Airline profits are soaring but passengers feel squeezed. We explore the economics of flying as the busy summer travel season takes off.
Guest Host: Marc Fisher
The e-book market is constantly evolving. Microsoft recently made a big investment in the Barnes & Noble Nook. Apple and the major publishing houses are locking horns with the Department of Justice over alleged price-fixing. Meanwhile, innovative independent bookstores are figuring out how to make money off e-books. Tech Tuesday explores changes in the e-book marketplace.
- Lee Rainie Founding Director, Pew Internet & American Life Project
- Bradley Graham Co-owner, Politics and Prose bookstore
- David Pogue Tech Columnist, New York Times
Graham talks with guest host Marc Fisher about renowned author Maurice Sendak’s disdain for E-books and what he sees as a generational divide among those who use E-books and those who don’t:
David Pogue’s 2010 video exploring the question of whether a single-purpose e-reader is a better buy than an iPad:
How Bookstores Are Coping In The Age Of The E-Reader
In the past several years, consumer choices between e-readers have grown rapidly as companies race to produce devices with more features and less bulk. An increasing number of people are making the switch from traditional books to the machines, or at least using an e-reader for travel even if they still prefer to open a cover and turn paper pages at home. But buying that first e-reader can be daunting now – with having to chose between a touch screen or buttons, black-and-white or color, wi-fi or 3-G, and committing to one company’s book list (like the choice between Amazon or Barnes and Noble).
At the same time, the publishing industry and bricks-and-mortar bookstores are trying to figure out how to keep up with the market. Barnes and Noble has changed the layout of many of its stores now so that its Nook readers are
prominently displayed just inside the main entrances, where the new and best-selling sections used to be. Independent bookstores that have no such branded e-readers of their own to offer are trying to figure out how to turn a profit in the era of instant gratification book delivery.
Bradley Graham, who bought Politics & Prose in June 2011 with his wife Lissa Muscatine, talks about a deal the American Booksellers Association struck with Google so independent bookstores, like his, can sell e-books. Graham says some stores, including Politics & Prose, have the Google link on their website. The bookstore would then get a percentage of the sale, but for Graham, e-book sales are still a very small percentage of the store’s total revenue (less than 1 percent). Google recently announced its plans to discontinue the program for independent bookstores at the end of this year, which has prompted some of the stores to explore the idea of creating their own e-reader.
Lee Rainie of the Pew Center’s Internet and American Life Project says that while no one was really reading e-books on e-readers five to 10 years ago, 21 percent of all American adults reported having read an e-book in the past year – a technology adoption that’s unusually dramatic for such a short time period. The latest Pew study on e-books and e-readers also found that people don’t necessarily abandon print books for e-readers. Rainie thinks that’s partially because people with e-readers tend to be avid readers in any format, and owning an e-reader means they never have to be without something to read.
MR. MARC FISHERFrom WAMU 88.5 at American University in Washington, welcome to "The Kojo Nnamdi Show," connecting your community with the world. I'm Marc Fisher, sitting in for Kojo. Coming up this hour, if you're thinking of buying your first e-book reader or upgrading the one you already have, the choices can be mind-boggling -- touch screen or buttons, black and white or color, Wi-Fi or 3G -- and because you're committing to one company's booklist, Amazon, Barnes & Noble or someone else.
MR. MARC FISHERAs more people gravitate to electronic books, companies are racing to develop new reading devices with more features and less bulk. And publishers and bookstores are trying to keep up with a fast-changing market even as many people argue that the existing technology, the actual book, remains the superior product. Microsoft entered the game last week by investing in the Barnes & Noble Nook division.
MR. MARC FISHERThe Justice Department weighed in as well, settling part of a price-fixing lawsuit against several book publishers. And amid all the upheaval, independent bookstores are trying to figure out how to make money in this era of instant gratification book delivery. Today on Tech Tuesday, navigating the choices in the e-book marketplace. We'll be joined in a moment by David Pogue -- he's tech columnist of The New York Times -- and by Lee Rainie, director of the Pew Research Center's Internet & American Life Project.
MR. MARC FISHERBut first, Brad Graham, the co-owner of Politics & Prose Bookstore, here in Northwest Washington, is with us. And, Brad, we learned this morning that Maurice Sendak, the noted writer of children's literature, of "Where the Wild Things Are" and "Chicken Soup with Rice," passed away. And I took note in a couple of the obituaries, that he was very clear in his late years that he hated e-books.
MR. MARC FISHERAnd so I wonder -- and you have a lot of authors who come into Politics & Prose. Do they talk at all about this new divide in the audience between the printed audience and the e-book reading audience? And do authors tend to sway one way or the other on this issue?
MR. BRADLEY GRAHAMWell, first, let me just say Sendak's loss is a tremendous loss to the literary world. I mean, he really was a preeminent children's illustrator of the 20th century, a real breakthrough illustrator in what was he able to present about the, say, the darker side of growing up and to really connect with kids. But to your question, authors are also wrestling with this new world the way all the rest of us are. And some have found greater comfort and ease and facility with e-books than others. It's going to take a while to sort all this out.
FISHERAnd do you see among readers a generational divide on whether they're adopting e-books? Is it as we would stereotypically think that younger readers are quicker to embrace e-books, or is it -- does it not break down by age?
GRAHAMI think that was true initially. But we see a number of older readers now gravitating toward e-books as well, even though one advantage of them is that you can change the size of the type. And that's -- for a number of our older readers, that's an advantage. And for those who travel more, too, who may be older, there's a great advantage to be able to download a lot of books on an e-reader rather than lug around four, five, or six books on a long trip.
FISHERLee Rainie, of the Pew Research Center, you've recently done a study on e-reading and found that the number of American adults who reported reading an e-book in the last year has soared over the last year and is now at something like 21 percent of American adults. Is this -- in your study, did you find any profile of the e-book reader that really stands out demographically from the rest of the book-reading public? Is Lee Rainie with us?
MR. LEE RAINIE...early technology...
FISHERThere we go. Yeah. Go ahead.
RAINIEThey look like -- hi, Marc and Brad. The people who have been the initial adopters of e-book readers tend to be like lots of early adopters of other technologies. They're a bit younger. They're a bit more upscale financially. They've got a bit more education than other people. But the striking thing we saw in our data was that between mid-December and mid-January, there was an explosion of popularity of e-book reading devices.
RAINIEThe marketplace changed towards the end of the year with the Kindle Fire and with the Nook tablet computer coming on the market and being at much lower price points than the iPad and earlier tablets. And so lots of people were buying them. About 28 percent of Americans now own one or another, either an e-book reader or a tablet computer. And they're beginning to get quite comfortable reading e-books in those formats.
FISHERAnd yet many of them -- in fact, nine in 10 of them who read e-books also read printed books. Did the study give us any reasons why these people do cling to both technologies?
RAINIEYeah. They're -- first of all, they're book lovers. Their whole reason to get these devices is that lots of new books were coming online in these formats. The price point in the early days, at least, was a bit cheaper than buying printed copies of books. But we talked to the people who had read both kinds of books in the past year and found that many of them, and probably for reasons that they cherished with their children, love to be able to read printed books with their children.
RAINIESo Maurice Sendak's books will always probably have a place in families for that reason. And people love to be able to share printed books with each other. They like that much more than the e-book format. But when it came to reading in bed or reading for convenience or having instantaneous access to books, they were a little bit more in preference of e-books. So the market is beginning to sort of sort itself out by preferences, as well as by genres.
FISHERYou can join our conversation about electronic books by calling 1-800-433-8850 or email us at kojo, K-O-J-O, @wamu.org. You can also get in touch with us by sending a tweet to @kojoshow. And, David Pogue, tech columnist for The New York Times, what's the current state of e-book technology? What's the difference between an e-book reader and a tablet for someone who wants that electronic experience of reading?
MR. DAVID POGUEWell, that distinction just became much more visible in this recent season. When the iPad came out, I was fascinated by watching Amazon's reaction -- Amazon with its Kindle -- because here is something that did the same thing, you know, e-books and reading texts but much more colorfully, much bigger screen. And so Amazon did exactly the right thing in response. It went where the iPad couldn't go, which is smaller and lighter and much, much cheaper.
MR. DAVID POGUEThe Kindle -- cheapest Kindle today is $80. And four years ago, it was $400 for exactly the same size screen. So the state of the art -- state of the market right now is differentiation. You have these black-and-white-only ones. They use the so-called e-ink screens, which is very crisp black text against this faint grayish background. I still think that we are in the Cro-Magnon days of e-book readers.
MR. DAVID POGUEI think it's hilarious that, you know, Barnes & Noble and Amazon say that the latest, most advanced -- I mean, think of the other technologies that began as black and white. You know, television, film and photographs, they seem quaint to us. And five years from now, we're going to look at these black-and-white e-book readers and just laugh like our grandparents use them. But, in any case, they have the advantage of being very readable, at least in sunlight. You do need your own illumination.
MR. DAVID POGUEThe next step will be, as Barnes & Noble has just released, e-ink, black-and-white readers that self-illuminate, kind of like an Indiglo watch does. And then there's the second bracket of these really clunky, heavy, but cheap, color e-book readers, like the Kindle Fire and the Barnes & Noble tablet. Again, to me, they're like Commodore 64s at this point. They're really crude and heavy and big and thick, with none of the lightweight pleasure of the black-and-white ones, but...
POGUE...these all will merge. They will all be color. They will all be cheap. And they will all be small.
FISHERWell, speaking of merging, is the e-book reader, as a standalone product, an interim technology? Are we going to come to a point where there's simply no reason to have a separate device for reading books and rather this is all incorporated into one all-purpose tablet?
POGUEI don't believe so. That isn't the way technology ever works. You know, everyone said, you know, when the television came along that there would be no more radio because who would just listen when they could watch and listen, you know? And when VHS movies came out, you can watch movies at home. Everyone said no one will go to the theater anymore. You know, we'll just watch all their movies at home. And that is never what happens. The history of consumer technology is splintering into more and more separate devices.
POGUEAnd that's what cracks me up about people who say that e-book readers are going to replace printed books. It's like, people, have you not been around for the last 100 years? What happens is differentiation. There will always be printed books because they have advantages. They will always have advantages over e-books. And e-books will always be with us, too, because they do things that printed books can't do. Maybe the problem is calling them e-book readers because they're really very -- they serve different purposes in some ways.
FISHERWhat would you call them?
POGUELet's put the audience on hold for 10 minutes, and I'll get back to you. I mean...
FISHERWe could ask...
FISHEROur audience could maybe chime in on this point. What would you call...
POGUEThat's a great idea.
FISHER...an e-book reader? What is the function that is distinct about that gadget that -- and why -- how do you make that choice about I'm going to read this book in print, and I'm going to read that book on an e-book reader? Brad Graham, do you have -- as you look at sales in the store, is there -- are there patterns among types of books, fiction versus nonfiction or anything else that gives us a clue as to how people decide which format they're going to read a book in?
GRAHAMSure. Early on, the types of books that were being read on e-readers were quite distinctive. They tended to be the more popular reads, the mysteries, the romances. Nonfiction books were not as popular for e-readers, and children's books were probably the slowest to move in that direction and still have not done so very much. You know, as a relatively newcomer to the bookstore business -- I mean, my wife and I only acquired Politics & Prose about a year ago.
GRAHAMWe have been struck by the lack of consensus in the whole industry about where e-books are going. Clearly, the -- one of the main stories in the industry over the last few years has been the dynamic growth of e-books. But it's very hard to find, among people who've been in the business a long time, any sort of agreement on where this may stop. Whether it may plateau soon, at somewhat under 50 percent, maybe whether it will far exceed 50 percent, there just seems to be no agreement on where this is going. And that leads to a lot of uncertainty.
FISHERAnd, Lee Rainie, has your study shed any light on that question of what is the direction that this is going in? And are there particular kinds of books where the e-reader is going to be dominant?
RAINIEWe didn't ask about genres, per se, but we did see what David was talking about -- differentiation. There are different genres that seem to be popular to people in different formats. There are ways now that independent bookstores, like Brad's, are adopting to this new world by adding features to the stores themselves and making them attractive places for community gatherings, which, you know, Politics & Prose has done for decades now.
RAINIEAnd this sort of differentiation struggle and this lack of consensus is allowing sort of new players to enter the market. There are whole new types of companies now that are -- allow for self-publishing or allow for different models of publishing than existed before, and so you're seeing the same sort of churn that we saw in -- certainly in the music business and, to some degree, in the video business as well.
FISHERLet's hear from Aaron in Arlington, Va. Aaron, it's your turn.
AARONOh, hi. I run the Barnes & Noble Nook program in Arlington. I inquired, and, actually, on my desk, I have the most recent article, that Pew study. And I have the most recent review from The New York Times of the newest Nook, which I think was written David Pogue. I could be wrong about authorship there.
RAINIEYou are correct.
AARONOh, great. Well, I love both of them. I make everyone who works for me read both of those, and I just say thank you for contributing to the body of literature. I think there are so many misunderstandings, and I encounter them in kind of the line of work every day about what it means to adopt this new technology and, you know, people thinking that they have to give up what they already have in order to get this new thing, that they have to make a break from the past.
AARONAnd I myself, you know, I read on an e-reader. But I read my books, and I read magazines. I read all kinds of things. So I think it's just -- it's great to encourage the world to take an open mind about this and to be open to the new advantages that you can get from it. And I would strongly encourage, especially authors and writers to, you know, to -- God bless Maurice Sendak.
AARONBut I think that there is a certain amount of fear of something new that is unfortunate and unwanted because there is a way to use this technology to reach new kinds and classes of people. And that's something that, I think, we should see more writers willing to take an advantage of, looking forward rather than kind of being afraid of a new thing.
FISHERThanks for the call. And, David Pogue, one of the latest innovations that Aaron mentioned is the Nook with built-in light for reading in bed at night. And this supposedly won't bother your spouse. How does that work?
POGUEWell, this is the one that I mentioned with the sort of Indiglo backlight, just like LCD watches have or had where you hold down a button and the background would sort of light up. The problem is with those e-ink screens is, as we mentioned, they look fantastic in bright light. But they're like a regular book. You can't read them at all in the dark. That's differentiated from, say, the iPad or one of these color e-book readers. So you had a -- and those color ones don't look good in the sun. You can't read those in the sun.
POGUESo you could either buy a reader that looks good in great light or one that looks good in low light, but not both. So what Barnes & Noble was the first to do was to solve that problem rather neatly, and there are thousands of Kindle owners who actually buy little $50 clip-on penlights that go on the edge of the reader and do nothing but provide illumination for the otherwise un-illuminated screen. That is not conducive to sleep for the spouse. So what this thing does is it glows gently, and it is absolutely perfect.
POGUEIt is beautiful to read. It doesn't disturb the person next to you. Amazon, of course, has its own similar -- they claim superior self-illuminating e-book reader coming up later in the year. This is -- this has become a two-horse race, Barnes & Noble and Amazon. We haven't really touched on the way these companies lock you into their libraries, but that's one problem I have with the word e-book reader is because they're not books. You're basically rent -- it's like going to see a movie, right?
POGUEYou don't expect to own anything when you're done watching a movie in the theater. You've just had an experience. And in some ways, that's what we're buying here. You don't really own the book as noted when last year, Amazon found a rights problem with two of its e-books and, in the middle of the night, went in wirelessly to everybody's Kindles and deleted those books without consulting anybody.
FISHERThat's a way to win customers.
POGUEThe irony is that the two books were "1984" and "Animal Farm."
FISHERWow, that's fabulous. Well, we will get into the...
POGUESo people need to get used to...
FISHERWe will get into the question of Amazon and Barnes & Noble and other, and how one crosses those categories if that's even possible when we come back after a short break with our guests, David Pogue, Brad Graham and Lee Rainie. I'm Mark Fisher, sitting on "The Kojo Nnamdi Show." We'll be back in a moment.
FISHERWelcome back. I'm Marc Fisher of The Washington Post, sitting in for Kojo Nnamdi, and we are talking about e-books, how to pick one and what their future may be. We're talking with Brad Graham, co-owner of Politics & Prose bookstore, David Pogue, tech columnist for The New York Times and Lee Rainie, director of the Pew Research Center's Internet and American Life Project.
FISHERAnd, David Pogue, before the break, we were just getting this question of who the big players are in the e-book world. And we had news last week that Microsoft is investing $300 million in Barnes & Noble's Nook division. What is Microsoft looking for? And tell us a little bit about this face-off of the giants in this world.
POGUEGreat. Well, the reason I think it's important that there are just these two giants is, as I mentioned, you can't read each other's books on different readers. So if you buy an Amazon Kindle today and buy a bunch of books, you will never be able to read those books on a Barnes & Noble Nook should they come up with a better reader someday. So the decision you make is locking you in for good unless you're willing to throw away hundreds or thousands of dollars of e-books.
POGUESo the Apple, the Nook and the Kindle formats are all mutually incompatible. For that reason, I wouldn't advise my readers to touch anything from Sony or any of the lesser-knowns -- lesser known e-book readers, at least if you want to read commercial books. I mean, if all you want to do is read out-of-copyright, you know, "Moby Dick" kind of stuff, then any of these readers will be fine. So what Microsoft wants? I'm not really sure.
POGUEIt's been Microsoft's strategy late in fields where it doesn't have a good foothold to team up with the second place player. They just bonded up with Nokia in cellphones when Microsoft's own cellphone efforts were dying. And so here they are joining up with the number two player in e-books, Barnes & Noble, no doubt in hopes of coming up with the mutually satisfactory relationship.
POGUEPerhaps Microsoft is trying to bring its, you know, its Windows 8 technology to e-book readers, make them more like actual tablets. That's something that doesn't exist right now, a cheap, light, thin, inexpensive, full function tablet, like imagine something that does everything an iPad does but it's not $600.
FISHERWell, another big name in the tech world is involved in e-books. In a sense, Google recently announced that it will discontinue its link for independent bookstores at the end of this year. But I understand that bookstores are exploring their idea of creating their own e-book reader. Brad Graham, is that what's happening?
GRAHAMWell, yeah, there has been discussion for a while now about the possibility of bookstores being able to offer their own device. You know, a number of our customers have asked if that's possible. And I think that there is some thought being put into that, but there are also some other options out there that are being explored as a replacement for Google.
GRAHAMI mean, it was a surprise that Google, having just reached this agreement about 18 months ago with independent bookstores to provide this e-book service, suddenly announced that they would be withdrawing it at the end of the year. But we do have the rest of this year to figure out the alternatives.
FISHERThere is -- we have an email from Steven saying that he hear the previous conversation about e-books and was astonished to hear warning that you should be aware of what you buy as you'll be wedded to e-book vendor. "Has no one heard of calibre," he says, "a free e-book manager which converts almost any format to almost any other format?" Anybody familiar with that? David.
POGUEYeah. This is David. I'm familiar with calibre. A couple readers wrote to me. I haven't used it. It's not clear to me. I spent a lot of time in the site. Whether, in fact, that also applies to copy-protected books -- will it convert a copy-protected Kindle book to a copy-protected Nook book? If it does, that's wonderful. I would not put money on that company still being around, though, once it rises to prominence and gets on the radar of Barnes & Noble and Amazon. That would defeat their entire business model.
FISHERRight. Well, you can keep up with our conversation on e-books on Twitter by using #TechTuesday. And let's hear from Bob in Rockville. Bob, you're on the air.
BOBHi, guys. How are you?
FISHERPretty good. How about you?
BOBGood. Well, I had a couple points that I wanted to make. First of all, I wanted to disagree with the guest that said that e-books will never replace printed books. I'm one of those guys that's been brought into the 21st century kicking and screaming. And my kids, who are in their 20s, of course, can't imagine their life being unplugged. And it's -- this is only going to get worse as time goes on, so, eventually, I think everything is going to go the e-book way.
BOBAs for -- the second thing is, as for myself, I just don't think I could ever get into buying an e-book because -- you know what? -- nothing will ever replace the feel of a good book in your hands on a rainy afternoon or if you just want to pop yourself up in a corner some place and get lost in the pages. Nothing is ever going to substitute for that.
FISHERIt's the feel, and, to my mind anyway, it's the smell. And maybe I'm alone in this, but there's a certain smell about a fresh new book or even an old used book that adds to the experience. And, Brad Graham, is there -- do you think in 20 years we're going -- you're going to be running a store that's essentially a showroom for books that are delivered almost entirely electronically?
GRAHAMWell, I hope not. You know, there's an analogy often made between what happened to record stores and bookstores. But, you know, the listening experience is quite different than the reading experience. I mean, there is a certain physical element -- tactile element to reading a book. I mean, at least traditionally there has been, and I don't think that's going to disappear.
GRAHAMAnd what we're seeing -- this was alluded to earlier on the discussion of some of the recent survey information, is that some of the most avid users of e-books remained avid readers of physical books. And I think that's very encouraging to us. We see this in the store, too. We see some of the people who are downloading books are also still buying a lot of physical books.
GRAHAMAnd I think that's going to continue. I think what we're going to see is the emergence of a lot of hybrid readers, that is, people who may use an e-reader when they -- and say they're going on a trip but who, when they're at home, will still prefer the physical book.
FISHERAnd, Lee Rainie, you -- the survey has found that not only do e-readers read print books as well, but also e-readers tend to read more books as a whole than pure print readers.
RAINIEYeah. That -- if there's one distinguishing thing about the people who have bought into the new technology, is that they're omnivores. They want it all in all the formats that matter to them, and different formats matter in different sets of circumstances. But one other thing that we asked people about e-readers themselves is if you don't have one now, do you plan to get one, and a small proportion said yes. But many more people said some of the things that have been referred to in the conversation.
RAINIEEither they said, I've got enough devices in my life, I don't need another one. I love the reading experiences I have within a printed format. I'm worried about the lock-in experience that David was describing. And so we're still evolving, and I would argue, too, that the very nature of reading is in flux. You know, the e-readers have added a social dimension to reading that didn't exist in quite the same scale before.
RAINIEPeople are sharing bits of text. Or when I'm using my e-book reader, I can see what passages other people have underlined. And also, there's a -- you know, multimedia experiences are potentially coming into the reading experience as people can have more than just the eye-balling text capacity to enjoy material.
FISHERHere's an email from Mike, who says he owns many devices. He has an iPad, an iPhone, a Kindle 3G, and he likes the Kindle platform the best 'cause it allows him to read across all three platforms, sinking seamlessly to the furthest page that I have read. And he goes on to say that the iPad is not so great in the sun because of the glare. The Kindle is great for reading at the beach or in direct sunlight.
FISHERAnd the iPhone Kindle app is great because sometimes you forget your Kindle and iPad and find yourself with time to read. So he's got a very sort of divided life among his various gadgets. But, David Pogue, I would imagine that Mike is probably on the edge of this technology and that most people are trying to just deal with that binary choice between e-book and print.
POGUEYeah, I'd say it'd be unusual to own more than one thing, but I should mention -- in my review of this latest Barnes & Noble Nook, I said, you can't read a Kindle on a Nook, can't read a Nook book on the Sony. You can't read a Sony book on the iPad, and many readers were upset with that because they felt that there was a case I didn't mention, which is that you can read Kindle or Barnes & Noble books on your phone or your laptop or your iPads. So, in fact, you don't need to buy one on these devices at all just to read the books they sell.
POGUESo that -- there are these edge cases, and I have to admit I'm -- I've become addicted to reading on my iPhone when I'm standing in line, when I'm waiting in a doctor's office, when I was waiting for this interview to start because there is whatever latest book I have right in front of me. And, yes, the Amazon books all synchronize across devices so that you're always on the same page, whatever device you pick up. But of course, Barnes & Noble advertises exactly the same feature.
FISHERWell, I have to admit, I'm cheap enough that I find myself reading books on Google books and, you know, skipping over the pages they won't let me see. But that's not a good thing.
FISHERBrad would be very upset with me, I'm sure.
GRAHAMWell, you know, look, I want to say one thing, you know, independent bookstores, can see that e-books are -- have become increasingly popular, and we're in the game. I mean, this is what the arrangement with Google allowed 18 months ago. It allowed us to offer those of our customers who would like to download e-books to go to our websites and download, and then we get a share of that. And it's not very much of our business now. It's not very much of most bookstores' business. But we do offer that service, and we hope to continue to.
FISHERAnd you've also invested in a machine that you have at Politics & Prose called Opus, which is a print-on-demand book. Do people use it? And is it more of a curiosity or is it of technology of the future?
GRAHAMWell, it's definitely curiosity, and it's really quite popular. We're one of about a dozen bookstores now in the country that have this -- the official name is Espresso Book Machine, made by On Demand Books and marketed by Xerox. And it's very popular, especially among those interested in self-published works. It also provides access to millions of out-of-print titles, and our slogan for it is: real books in real time. So we can even give you a book faster than Amazon can. We can produce it instantaneously right there in the store while you watch because its (word?).
FISHERAnd does it look and feel like a book?
GRAHAMYeah. Yeah. No, you could -- you'd be hard-pressed to tell the difference between -- it's a soft cover, but you'd be hard-pressed to tell the difference between a book that comes off of Opus, as we've nicknamed our machine, and one that comes off of a much bigger off-set press. I mean, it's -- Opus produces very high quality books.
FISHERBut do they smell right?
GRAHAMThey're hot. They're warm to the touch, just like -- and it feels like bread coming out of the oven.
FISHERThat's great. Let's hear from Diane in Fairfax who raises an interesting question about what authors get out of all this. Diane, you're on the air.
DIANEHi. I read everything, so I'm an omnivorous hybrid, I suppose. And it's occurred to me that there's got to be a pretty huge price differential between what an author is paid for the sale of an e-book or its equivalent and what they're paid for the sale of a hardcopy in a bookstore. And I'm wondering if you could address that as I've never heard anybody talk about it.
POGUEThis David Pogue. I may be the -- I don't know about you two gentlemen, but I know that I'm an author, got about 50 books out there. And, actually, it's pretty much the same deal. So whatever your royalty percentage is for the printed books, you get the same royalty for the electronic books. The big difference, of course, is that many of the electronic books are sold, at least by Amazon, for less than the printed book, and many, many readers would argue, as it should be.
POGUEBy the way, I just got my latest royalty statements and was interested to see the proportion of printed books to e-books for the exact same titles. And it looks like the e-books are about a quarter of the sales of -- and most of mine are, you know, computer books, how-to books. But, so far, the e-books are still trailing but coming on fast.
FISHERAnd presumably your proportion of e-book sales would be higher than many other books because of the nature of what you write about.
POGUEI would think so, yeah.
FISHERWell, the -- thanks for the call, Diane. The Justice Department recently settled a lawsuit against several book publishers for allegedly conspiring on e-book pricing, which raises the question of where the price of e-books is heading. I mean, we had this -- we've had this price war of sorts going on. Is that coming to an end, and are we going to see a dramatic increase, Brad?
GRAHAMWell, I think -- I mean, the general view is that the price of e-books is going to go down, at least for a while, and the market share at Amazon has of those of the e-book market will go up. I mean, Amazon had a very high percentage, around 90 percent, a few years ago when the agency model, as it's called, was introduced in these five or six publishers that agreed to set the price of e-books between $12 and $15. And what that actually allowed for was a more competitive market.
GRAHAMIt allowed for Barnes & Noble to capture 25 or so percent of the market, Apple, 15 percent of the market. But what the Justice Department has done now, amid evidence that these publishing executives had colluded and meeting at fancy restaurants in New York and so on, to agree to the agency model, it will ironically lead to a less competitive market situation that will allow Amazon, again, to deeply discount even below cost to them. And the expectation is that Amazon's market share will go up to where it was before.
FISHERAnd how did the traditional book publishers manage to lose out on this situation? I mean, it seems they -- that the tech companies kind of took over. And the bookstore companies, Barnes & Noble in particular, and the publishers are now sort of scrambling to see how they can survive in this new environment. Were the publishers behind the ball on technology?
GRAHAMThey, I think, would agree that they misestimated, misjudged, and saw a certain potential in dealing with the Amazon originally and didn't see the threat.
FISHERHere's an email from Kathleen, talking about compatibility with libraries. She's about to buy her first e-reader, probably something very basic, and she says, "I know these things are priced fairly cheaply in order to sell the various sponsors' wares. But I plan to use it primarily to access free sources, such as public libraries and Project Guttenberg. Can you address the issue of how compatible each device is with these free sources or suggest other free or inexpensive online sources of books?" David?
POGUEYes, they're all extremely compatible. This is one of the great success stories, and, again, you don't need a reader to read these free books, the older books. They're available on your phone, your tablet, your laptop. But, yeah, they're not copy-protected. They're freely interchangeable. It's really only the commercial modern books that we care about. And you will not be locked in to these free manuscripts. You know, they're available in formats like ePub or PDF or even just plain text files, and they read just fine.
POGUEOne thing I love about the Kindle is, when you buy a Kindle, it has its own private email address. And you can send things to it by email, like an article you're reading from the Web or you find a stash of your old college dissertations or these free out-of-copyright books. You can just get them onto the Kindle by emailing them, which is very cool.
FISHERDavid Pogue is tech columnist for The New York Times. We're also talking with Lee Rainie of the Pew Research Center, and Brad Graham, co-owner of Politics & Prose bookstore in Washington. I'm Marc Fisher, sitting in for Kojo. And we come back after a short break, we'll continue our conversation about electronic books and take more of your calls. Stay with us.
FISHERWelcome back. I'm Marc Fisher of The Washington Post, sitting in for Kojo Nnamdi. And we are talking about e-books on this Tech Tuesday. You can join our conversation at 1-800-433-8850. And, Lee Rainie of the Pew Research Center, your study of e-reading across the country, one of your findings was that most book readers prefer to buy rather than borrow. And I know there was some concern when e-books first came along that libraries would play a larger role and that people would buy fewer books. But you don't think that's happening.
RAINIEWell, so far, it doesn't show up on our data, and these tend to be book buyers in the first place. So it might be that the early adopters are just very comfortable with that model. But the question that Kathleen just raised is a really central one to, you know, community institutions. Libraries are struggling in their relationship with publishers about the dos and don'ts of the availability of e-books. Four of the six major publishing houses do not allow libraries to lend out their material as e-books.
RAINIEHarperCollins does allow libraries to lend it out, but on a limited basis. They are only allowed to lend out 26 copies of a book and then have to renew their license in order to make it available to that 27th interested borrower. And Random House does allow its books to be read and purchased by libraries and lent out. But they just raised their prices substantially to the main service that is used by libraries, a service called OverDrive. So this is part of the world that's in major flux now, and it speaks to the issue that you raised before, Mark, about were publishers caught off guard.
RAINIEThe big thing that they, you know, talk about a lot is having their material Napsterized. They're not anxious to have the material that they pay a lot for, and authors get compensated for, to have it be, you know, hacked and available -- made available for free. And so that sort of stopped their thinking about how willing they were to make a lot of material available in digital format.
FISHERAnd, Brad Graham, we have, by the way, a link to -- where folks can buy e-books at the Politics & Prose website. There's a link on our kojoshow.org website. Brad Graham, you serve an area where people not only buy a lot of books, but spend a lot of time in libraries and use them quite extensively. Have -- has -- have e-books made libraries a tougher competitor for you?
GRAHAMNot that we're aware of. I mean, we're still selling more physical books than ever before. And, at the same time, we're -- our sales of e-books has begun to go up. I hope this never ends. I can't completely understand why we're seeing all this, but it's certainly been very, very healthy for independent bookstores.
FISHERLet's hear from Katie in Brookeville. Katie, you're on the air.
KATIEHi. I had not heard this topic brought up, and it's somewhat a little trivial. My husband and I live in a sailboat. I just happen to be visiting family in the States, and storing books was always an enormous issue. We're both readers. And so when the Kindle came out, it was just transforming for us because we suddenly could have 200 books in the place where one book would have fit before. So that aspect of it alone is -- it was great for us. I personally would still rather have a real book in my hand, but it's been a major transformation in storage space on a sailboat.
FISHERGood point. Certainly the convenience of e-books is tremendous reason for people to move in that direction. And another thing that several listeners have brought up is the lowered cost of entry for aspiring writers, and small presses seem to be able to get into the market more easily because of e-books. Here's Stanley in Washington. You're on the air. Stanley?
STANLEYHello. Yes. I'm one of those authors. About 10, 12 years ago, I wrote a memoir, and I wasn't able to get an agent, who, in turn, would have to get me a publisher. And I always quoted the statement by A.J. Liebling that said, you only have freedom of the press if you own one. But -- so I put it aside until recently when the e-books came out. So now I've self-published, and I'm hoping to make sales through the e-books.
STANLEYYou no longer need a publisher to print all those books and to distribute them. What you -- oh, yeah, you do need the marketing, and that could be done otherwise. So I think it is a good thing for the incipient author, the first-time author who wants to get before the public.
FISHERLee Rainie, is there any evidence that people are reading a wider variety of books because of the availability of electronic books?
RAINIEA little bit. There's a really interesting long-tail story, just as there was in the music experience and, to some degree, in the video experience where obviously best-sellers still matter a lot. But there are more people now creating content. About two-thirds of American adults make stuff using digital social media and other formats, and it's become a world now where anybody can be a publisher and an author if they choose to be.
RAINIEAnd they have the tools now to do at least the first-level marketing to their immediate friends and family and their followers in Facebook and Twitter and things like that. And it's the same story that played out in the garage band era. There are many more folks in this country who are probably making a little bit of money off music now than was ever the case before the digital era. But the sort of big acts are struggling a little bit, and there are ways now that the middle men, the middle performers in this market, are the ones who are struggling the most.
FISHERDavid Pogue, we have an email from Mark in Washington, asking if we could address the Android reader app. He was given an Asus Eee Pad and was wondering what app you favor and why.
POGUEWell, I haven't really -- I mean, obviously, you get the Amazon app for Kindle books and you get the Nook app for Nook Books. If you mean, you know, one that can read the old out-of-copyright texts, that's -- I haven't researched it. I've just gone to Amazon -- Android marketplace and see what's highly recommended. But, Marc, since I have the floor, can I -- I'd like...
POGUE...to have one more rant. I've been biting my tongue for three minutes ever since Lee talked about the pricing of these books.
POGUEAnd I don't know if people -- I think we need to really rethink the entire concept of these prices because the common man says they should cost less because they're not -- there's no printing or binding or shipping or storing expenses for electronic books as there are with printed books. And, OK, that's an argument that we could have. But the elephant in the room is the difference of ownership. I hinted about this earlier. But, I mean, if you acquire a library of e-books, you will never leave them to your children. You cannot donate one to a school when you're done with it.
POGUEYou can't resell it. You can't lend it. You can't rent it. You're basically getting the experience of reading that book, and that's it. It's limited to you forever. So that's one thing that suggests that the pricing is way out of whack, that the comparison with a physical object is completely wrong because you can sell, donate or leave the physical object.
FISHERWell, that sounds like an argument for e-books being rather dramatically cheaper than physical books.
POGUEWell, I think so. And the other argument for that -- and I know I'm an idiot because I'm an author, but I believe I would make more money. I do. If you look at what happened with the iTunes app store, remember, Steve Jobs told programmers they should market these apps at $1, not $30, which is what shareware costs in the computer world, but $1. And people thought that's nuts. That's one-thirtieth the income, right? No. That led to people selling hundreds or thousands of times more copies than they ever would have.
POGUEAnd, yes, you get only $1 instead of $30, but you're selling 1,000 times more. And I suspect that if e-books became, you know, the price of them, you know, a movie ticket or a sandwich or if it became a spontaneous, impulsive buy, not $15 but $8, you know, people would just gulp them down in a way that would make all -- everybody's profits rise like crazy. I'll bet. I think someone should experiment.
FISHERWell, I think Brad Graham is having a heart palpitation, so I...
GRAHAMWell, I'm just trying to imagine where people are going to find all this extra time to read all these additional books they're buying.
FISHERWell, but is there -- should -- Brad, David's point is very similar to what we hear about in the newspaper industry, for example. If you don't have all the costs of printing and distributing and so on, you should be able to have a healthy news operation at a much lower cost if it's purely online. Isn't that true for books as well?
GRAHAMRight. But there still is a fair amount of expense involved in finding these books and editing them and developing them and bringing them to market. I mean, you know, I mean, marketing itself is still quite an expensive proposition.
FISHERAnd here's Mike in Gaithersburg with a point on that question. Mike?
MIKEYeah. I recently read one of the "Aurelio Zen" mystery novels on my iPad using the Kindle app. And the point that I want to make is that you have to be careful about the quality. It looked to me like this book had been scanned and then translated with an optical character recognition. There were a lot of typos.
MIKEThis book had a mix of English -- it's written mostly in English, but it has a lot of Italian in it. And there were a lot of typos, especially in the Italian, but even in the English, that an editor could easily have caught. But, apparently, no great effort was made to make sure that the book had been rendered properly.
FISHERBrad, are you seeing a significant quality differential between print and e-books?
GRAHAMNo. I mean, you know, there's -- we haven't seen that much difference.
FISHERAnd, David, is that a complaint that people have about e-books in general?
POGUEI don't think so. I didn't catch the title of that book, but it sounds like one of the above-mentioned, you know, free, out-of-copyright public domain books, many of which were, in fact, scanned by Google, which their -- they have these huge processes underway now. They're scanning millions and millions and millions of books, but they do wind up with a lot of typos and misrecognitions in them.
FISHERNot much time left, but I want to get to Gabby in Rockville, who has an interesting question. Gabby?
GABBYYes. I'm actually still a college student, and I know that you guys have been focusing on books in general. But I wanted to hear something about textbooks and the fact that we can't use them for more than six months, I think, 'cause I needed to refer to one that I bought last semester. And I couldn't 'cause it was expired.
FISHERBrad, any news on textbooks and their increasing availability?
GRAHAMNo. We don't really handle them, so I'm not that familiar with what the glitch there is.
FISHERThis is Pogue.
FISHERYeah, go ahead.
POGUEYeah. For some reason, I mean, textbooks are the screamingly obvious win for e-books. You know, poor students like your caller have to haul these 400-pound backpacks around. I think the publisher should reimburse their chiropractic bills. I don't know why the textbook companies are so reluctant, but they're the most terrified of all to dive in. So incredible restrictions, incredible prices...
FISHERProbably because they have probably the highest profit margins, I would imagine, in the industry. I mean, the prices of textbooks are just extraordinary. Well, I want to close out with a tweet we just received from a listener who says, "I downloaded the entirety of Charles Darwin's works while on a tour on a ship off the coast of the Galapagos in the middle of the pacific Ocean. I am a convert."
FISHERSo, David Pogue, quickly, is there -- do you have a prediction about where we'll be a few years down the road in the mix between print and electronic books?
POGUEAbsolutely. Electronic books will have a greater percentage of the mix, but printed books will always be with us. They each have tremendous advantages.
FISHERAnd, Brad Graham, will we find fewer print books on your shelves in a few years and more of an appeal to e-book readers?
GRAHAMI hope there will be no fewer physical books, but we do assume that more of our customers will be also reading e-books.
FISHERBrad Graham is co-owner of Politics & Prose bookstore in Northwest Washington, Lee Rainie, director of the Pew Research Center's Internet & American Life Project, and their survey on e-books is available on our website, David Pogue, tech columnist for The New York Times. Thanks to all of you for joining us. And I'm Marc Fisher of The Washington Post, sitting on "The Kojo Nnamdi Show." Thanks for listening.
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