What's the Deal with E-Books?
[This article originally appeared in the May 2006 (Vol. 29, No. 5) issue of The Editorial Eye.]
When e-books (digital versions of printed books, read on computer screens, handheld devices like PDAs, or dedicated e-book readers) were first introduced in the late 1990s, boosters and industry pundits issued cheerful prognostications about their prospects. Publishers would embrace them because many of the costs of printing, storing, and distributing paper books would be eliminated. Consumers would adopt them because the latest bestseller by John Grisham could immediately be purchased, downloaded, and added to a compact library of e-titles small enough literally to slip into a pocket.
But those glowing predictions have never materialized. Is the e-book story a tragedy, or perhaps a farce? Or has the death of the e-book been announced too soon?
The state of e-books. The hype downplayed very real technology issues, such as the poor display quality of specialized reader hardware some vendors have promoted, and digital rights management software that places restrictions on consumers’ moving their books from one device to another. Market factors are also at work; publishers have been unwilling to take the plunge and make more than a handful of titles available in this untested format, and consumers aren’t quite ready to accept the definition of “a book” as something other than paper and ink.
But maybe we’re still in the early chapters of the e-book story. Nick Bogaty, executive director of the International Digital Publishing Forum (IDPF), believes that e-books are still in their infancy, comparatively speaking. “E-book reading devices and the attempts to capture this market just started in the late 90s, so in the grand scheme of things, in new formats of books, we’re still early,” he told the Eye.
According to the IDPF’s data, the market has been growing by 40 percent yearly. In 2004, e-book sales totaled $9.6 million; sales are predicted to be more than $15 million for 2005 (final figures are not yet available). This is a healthy growth rate, but when you look at the numbers with the printed book market ($23.7 billion in 2004, according to the Association of American Publishers), e-book sales can’t help but look rather feeble in comparison.
Bogaty acknowledges the disparity in market share between e-books and print books, but calls attention to the growth rate. “It’s growing at a rate that the print market hasn’t seen in decades. The print market is sort of flat or declining, and if I was a publisher, it would certainly interest me to be exploring other formats that are available to customers.”
Some major publishers are taking notice. Publishing giants Random House and HarperCollins Publishers, Inc., have announced plans to make digital versions of tens of thousands of titles (although their plans for distributing those titles have yet to be announced). Google started working with major libraries to digitize their holdings and make them searchable online, and Amazon.com offers thousands of titles in e-book format.
But some of the biggest buzz recently has been generated by Sony’s dedicated e-book device, simply called the Sony Reader. The Reader, scheduled to hit the market this spring, uses a new display technology that dramatically improves the resolution of the text. The device is the size of a slim paperback, and the rechargeable batteries are claimed to be good for 7,500 page turns, according to Sony.
Besides this new device, Sony is taking a page from Apple’s iPod playbook, and will be making about 10,000 titles available through its Sony Connect online store, much like the iTunes online store. Michael Gartenberg, an analyst with JupiterResearch, feels this combination has great potential. “What we’re seeing this time around is, yes, you still have to buy a new device, but the difference is the device itself is fairly small, it has a screen resolution that’s not quite paper, but double that of any other computer monitor that you’re probably using, and there’s a wide variety of content that Sony plans to make available for it. So you add up all those things, and you have a device that has the potential to overcome a lot of the hurdles that e-books have faced in the past.”
The Sony Reader isn’t the only new device hoping to catch the eye of the reading public. Other companies are working on flexible display technologies that will be an even closer mimic of the book experience. And there are rumors that Apple Computer Inc. will introduce an iPod for books. (Some iPod enthusiasts have taken on this task themselves and worked out how to read documents on the music players.)
While Sony, or any other company hoping to sell a device dedicated to e-book reading, may be able to create new converts to the e-book fold, they may have an uphill battle when it comes to selling to current e-book buyers. According to Bogaty, the vast majority of e-books are currently being read on PDAs, such as Windows Mobile and Palm devices.
While PDAs are perhaps another technology that haven’t lived up to their hype, you have to wonder if people who already have a multipurpose device capable of displaying e-books, will they be willing to spend another $300 to $400 for a device dedicated to that task? PDA owners may not, but the general reading public might. “The landscape right now is that people read e-books on PDAs,” said Bogaty. “What that is like at the end of this year, or six months from now may be dramatically different.”
Is anybody reading e-books? According to Gartenberg, e-book readers are technology enthusiasts. “[The market has been] relegated to the enthusiast who doesn’t mind reading things on their computer, for example.” Bogaty agrees. “Our organization puts together a monthly best-seller list, [and in the past] we had a lot of science fiction and fantasy on that list, which made me believe that people who were buying e-books were kind of computer geeky guys.” But that shows signs of shifting. “Increasingly, we have seen many more romances hit the best-seller list, which would certainly be more in line with the normal print world, where the majority of print customers are women. So that leads me to believe that e-books are entering into the mainstream, book-reading world.”
The lack of content has been one of the major drags on e-book acceptance. The IDPF conducted a survey of e-book buyers in 2005, and a common theme among the 700 respondents was a call for a larger selection of e-books, particularly best-selling titles by authors such as John Grisham, Stephen King, and J.K. Rowling. One respondent said “My biggest complaint is that the books I want to read are NEVER available!! This doesn’t make any sense as ALL titles exist in electronic versions before they are committed to print…”
Another big complaint among these e-book buyers was about the price of e-books. A common refrain was that an e-book should never cost as much as its print counterpart. After all, the cost of paper, printing, binding, warehousing, and shipping have been eliminated, so why should they cost as much?
Then there’s the issue of competing standards. Currently e-books are available formats from several vendors (as well as “vanilla” ASCII text e-books available free on sites such as Project Gutenberg (www.gutenberg.org). This leaves consumers having to keep different reader software installed on their computers or PDAs.
Closely related to the competing standards is digital rights management (DRM). Publishers are understandably protective of their copyrights, but many of the DRM features in current reader software impose burdens on the consumers that you simply don’t find in paper books. For example, you can loan a paper book to a friend or family member, but that’s not possible with many of the DRM schemes currently in place. “I’d really like to see a broad industry effort to try to address some of these DRM issues that customers have,” said Bogaty.
While selection and price are clearly factors preventing broad adoption of e-books, the purchase process apparently has not caused problems. “One of the things that people are very happy about is that purchasing experience,” said Bogaty. “I think that’s a testament to the retailers; that they have made the purchasing and downloading of e-books as easy as possible.”
What will it take for e-books to become a major phenomenon like digital music on devices like iPods? Is it pricing, title availability, or the right hardware? Most likely, it will be a combination of many factors, but the final answer is likely to be as hard to identify as the consumer is hard to predict. “To be honest,” says Bogaty, “if I knew the answer to that question, I’d be starting an e-book company.”
This article was originally printed in The Editorial Eye, 66 Canal Center Plaza, Suite 200, Alexandria, VA 22314-5507, (703) 683-0683.
Copyright © 2006 Roy Jacobsen. All rights reserved. You can print ONE copy of this article for personal use. Other than that, you can’t reproduce this article by any means without written permission from the author.


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