if connected

The digital era is finally arriving for books. I wonder if publishers, retailers, and device makers realise the Pandora’s box that they are opening.

Books are one of the last analogue media formats, and as such have proved largely resistant to piracy. Music went digital with the CD in the 1980s while TV and movies became digital with the DVD format a decade later. Both of these physical digital formats opened up those media types to piracy as anyone could create exact digital copies of the content and share them online. The CD and DVD did more than anything else to lead to the piracy explosion, more than the actions of the original Napster, or Pirate Bay, or Kazaa or any other online site.

By comparison, to pirate printed books consumers have to manually scan each page. Then an OCR process creates an approximate copy that needs extremely time consuming and tedious proofing to fix errors. Result – only the most popular titles get scanned and shared online.

eBooks change everything. They open up the book world to the threat of piracy. eBooks provide an already-proofed digital version. Content protection for eBooks using DRM systems is not the answer. The music industry is switching away from DRM for music sales because it doesn’t work and causes legitimate consumers pain. Just one person needs to break the DRM system and then share that knowledge online and then anyone can make copies. eBook companies are still persisting with DRM but I don’t see this lasting here any more than it has for music sales.

There’s a prisoner’s dilmma at work here: Individual publishing companies have the potential to steal competitive advantage if they move first and execute well with eBooks. But for the publishing world as a whole, such individual innovation will accelerate the arrival of the digital era and open up greater piracy.

This risk is not stopping eBook and eReader innovation. The digital era is arriving for books:

Retailers are proving the most innovative, perhaps: Amazon have built on their acquisition of Mobipocket with the launch of first the Kindle eBook reader gadget and then with the Kindle application for the iPhone. Barnes & Noble are moving with their purchase of Fictionwise (which incidentally has a store available inside the Stanza iPhone eBook reader app).

Publishers are innovating too. Penguin see their eBook sales as a key growth area. Harry Potter-publisher Bloomsbury just announced a link up with Exact Editions to offer digital titles to UK libraries (see this item on the Writers and Artists Yearbook blog). Tech publisher O-Reilly and other tech publishers are the most cutting edge non-fiction innovators with an extensive offering. Random House, Harlequin, Pan Macmillan offer a mix of samples and promotional titles on the Stanza app.

Publishing companies I’ve spoken with say digital is inevitable and I think they’re right. But I question if it makes any sense to speed the arrival of the digital book era. There’s one exception. Companies that make eBook reader devices will benefit in any event, whether consumers buy books, read free out of copyright books, or if consumers pirate books.

For everyone else, innovate, but be prepared for the coming digital storm that will overturn existing business models and increase book piracy.

Much has been written about the Sony CD DRM / rootkit issue. However, almost all coverage has attacked the inept execution (or recall, or sticky tape workarounds) rather than the core concept.
My problem is more fundamental. The useful life of a CD is much longer than the Windows XP operating system that this DRM software tightly binds itself into. This DRM software must avoid crashing future versions of Windows, which is impossible to guarantee for such unfinished operating systems (especially as it has failed to deliver sufficient reliability for the known quantity that is the current version of Windows).
I have several music CDs from the 90s that include ancient versions of Quicktime and DirectX that I’m reluctant to run on my current PC. In a few years, such CDs will have to work with the next version of Windows, Vista, and Mac OS 12 and everything else. It’s an impossible task for a third party developer (i.e. everyone bar Microsoft) given the extent to which such copy protection must interoperate with Windows.
Second, I’m unconvinced about the merits of putting any copy protection onto a music CD. It takes just one person to break/bypass the protection and publish the music onto a file sharing network and then anyone can download the album. No CD protection developed to date has ever been able to stop all piracy. I suspect such efforts are futile and will inevitably hinder legimitate customers from enjoying their music in the process of attempting to stop the pirates.
The industry should be pursuing other solutions to market music and combat piracy. Read this JupiterResearch report for our take, or ask us for specfic advice on your particular products or services.

Nokia’s announcement may be more important for the news that AAC and OMA will be supported on PC versions of Windows Media Player, rather than the flipside of Windows Media support on Nokia handsets. Why?
Well, just a short while ago, everyone was berating Sony for the lack of native mp3 playback on Sony’s digital music players. The theory went that without mp3, existing digital music users wouldn’t switch, as conversion of large numbers of existing mp3 files to Sony’s Atrac format would be slow and would worsen the sound quality in the process. This ignored the potential for Sony to target the sizeable existing music audience that had a stack of CDs or MDs and hadn’t made the switch yet to digital. However, nevertheless, Sony is now making changes to avoid the problem.
In the meantime, the world changed.
iPod sales accelerated.
iTunes now rips CDs into AAC digital music files by default, not mp3.
Many of the millions of new iPod users that bought their devices in the second half of 2004 are building up AAC collections from their CDs, not mp3.
For digital music manufacturers that are looking to poach iPod users, native AAC support is becoming much more important.
Of course, digital rights management issues continue to limit portability of songs purchased from the iTunes music store and protected by Fairplay DRM. That is where PC OMA DRM support is so interesting, but that’s another topic for another blog entry!