Are e-book publishers repeating the mistakes of the music industry?

As first appeared in Digital Publishing: Assignment 1

One of the biggest threats to the music industry has been pirating songs and cheating artists out of royalties. When publishers began digitalising novels, e-book piracy was a concern all parties involved had to consider. Although, piracy is not a novel concept; centuries ago, publishers used to spread censored texts on paper and ink, cameras were brought into cinemas and people used to record songs that played on the radio on tapes. Our parents might have fallen into that latter category.

While the music industry focused on attempting to install DRM (Digital Rights Management) software to prevent people from accessing content they didn’t purchase, pirates found their way around it. As sharing media digitally is the easiest solution, I’m asking the question of pricing, the impact of self-publishing on the industry and what actions the book publishers could take to solve the situation.

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What’s the impact on the music industry over illegal downloads?

As music started being shared digitally, companies implemented DRM into the code ‘that prevents copying’ as ‘a systematic approach to copyright protection for digital media’. Doctorow describes the problem in DRM is that all ‘systems share a common vulnerability: they provide their attackers with ciphertext, the cipher, and the key. At this point the secret isn’t a secret anymore.’ Because of this, users did not have to be that technically sophisticated to obtain illegal copies of the music or movies you were looking for. People just wanted the music they liked quickly and easily, the fact that they didn’t have to pay for it was an added bonus.

Napster was developed as a way for a group of friends to share music like people used to exchange records and CDs. The difference is that Napster exploded to encompass people from all over the world and that meant the creators of any content that could be shared online suffered by losing out on the royalties. Although, when Apple came out with iTunes music store with millions of DRM-free songs for under £1 each, it did not address the issue. Apple added a code to prevent users from accessing the songs from more than 5 different computers. So, it was easier to buy high-quality tracks for low prices, but if you changed devices often, you couldn’t access your media. That meant that people still preferred to pirate the music instead of risking paying for something they might lose.

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Many producers in the industry tried to crack down on music piracy, but with it being an ever-evolving hydra, it’s been impossible to stop completely. Despite having a huge negative impact on the industry, music makes up only 2.9% of everything pirated on the internet. It gives off the impression that no matter how hard the industry works to make sure the content people create is compensated; someone will always find a way to get it for free.

Is pricing the problem?

Some of the blame for causing the problem can be put on the pricing of e-books, as the price tag can be just as much as a physical copy of the book. Studies have shown that 70% of 18-29 year olds pirate media and a factor in so many students pirating is the cost. If their income is lower, they are more likely to look for free, illegal alternatives to accesing the content they want or need.

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Google put out a report in 2013 called “How Google Fights Piracy” and it spoke out against using DMRs. ‘The right combination of price, convenience and inventory will do far more to reduce piracy than enforcement can.’ This should encourage publishers to design more innovative and accessible services that are better value for the customer. There are services out there like Netflix and Spotify for books, such as Scribd and Oyster. However, because of different copyrights across the globe, they face the same issue as Netflix: it can’t offer the same content everywhere. Another issue McElhearn described with Scribd was that most of the library of books offered was self-published content from ‘authors looking for readers’, as ‘a lot of Scribd content is “documents,” such as catalogs (seriously), court filings, instruction manuals, and more.

The content unavailable is an issue with Scribd as readers might not be getting what they paid for could be off-putting for avid readers with tighter purse-strings looking for an alternative to pirating. But the subscription model for books could be useful in the future, but it would prove as advantage to readers who read quickly, as opposed to readers who take longer to finish each book. It would depend on whether a user would be willing to pay $8.99 a month to read 2 books or 6 books.

Is free the answer?

Coelho said that readers of his novels are ‘welcome to download my books for free and, if you enjoy them, buy a hard copy – the way we have to tell to the industry that greed leads to nowhere.’ His readers agreed; one reader said ‘You sir are right, by downloading your books I was determined to buy the hard copy! If I wasn’t a pirate I never would read your books! I consider it a preview, if you like it, buy it!’ If this was a model the whole industry could get behind, and use one platform to do so, it might be effective.

Of course, there will always be those against giving out creative content for free, even writers using sites like Wattpad, Kindle World, and Figment. Not to mention social media sites like Tumblr and Fanfiction, where writers can’t sell their content for fear of infringing copyright. These authors are most likely looking for a platform to share something they’re passionate about. However, writers have also bagged publishing contracts based on the popularity of a book they self-published, E.L. James with 50 Shades of Grey being the most well-known example.

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The rise of self-publishing (and how it’s affecting the market).

Many people have taken advantage of the new technologies to tell their stories and earn money by selling them online. Amazon Marketplace has self-publishing options in both e-book format and hard copy. However these self-published books haven’t been professionally edited or formatted and they are priced at less than £2 each. In the US, 235,625 print and electronic titles are released each year . The self-published books have a lower production cost, as the author is doing all the editing, cover design, marketing etc. as opposed to professional publishing houses that have a team of people dedicated to each novel they produce. This means that the independent authors can publish several books quicker, rather than publishers only being able to put out one or a maximum of two a year.

Over 25% of writers self-publish and they typically get their investment back, plus 40%. 86% of those who self-published said they would do it again. Flood  wrote that ‘Traditional publishing is no longer fair or sustainable’. Being published by a traditional in-house publishing company is no longer the only way to be successful in publishing.  The low cost, quick turnover and satisfactory content doesn’t devalue the professionally edited and formatted editions that come out of publishing houses. It does mean that self-publishers often have the same skills as a team in a publishing house and publishers must work that much hard to prove that traditional publishing is still the ‘better’ option.

However, Solomon argues that ‘publishers are doing less for what they get’ and ‘with ebooks, though, publishers’ costs are less, so authors should get a better share… Even on traditional books, publishers’ production costs have gone down but authors have not benefited from these costs savings.’ This could also be interpreted as an advantage to self-publishing: the author would simply get more of the profit for the work they actually do. This can also be linked back to being noticed as a writer. If you are a big-name author, your work will be pirated. But if you are less well-known, choose to self-publish and put a low price on it, people are more likely to buy your product than pirate it.

What is the book industry doing about it?

While E-book piracy is only 0.2% of everything that is being pirated online, it is still significant in the book publishing market. 4 out of 5 publishers are now producing e-books. Publishers don’t concern themselves with the circulation of one copy between ‘a small circle of friends or acquaintances’ rather than ‘collecting orders’ that could later ‘amount to issue to the public’. It is not a big enough threat to the industry if you share it around with a small circle of friends for publishers to take serious action. Whereas sharing a download link on forums that anyone can access freely are cutting publishers’ profits.

What’s likely to happen next?

It doesn’t look likely that books will drop down to being free downloads, however, they might drop in price to one set price. Many publishers are looking adding more value to the products they sell. For example, 31% of e-book publishers are producing enhanced e-books. Others are looking into bundling, selling several books at once, such as a box set of a series or the same book but in different formats (hard copy, e-book, audiobook). It’s like the middle ground in the print vs. online debate: how about all three? The industry could go in many different directions with their approach to e-book piracy, but I think they have taken note from the music industry.