Saturday, March 24, 2012

Have you “bought” into the e-Book model?

Do you buy e-Books on say an Amazon Kindle or a Barnes and Noble Nook or other e-reader?

If you answered “yes”, you are wrong – and you’ve likely been fooled. You’ve actually only “Licensed” the book. Here’s what Amazon has to say about it from here:

Upon your download of Digital Content and payment of any applicable fees (including applicable taxes), the Content Provider grants you a non-exclusive right to view, use, and display such Digital Content an unlimited number of times, solely on the Kindle or a Reading Application or as otherwise permitted as part of the Service, solely on the number of Kindles or Other Devices specified in the Kindle Store, and solely for your personal, non-commercial use. Digital Content is licensed, not sold, to you by the Content Provider.

They go on to say:

…you may not sell, rent, lease, distribute, broadcast, sublicense, or otherwise assign any rights to the Digital Content or any portion of it to any third party…

As you can see it is a license. Are you beginning to see that you didn’t actually buy any books from these stores? Of course, it might look like you bought them.


It does clearly say “Buy” on that button. Confusing, right? In fact, at some later time, a court may need to decide whether this is deceptive or not. After all, there are plenty of more descriptive words that could be used here such as “License” or perhaps even “Rent” or “Lease” instead of “Buy”.

I had personally stayed well clear of the e-Book market for some time due to my concerns over permanence and use rights. However, I recently had a birthday (darn it) and received a Kindle Fire. It’s a very nice device I must say. I did go ahead and license a couple of books and also download a couple of free (out of copyright) books as well. Now, normally I keep my books on a bookshelf. Well, to be fair – several bookshelves. In fact, they are all over the house. I keep most of them and read them over and over. I have several that I acquired from library sales when I was a kid – some of these are 50 years old and still in decent condition. Because I bought (or was given) all these paper books, I have first sale rights to them. The doctrine of first sale basically holds that once a copyright owner has sold you a copy they have no further interest in that copy and cannot restrict the trade of it. So I can bequeath them to my kids, sell them at a used book store, ship some via the postal service to a friend in another state as a gift, donate them to a charity, etc. Pretty much all of the things a license prevents me from doing. With the paper books I buy today I may read them, then hand them to my wife, daughter, or son to read. They end up back on the bookshelf afterwards. With a license, I cannot let them read it. They have their own Kindle with their own account and transfers aren’t allowed.

In fact, that bookshelf is a good analogy for what Amazon calls their cloud storage. A place to keep the book where you can go get it again when you want to read it later. However, with the paper books I can buy a new bookshelf and the books can move to it. I can buy a new house and the books come with me (damn they are heavy!). With the license model though I can’t take my books to a new bookshelf. Let’s say that in a couple of years it is time for a new device. Perhaps the battery no longer holds much charge or there is a much better shiny new one available now. What if it happens to be a Barnes and Noble device? Or a Google one? My books don’t go to the new bookshelf (the new cloud). In fact, as we’ve established, they aren’t my books. They are just licensed. So, I now can’t really access them anymore. At least not from my nice shiny new device. Oh, sure there is a reader for the computer and one for a phone but that just isn’t the same thing.

So, if I can’t gift them, loan them, take them with me (to a new cloud), or sell my rights to them they must be licensed at a much lower price than what the paper books which do come with those rights are sold, right? Wrong! Many or most are the same price. Here’s a sample:


Wow, they are the same price! Now, the convenience of being able to have them on your Kindle and not have to carry around the (heavy) paper books is worth something. But, the fact that there is no printing, binding, shipping, inventory management, destroyed copy accounting (where stores get credit for unsold copies by tearing the covers off and throwing the book in trash), etc. seems like it is much more of a convenience for the publishers and purveyors of these digital works than it is for the consumer. I know most reasonable people I’ve talked to are quite sure that e-Books should be less expensive than paper books. The only real question is by how much.

How should this market look?

First, we should indeed be buying a copy and not licensing it. That would immediately open up the protections of the first sale doctrine. Next, we should have the ability to transfer these e-Books just like ordinary paper books. I can even see companies like Amazon and Barnes and Noble getting recompense for the transfer since they would have to facilitate it and develop and maintain the software to enable it. It should not be a percentage of the book price; it should be a fixed fee – something on the order of 25 cents – to transfer the book to another. So, if I wanted to gift a book I’d read to a friend it would cost me a small amount just like it would if I had to send a paper book through the postal service. There should be a used book store on these services where I can sell my book back for some small amount and then others could buy it from there. If I decide to leave one cloud service and go to another, all that content should be removed from the first cloud and moved to the new one with no loss of “my books”.

Of course, the publishers don’t want this. They, like the movie industry, seem to prefer that we purchase the same content over and over. Want my daughter to read it? Buy another license. Done with it and want to send it to a friend? Another license. Not cool. And – the bottom line – it has to be reducing the market for e-Books. I was chatting with a coworker about this the other day and we came to the conclusion that we two could not be the only ones who would buy far more e-Books if we were sure we could keep them between cloud providers, transfer them to others, etc. Far more.

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