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Turning Pirates Into Customers
I originally wrote this for Shane Jiraiya Cumming's blog a month ago, during his Grand Conversation about ebooks; it was posted there a month ago. The conversation is fascinating series with input from many authors and publishers, and I encourage people to go read it. (And try out his books; he's got a couple of freebies and a set of very reasonably priced ebooks at Smashwords.) This essay was intended to be "a blog post;" Shane wound up posting it in 3 parts because blog posts shouldn't be 4500+ words long. But since this is DW that allows *cough* 50k word fanfics in a single post, I'm posting it all together here.
I do have some ideas on why it's important to consider pirates as potential customers, and how to convert them. (Or rather, how to convert the leeches; the uploading pirates are often already good customers.)
When I'm being technically accurate, I call it "unauthorized file sharing" because it might not be illegal.[1] Most of the time, I just call it "piracy" because that term has been embraced by several sides. Authors & publishers use it to imply they're being raided and stolen from by people outside of the reach of normal laws; uploaders and downloaders use it to imply they're creative rebels fighting against oppressive corporations. (Who did you root for—Captain Jack, or the East India Trading Company?)
While the legal and moral issues of "piracy" aren't certain, the practical truth is that it's both frustrating and scary for authors, who look at those downloads and think, "why aren't they buying my book, if so many of them like it?" Which comes to the heart of the problem:
What authors need (and publishers, if those are involved) is not "an end to digital piracy." What they need is more sales. They need more customers, and more of the current customers buying more ebooks. It doesn't matter if they stop pirates; book contracts aren't renewed based on the number of pirates stopped.
DMCA takedown notices to Megaupload and Rapidshare don't result in more sales. Shutting down ThePirateBay doesn't sell books. Even if takedown efforts resulted in removal of content, instead of pushing it laterally to somewhere else on the web, there's no evidence that those people would turn around and buy the legit versions of the content they formerly pirated, instead of turning to other, legitimate free content online.
I'm focusing on ebooks and not including print as an acceptable substitute. The solution to "the ebook isn't available at a price I can accept" will not be "just buy the paper version instead." First, because some of us don't read print, either as a matter of preference (like me) or ability (people whose hands are too weak or shaky for pbooks, or who need large text); second, because the most affordable print version is often second-hand… which still leaves the author out of royalties. Third … let's just allow there is a third, and fourth, and more possible reasons why print is not always a reasonable substitute. Telling people they should be reading more pbooks isn't going to work.
Might as well say, "if my book isn't available at a price you like, read something else." That’s a shoot-yourself-in-the-foot approach to potential customers when you stop and think about it.
"Pirates" are all potential customers. The most active—the ones who upload often, and download lots, not the ones who download the newest bestseller because it's faster than borrowing their brother's copy—are interested in ebooks. Pirates care about the works they share. (Or steal, depending on your vocabulary choices. Either way—people don't steal what they don't want, even if what they want is "a huge collection" rather than anything specific within that collection.)
To get them to buy instead of download, authors need to know what they're downloading, and why they're not buying it. It's not "because they're lazy, greedy criminals who would rather steal than pay artists." Most people want to support the artists who create the content they love; if they don't, it's because they either believe they can't afford to, or circumstances have made that support impossible for them.
The common response to "they can't afford to" is "well, then they shouldn't read those ebooks." But we are surrounded by content we aren't required to pay for. Television (taxed in some countries, but not on a per-use basis; you don't pay more if you watch more), movies watched at friends' houses, books borrowed or given by friends when they're done or picked up at rummage sales for $5 a bagful, prices so low as to be meaningless, and not resulting in payment to the writers. We've always had access to huge collections of entertainment and educational content without paying; insisting that the digital world is different makes no sense. It goes against centuries of cultural inertia; artistry has always been paid for by a few and enjoyed by the masses.
Which doesn't mean it couldn't be paid for by more people. More payments = more people devoted to writing instead of shuffling papers in an office; those of us who love books would like that. Nobody in ebook downloading circles says, "I download so that authors will go broke, because I want less ebooks in the world."
Before getting into how they might be convinced to buy instead of downloading, I want to go over what they download. Convincing people to buy requires knowing what they're expected to give up. Unauthorized ebook downloads—"pirated" books—consist of three main categories:
1) Commercial ebooks, with DRM removed if it existed, shared with people who either don't believe they can afford the legit version, or don't want to deal with its restrictions. (DRM, store requires a credit card instead of PayPal, not available in their format of choice, etc.) This includes (among other ebooks), many popular bestsellers, a lot of romance & erotica ebooks, and digital textbooks. When researches try to estimate the "damages" caused by piracy, they focus almost entirely on these books.
This is the category that potentially causes real financial losses; a free download of an ebook available for sale is unlikely to be bought. Some people do buy them, either out of a sense of obligation, or because they forgot they had a free version, or for the sheer convenience of getting it at the moment they're interested. However, the higher the price of the commercial version, and the more restrictive the DRM from the customer's perspective, the less likely these sales are.
This is the area where authors and publishers need to focus their efforts on convincing people to buy rather than pirate. This is the only area worth spending real effort on; nothing else is competing against actual sales. "Punish the wicked pirates" may be a fine goal, but it has nothing to do with selling books.
2) Books with no authorized digital edition, which includes both scanned-and-converted books and no-longer-sold commercial ebooks. This includes comic books and manga, very little of which is legitimately available digitally, and almost none of that is backlist; out-of-print graphic content tends to stay out-of-print. Most of the rest of the scanned ebooks are out-of-print books, although some have been re-released in paper; the publisher may not believe there's a market for the digital version, or hasn't the rights or resources to offer it digitally. Some are popular books that have no authorized digital version. This category also includes "not available in my country" ebooks … the digital text is not available, at any price, without breaking a law or violating a TOS somewhere.
It's unclear that this category causes any financial damage at all, and it likely drives up sales for print editions by keeping people aware of and interested in those authors or publishers. The most famous example is Rowling's books; the almost-never-discussed category is romance novels. (Harlequin just started a digital backlist program; until recently, they retired ebooks after only a few months.) Other ebooks drop out of availability as authors change publishers.
For this area, the potential customer can't just be redirected to a purchase. If the reader wants access to that ebook, she must either (1) painstakingly scan & convert it herself (which may or may not be entirely legal, depending on her location), or (2) avail herself of the generous work of others, who have procured a digital copy (either by scanning or purchasing a legit version) and made it available for download.
This is the category that authors and publishers need to acknowledge as, at worst, grey; it's hard to incite moral outrage for the nonprofit distribution of orphan works, with no known rights-holder, and out-of-print comic books, and niche publications that have no interest in exploiting a digital market. Piracy advocates point to this section first when the moral issue is raised, and the common author/publisher reaction of "if they're not legitimately available, just don't read them" is a weak response; it's interpreted as "we'll decide what you should be reading; your own tastes are irrelevant."
3) Scanned-and-converted books that differ from the authorized digital edition, often because they were scanned years before an authorized edition was released. These sometimes continue to be shared because their editing is better than the commercial release, which is often automatically OCR'd without proofreading and poorly formatted. (The 12-year-old digital versions of Tolkien's works are better-proofed than the ones sold today. The usenet .txt files didn't have "Tha Hobbit" on the title page.) Or they persist because they're available in formats not sold—often txt or html. Or because the authorized version is considered so very expensive that people will settle for a lower-quality makeshift—this is very common for textbooks.
This is the category that authors and publishers need to pay close attention to; it highlights the problems in their marketing plan. Readers are getting something from the amateur scanned edition that makes it more valuable than the professional release … the fact that this is not uncommon, shows the lack of quality of many professional ebook releases. Uncorrected OCR, formatting that looks awful on a dedicated reader (I've seen 1" hard-coded margins on the 3.5" wide screen), blocked search or print options in PDFs, lack of a functional (linked) table of contents… commercially-purchased ebooks are a crapshoot for quality issues, and one way to spot them is to check which bootlegs are not the same as the official download.
Sometimes, the previous scanned versions are shared because of inertia; those torrents are widely available and the new commercially-available, DRM-cracked ebook is not. But as sloppy and scattered as the download sites are, quality does get more attention than its lack; if the commercial version is notably better than the previous bootleg, it'll slowly replace it, and that ebook will slide into the first category instead of the third.
Not that the bootlegs are all great quality files; they have the same series of problems (well, except for the blocked print-and-search options)… but at their price, nobody complains. Anyone who feels inspired to fix the problems can do so, and release that version with no more moral qualms than they had before. A purchased book, with DRM, can't be fixed, no matter how bad it is.
Which brings me to the point that authors will be most interested in: How do you convince them to buy instead of downloading?
This is one of the first reasons (or excuses) offered for why people download instead of buying; purchased ebooks are a mix of "good enough" and "problematic," with the occasional nightmare (books with no punctuation at all, wrong book entirely—right filename, wrong contents). Anyone who's been burned on a purchase (some ebook stores have a "no returns AT ALL" policy; most others drag their feet about fixing bad digital purchases) might feel justified in turning to other sources for their ebooks.
Authors, harass your publishers to both proofread and check the formatting of ebooks on ebook readers, not just a computer screen. Publishers, invest in a few different readers for testing, and make sure each ebook is opened and checked by human eyes before it's pronounced ready to sell. You wouldn't release a new hardcover as loose-leaf pages of recycled newspaper held together with a rubber band around a couple of sheets of cardboard; don't do the digital equivalent with your ebooks.
Fix the formatting. Fix the metadata. And tell your customers about it… request ebook listings that have a spot to mention fonts, justification, line spacing, and proofreading. The average ebook buyer won't care, but will be pleased to note that you're paying attention. The potential pirates might reconsider bootleg downloads (with their erratic quality levels) if they're assured the legit versions are good
If you can't control how they're described in ebook stores, make sure the listing on the author or publisher's site talks about ebook formatting quality. Tell customers what anyone considering buying a print book would know at a glance: how long is it (word count is preferred to page count, for ebooks, but even filesize is some help), is it serif or sans serif, are the paragraphs indented or is there a blank line between them? What cover art does it have? Is there internal artwork? Does it have an index? A table of contents? Tell people what they're buying, and they'll be more likely to pay you. Tell them they don't need to crack the DRM to read it because it doesn't need to be fixed. Encourage reviewers to mention ebook formatting, just as they'd mention whether a printed book had margins too small or an easy-on-the-eyes typeface.
Of course, they may need to crack the DRM to read it because it's only offered in stores that are incompatible with their device. If you only sell at Amazon, with DRM, and the customer has a Sony Reader, she has some choices:
The question authors should be asking is not, "does DRM prevent (some) piracy?" because they don't need to prevent piracy. They need to gain sales, so they should be asking, "does DRM prevent more lost sales through piracy, than it prevents purchases through inconvenience?" Many former customers have said they'll never buy DRM'd ebooks again … several of those were active buyers, early adopters in a position to encourage their friends to try ebooks.
Many people also claim that DRM doesn't bother them, or that it's a necessary nuisance, and they don't mind it because it helps authors get paid. I've yet to see one of those posts/comments say, "of course it doesn't bother me that I can't share my Kindle books with my husband's Nook. We don't mind at all having to buy the same book twice so we can both read it." Nor has anyone said, "I lost access to 50 ebooks when Adobe changed from its old DRM system to ADE, but I was never going to read those again so I don't care. I'm happy to buy plenty of DRM'd books with the new system." It's only people who have never lost access to their purchases, never been frustrated by being prevented from what they thought was a perfectly reasonable use of their ebooks, who sing the virtues of DRM. (And publishers and authors, who scrupulously avoid offering any actual statistics to support their claims that DRM helps rather than hinders sales.)
I can't say "DRM costs more sales than it prevents losses through filesharing." I can say that authors and publishers should take a careful look at the facts, and start collecting useful statistics, because it's not as simple as "DRM prevents theft." DRM also prevents sales … and you don't get to be a bestselling author (or a full-time, quit-your-day-job author) by "preventing theft."
Ebooks don't have those costs. The marginal cost of an ebook sale is, not counting DRM, is pennies per book… if the hosting/sales platform is expensive to run. Everything else is a cost per-title; after the title sells X copies (where X covers the costs of creating and arrange for sales of the ebook), everything else is profit. That never happens with print books: every sale requires an outlay of 12%-30% (depending on which publisher you believe) of the cover price.
The issue shifts from "how high can we make the price and still convince customers to pay us, in order to cut down the marginal costs" to "how low can we make the price and still make a profit from our expected number of sales?"
Konrath thinks that the magic price-point is $2.99. TheNextWeb thinks it's between $3 and $10, with popularity of author playing a notable part. Teleread has some charts showing how it's not price, but price-plus-sales, that make for profit, and that there's a tipping point (in both directions) where a book makes less money than it could because it's at the wrong price point. Publishers imply that $8 ebooks will lose them money, which makes some of us wonder if Baen went bankrupt years ago and just forgot to tell anyone.
They insist that Konrath is a fluke, and so are the dozens of other self-published authors who're paying off their mortgages with $3 ebook sales.
I don't know if Konrath and others (Hocking, Larson, Kitt, etc.) are "flukes." Certainly, three dozen self-published authors out of the tens of thousands offering books for sale are not proof that it's a financially viable approach for most authors.
I do know that when I'm looking for something to read, I start by looking at freebies, and move on to ebooks that cost money, and I've never had to go higher than $6 to find something I know I'll thoroughly enjoy, and rarely higher than $3. Fiction ebooks priced about $6US are not on my radar. (Nonfiction's different. I've spent $30 on an RPG ebook.)
Why $6? Because Baen's maximum price for ebooks is $6, and I like a lot of Baen books. (And I'm poor; I grew up on secondhand, half-cover-price books.) For a lot of readers, the cap is $10, because they like mainstream bestsellers and don't care about DRM, and they can find bestseller ebooks for $10. But my impulse-buy level is $1-$3; I'll buy up to a $3 ebook based on a nice cover and interesting description; I'll only go up to $6 for authors I know or books that've been recommended by friends. Others have different ranges: $7 on a whim, $15 for books they've seen advertised on TV or have seen the movie of. Or only freebies, unless they've seen or heard something about a particular book, at which point they're willing to pay no more than $5 for it.
Authors need to find their customers' impulse-buy level, and their max price level, and find a way to sell books in that range. Publishers need to quit fearing that every ebook sold is a lost hardcover sale. Every ebook priced outside of the customer's range is, at best, money in someone else's pocket, and at worst, a temptation to piracy.
Convincing potential customers to change their price ranges is a lot harder than changing ebook prices, which should be bouncing all over the place. Authors and publishers should be struggling to find the sweet spot that maximizes the sales/profit ratio, not struggling to convince the public that the price they picked is what the customers should be paying.
Of course, it doesn't matter if the price is in the customer's range, if the book isn't available for purchase. Right now, the business assumption is that online sales of physical contents take place at the seller's warehouse, and are subject to those taxes and business arrangements. But sales of digital content are presumed to take place at the buyer's location. Or the buyer's ISP's location. Or the buyer's credit card's bank's location: A man in Australia is restricted from buying some ebooks from Amazon. Some of those books aren't available in his local shops, either. However, he can visit the United States and buy the physical books … but Amazon has no way to sell him a digital book when he's visiting the US.
The business contracts—not laws—that arranged these restrictions are perhaps understandable applications of copyright law and publishing contracts, but that doesn't make them less onerous to the customers. What they see is: I visit ebookstore, I find a book I like, I click "buy"—and get told, "No! Not for the likes of you!" Sometimes, this happens after several steps of shopping-cart hassles; the bookstore doesn't say "If your card isn't registered in the US, you can't use it for this book;" it just returns an error message instead of a receipt.
They don't care how complicated publishing contracts are; they don't care that buying the print version would indicate demand for the book in their country and maybe someone would buy the ebook distribution rights. Ebook stores that refuse to filter listings based on sales options come across as teasing, as mocking—deliberately showing off something the customer can't have.
At best, this results in the customer buying something else. At worst, they head off to the torrent sites, secure in the knowledge that they're not costing their favorite author any royalties. The author can't get royalties for sales that aren't permitted.
There's no easy way to turn these "pirates" into customers. The contracts that govern international sales are complex and varied, and changing this system would undermine a lot of IP-based business. It probably needs to be changed, and will … slowly. In the meantime, screaming at readers who got the only version available to them is probably not going to help future sales.
And it's unclear how "it wasn't available for sale, so I downloaded it" differs from "it's out of print, so I got it from a used book store." In both cases, the author gets a new reader who paid no royalties. Yes, the physical book can only have so many readers before it falls apart, necessitating a new sale … but if it's out of print, that new sale doesn't win any new royalties, either.
Charlie Stross pointed out, "Historically, only 25% of readers paid into the authors revenue stream. A 75% piracy rate may therefore be seen as a continuation of business as usual."
Digital sales might be able to change that percentage—by offering well-made ebooks, by letting the customer know what they're buying before purchase, by keeping prices reasonable, by making purchase convenient, by not insulting the customers. This is generic business 101: Quality. Price. Convenience. And don't call them thieves if you want to get money from them.
Commercial ebooks are still competing with free downloads. And the bottled water industry is competing with tap water. Authors and publishers have plenty of economic models to consider; they just have to figure out which ones can be applied to their craft.
The hardest part's already done: ebook pirates care about ebooks. They want authors to write more, and they know that means somebody has to pay those authors. Many of them would like to be part of that "somebody." They're invested in the ebook industry, opinionated and informed (sometimes even well-informed), and willing to explain their reasons at great length. Authors should take every "justification" offered for piracy as marketing research—this is what the commercial version isn't offering—and work to fix it. At the very least, you can count on the existence of other people who didn't pirate, but didn't buy the book either, for the same reasons.
You can't turn all the pirates into customers. You might not be able to turn any pirates into customers. But you can use pirates to find out how to get more customers.
That's what authors need: more ebook buyers. It doesn't matter how many free copies are floating around, legitimate or not; it matters how many people are buying, and why they're not. Find out why not. And fix whatever's standing in their way.
~ end ~
Customers in potentia
Everyone knows the title of this post is an attention hook, not an offer, right? Presumably, readers understand that if I actually had any magic button that would turn digital pirates into paying customers, I'd either use it out of the goodness of my heart and make the world a more honest, more profitable place, or sell it to Disney for ten billion dollars and retire to my own island while they completed their takeover of world culture.I do have some ideas on why it's important to consider pirates as potential customers, and how to convert them. (Or rather, how to convert the leeches; the uploading pirates are often already good customers.)
When I'm being technically accurate, I call it "unauthorized file sharing" because it might not be illegal.[1] Most of the time, I just call it "piracy" because that term has been embraced by several sides. Authors & publishers use it to imply they're being raided and stolen from by people outside of the reach of normal laws; uploaders and downloaders use it to imply they're creative rebels fighting against oppressive corporations. (Who did you root for—Captain Jack, or the East India Trading Company?)
While the legal and moral issues of "piracy" aren't certain, the practical truth is that it's both frustrating and scary for authors, who look at those downloads and think, "why aren't they buying my book, if so many of them like it?" Which comes to the heart of the problem:
What authors need (and publishers, if those are involved) is not "an end to digital piracy." What they need is more sales. They need more customers, and more of the current customers buying more ebooks. It doesn't matter if they stop pirates; book contracts aren't renewed based on the number of pirates stopped.
DMCA takedown notices to Megaupload and Rapidshare don't result in more sales. Shutting down ThePirateBay doesn't sell books. Even if takedown efforts resulted in removal of content, instead of pushing it laterally to somewhere else on the web, there's no evidence that those people would turn around and buy the legit versions of the content they formerly pirated, instead of turning to other, legitimate free content online.
I'm focusing on ebooks and not including print as an acceptable substitute. The solution to "the ebook isn't available at a price I can accept" will not be "just buy the paper version instead." First, because some of us don't read print, either as a matter of preference (like me) or ability (people whose hands are too weak or shaky for pbooks, or who need large text); second, because the most affordable print version is often second-hand… which still leaves the author out of royalties. Third … let's just allow there is a third, and fourth, and more possible reasons why print is not always a reasonable substitute. Telling people they should be reading more pbooks isn't going to work.
Might as well say, "if my book isn't available at a price you like, read something else." That’s a shoot-yourself-in-the-foot approach to potential customers when you stop and think about it.
"Pirates" are all potential customers. The most active—the ones who upload often, and download lots, not the ones who download the newest bestseller because it's faster than borrowing their brother's copy—are interested in ebooks. Pirates care about the works they share. (Or steal, depending on your vocabulary choices. Either way—people don't steal what they don't want, even if what they want is "a huge collection" rather than anything specific within that collection.)
To get them to buy instead of download, authors need to know what they're downloading, and why they're not buying it. It's not "because they're lazy, greedy criminals who would rather steal than pay artists." Most people want to support the artists who create the content they love; if they don't, it's because they either believe they can't afford to, or circumstances have made that support impossible for them.
The common response to "they can't afford to" is "well, then they shouldn't read those ebooks." But we are surrounded by content we aren't required to pay for. Television (taxed in some countries, but not on a per-use basis; you don't pay more if you watch more), movies watched at friends' houses, books borrowed or given by friends when they're done or picked up at rummage sales for $5 a bagful, prices so low as to be meaningless, and not resulting in payment to the writers. We've always had access to huge collections of entertainment and educational content without paying; insisting that the digital world is different makes no sense. It goes against centuries of cultural inertia; artistry has always been paid for by a few and enjoyed by the masses.
Which doesn't mean it couldn't be paid for by more people. More payments = more people devoted to writing instead of shuffling papers in an office; those of us who love books would like that. Nobody in ebook downloading circles says, "I download so that authors will go broke, because I want less ebooks in the world."
Before getting into how they might be convinced to buy instead of downloading, I want to go over what they download. Convincing people to buy requires knowing what they're expected to give up. Unauthorized ebook downloads—"pirated" books—consist of three main categories:
1) Commercial ebooks, with DRM removed if it existed, shared with people who either don't believe they can afford the legit version, or don't want to deal with its restrictions. (DRM, store requires a credit card instead of PayPal, not available in their format of choice, etc.) This includes (among other ebooks), many popular bestsellers, a lot of romance & erotica ebooks, and digital textbooks. When researches try to estimate the "damages" caused by piracy, they focus almost entirely on these books.
This is the category that potentially causes real financial losses; a free download of an ebook available for sale is unlikely to be bought. Some people do buy them, either out of a sense of obligation, or because they forgot they had a free version, or for the sheer convenience of getting it at the moment they're interested. However, the higher the price of the commercial version, and the more restrictive the DRM from the customer's perspective, the less likely these sales are.
This is the area where authors and publishers need to focus their efforts on convincing people to buy rather than pirate. This is the only area worth spending real effort on; nothing else is competing against actual sales. "Punish the wicked pirates" may be a fine goal, but it has nothing to do with selling books.
2) Books with no authorized digital edition, which includes both scanned-and-converted books and no-longer-sold commercial ebooks. This includes comic books and manga, very little of which is legitimately available digitally, and almost none of that is backlist; out-of-print graphic content tends to stay out-of-print. Most of the rest of the scanned ebooks are out-of-print books, although some have been re-released in paper; the publisher may not believe there's a market for the digital version, or hasn't the rights or resources to offer it digitally. Some are popular books that have no authorized digital version. This category also includes "not available in my country" ebooks … the digital text is not available, at any price, without breaking a law or violating a TOS somewhere.
It's unclear that this category causes any financial damage at all, and it likely drives up sales for print editions by keeping people aware of and interested in those authors or publishers. The most famous example is Rowling's books; the almost-never-discussed category is romance novels. (Harlequin just started a digital backlist program; until recently, they retired ebooks after only a few months.) Other ebooks drop out of availability as authors change publishers.
For this area, the potential customer can't just be redirected to a purchase. If the reader wants access to that ebook, she must either (1) painstakingly scan & convert it herself (which may or may not be entirely legal, depending on her location), or (2) avail herself of the generous work of others, who have procured a digital copy (either by scanning or purchasing a legit version) and made it available for download.
This is the category that authors and publishers need to acknowledge as, at worst, grey; it's hard to incite moral outrage for the nonprofit distribution of orphan works, with no known rights-holder, and out-of-print comic books, and niche publications that have no interest in exploiting a digital market. Piracy advocates point to this section first when the moral issue is raised, and the common author/publisher reaction of "if they're not legitimately available, just don't read them" is a weak response; it's interpreted as "we'll decide what you should be reading; your own tastes are irrelevant."
3) Scanned-and-converted books that differ from the authorized digital edition, often because they were scanned years before an authorized edition was released. These sometimes continue to be shared because their editing is better than the commercial release, which is often automatically OCR'd without proofreading and poorly formatted. (The 12-year-old digital versions of Tolkien's works are better-proofed than the ones sold today. The usenet .txt files didn't have "Tha Hobbit" on the title page.) Or they persist because they're available in formats not sold—often txt or html. Or because the authorized version is considered so very expensive that people will settle for a lower-quality makeshift—this is very common for textbooks.
This is the category that authors and publishers need to pay close attention to; it highlights the problems in their marketing plan. Readers are getting something from the amateur scanned edition that makes it more valuable than the professional release … the fact that this is not uncommon, shows the lack of quality of many professional ebook releases. Uncorrected OCR, formatting that looks awful on a dedicated reader (I've seen 1" hard-coded margins on the 3.5" wide screen), blocked search or print options in PDFs, lack of a functional (linked) table of contents… commercially-purchased ebooks are a crapshoot for quality issues, and one way to spot them is to check which bootlegs are not the same as the official download.
Sometimes, the previous scanned versions are shared because of inertia; those torrents are widely available and the new commercially-available, DRM-cracked ebook is not. But as sloppy and scattered as the download sites are, quality does get more attention than its lack; if the commercial version is notably better than the previous bootleg, it'll slowly replace it, and that ebook will slide into the first category instead of the third.
Not that the bootlegs are all great quality files; they have the same series of problems (well, except for the blocked print-and-search options)… but at their price, nobody complains. Anyone who feels inspired to fix the problems can do so, and release that version with no more moral qualms than they had before. A purchased book, with DRM, can't be fixed, no matter how bad it is.
Which brings me to the point that authors will be most interested in: How do you convince them to buy instead of downloading?
Sell something worth buying.
It starts with quality. Printed books have a known quality level; even if the writing itself is poor, the book is not; the typeface is readable (or if not, the reader can opt not to buy; people who need large-print books don't buy Mass-Market Paperbacks), the margins are reasonable; the paragraphs are formatted correctly according to whatever stylesheet the publisher prefers. Typos are rare; chapter headers in plain text without page breaks are nonexistent. For nonfiction, a table of contents is almost always present. Ebook buyers can count on none of these things.This is one of the first reasons (or excuses) offered for why people download instead of buying; purchased ebooks are a mix of "good enough" and "problematic," with the occasional nightmare (books with no punctuation at all, wrong book entirely—right filename, wrong contents). Anyone who's been burned on a purchase (some ebook stores have a "no returns AT ALL" policy; most others drag their feet about fixing bad digital purchases) might feel justified in turning to other sources for their ebooks.
Authors, harass your publishers to both proofread and check the formatting of ebooks on ebook readers, not just a computer screen. Publishers, invest in a few different readers for testing, and make sure each ebook is opened and checked by human eyes before it's pronounced ready to sell. You wouldn't release a new hardcover as loose-leaf pages of recycled newspaper held together with a rubber band around a couple of sheets of cardboard; don't do the digital equivalent with your ebooks.
Fix the formatting. Fix the metadata. And tell your customers about it… request ebook listings that have a spot to mention fonts, justification, line spacing, and proofreading. The average ebook buyer won't care, but will be pleased to note that you're paying attention. The potential pirates might reconsider bootleg downloads (with their erratic quality levels) if they're assured the legit versions are good
If you can't control how they're described in ebook stores, make sure the listing on the author or publisher's site talks about ebook formatting quality. Tell customers what anyone considering buying a print book would know at a glance: how long is it (word count is preferred to page count, for ebooks, but even filesize is some help), is it serif or sans serif, are the paragraphs indented or is there a blank line between them? What cover art does it have? Is there internal artwork? Does it have an index? A table of contents? Tell people what they're buying, and they'll be more likely to pay you. Tell them they don't need to crack the DRM to read it because it doesn't need to be fixed. Encourage reviewers to mention ebook formatting, just as they'd mention whether a printed book had margins too small or an easy-on-the-eyes typeface.
Of course, they may need to crack the DRM to read it because it's only offered in stores that are incompatible with their device. If you only sell at Amazon, with DRM, and the customer has a Sony Reader, she has some choices:
- Don't buy the book. Whether or not the reader's happy with this, the author's out a sale.
- Buy, and read on desktop instead of ebook device. Reader is not happy; she bought the device to allow her to read on the go.
- Buy, and crack the DRM. Download one of the various programs written for this (dodging around a DMCA violation; it's not illegal to have such programs, but it's illegal to distribute them; it's unclear if it's legal to use them to be able to read your own purchases), google for instructions on how to run it, crack the book. Download a conversion program like Calibre (free, open source, legal) and run the cracked version through that to get to a format her device supports. Author's happy with the purchase; reader may be happy with the reading but annoyed at the amount of extra effort involved.
- Skip all that, type [book title] [free ebook download] into Google, and get a version someone else has gone to the effort of cracking, in a format she can just load onto her device. Reader's happy; author's not.
The question authors should be asking is not, "does DRM prevent (some) piracy?" because they don't need to prevent piracy. They need to gain sales, so they should be asking, "does DRM prevent more lost sales through piracy, than it prevents purchases through inconvenience?" Many former customers have said they'll never buy DRM'd ebooks again … several of those were active buyers, early adopters in a position to encourage their friends to try ebooks.
Many people also claim that DRM doesn't bother them, or that it's a necessary nuisance, and they don't mind it because it helps authors get paid. I've yet to see one of those posts/comments say, "of course it doesn't bother me that I can't share my Kindle books with my husband's Nook. We don't mind at all having to buy the same book twice so we can both read it." Nor has anyone said, "I lost access to 50 ebooks when Adobe changed from its old DRM system to ADE, but I was never going to read those again so I don't care. I'm happy to buy plenty of DRM'd books with the new system." It's only people who have never lost access to their purchases, never been frustrated by being prevented from what they thought was a perfectly reasonable use of their ebooks, who sing the virtues of DRM. (And publishers and authors, who scrupulously avoid offering any actual statistics to support their claims that DRM helps rather than hinders sales.)
I can't say "DRM costs more sales than it prevents losses through filesharing." I can say that authors and publishers should take a careful look at the facts, and start collecting useful statistics, because it's not as simple as "DRM prevents theft." DRM also prevents sales … and you don't get to be a bestselling author (or a full-time, quit-your-day-job author) by "preventing theft."
Make them pay.
Being successful as an author (on a financial level; I'm assuming the ones who only care about reaching a wide audience don't mind piracy a bit) requires selling lots of books. That'd seem to be an obvious point, except that a lot of publishers seem to think that they don't need to sell as many books, as long as they get a big enough profit on the ones they do sell. This is a good, or at least reasonable, approach for paper books, where each book has to be printed, bound, stored, shipped, displayed, and sold to a customer, and each of those steps involves resources that cost money and people, who probably want to be paid. The fewer pbooks you sell, the less you have to pay for all those steps. (Assuming, of course, that sales include everything that's printed. Which they don't, but that's a separate issue.) If publishers could sell a single book for $50,000, they wouldn't need to print 5000 copies of it and ship them all over the country.Ebooks don't have those costs. The marginal cost of an ebook sale is, not counting DRM, is pennies per book… if the hosting/sales platform is expensive to run. Everything else is a cost per-title; after the title sells X copies (where X covers the costs of creating and arrange for sales of the ebook), everything else is profit. That never happens with print books: every sale requires an outlay of 12%-30% (depending on which publisher you believe) of the cover price.
The issue shifts from "how high can we make the price and still convince customers to pay us, in order to cut down the marginal costs" to "how low can we make the price and still make a profit from our expected number of sales?"
Konrath thinks that the magic price-point is $2.99. TheNextWeb thinks it's between $3 and $10, with popularity of author playing a notable part. Teleread has some charts showing how it's not price, but price-plus-sales, that make for profit, and that there's a tipping point (in both directions) where a book makes less money than it could because it's at the wrong price point. Publishers imply that $8 ebooks will lose them money, which makes some of us wonder if Baen went bankrupt years ago and just forgot to tell anyone.
They insist that Konrath is a fluke, and so are the dozens of other self-published authors who're paying off their mortgages with $3 ebook sales.
I don't know if Konrath and others (Hocking, Larson, Kitt, etc.) are "flukes." Certainly, three dozen self-published authors out of the tens of thousands offering books for sale are not proof that it's a financially viable approach for most authors.
I do know that when I'm looking for something to read, I start by looking at freebies, and move on to ebooks that cost money, and I've never had to go higher than $6 to find something I know I'll thoroughly enjoy, and rarely higher than $3. Fiction ebooks priced about $6US are not on my radar. (Nonfiction's different. I've spent $30 on an RPG ebook.)
Why $6? Because Baen's maximum price for ebooks is $6, and I like a lot of Baen books. (And I'm poor; I grew up on secondhand, half-cover-price books.) For a lot of readers, the cap is $10, because they like mainstream bestsellers and don't care about DRM, and they can find bestseller ebooks for $10. But my impulse-buy level is $1-$3; I'll buy up to a $3 ebook based on a nice cover and interesting description; I'll only go up to $6 for authors I know or books that've been recommended by friends. Others have different ranges: $7 on a whim, $15 for books they've seen advertised on TV or have seen the movie of. Or only freebies, unless they've seen or heard something about a particular book, at which point they're willing to pay no more than $5 for it.
Authors need to find their customers' impulse-buy level, and their max price level, and find a way to sell books in that range. Publishers need to quit fearing that every ebook sold is a lost hardcover sale. Every ebook priced outside of the customer's range is, at best, money in someone else's pocket, and at worst, a temptation to piracy.
Convincing potential customers to change their price ranges is a lot harder than changing ebook prices, which should be bouncing all over the place. Authors and publishers should be struggling to find the sweet spot that maximizes the sales/profit ratio, not struggling to convince the public that the price they picked is what the customers should be paying.
Of course, it doesn't matter if the price is in the customer's range, if the book isn't available for purchase. Right now, the business assumption is that online sales of physical contents take place at the seller's warehouse, and are subject to those taxes and business arrangements. But sales of digital content are presumed to take place at the buyer's location. Or the buyer's ISP's location. Or the buyer's credit card's bank's location: A man in Australia is restricted from buying some ebooks from Amazon. Some of those books aren't available in his local shops, either. However, he can visit the United States and buy the physical books … but Amazon has no way to sell him a digital book when he's visiting the US.
The business contracts—not laws—that arranged these restrictions are perhaps understandable applications of copyright law and publishing contracts, but that doesn't make them less onerous to the customers. What they see is: I visit ebookstore, I find a book I like, I click "buy"—and get told, "No! Not for the likes of you!" Sometimes, this happens after several steps of shopping-cart hassles; the bookstore doesn't say "If your card isn't registered in the US, you can't use it for this book;" it just returns an error message instead of a receipt.
They don't care how complicated publishing contracts are; they don't care that buying the print version would indicate demand for the book in their country and maybe someone would buy the ebook distribution rights. Ebook stores that refuse to filter listings based on sales options come across as teasing, as mocking—deliberately showing off something the customer can't have.
At best, this results in the customer buying something else. At worst, they head off to the torrent sites, secure in the knowledge that they're not costing their favorite author any royalties. The author can't get royalties for sales that aren't permitted.
There's no easy way to turn these "pirates" into customers. The contracts that govern international sales are complex and varied, and changing this system would undermine a lot of IP-based business. It probably needs to be changed, and will … slowly. In the meantime, screaming at readers who got the only version available to them is probably not going to help future sales.
And it's unclear how "it wasn't available for sale, so I downloaded it" differs from "it's out of print, so I got it from a used book store." In both cases, the author gets a new reader who paid no royalties. Yes, the physical book can only have so many readers before it falls apart, necessitating a new sale … but if it's out of print, that new sale doesn't win any new royalties, either.
Charlie Stross pointed out, "Historically, only 25% of readers paid into the authors revenue stream. A 75% piracy rate may therefore be seen as a continuation of business as usual."
Digital sales might be able to change that percentage—by offering well-made ebooks, by letting the customer know what they're buying before purchase, by keeping prices reasonable, by making purchase convenient, by not insulting the customers. This is generic business 101: Quality. Price. Convenience. And don't call them thieves if you want to get money from them.
Commercial ebooks are still competing with free downloads. And the bottled water industry is competing with tap water. Authors and publishers have plenty of economic models to consider; they just have to figure out which ones can be applied to their craft.
The hardest part's already done: ebook pirates care about ebooks. They want authors to write more, and they know that means somebody has to pay those authors. Many of them would like to be part of that "somebody." They're invested in the ebook industry, opinionated and informed (sometimes even well-informed), and willing to explain their reasons at great length. Authors should take every "justification" offered for piracy as marketing research—this is what the commercial version isn't offering—and work to fix it. At the very least, you can count on the existence of other people who didn't pirate, but didn't buy the book either, for the same reasons.
You can't turn all the pirates into customers. You might not be able to turn any pirates into customers. But you can use pirates to find out how to get more customers.
That's what authors need: more ebook buyers. It doesn't matter how many free copies are floating around, legitimate or not; it matters how many people are buying, and why they're not. Find out why not. And fix whatever's standing in their way.
~ end ~
[1] Judge Gertner, in Sony v Tenenbaum:
… file sharing for the purposes of sampling music prior to purchase or space-shifting to store purchased music more efficiently might offer a compelling case for fair use. Likewise, a defendant who used the new file-sharing networks in the technological interregnum before digital media could be purchased legally, but who later shifted to paid outlets, might also be able to rely on the defense.