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Summary:

What could a world of tablets bring? Not just better e-book readers or game machines, but an explosion of personally produced content, distributed by individual apps. But will Apple and Amazon seize that opportunity?

If all goes as expected on Wednesday, we will soon find ourselves in a world of tablets, with the Apple iTablet (or whatever it’s going to be called) joining the market-leading Kindle. The one thing everyone seems fixated on is the effect that these devices are having — or will have — on the book-publishing industry. Amazon’s Kindle is currently the leader in the e-book business, but it’s widely expected that will change soon, thanks to The Great Disruptor of Content Industries, otherwise known as Steve Jobs Inc.

In an attempt to forestall such threats, Amazon last week boosted the royalty rate it pays to authors and publishers who offer e-versions of their books for the Kindle. The new deal gives authors and publishers 70 percent of the price (provided the author/publisher meets certain criteria). That’s twice the previous rate the company was paying, and slightly above the 63-percent rate that Apple is allegedly providing.

Among other things, Amazon is clearly making a play to authors to convince them to go direct, and cut out the publisher middleman. But why stop with books? If Amazon is smart (which it clearly is), the company will use the Kindle as a distribution mechanism for all kinds of digital content — blogs, independent magazines, blooks (blog/books) and any other kind of individually-created media it can get its hands on.

In the same way an author who might have otherwise used a publisher could be tempted to cut a deal with Amazon for Kindle distribution, in return for 70 percent of the royalties, think about any other content creator and how a tablet platform could impact their business: blogger, writer, musician, artist. Just create your own app, and away you go.

If you could strike a deal with Amazon to provide access to your content on the Kindle, that would give you an opportunity to reach your readers/audience directly. Yes, you already have a website, but put your content on a different platform and you can do different things with it — maybe even something people would pay for. Conde Nast says people are buying copies of its magazines through its new iPhone app, so why not a Kindle app? And Apple is already said to be demoing iTablet apps that could do much more.

Cincinnati Bengals wide receiver Chad Ochocinco has his own iPhone app, through which he distributes his Twitter feed, random thoughts and audio clips that feature him saying things like “Wassup” in English and Spanish. It’s a trivial enough application, but what’s to stop anyone from creating their own app? If your content is good enough, why shouldn’t people pay for it just as they have been paying for Conde Nast’s?

Once the iTablet launches, the fight will truly be on between Apple and Amazon: to sign up as many content creators and distributors as possible. The more exclusive relationships a tablet maker has with authors and content creators, the better platform it has to become not just the iPod of books but of all kinds of digital content. And then the disruption of the media and content industries will begin in earnest.

Thumbnail image courtesy of Flickr user kakkie, post image courtesy of Flickr user UGardener.

  1. I am looking at the education market, and frankly the issue could be more about how we consume content as applications. Magazines, music and movies are beautiful, but the market can’t even catch up to the idea of sharing which is how so many of us find content!

    I am preparing prototypes right now for an educational product that could be based on the iPhone, since we developed an automated build process, or on Android with more development. Will Apple allow is to create a segregated store? Will they allow apps to launch from other apps? Doubt it…

    And, this is about letting teacher create content as well.

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  2. Cutting out the middleman is all very well in theory, but if the iTablet uses the App Store to distribute your content, then no-one is going to see it unless you market effectively – which is one of the things that publishers can do well. Getting traffic to a blog is much easier than to an iPhone app, just because of the wonders of google.

    I think that we’ll start to see the rise of publishers as employees rather than owners i.e someone who you pay to handle your content and get to the biggest market possible.

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    1. That’s a good point, Andy — platforms like the iPhone and iTablet could help to re-engineer the relationship between authors and publishers.

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  3. [...] Mathew Ingram, GigaOm’s freshly-minted writer and part of the mesh gang, has a post about how the launch of [...]

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  4. What’s interesting to note is how market power is shifting from content distributors to content creators thanks to Apple’s entrance into the e-book market. A 70% royalty is just the beginning. Power will eventually shift back to the distributors as the market coalesces into a predictable revenue model, but at least for a short while those that sweat and toil in the creative tarpits will reap more of the reward for their inventions.

    On a side note, it is also interesting to see how so much activity and innovation in the market is focused on content and computing. As we look forward to the great economic recovery, it is becoming more apparent that the new engine of innovation will occur at the nexus of the two, in the acceleration of knowledge, understanding and good decision-making through ubiquitous and integrated technology.

    Dave Geada
    Vice President of Marketing
    StrataScale
    The Cloud Hosting Experts
    http://www.StrataScale.com

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  6. What about consumers?

    I’m not going to buy two different devices so I can get electronic versions of things I want to read. Publisher exclusivity may be a nice selling point for the devices, but it is a lousy deal for consumers.

    As a consumer, I would like to read what I want on whatever device I want to read it on. If these devices are going the exclusivity route, count me out.

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  7. The reason I don’t own a Kindle is it is too expensive. The tablet will likely be 4 times as much (plus need a dedicated data plan).

    Maybe the university education market, but you’re not going to be selling a $1000 tablet computer into the K-12 marketplace

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    1. I agree with this, but the Apple product is likely going to be the first successful tablet, and I have been testing them for a long time. The statistics are that the current spend on educational content is $250 per student. If that can be broken down to $50 for content per year, and a tablet amortized over two years, we’ll never see a non-functioning photocopier in a school again. Scan a sheet and throw it in the system.

      Take a look at what I am thinking: eduk8.com. The remaining screens will be loaded this morning. My last project was Scott Foresman’s $100M reading program. It is possible very soon and I have been waiting a decade.

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      1. Good luck with your service. When I was in college, a large portion of our material was distributed via webpages or pdfs. While I appreciated the cost savings, it was terrible to spend hours a day at my (desktop) computer reading through pdfs and then typing up or handwriting notes and discussions. Eventually we progressed to using wikis and email discussions for some material, and I can certainly see how an interactive experience will be valuable.

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      2. That is exactly the point of these concepts — to eliminate digging through an eBook! That is just plain silly. Since I am targeting kids, the content needs to be controlled and fed appropriately to keep the kids on task.

        When I designed textbooks, there was a large effort to consider calendars as a basis for teacher edition texts. I am not showing those yet… I believe that smaller chunks of information analogous to readers, or even magazine articles, are the future of media. This calls into question the very idea of books and magazines as artifacts. Not novels! Textbooks are simply an aggregated set of materials.

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    2. I’m encouraged by the tablet because I think it will provide the force needed to innovate the digital media and ebook industry, but I definitely agree that it will need to come down in price.

      A tablet ereader and collaborative learning tool could be a great thing for university students, but so far textbook publishers haven’t done enough to make content easily accessible to students. Some schools have gone through trial periods with digital content, but frankly right now there just aren’t enough of the appropriate texts with the appropriate features to make it work on a large scale.

      I hope that publishers, app makers, and content creators will begin to realize this and job at the opportunity to innovate the distribution and features of their material.

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      1. What my effort will do is provide a platform for textbooks in the K-8 market. It is centered around a Google Wave-like communication platform and the teacher feeds content such as text components and worksheets to students.

        It would allow publishers — trade an educational — to submit content and be compensated for it. Texts as eBooks are really not that engaging or interesting pedagogically.

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  8. I agree with Andy’s point that the vision of a distribution system that allows authors to distribute directly to readers for just a 30% cost is in practice just a utopia. Cory Doctorow said it rather well in the context of piracy that the biggest threat to an author is not piracy but obscurity. Anyone who is familiar with the role played by a large publisher knows that the primary service they provide is marketing. The publisher gets your books reviewed by the taste-makers and ensures that its right inside the door at the big booksellers. The search costs inherent in any large collection of data ensure that this marketing role will continue to be necessary. All that is changing for authors is the point-of-sale.

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  9. Let’s just think about one category: cooking. I have a large collection of great cookbooks written by great chefs and award winning cookbook authors. I’ve got a huge stack of old Gourmet, Cook’s Illustrated, and Bon Apetit magazines. Our local market had some really fresh Monkfish today. I bought some. Now begins the hunt through my cookbooks and magazines for that great Monkfish recipe that I can vaguely remember from several years ago.

    Most of my cookbooks have just a few color photos. The publisher wanted to hold down the cost of printing. None of them have any video clips demonstrating a procedure. None of them have any hyperlinks to other recipes, books, sources or authors.

    There is also the worldwide web. Sites like Epicurious. TheFoodChannel, and BigOven.com offer thousands of searchable recipes. But the quality isn’t so tightly controlled as those recipes by prize winning authors. The web sources are a bit of a crap shoot. I don’t want to gamble. I want to cook a great meal.

    Now I’ve found my Monkfish recipe. The measurements are for four people. I’m going to have 13 guests for dinner. Let’s see now, the recipe is calling for 1/4 teaspoon Tabasco sauce, how much do I need for thirteen servings rather than four?

    I’m running out of space for my books and magazines. We’re downsizing to a smaller house. What to do, what to do??

    I think an iTablet could address all of these issues. I’m sure that’s only part of what they have in mind.

    If you think about categories other than cooking, you will see that each category has it’s own issues. Textbooks for college students have different issues than textbooks for grammar school children. A biography of Napoleon Bonaparte could have a searchable map of Europe in the Napoleonic era and links to Wikipedia entries for characters mentioned in the book. How about a video tour of the battlefield at Waterloo? A tablet like this has a lot of potential.

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    1. @davesmall : interesting thoughts about cookbooks. I’m trying to tackle part of the cookbook issue through my website (connecting paper cookbooks and recipes online), but you can see how recipes are crying out for digitization. I wonder if the industry is even a tiny bit ready for it though? Looking through our user’s bookshelves I see a huge number of older and obscure cookbooks; current titles are only the tip of the iceberg. I can imagine the nightmare dealing with the rights for all of those. So many are out of print but not out of copyright.

      I think we could have some really interesting cookbook/app combinations, and ways of connecting the books digitally, but I wonder if the industry and copyright law will be able to handle it…

      Andrew Gray
      Cookbooker.com

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  10. [...] The iTablet: Let a Thousand Content Apps Bloom [...]

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