Uncle Frank: I think it is very possible to see what I prefer to call for my own purposes "e-literature" versus e-books as being a discontinuous innovation. I am not sure how I see the game playing out, but the winds started swirling last week with the issuance of the Stephen King short story. The publisher went on record as saying everyone involved would have been delighted with 100,000 downloads of the King work. The last count I saw was several days ago and it was at 600,000 and still going strong. Think about this.....600,000 persons at least (assuming no one passed around their reading devices..in my house my wife and I both read the story off one Rocket e-book) enjoyed Mr. King's story and not one piece of paper was involved!! This little trial balloon provided the author with a mass audience, the publisher with access to a large intelligent, tech-savvy readership, the distributors with "eyes" for their websites and additional sales (I have bought three other books, Rocketman has bought one other...thousands of other people have done the same). The cost of the story was very low (or non-existant, as some sites gave it away), but the costs of producing it were also very low. No paper, no ink, no shipping costs, no storage, no shelf space problems, no returns, no damaged or lost merchandise. The net cost of producing this work of fiction was perhaps 5% of a printed version? And, there is no doubt plenty of profit left for Mr. King and his publisher to get their share. (assuming 500,000 downloads paid the $3.00 for the story, the parties can split up $1.5 million. Take a little off the top for promotion, and you still get 1.3 million. Also, because we all paid up front at the time of download, the profit flows to the parties entitled to it that much faster.
Now, let's assume that electronic books cost 40% less to produce as printed versions. (This is probably too high, but let's work with it). A year from now when Tom Clancy writes his next big book maybe I will have the choice of downloading it for 18 dollars or buying the hardcover version for 21 dollars. My Clancy, his agent and his publisher will realize more profit on the electronic download than on the paper version, so they will support the electronic approach. They are happy. I pay less, so I am happy. (If I love the book, I can buy the paperback when it comes out a year later for $6.99). Because the downloads are encrypted and otherwise protected, there is no black market as there is in paper.......and another big factor which should not be ignored. It is not as easy for me to pass on my "copy" of the book. With a hardcover I just hand it over to my friend. With an e-book I have to give him my reader. No way; I will be reading my next book. So, Mr. Clancy should realize more direct sales with e-books.
Therefore, we have as advantages: Less Cost to the consumer, greater profits to the authors, publishers, agents and the distributors (build that value chain, faster flow of funds, better tracking of readership, no paper, no ink, no storage, no returns, no pass arounds.
Negatives: No paper, no ink. For some people this will be tough. For many, however, it will be simply a matter of choice: e-book at 40% less cost or traditional paper. I don't know how wide the chasm will be here. It is not wide for me, but I am an early adapter by nature. I want to see my Aunt Evelyn reading a Rocket E-book. Then I will know it crossed.
As far as building the value chains, establishing the open standards, etc., I don't know. I just think it will come.
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