easy to read and use but you can’t have two pages open side by side like a paper book. A small concession. However, the Kindle syncs between the Kindle app on your iPhone and your iPad so it knows where you were last time you were reading between the devices. Clever.

The next impressive application is the built-in calendar. It synchronises with your work calendar or your Google calendar and it is beautifully laid out so you can see your schedule in detail and in general on the same page. You can also synchronise your work email (and personal email) through Microsoft Exchange too.

Overall, I was impressed with the iPad. It is pricey but I know it would be incredibly useful. It’s not something on which you would do a lot of hard-core office work on, but it is something I can quite see that I would have with me for much of the day, whether for reading books, watching films, listening to music or catching up on my emails and schedule.

I can quite see why Apple has sold over a million of them since March.

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Here’s an interesting article. Dan Brown, the author of The Da Vinci Code, has released his latest book and it is selling ‘like hot cakes’. But, the interesting fact is that the ebook version designed to be read on Amazon’s Kindle device is outselling the printed version.

This might be just one of the moments in time when all of the hype about the book and the Amazon device turn into reality. The twist in the tale is that the book is also set to become the most discounted book in history too.

Kindle edition outselling print version on Amazon.com | theBookseller.com http://ow.ly/pLC5

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Arnie wants books digitised in schools

Recent news from California about Governor Arnold Schwarzenegger seeking to move all of the States school textbooks from printed versions to digital versions to save $350 million  came as no surprise this week. The State has practical reasons behind it. Namely, a $24.3 billion debt in their finances.

It then comes as no surprise to hear that Amazon will launch its new ebook device, the Kindle DX, this year which has a bigger screen and is aimed at the academic market which needs more ‘space’ on the screen to accommodate the richer nature of school text books than novels. That’s good timing.

There are people who doubt whether there will be demand for ebooks, as illustrated in today’s article in The Bookseller, when novelist, Nick Hornby, voiced his opinion that people only buy books for reading on summer holidays. Hornby made sense but this is only one part of the market, of course.

Publishers continue to see the rise in sales of their digital products, such as ebooks and audiobooks. They are not yet in double digits as a percentage but they are growing and at a pace. Schwarzenegger’s announcement depressed Pearson’s share price and when 42% of the publisher’s sales come from the education market, it’s time for them to stop sucking the cash cow dry and switch to digital.

There are concerns over the price of some of the ebook reading devices, but when you consider that an academic textbook can cost between £40 and £55, and a reader device costs £300 to £400, local education authorities will soon be better off by providing digital versions of books, even if they are downloaded onto existing laptops or PC’s.

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News on your desktop

Reading a newspaper is an immersive experience. Getting the Saturday newspaper is one of the weekend’s great pleasures. The number of topics covered is large but interesting. I may not read all of it but I will read most of the newspaper. There are usually one or two articles which stick out which are particularly memorable and thought provoking.

However, during the week reading a newspaper is a different matter. I read a newspaper in a different manner which means fitting in reading an article or two when I am on a train, having a sandwich at my desk at work or briefly in the evening after getting the children to bed.

As a result, I buy a newspaper less frequently but I do read their digital versions for catching up on the rugby team I support, business news or technology news. I read the news through my mobile phone or on my laptop. All for free, of course. I also follow a number of blogs which are all ‘aggregated’ through an application called ‘ShareFire’ which presents them all in one place for me to read when I can. ShareFire is a simple, free and easy to use tool which saves me having to log into each blog on the web.

And that is the newspaper publishing industry’s problem in a nutshell. I am a contributor to their current demise. I admit it. I read far more than I ever used to than when I just read a newspaper.

But something caught my collective eye at work today. As a technology company, we are always looking at new trends, technologies and applications. This morning, our ‘Chief Geek’ spotted an blog article by Serge Jespers about an application built in Adobe Air and Flex by The New York Times for their readers.

It’s a free download which provides non-subscribers with a limited amount of news at no charge. To get the full version, you need to pay a subscription of $3.45 a week. You can search the newspaper, watch videos of the news, see the news in pictures all for free too, and all from your desktop (which means that the application loads pages in the background so you can move between them quickly).

Another article today on the BBC technology blog site by Rory Cellan-Jones highlighted an interesting comparison to how the newspaper publishing industry could learn a lot from the English Premiership which is very successful at making sure that people pay for their content through subscriptions. Commentators were saying that the football league example was not good because people are happy to pay for live football games to be streamed onto their TV’s but not so keen on watching highlights or replays. However, news is even more short-lived than a football game and few people want to read yesterday’s newspaper, unless you buy ‘The Week‘ of course.

There is great talk about devices designed specifically to enable people to read eBooks and electronic versions of newspapers and magazines, such as Amazon’s Kindle 2 or Sony’s eReader. But, these are expensive and most people won’t want to fork out a load of money when they already have a decent laptop, web-book or PC from which they can easily read.

So, the development by The New York Times of a branded reader application for their news which enables the publisher to get paid for their content and which helps customers get up to date news in a well presented way is a move which could start to pave the way for the publishing industry to secure its future. I will be watching with interest.

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Exclusively everywhere

The publishing world is going mad. Digital technology is disrupting everything that they used to hold dear. Newspaper publishers are seeing their printed paper circulations dropping,  along with the advertising revenues that went with them. At the same time, having given away their online versions for free and keeping them subsidised by the online advertising, the online revenues are not keeping pace with the decline of the offline versions. This is not news and it is well documented in the well written article about the demise of the newspaper as we know it by Clay Shirky. 

There is a lot of talk in the publishing world about what the industry does not want to be. It does not want to be like the music industry which is trying to keep up with its customers who want to download music. The publishing industry does not want to lose control of its content. It does not want to see authors going direct to consumers and negating the need for their editorial, production and marketing skills. Nor does it want to be in the situation of the newspaper publishers. 

The publishing industry is in a position where devices are starting to become good enough for people to buy eBooks in significant numbers now and publishers are becoming increasingly anxious to adapt to the changing scene amongst their consumers. Their concerns over which format to use and which device will be the ‘killer device’ are growing. Unlike the music industry, publishers have never needed to think about which device to publish their books for. The device was the paper and print. If you publish regluar novels which just has text and no illustrations there is one format for you. If you publish cookbooks, for example, then you need a format which can handle the more complex text and images.

Amazon looks like it will introduce its Kindle 2 device into the UK soon for which publishers will have to provide their eBooks in various formats for Amazon to add in its own digital rights management. Waterstones favours the Sony Reader device and they require eBooks delivered in a format which only really suits novels which contain plain text. There are numerous eBook reading devices on the market and several different formats into which a book can be turned into an eBook. 

Publishers are now having to adapt their skills in print to digital skills to ensure that they are prepared for when their sales of digital books move from being a noticeable item on their top line to a significant part of their bottom line. And, instead of thinking about what they don’t want to be, they should start to think about what they want to be. And there is a model which they should consider.

Computer games developers and publishers have always needed a device to be purchased on which their games can be played. In the early days, it was a computer. Then specialised devices came along and the manufacturers of the devices started to battle it out for domination and Sony was the early winner with the Playstation. Microsoft brought out the Xbox and Nintendo discovered a new market with the Wii. 

But the games publishers and developers learnt fairly early on that the platform did not affect their development and publishing of games. The games developers (the equivalent of authors) created ever more immersive and graphically stunning games to make the most of the power of the games consoles which could be played on either an Xbox or a Playstation. They just developed ‘compiler’ programmes and ‘architectures’ through which their games adapted to the platform for which they had been purchased. Games publishers want to be able to distribute their games onto as many platforms as they can.

The good thing about books unlike a newspaper is that they are likely to be read again. Not read as many times, perhaps, as often as a track is played on a MP3 player, but an eBook has a longer life than a newspaper article, nevertheless. A game is likely to be played several times before it swapped or exchanged. Of course, most games come on a disc. But, increasingly, games are being played online and soon they will be downloaded to consoles when broadband speeds increase. So, in that sense, publishers will be ahead of games developers. 

A game can be rented from Blockbuster for a few nights, or purchased from the store or online. eBooks will need to be adaptable enough to allow different forms of ownership and payment such as borrowing from a library, renting from an online store, as well a perpetual licence when bought outright. 

Book publishers should think like this too. They just need to carry on finding good authors, and marketing the books well and let the device manufacturers fight it out amongst themselves on which device will be the most popular. In the meantime, they need to grow their digital capability to be able to deliver eBooks in several different formats and study how companies like EA Games work to get some ideas.

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The recent ‘Tools of Change for Publishers’ conference in New York seemed to sum up the tension in the publishing world on where their industry is heading. “Will printed books survive?” is one question which is being asked but, more importantly, “How do we keep control of our content while embracing the digital potential?” seems to be the main question on publishers minds.

The newspaper and magazine publishers are facing a dilemma. They were quick to adopt technology to reach their customers but they have trained their audience to expect a free online version of their favourite newspaper. Now that their circulations are falling, they appear to have no way to attract subscription paying customers to read their newspapers.

Magazine publishers in certain categories, such as ‘lad mags’ have seen their circulations plummet as the credit crunch hits and the magazines are ditched in favour of more wholesome entertainment like Sky Sports. Other magazine categories have seen the opposite trend in their circulations. For example, the circulation of The Economist has risen and people are happy to £4 for well written content.

Amazon recently launched the ‘Kindle 2’ which their chief, Jeff Bezos, said had been named to illustrate that their eBook reading device had been designed to be the starting point for enabling consumers to read book and newspapers in a digital medium and not an end point. That is a nice analogy although you still need something to light the kindling wood to get the fire going.

Furthermore, the use of mobile phones for reading and viewing content is growing. Personally, I now use my Nokia N96 to watch BBV TV and listen to recent radio shows using the installed iPlayer before I switch off my bed side light at night. That phone combined with improved 3G coverage has enabled me to view content in ways which I simply could not have achieved two or three years ago.

There seems to be inertia as publishers wait for the big product which enable them to provide their content in digital forms which does not see them in the position that the music industry is in where they are fighting a tactical battle of trying to catch up with their customers desires to buy music in ways which does not involve them buying an album on CD of which they only really want to two tracks. As the article in The Economist suggests “An iTunes moment.”

The Amazon Kindle 2 looks like a nice product. It has a 3G connectivity, it is light and slim and it can hold 1,500 books, it “reads like real paper”, it “boasts 16 shades of gray for clear text and even crisper images” and there is a range of 230,000 books as well as newspapers, magazines and blogs to choose from.

Listening to people have used the Kindle 2, one theme stood out for me and that was one person saying that they now read more books as a result of having the device. That is why I like my iPod. I listen to far more music than I ever used to. It’s just easy.

Despite some sceptics in the UK, I think the Kindle 2 will be a success and, like the iPod, it will be improved all the time and the richness of the internet to which we have recently become fans will soon be available. I believe the ‘big thing’ for publishers and their authors will be their ability to have a closer relationship with their audiences in the digital world and they need to provide applications and tools to enable that as well as getting their books ready for Kindle-like products.

To use a Stephen Covey phrase, the Kindle will be a ‘big rock’ around which publishers must create other tools and applications which will enable their audiences to have richer experiences with their volumes of content. For example, cook books which link to short videos on techniques, or Sci-Fi books with links to fantasy games.

Publishers just need to do it. With digital, they can build things quickly, test them and assess the results rapidly. Just stop waiting for the ‘iTunes’ moment’ because it is already here. 

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