The Sad Tale of Shrinking CD Sales: Will Books be Next?

There was a sad little tale in the Wall Street Journal yesterday about the decline in music CD sales. Seems that sales declined for the seventh time in the last eight years. Even more devastating was the fact that sales declined a full 20% over the last year.

The Journal states that the industry has ben decimated by illicit online downloading.

Wait a minute!  I haven't bought a CD in several years but I have legal access to each and every song that I have downloaded in those years. 

It is hard to fathom the stupidity inherent in that statement.  I guess the writer doesn't get out much.  If he did, he would see that there are a whole lot of places that allow you to buy the song of your choice for 99 cents. Perfectly legal and legit -- not illicit in any regard.

I don't know about you but I doubt I will ever buy a packaged CD again.  I mean why?  I have a legal Napster account that lets me listen to (and carry around) almost anything I want for one low monthly subscription fee.  And if I want to burn it on a CD and make my own mix I can buy the song for 99 cents.

Besides, everyone knows, that on every CD there are two or three songs you love, several you tolerate and if you you are really lucky only one or two you hate. 

Back in the good old days, when music came on records, it was too much hassle to get up and risk scratching the vinyl to skip one of those songs you hated.  You just suffered through it. 

Tapes were a little better, but still a hassle.  You could at least fast forward.  And then came CD players and even better CD players with remote control.  Once little press of the button and the song was skipped forever.  You still had to pay for, but at least you didn't have to listen to it.

That was the thing that finally convinced me to replace many of my tapes with CDs.  Mind you, I had replaced records with cassettes -- very costly and was really hesitant to do it all over again with CD.

And finally MP3 downloads.  I actually adopted this technology pretty quickly once I figured out I could subscribe to a service, carry one tiny little device to the gym and hear hundreds of my favorite songs. 

Does it get much better than this?  I can listen to almost anything for my monthly fee and decide what I like. Then I can decide what tracks I like well enough to want on a CD and I can burn them at will. Mostly there aren't many.

Most of the songs I buy and burn to CD are presents for people I love.  People like my friend Laurie who is a technophobe or my mother and her sisters. 

So what does all this have to do with eBooks? 

Well, publishers (and some authors) have a huge level of paranoia about piracy.  All of the hassle with DRM (90% of our support issues are because of DRM issues) are a direct result of this particular paranoia.  I am sure that many of them read the article and saw it as vindication for their position. 

Unfortunately, this particular vindication is patently absurd.

del.icio.us Tags: ebooks,e-books,ebook piracy,DRM,ebook technology

eBooks, Amazon and Oprah

It's been quite a week for Amazon. On Thursday they announced a revised projection for 4th quarter sales: somewhere between $6 and $7 billion. I don't care who you are; that is a LOT of money!

Before you start feeling sorry for them; consider that on Friday Oprah endorsed the Kindle. Called it a "life changing" product, no less! She says it changed her life and even says "It's absolutely my new favorite favorite thing in the world."

Oprah is, of course, a marketing machine and this endorsement is sure to help Amazon's bottom line. And you can be sure that publishers are hoping it helps them as well.

The thing that really strikes me is that when it comes to eBooks, Amazon has fixed it so that they realize revenue off of almost every eBook sold for portable devices. Take a look at the chart listing the various popular reading devices and the reading software that they use to read DRM protected eBooks.

	Adobe	eReader	Mobi	MS Reader	Propr- ietary	Palm
BeBook			X
Cybook			X
iPhone		X
Illiad			X
Kindle					X
Nokia Phones			X
Palm			X			X
PocketPC			X	X
SonyPRC	X				X

Almost all of them use Mobipocket as the reader of choice. And just guess who owns Mobipocket. Amazon, or course. So, as long as publishers insist on using DRM on their titles, Amazon wins big!

It might be inaccurate to say that Jeff Bezos has bet the farm on digital reading, but however you look at it, he has certainly hedged his bets!

This is very good for Jeff and Amazon, I am not so sure that it that good for authors, publishers or even readers. Amazon is in the extraordinary position of control both access to the market (authors and publishers) and product placement in the market (readers). It always makes me nervous when any company has that much control (or even influence) in a particular market.

del.icio.us Tags: ebooks,e-books,digital reading,amazon,oprah,kindle,eReading,eBook hardware

Penguin and eBooks (one step forward and one step back)

Penguin Publishers is in the news this week. For all of us eBook readers it basically amounts to one step forward and one step back.

Step Forward

Back in June I complained about Publisher’s and eBook pricing. One of the publishers I sited as having eBook pricing that made no sense was Penguin. At that time Angel Falls by Nora Roberts was selling in hardback for $25.95 and in paperback for $ 7.99. But the real disconnect came from the fact that the publishers suggested retail price for the eBook is $25.95!

I mean, really!! eBooks essentially cost the publisher nothing to produce – no paper, binding, printing or returns. Admittedly there as costs associated with distribution and marketing but the distribution costs are far less and the marketing costs generally fall to the eBook sellers.

Evidently, Penguin got at least part of the message. They put out an announcement to booksellers last week that they are planning to discount eBooks by 20% from the printed editions. Of course, they did not bother to specify which kind of printed editions – hardback or trade paper. If they follow through, however, you will see the eBook edition of Angel Falls retailing at $6.39. BTW there is not sign (yet) of them lowering our cost for the eBook.

Step Back

Penguin Audio, one of the five original publishers participating in eMusic's audiobook downloading program, begun last month, has withdrawn its 150 available titles, according to the New York Times. The reason: "concerns about digital piracy."

Evidently, even though Random House says they have not seen any piracy, Penguin executives are too nervous to even give non-DRMed books a chance.

You would think that the Publishing industry could look at the Music industry and see the future. Digital downloads, ultimately, change everything! Mega publishers should realize that they probably won't thier clout from piracy. The real danger is that best selling authors will do what Madonna has done to Warner and go directly to a promoter for a better deal. They can artifically inflate the price of a digital file, but for how long?

Last time I checked, one step forward and one step back, pretty much leaves you in the same old place. But I am trying to stay positive (making lemonade and all that).

Perhaps it is more like two steps forward and one back. DRM is a nuisance but one I have learned to live with. A cut in price has a much more immediate and practical benefit to me as a reader; one I am eager to take advantage of.