Guest Column : The Kindle—Igniting the Book Business
Amazon's Kindle has raised issues for book publishers, such as appropriate pricing options for e-books.June 2009 By Peter Olson and Bharat N. Anand
Book businesspeople are about to make the same mistake that has devastated the music and newspaper industries: worrying about whether a new digital format will cannibalize their traditional business rather than focusing on how to make the new format more competitive with other digital media.
Recently, there has been a flurry of alarmist articles about Amazon’s Kindle 2, mainly addressing the following questions:
1. How does the current digital reading experience compare with the printed book?
2. How should e-books be priced in relation to p-books?
3. Will the print book industry disappear?
The real issues are:
1. How can we enhance the reader’s overall experience—not just reading, but browsing, purchasing and library-building, and not just through print or digital media, but through a combination of both?
2. How can we create pricing options that will increase demand for books and offset the decline in book readership?
3. How can we build a new business model that is attractive to authors and sufficiently profitable for publishers and online retailers?
Asking baby boomers whether they will forego their affinity for printed books is irrelevant. The key to the future is whether e-books will be interesting enough to Generations X, Y and the millennials to capture a significant portion of their entertainment spending.
Other companies will enter into competition with Amazon. Sony and Apple almost certainly will introduce enhanced e-readers, and in all likelihood, new entrants will be tempted to invest in the format of the future. The ensuing competition will result in improved e-book readability and drive down prices for the devices. What will this mean for the book business?
First, online retailing is poised for a second wave of innovation. The innovation of the Kindle was not to improve e-reading—many earlier e-readers offered a very similar reading experience—but to dramatically alter the purchasing experience through its wireless capability. Similar innovations are destined to occur in browsing and marketing. Until now, book covers designed with “dust” jackets to sit on shelves for prolonged periods of time have been the basis for the online positioning of books; obviously publishers could do better by designing online-oriented cover versions that would not only be more eye-catching and dynamic, but potentially even interactive.
Similarly, the digital version of a book could be a portal to additional information about the author or content—imagine learning, right after reading “Lolita,” about how Vladimir Nabokov came to write the novel, or getting a visual demonstration of Robert Millikan’s oil-drop experiment right after reading the chapter on electron charges.