Bubblespeak for E-Books

Economics Publishing Reading Technology

There was a lot of excitement in the e-book world this week after both Barnes and Noble's Nook and Amazon's Kindle slashed their prices to help them compete against the iPad, and against each other. For some reason, this has also led a few book industry pundits to suddenly declare that the Kindle is the big winner in the e-book technology face-off.

Oh, how I wish I could short the Kindle's stock. (Yes, I know I could short-sell Amazon's stock, but that's not the same thing). In fact, I'd short any e-reader's stock. I've lived through this kind of technology/money hype before, and I know how hollow the hype can be. Like the famous dot-com boom of the 1990s, the current explosion of interest in e-book technology is not based on actual consumer interest, but rather on the hope for a financial bonanza. How can you tell when a great new trend is a bunch of hype? When more people write articles about a new product than actually use or buy the product, that's a pretty big sign.

In the late 1990s, a stupid idea like Gazoontite.com (the online service for allergy sufferers!) could raise millions of dollars in advance funding even though the actual service was completely, laughably bad. The Silicon Valley and Silicon Alley bankers and executives who talked up these new ventures must have known in their guts that the products they were launching lacked consumer appeal. But the hype became the product, became the basis of investment. I see the same type of ugly mess brewing with e-book technology today. Lots of people want to invest in e-book readers, and fewer people want to use them. As of the summer of 2010, as far as I can tell, the paperback book remains the single most practical, effective and attractive format for book-length reading. The iPad is probably the most exciting (if far from satisfactory) electronic device, and all the other e-book readers are far behind and looking more hopeless every day.

For over a year now, the business conversation about e-books has taken place in future tense. This is an obvious bad sign in itself. When Les Paul invented the electric guitar in 1940, there were no music trade journals opining endlessly about how the electric guitar was going to change music forever. When the first commercial microwave ovens hit the market in the early 1970s, or when digital photography wiped away the film industry in the past decade, these changes made themselves felt quickly and quietly. Nobody had to write long, pained articles -- or entire pained books -- about the revolutions these products created. A real product revolution happens so quickly that nobody has time to write about it until it's over. Anybody who writes about a successful marketing revolution in future tense is not worth listening to.

I care about electronic reading, and I'm worried that a financial bubble market based around e-book technology will leave the important and innovative field in a shambles the same way the dot-com bubble and crash of 2000 left the website business a shambles (until about 2004, when the new age of social networking allowed the industry to come back to life). I want more balanced and more skeptical coverage of the e-book device market. Articles like Ed Nawotka's at Publishing Perspectives are a refreshing break.

Investors, publishers and pundits: here's the key question to ask, when you want to reality-check the hype you're hearing about some new device that makes electronic reading a breeze: have you run out to Best Buy and bought this device yet yourself? If you haven't, that tells you all you need to know. When a product is good enough to really cause a revolution, you'll already own it.

7 Responses to "Bubblespeak for E-Books"

by hepcat on

For me this argument will always boil down to a question of convenience and accessibility, and the counterpart for comparison's sake will always be MP3s vs. CDs, which is a valid one I think. I know you've talked about this before.

MP3s are just plain more convenient. They're able to do everything a CD can but they're smaller, faster, can hold more information, more portable etc. I can't think of a single advantage a CD holds over an MP3. Perhaps I have no nostalgia for them like some have for vinyls.

MP3s also win in terms of accessibility. It's so much easier, let alone cheaper, to sit on your computer and let the music come to you. It's a no brainer. Most of this was driven illegally at the outset, but I have little sympathy for record labels without the foresight to see it coming and do something about it.

Ebooks win the accessibility issue, IMO. Books will be cheaper and just a click away. This is a major advantage for younger people like students, who haven't the money or perhaps time to go to a bookstore. When I studied philosophy in college, I found nearly every text I needed online, for free (though I confess I printed them out because I prefer not looking at a computer screen if I have a hardcopy-- and this is the problem with Ebooks).

An ebook has no advantage in being smaller, like the MP3 did. My paperbacks aren't much bigger than these machines. I can take them anywhere I can take the machine, but given the choice, eye always prefer paper, pun intended (not to mention the fact that paperbacks sometimes smell like leaves in the fall). The best Ebook reader yet to be invented will never be able to solve these problems.

Ebook manufacturers are trying to foster a revolution that isn't there, rather than harnessing it like what happened with MP3s. Thus the hype. The MP3 boom was all consumer driven until companies finally figured out how to make a buck out of it, and now they're trying to invert that relationship.

I think you're right, Levi. There's a niche for ebooks, and they won't go away, but this 'revolution' seems more like an abortive coup.

So what will be dotcom's 2004 for E-books? What will be the 'social networking' moment for E-books? What is your prediction? Thanks.

by Mayowa on

Levi,

I like your sustained efforts to draw attention to this phenomenon, well done.

Recent figures have the iPad selling around 3 million units in three months and I was thinking perhaps e-readers alone can't sustain a revolution, perhaps they are only a component of changing attitudes towards tablet computing in general. If that is true then ereaders will be in the same unsustainable position as the wider publishing industry that is larger than the market demands.

Thanks for the great post.

by KKizer on

I've thought the same thing about eReaders as Mayowa...they're a component of a larger platform. And it's the size thing that hepcat points out as well. There's no practical advantage to being smaller. Readability is all that matters when it comes to, uh, reading.

I use the eReader app for books I'd like to have on-hand at all times but don't want to lug around physically, i.e. reference materials, e.g. the AP Stylebook, Strunk and White, "Getting Even" by Woody Allen. You know, the essentials.

I am good friends with a woman who owns a bookstore in downtown Los Angeles and she gets a little upset with me every time I walk into her store with my Kindle. So I always buy a nice hardback from her to make up for my machine. Recently, we discussed how her store could actually benefit from Kindles and other ereaders. She said she would install a big rack and sell tons of them and their accessories once the machines become generic and fall to about $50.

A generic $50 ebook reader.

I do have to tell you that my ongoing tryst with a Kindle is showing no signs of slipping. I carry it everywhere. When I sit down at restaurants with friends they ask why I have my Kindle with me and I tell them it's so I can read if they start to bore me. And I do really read the hell out of this thing. It's main characteristic is that it makes reading easy. Seriously. I have an old copy of Ulysses and an ebook copy on my Kindle. The book drives me insane and I would like to make Joyce eat his hat. But the ebook version goes faster and I back up in the text much less than with the hard copy. I don't know why yet. I just know it works.

by Dan on

Hepcat - I love MP3s - in their place, like on my Ipod. Otherwise I'll take CDs any time for my home stereo. I listen to classical music and opera, for which CDs are still thriving. The dirty little secret about MP3s, as I understand it, is that they are compressed files -- the audio is not CD quality. This matters on a good home stereo, listening to fine music that covers the spectrum. (Levi - correct me if I'm wrong about MP3 compression and reproduction quality).

I prefer real books and don't use an e-reader; however, my wife loves her Sony ereader. I agree with Levi that there's more hype than substance to the non-revolution. Levi says, if it's truly great, you'll already own it. He's right.

by Levi Asher on

Thanks for responses, all ...

CuriousBookFan, that's a good question. One area where I definitely think e-books should and will have a major impact (though it hasn't happened yet) is education. My kids all struggled with heavy textbooks through junior high and high school. The prices of college textbooks are criminal ($75? $100? WTF?!) . Unfortunately I think the educational/publishing industry is not welcoming the arrival of electronic books, but this is an area where consumers -- in this case, students, teachers, professors, etc. -- really should make their voices heard and insist on rapid change. I still think the paperback book is the best format for casual pleasure reading, but there is a pretty clear and strong case for adoption of e-reader devices in schools and colleges. Maybe this can be a game-changer, if we can push it past the textbook industry cabal.

Alessandro, thanks for sticking up for the Kindle. It is definitely a relevant fact that some people truly do love their Kindles or other e-book readers. I still don't detect that Kindles are popular out there, but I see that they do have a devoted following.

Dan, you are correct about the effect compression has on MP3s.

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