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Wednesday, October 2, 2013

Netflix Model Damages Book Publishing Forever


Books are not a commodity meant to be sold by the pound. But recent developments in the marketplace dictate otherwise. And should the new pricing model put forth by companies such as Oyster and Scribd succeed; the industry will be downsized significantly.

Scribd announced an all-you-can read buffet plan that will allow subscribers to gain unlimited access to e-books for $8.99 a month. Oyster, a NY-based start-up, offered a similar plan for $9.95 a month. Scribd’s offering includes most of Harper Collins’ catalog and other books. Oyster offers Harper Collins, Workman Books, and many others.

So why is this the worst thing to hit publishing- ever?

First, you devalue books in the eyes of readers. Regardless of the quality of the content and the inherent value an author or a publisher brings, all books become the same.

Second, publishers and authors have less of an incentive to put out quality books because they won’t be able to make up for it on price.

Third, authors will earn less because the book cover price will become less.

Fourth, such appealing printing expedites the exodus from printed books and book stores. This will put book stores under and printed books will become too costly in comparison to the ever-cheaper e-book. Some readers just love print and some books are made for print (art, photography, architecture, gift books, and cookbooks).

Fifth, the publisher's brand is further eroded. If all kinds of books are thrown together in the same barrel, no one’s checking the label. The big five will become indistinguishable to the consumer. They will dilute their names and make themselves insignificant.

Sixth, a cap on pricing limits the growth of the marketplace. At annual subscriptions of $108, even if 200 million Americans signed up, the marker would hit21.6 billion dollars. But we don’t have 200 million book-buying Americans. Out of 310 million people, you have a lot of kids, non-English speaking immigrants,  illiterates, usually impaired, and slow learners. Something like at least one-fourth of all Americans did not read a single book last year and many others did not buy one.

Lastly, once the only differentiation in the marketplace is price, everything goes downhill. There will always be a retailer looking to discount books even further, which will steal profits from publishers and authors.

I oppose the Netflixation of books but if you were to have such a system, I’d impose the following:

·         Limit the number of book rentals per month, per user.
·         Only send one book at a time.
·         Have a multi-tiered system, based on whether a book ius a best-seller.
·         Charge more than 10 bucks a month. I’d rather see a discount based on usage. For instance, the first book of the month is full price. Second book is half price. Third book is 55% off. Fourth book of the month is 60% off of cover price. Link the price to usage. And distinguish that each book has a different cover price.
·         Only make backlist books (those 6 months or older) available for this service.

The industry should rethink its participation in any pricing strategy that devalues books or injures the print book market. Once they swim in a Netflix pool it will be hard not to drown.

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Brian Feinblum’s views, opinions, and ideas expressed in this blog are his alone and not that of his employer, the nation’s largest book promoter. You can follow him on Twitter @theprexpert and email him at brianfeinblum@gmail.com. He feels more important when discussed in the third-person. This is copyrighted by BookMarketingBuzzBlog © 2013

5 comments:

  1. How many readers are there who pay $9.95/month for books? Isn't this more like a paid library subscription than anything? I've always been able to obtain a large number of books to read at no out-of-pocket cost at my library. I know few people who buy a large number of new books. I know they exist; I just wonder how many

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  2. Amazon offers unlimited reads (one at a time) $79.00 year that's less than 10 bucks a month and I am a published author.

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  3. As an indie author, I don't see your #5 as a drawback. And anyway, it's already happening. A number of studies have shown that readers don't care about the publisher's name.

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  4. Nicole Martin has a good point; and you can get unlimited books, 10 at a time (at least at the Philly library) online through libraries. Why bother with this sort of thing at all?

    The only pricing caps I can get behind are basic, market-driven common sense. If you're a new author, don't try to get $19.99 a copy for one of your e-books. If you're an established author, don't try to rook people for $19.99 a copy for one either! If you do, you'll be very disappointed. They already had to pay for the reader so whatever cost accrued from "printing" a book has already been paid by the reader. Don't make them pay twice!

    There's enough recent data out there that nearly half of Americans don't read a book each year, so we're not going to have that big of an impact either way.

    Plus both services mentioned here are limited to tablets and iCrap products - no e-ink/e-ink-esque devices like a Kindle or a basic Kobo can run the apps, so I don't think it's going to be that popular anyway.

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  5. As an author, it's my responsibility to avail myself of every possible means of distribution for my work. Each distribution method = a potential stream of revenue for my creative products.

    I'm very excited about subscription-driven access to ebooks. The same day I heard about Oyster (about a month ago) I contacted them to see about including my catalog.

    Clearly, the "netflixation" of content is something content creators are willing to get behind. One need only look at Netflix and Amazon Prime themselves, where more and more production companies are taking their original productions instead of opting for broadcast networks.

    Diverse opportunities drive competition, which drives business. That's a huge win for the publishing industry.

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