Distribution Goes Digital
“We are leading the pack by building a digital warehouse, which is the digital equivalent of our print warehouse,” commented Jane Friedman, president and CEO of HarperCollins Publishers, in the May issue of Book Business. This is the ultimate sign-off on the industry’s embrace of the future, and its take-back of content control from trailblazers such as Google, Amazon and Yahoo.
For some years now, various technology vendors have enabled publishers to deliver electronically formatted versions of their titles for special purposes. These have included applications such as conversions to XML formats (e.g., Publishing Dimensions), proprietary e-book reader formats (Mobipocket), sight-impaired applications (National Instructional Materials Accessibility Standard/NIMAS), archiving and storing electronic versions of titles for other uses (OverDrive Inc.), PDF archives to drive on-demand printing (Lightning Source Inc.), licensing content to be sold in turn by subscription or sale for limited use (NetLibrary), browse-inside applications by e-tailers (Amazon) and specially targeted online libraries for education, training and business (ebrary Inc., Books24x7 Inc.).
This model of diversified outsourcing options seemed OK for the purpose, as no one expected any broad general trade or consumer revenue to spring from these applications. In addition, the targeted professional, STM (scientific, technical, medical) and academic electronic channels were tightly straitjacketed by rights-management hurdles in a market where access was generally paid for by corporations or institutions. Users were interested primarily in chunks of information when needed, rather than carrying books around for immersive reading or holding them in personal libraries.
What Happened to Alert the
So, what happened to alert HarperCollins, Random House Inc. and the other major trade players to do what many reference, STM and smaller publishers were happy to allow others to do for (or with) them in order to gain wider exposure?
What happened, as Mike Shatzkin—founder and CEO of publishing consultancy The Idea Logical Co.—said at the Book Industry Study Group’s (BISG) Making Information Pay conference in May, was that what seemed of marginal consequence became both a major threat as well as an opportunity. Google launched its Book Search, which scanned the entire contents of copyrighted books to make them searchable, and Amazon launched its Upgrade program, by which it offered online viewing of an entire book for an extra charge with the book’s purchase. (You can access Shatzkin’s complete presentation at Idealog.com/speeches/mipdads.htm.)
In other words, others were building business models on publishers’ content and taking charge of its use. Publishers with major investments in backlists realized that control of how content was used and presented would be slipping out of their hands. They also saw how reading circles (TheBookReportNetwork.com), blogs (PersonaNonData.blogspot.com), social networks (MySpace.com/HarperTeen) and communities of interest (BabyCenter.com) lead to buzz and to printed-book sales. Being able to push their product into as many Internet communities as possible, controlling both the terms and the finesse of its use while encouraging more widespread access than before, could be a win for everyone.
And so, within a year, there emerged HarperCollins’ Browse Inside (HarperCollins.com/book/browseinsidemain.aspx) and Random House’s Insight (RandomHouse.biz/webservices/insight)—each connecting their digital archives to their newly named and soon-to-be-ubiquitous widgets. These electronic windows can be dropped onto anyone’s Web site and will provide instant access to the publisher’s entire library of titles.
It will not be long before every publisher will be offering a widget of their own, or will be part of a collaborative widget service, and the need for traffic management will set in—after all, how many widgets will Web sites host or browsers separately link to as users pursue their interests? Ingram Digital Services, because of its digital content management and distribution capabilities, would appear to be the logical candidate for the first such widget service to publishers. However, it would make sense for any of the digital management services, such as OverDrive, to do so.
From DAMs to DADs and Beyond
So we now come to the new digital asset (DA) alphabet soup of the moment: DAP, DAD and DAR—for producers (P), distributors (D) and recipients (R). These acronyms were created by Shatzkin and another consultant, Mark Bide, for a study conducted by international publishing-software and consulting-services supplier Klopotek, which has published the results as a white paper (Klopotek.com).
Offspring of the DAM (digital asset management) systems of the 1990s that have been stifling easy distribution of digital assets through rights management software wrapped around content, the new vocabulary provides an opportunity to focus on getting content out into revenue-producing information streams.
In fact, Shatzkin observes, the increasing need to be certain that accurate metadata about book titles, publishers and authors accompanies content will doubtless generate MUMs (“managers of unlimited metadata—to work with the DADs to round out the solution,” he says).
The solution to digital asset distribution is orderly definition, structuring and aggregating of technologies, functions and services that will characterize the digital supply chain. It is the new definition of DADs that provides the key supply chain linkages for this new industry workflow and value-added channel. (You can see how the digital asset distribution supply chain works in the chart below.)
The DAD, according to Shatzkin, “will have to offer a pretty complete service: storing publishers’ assets, converting them to different formats, providing DRM [digital rights management] as required, and successfully delivering them to platforms and Web sites of every description,” he says. “Although some large publishers with pretty substantial capabilities of their own might pick one DAD for one digital service and another for a different one, most publishers who need a DAD will want one to handle everything for them.”
Among the DADs Shatzkin mentions are The University of Chicago Press’ BiblioVault; codeMantra’s conversion house; HarperCollins’ use of NewsStand Inc./LibreDigital for its digital warehouse; Ingram Digital (see my column in Book Business’ April issue for a flowchart of Ingram Digital’s services); Macmillan’s BookStore; Random House; and Value Chain International. A serious new entry announced at BookExpo America 2007 is Macmillan Publishing Solutions’ MPS Macmobile, a wireless application protocol (WAP)-enabled Internet-based delivery system for content in all formats to any portable-device platform. (See page 10 for more about MPS Macmobile.)
Digital asset producers—DAPs—are, of course, the universe of content publishers, ranging from traditional publishers to the new on-demand publishers.
Digital asset recipients—DARs––are users of DADs’ output. What may be confusing here is that DARs, as defined by Shatzkin and his white paper, are aggregators, archives and portals themselves who distribute content in its user-form to other consumers. Examples he cites are Google, Amazon or NetLibrary.
Publishers need to become accustomed to thinking of themselves as DAPs, first and foremost, a paradigm shift from the paper-based industry launched by Johannes Gutenberg in Mainz, Germany about 557 years ago. Our future book-delivery supply chain always should be thought of as a digital file residing in a master archive that can drive both printed and all other versions and formats of the work.
Probably one of the oldest pioneers in digital media storage, rights and e-commerce management and distribution is Cleveland-based OverDrive Inc. (OverDrive.com), founded in 1986 by Steve Potash, its president and CEO. Potash is also president of the International Digital Publishing Forum (IDPF—the successor to the Open E-book Forum), and a champion for industry standards in electronic publishing (IDPF.com).
The online distribution model in the OverDrive chart (right) typifies the supply chain sequence handled by a DAR. The consumers in the chart are retailers, libraries and corporations.
Universal Data Formatting
Standards Are Needed
The major uses of digital content are in text, audio, DVD or video products, in PDF form—to drive book printing, for browsing and display in marketing—and in searchable form, including download, customizing and mash-ups (which combine content from multiple sources).
In order to manage the content effectively for these purposes, formatting conventions and metadata need to follow universally accepted and applied standards. What DADs distribute to DARs can verge on the useless to the misused and unused without the ability to read and process the data at the user end of the chain because of proprietary and other format barriers.
“Each year, we move closer toward the vision of the future,” Potash said, referring to universal access to digital content, as he announced the development of new Open Publication Structure (OPS) and Open Container Structure (OCS) device-independent e-book formatting and delivery standards at IDPF’s Digital Book 2007 conference in May.
Reinforcing the importance of standards in metadata, Michael Healy, executive director of BISG, urged the industry at BISG’s Making Information Pay conference to apply Online Information Exchange (ONIX) international data standards in transmitting title information.
Waiting in the wings to build on data integrity/standards and availability are radio frequency identification (RFID) applications for the book industry. Industry consultant Jim Lichtenberg, president of Lightspeed LLC, led a BISG-sponsored panel at BookExpo in which applications of this technology were demonstrated. A chip embedded in the cover of a book, providing nothing more than a coded ISBN or some other identifier, can enable instant determination of inventories and register sales, and locate misplaced items—to cite a few applications along the supply chain.
Digital asset distribution is a supply chain link defined by the functions it performs, the technologies it relies on and the businesses that provide its services. The DAD can be an outsourced third party or an in-house business unit (analogous to the print product distribution and fulfillment capabilities larger publishers have developed for themselves and may offer to other publishers as well).
While bits and bytes in packets of data have been moving around the global Internet pipelines for less than 25 years in the commercial form we now know, it is hard to believe that serious attention has been paid to digital formatting for commercial use by traditional publishers for only 10 years or so. But for a process whose timelines are defined by nanoseconds, bringing definition to its supply chain channels has emerged none too soon.
Not to forget the printed book, but that granddaddy of portable information storage can no longer go it alone, and in future columns, I’ll be exploring the ways in which digital assets are transforming the book manufacturing and distribution chain that still generates virtually all the revenue for our industry. BB
Eugene G. Schwartz is a regular contributor to Book Business. He is a publishing industry analyst, writer and editor-at-large for Foreword Magazine. A former PMA board member, he is president of Consortium House, a management and business consultancy to publishers. He previously was a manufacturing, production and operations executive.
- Books24x7 Inc.
- Ebrary Inc.
- Independent Publishers Group
- Ingram Digital
- Libre Digital
- Lightning Source Inc.
- Lightspeed LLC
- Macmillan Publishing Solutions
- NewsStand Inc.
- Overdrive Inc.
- Publishing Dimensions
- Random House Inc.
- The Book Industry Study Group
Eugene G. Schwartz is editor at large for ForeWord Reviews, an industry observer and an occasional columnist for Book Business magazine. In an earlier career, he was in the printing business and held production management positions at Random House, Prentice-Hall/Goodyear and CRM Books/Psychology Today. A former PMA (IBPA) board member, he has headed his own publishing consultancy, Consortium House. He is also Co-Founder of Worthy Shorts Inc., a development stage online private press and publication service for professionals as well as an online back office publication service for publishers and associations. He is on the Publishing Business Conference and Expo Advisory Board.