Used Kindle eBooks?

Amazon has patented a means to sell used ebooks within the Kindle system.  A book will be branded within the system when it is bought, then when the buyer puts it up for resale at the Kindle store, it will be removed from his account and transferred to the buyer’s account.  Amazon will receive a small fee for each sale.  A limited number of sales of each book may or may not be included in the system.

According to copyright law, specifically “The Doctrine of First Sale,” this is illegal because digital goods aren’t physical things so they can’t be resold.  (See my article on “The First Sale Doctrine and eBooks” for more details.  http://mbyerly.blogspot.com/2009/04/first-sale-doctrine-and-ebooks.html  )

But a legal battle is currently being fought between ReDigi, a used digital music store, and the various groups in the music industry over a similar system.  If ReDigi is able to win this, Amazon will probably move forward with their own system of resale.  

At first glance, it appears Amazon would be cutting into its own Kindle profits with this system, but Amazon isn’t known for its poor business practices.    Here’s what it will gain from the system.  

Buyers go for the cheapest prices.  If a used Kindle ebook is cheaper than any other version of the book, buyers will start using the Kindle system and its hardware.  iTunes, Nook, and other sites won’t be able to match these lower prices unless they start selling new ebooks for next to nothing or they put into place their own reselling system.  Such a complex system would take some time, perhaps years, so Amazon would gain the advantage in the market for many years to come.  

Some in the industry believe that Amazon is intent on killing off publishers so authors will have to go the self-publishing route, and authors as individuals have no real bargaining power when it comes to the terms Amazon will set.  (See “Used eBooks: The Ridiculous Idea that Could Also Destroy Publishing”  http://motherboard.vice.com/blog/used-ebooks-is-a-ridiculous-idea-that-could-ruin-authors-publishers  )

What will all this mean if Amazon’s used ebook system becomes available?  Readers may be happy with this system, but authors and publishers will not.  Publishing has a very low profit margin, as is, and anything that will cut into that profit will hurt, sometimes to the point of putting authors and publishers out of business.  

Authors like me have been busy educating readers on “The First Sale Doctrine” so they will know that ebooks can’t be resold, loaned, or put online for free, but a system like this will make readers believe that, if Amazon can do this, so can they. Piracy will spread.

If Amazon gains total supremacy in the distribution market, then they will be able to dictate the terms in contracts with authors and publishers, and those terms will shift even more of the profit into Amazon’s pockets.

If the other distribution markets fail and Amazon is the only source of ebooks, it can close down the used market place, and readers will have to pay much more for the surviving content.  After all, Amazon is in it for Amazon as they have proven over and over again.  

This system may not be the eBook Zombie Apocalypse as a universal removal of “First Sale Doctrine” on digital goods would be, but it may very well be the beginning of the end of publishing as a profitable venture.  

UPDATE: On March 30, 2013, a federal court ruled in the Capitol Records versus ReDigi case that it is illegal to sell "used" digital files.  No word yet if ReDigi will continue to fight this battle.  

http://arstechnica.com/tech-policy/2013/04/can-i-resell-my-mp3s-redux-federal-judge-says-no/

Used eBooks: The eBook Zombie Apocalypse

Digital products like ebooks are licensed, not sold, to a buyer so they can’t be legally resold, shared, or loaned.  (See my article on “The First Sale Doctrine and eBooks” for more details.  http://mbyerly.blogspot.com/2009/04/first-sale-doctrine-and-ebooks.html  )

A group called the Owners‘ Rights Initiative ( http://ownersrightsinitiative.org/  ) wants to change that.  They believe that the owner of a digital book should be allowed to sell it used.  Members of this group include some library trade groups, used resellers of paper books, and eBay.  

Some readers consider this a good thing because they can get back cash on books they read in the same way as they do with paper books.

But is it a good idea?  

The answer is a resounding no.

The biggest problem with used ebooks is ebook piracy.  Some think that cheaper books mean less reason to pirate books and that’s true to a certain extent, but used ebooks mean that authors and publishers will no longer be able to prove that an online copy has been stolen.

Right now, publishers and authors license their books to specific resellers/distributors like Amazon Kindle, B&N’s Nook, and Smashwords.  If a book is available at any other site, the publisher and author know instantly that that book is pirated, and they help the police take these sites down.  These sites are fairly common, and some look like legitimate bookselling sites so the consumer is no wiser that they are buying stolen books.  Some of these sites actually sell the books, others are scams which steal credit card information and install viruses on the victim’s computer.  

If ebooks are sold used, the scam site will be able to fly under the legal radar.

Pirate sites will claim that their books are being given away for free by legal owners so they can continue their dispersal of illegal copies.  

If ebooks are sold used and a site or individual can sell thousands of copies of the same ebook by saying that they are selling one used, there will be no way for the author/publisher to prove this.  This will essentially make book theft a crime that can’t be punished.

Even readers who want to do the right things by buying legally won’t be able to tell who is a legitimate reseller and who isn’t.  

Readers looking for bargains will buy illegal books instead of legal ones, the profit margin for authors and publishers which is small now will plummet to the point that publishing will no longer be profitable for anyone, and those who make the money will have done nothing to create books.  

Publishing will be dead, and the ebook zombie apocalypse will be here.

Ironically, the ORI library trade association members who are angry that some publishers are making it harder for them to buy and loan ebooks will be just as devastated by these events.  With ebooks available for next to nothing or for free online, libraries will have even less value for users and tax payers so they disappear or lose major funding.  These library groups may find their members  lurching around with the rest of us in publishing in the ebook zombie apocalypse.  

MORE INFORMATION ON THIS SUBJECT:

“THE RIGHT TO RESELL, A TICKING TIME BOMB OVER DIGITAL GOODS:”

http://paidcontent.org/2012/12/15/the-right-to-resell-a-ticking-time-bomb-over-digital-goods/

TOMORROW:  Amazon’s scheme to sell used ebooks within the Kindle system.

Finding the Right Epublisher

Picking an epublisher is a bit trickier than picking a traditional New York publisher because there are so many and their methods are so different. 

To start your search, first check out review sites and look for reviews of novels similar to yours and see which ones get the praise. If you can't tell an ebook publisher from one of the traditional publishers, use Google to check out the publisher. Soon, you'll recognize publisher names.

You can also ask about at various online writing groups and sites where writers hang out. Some clueless types hype their very poor publishers so don't take everything you hear as correct. 

When you find likely publishers, check out their site. Look at the kinds of books they sell. 

If your book is straight fantasy, you may regret a publisher which emphasizes romance on its home page or has a very small amount of fantasy because you'll have difficulty selling to the fantasy crowd even if your book is a perfect example of a great fantasy. The SF/fantasy crowd tends to be snobs and run in the opposite direction if they associate your publisher with romance.

Another way to check out epublishers is to see if the publisher's books are available in a wide range of formats and at other sites besides their website. Without exception, my ebooks sell worst at the publisher's site than anywhere else because readers prefer the one-stop shopping of places like Amazon Kindle. 

Go to the main venues like Amazon Kindle and see who is selling the most books in your genre. (The lists can be arranged in best-selling order.)

Go to publisher sites and read their guidelines and their posted contract. Compare the contract to EPIC's model contract. (http://www.epicauthors.com/) Also, look at EPIC's "Red Flags" article. Links to both can be found under "Helpful Items" on the left side of the site. 

Read a number of the publisher's books, or at least, the posted promotional chapters. Are there grammatical and spelling errors? Are the books bad? If so, find another publisher. 

Also, look at their covers. Would you want a cover like that? Do the covers fit the genre of the book? 

Once you get a few possibilities, ask about them on listservs where authors congregate. Most of us will warn you away from the crooked and inept publishers. Also, check them out at Preditors and Editors. http://www.anotherealm.com/prededitors

You'll soon discover that the biggest epublishers with the best reputations are closed to submissions most all the time. Their stable of writers can produce more than enough books for them without dealing with the slush pile. 

But there are new publishers who are more than eager for good material. Unfortunately, they usually don't have a track record so you really don't know what you're getting in to.

All this research won't guarantee a safe passage through the stormy waters of publishing, I've had a few disastrous publishers who have lost distribution after I've signed with them or who have proven to be inept, but publishing is like life. Sh*t just happens despite whatever we do.

TOMORROW: I finish this series by talking about self-publishing resources.  Thursday, I will post my weekly "Links of Interest."

Epublishers and Other Online Distribution Methods, Pro and Con

EPUBLISHERS

Epublishers release their books in digital format although some also offer print options mainly in the form of print-on-demand publishing.

The advantage to epublishing is a wider range and number of publishers as well as less pigeonholing of book types. Since the costs of producing an ebook are much smaller than with paper-published books, the publisher can afford to publish books that don't fit tight market requirements.

Most epublishers handle the cost of editing and cover design, but only a few offer a very small advance of royalties.

You will usually have a great deal of impute into the cover art, editing, and the book blurb.

Distribution is nonexistent in bookstores, of course, but the books are available at the publisher's website and ebook distribution sites like Fictionwise where they will be sold with the ebook versions of books from traditional publishers and small press.

One major disadvantage is less money. Not enough people are buying ebooks yet so the money isn't there.

Even erotica, the growth market for ebooks, isn't offering much profit for most new authors because of the glutted market.

Those most successful in ebooks are prolific writers who are able to produce three or more high quality books a year that are sold to the same audience. That audience buys all their books, and each new book draws in more readers who buy the backlist. Darrell Bain and Charlee Compo are good examples of this kind of success.

Epublishing companies also have the same disadvantage as small press. They are run by individuals so an illness or family tragedy can put your book on hold, or the publisher can fail completely.

SELF PUBLISHING IN EBOOK FORMATS

You can format your book into an ebook then sell it from your website or through a few ebook distributor sites. Some of the major distributor sites like Fictionwise are closed to the self-published.

The advantage is total control and a much cheaper setup cost than a paper book. The disadvantages are much the same as with any form of self-published book.


A WEB NOVEL

The final market really isn't a market because no profit is made.

If you want to be read and money doesn't matter, putting your book on the web for free via a website, a blog, a free download site like Memoware, or a listserv like Yahoogroups may be the route to take.

You will have to promote for readers, but you will get them, and a few will actually comment on your work.

Some writers do this as a learning experience. Others simply don't want to bother with the hassle of the publishing process.

The disadvantages are no money and the possibility your book may end up elsewhere without your permission.

The simplest way to gain popularity, readers, and comments is to write in a popular fan fiction universe like Harry Potter or HEROES. A decent writer can become a big fish in a very small pool with lots of fans and none of the heartache of the professional markets.

FINAL COMMENTS

If you're still confused about which market you should try, think long and hard about what you really want from publishing and go from there.

And welcome to the wonderful world of publishing. Tighten your seatbelt because you're starting one heck of a bumpy but fascinating flight.

Part Six

The Current State of Publishing and Bookselling, Part 6

WHAT ABOUT EPUBLISHING?

Right now, few authors can make a living at epublishing. Even erotica, the growth industry of epublishing, no longer pays the bills as it once did.

The market has become glutted with books from other small publishers, and the major publishers have moved into the market in ebook and paper formats.

Venues for ebooks like Fictionwise are currently being glutted with backlist from major publishers so that unknown authors can sink in a sea of books quite fast. Romance is particularly prone to this.

The authors who are successful in epublishing are prolific, produce quality books of one kind so they build their sales through backlist and loyal readers, and they market constantly to sell that first book to new readers.

Of course, this is the primary survival means in paper book publishing for most authors right now.

~*~

Tomorrow, I'll suggest ways that readers and writers can fight to save the books they love.

Is Epublishing Authors' Salvation

In 1995, I believed that electronic publishing and the Internet were salvation for authors, and they would finally break the stranglehold on authors and books held by the conglomerate publishers, the book distributors, and the book chains.

I took a brave or foolhardy leap into the market with one of the first epublishers. Since then, I've watched the market's changes, and I've talked to hundreds of authors, small publishers, and readers. Here's what I've learned.

Readers are creatures of habit. If it's a choice between a known factor like a bookstore/a paper book/a name author and an online source/ebook/unknown author, most readers will choose the known.

If they can't find what they want to read in paper, they may seek it in an ebook, but they will return to paper books if given the same selections. This is currently happening in the erotica market as the large publishers have entered the market. The readers are returning to the bookstore to buy many of the same authors they bought in ebooks.

At the same time, readers aren't willing to go directly to the source of the ebooks. They rarely buy from author sites or from publisher sites. Instead, they prefer the one-stop shopping of electronic distributors like Fictionwise. Most authors I know have, at the least, one hundred sales at places like Fictionwise to one publisher-site sale.

Most of these distribution sites only work with publishers, not individuals, so the major markets are closed to the self-published author.

The original works available at electronic distributors are being drowned under wave after wave of conglomerate publisher backlist.

Meanwhile, various conglomerates and companies like Amazon are fighting to control the distribution of ebooks through software formats, distributor sites, and devices like the Kindle.

Publishing has much smaller financial numbers and much fewer sales in the digital format than the music industry so neither the author nor the small publisher are seeing much profit or success, and the small publishers are a dying breed.

Without a platform or a reputation from conglomerate publishing, most authors struggle for profit.

Those authors who succeed strictly in epublishing do so by writing a large number of first-rate, consistent books in the same genre.

So, essentially, the great digital freedom for writers from conglomerate publishers, the book distributors, and the book chains that I envisioned hasn't happened in the last dozen years and probably will never happen because of reader habits and the current direction in the markets.

REQUEST: If you enjoy this blog, please share it with your friends and online writer groups.

I enjoy writing it, but I can't justify the time if I'm talking to a small group.