Fictionwise E-book Sales Restricted Outside US- the Real Story

booksSlashdot recently pointed out that the distribution restrictions of the eReader e-book retailer had changed and implied that the changes had to do with the Barnes & Noble acquisition of parent company Fictionwise. Since we’ve long been customers of eReader e-books, we wanted to get to the bottom of the matter and so have gotten the real scoop from Fictionwise.

At the heart of the matter is the fact customers find they may not be able to purchase a given e-book if they reside outside the U.S. or Canada. An attempt to purchase said content results in the information from eReader that the sale cannot be completed due to distribution restrictions.

The folks at Fictionwise have pointed out to us that first of all this has nothing to do with the B&N purchase.

This has nothing to do with the B&N acquisition, it has been brewing for months and this affects all ebook retailers who serve books from large publishers.  As of right now, any retailer who is not enforcing these restrictions on the affected titles could find themselves losing titles from major publishers.

So we see that Fictionwise is not the only retailer affected by these outdated licensing practices, and that’s exactly what is at play here. Publishers like Fictionwise and Amazon do not own the content they sell, they simply license it for sale just like you and I license it when we buy e-books. The archaic licensing system means that publishers have to make separate license deals for each country in which they want to sell e-books. This is something that is very difficult to do, even for the bigger houses like Fictionwise and Amazon.

So why did this hit Fictionwise just after the B&N merger if it’s not related?

Several publishers have recently taken the position that geographic rights have to be enforced on ebooks. Fictionwise, in conjunction with our content aggregators, negotiated to be allowed several months to implement systems to properly track and manage geographic rights on a per-title basis in the data feeds we receive. Those systems were finally implemented the first week in April and started going live.

The good news is that if Fictionwise and other e-book retailers can develop complicated systems for handling global sales in light of so many different distribution restrictions, then e-book sales can be done without blanket sales discrimination, as is the norm today. The folks at Fictionwise are working on such a system as we speak, but it’s not easy to implement.

It’s important to note that not all Fictionwise content is restricted.  The information we’ve received indicates that unencrypted content is not restricted at all and only about a third of their encrypted content is restricted. That affected content has varying degrees of restrictions, with some of the e-books not very restricted geographically. Let’s hope the book publishing industry gets its act together and gets up-to-date technologically in order to remove barriers to selling their content. One has to wonder if this situation plays into why Amazon won’t sell the Kindle outside the U.S.

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