does this make me a bully? Picking on the gadget press again. . .

http://www.informationweek.com/blog/main/archives/2009/02/the_kindle_is_a.html

Nice rhyming in the title: kindle/swindle.

After bitching that things like Moby Dick and Hamlet are cheaper for Sony than for kindle (thus exposing that he doesn't realize the Amazon format is a DRM'ed version of Mobi and therefore you can hop on over to Gutenberg and get either of those completely free for the kindle if you're willing to use the USB cable instead of WhisperNet. I'd forgive that kind of ignorance -- except he's gadget press), he then says:

"Someone will also have to explain why books in the public domain aren't free -- there are no production costs involved."

No production costs? Right, because scanning that shit in and fixing all the errors is totally without time or other cost to anyone. Jackass.

"I'm not saying that music is intrinsically worth more than books, but it does require more artists and involve higher production costs to cut an album than to produce a digital book."

Well, given that a _lot_ of authors are required to produce some digital books, and only one to cut some albums, and given that at least people producing CDs and mp3 format music often do it quite cheaply in their own homes, I don't see how he thinks anyone is going to take such an obviously false assertion seriously.

Or, for that matter, take him seriously.

Ignoring the idea that somehow a wheeled bag solves the stack-of-books next to the bed problem (or, for that matter, carryon luggage limits), lots and lots of people are giving it away for free on the kindle. Just go check out Baen's backlist. Of course, if you _do_ get something for free, it won't be archived for you forever. Which might be worth $2.39. Or $1.99. Or something, anyway.

Remarks on Disruptive Innovation

The standard form of disruptive innovation looks exactly like the Netbook revolution. There's a product (laptops). It works well. It has a lot of great features. People like it. But it's basically been sold (and resold) to everyone who can afford one. Then along comes someone making a crappier version of the same thing (smaller display, smaller keyboard, less memory, no optical drive, blah, blah, bleeping blah) that serves no obvious purpose. It promptly sells like gangbusters and nearly puts the old school makers out of business until they jump on board a trend they can't quite figure out. In the netbook case, it was about non-road-warriors who wanted to still have some connectivity when away from home. And about kids, whose parents wanted them to have a computer, but didn't want to cry when it inevitably took some kind of damage. Cheaper/worse both created a new market AND cannabilized important fractions of the old market in a disruptive way. The same thing has happened in the computer industry repeatedly. Somebody wrote a book about it a while ago, but it's been more than 5 years since I read it so the author and title completely escape me at the moment. [ETA: _The Innovator's Dilemma_, Clayton Christensen]

I think the kindle represents a brand new form of disruptive innovation. Normally, disruptive innovation is cheaper/worse and creates a bigger/new market while cannabilizing a fraction of an old market. What the kindle is doing is something very different. For most readers, it would be more expensive than just buying the books they want to read -- at least it would take a prohibitively long time to pay back the cost of the reader in the savings of buying ebooks over paper books, and anyone who buys used can probably make that payback time period eternal. You can argue whether it's better than a book, but let's go with the theory that for some books it is better (20 books you can hold in one hand) and for other books it is worse (anything with pictures, especially color pictures, and most things with tables and other graphics). Virtually everyone agrees that the market for the kindle is quite tiny compared to the market for ordinary books.

Now, Steven King is out there saying it's like chocolate and peanut butter. Which it might be -- two great tastes that taste great together. I don't know. I know I like chocolate and I like peanut butter and I love my kindle and I still buy paper books (occasionally, even ones available on the kindle, when I'm only going to read it once, and then want to donate it to the library).

The kindle market is a very, very tiny fraction of the universe of people who buy books in the course of a year. But the kindle market is a disproportionately large fraction of the universe of books sold in a year, because the tiny fraction of people who buy kindles buy a lot of books compared to the rest of the universe of book buyers. A similar phenomenon occurs with music, but not quite as strongly. Essentially, the kindle market is the market for most books sold -- but most book buyers are not the market for buying kindles.

You can call that a niche market and dismiss it. But that's dangerously stupid, and here's why. The _rest_ of the book market is the bestseller market. Most of the people who buy books in the course of a year will buy bestsellers -- but most of the books sold in the course of a year are not bestsellers. If the kindle successfully cherry-picks off the small number of people who buy most of the books, the paper-book industry will have the bestseller market left. Also, some seasonal books, art books -- stuff like that. And the bestseller market is a bad market to be in, because the predictable bestsellers are usually authors (like Steven King) who get a _lot_ of that huge amount of money for themselves (because they can, and they should, and more power to them). And the unpredictable bestsellers have a nasty habit of occurring as a result of chasing a lot of possibilities for medium amounts of money in hopes of one of them paying for all of the duds. Lest you think that a new kind of bestseller could arise (say, by hitting it big on the kindle and crossing over), you can bet that over time standard agency contracts will pull most of that added money out for the author and her agent, so the publishing houses will not gain big there, either.

People complain about the dedicated hardware of the kindle. What they really should be noticing is all that dedicated display hardware on the paper books. And how much it costs. And how, over time, all the content profit is going to migrate to the cheaper platform (hint: not paper). And publishers who focus on paper are going to make it on their margin producing ink-and-paper -- not on their ability to find great new voices and cultivate them into selling powerhousees.

Fear not, however -- there is still a role for the editor and all the other publishing paraphernalia (well, book signings are going to be tricky; maybe a kindle will be sold with a built in camera so a picture can be taken of the fan and author both smiling at it). The raw words still need to be massaged. Plots and characters still need help. Facts need to be checked. Etc. But this has got to stop being about display technology, or the book industry is going to die.

Finally, I've been running across forum threads in which people say they really want to pay less for the kindle; could it please be sold without whispernet for like $150? This makes me chuckle. I just signed up to buy v.2 for $359 (already owning v.1). And I never get to use whispernet.

Altho come to think of it, I bet I _will_ be able to use it when I move. Sweet.

a couple more remarks about disruptive innovation

It occurs to me that while Curves was the standard form of disruptive innovation for gyms, really nice treadmills/steppers/stepmills/rowers/etc. might be more like the kindle disruption of gyms.

Gyms (fitness health clubs, whatever) are potentially a great analogy, in that like books, they are used a lot by a tiny fraction of their membership. But gyms mostly make money on the people who buy memberships they don't use, so maybe not such a great analogy after all. Certainly, they display a related unevenness.

ETA: I guess where I'm going with this is that a niche market can work for or against a general market. If the niche market attracts all the people who cost the general producer a lot of money without a lot of return, the niche market is _great_ for the general producer. But if the niche market attracts all the people whose margin was funding the general market, which without them is an overall money loser, then the niche market can potentially wipe out the general producer.

And books display this problem in a self-similar way -- everything about books has the value concentrated in very limited areas, that historically you've only been able to get at by going after large swathes, but the added information introduced by the internet has really changed things. The used market, for example, first wiped out most bricks and mortar used book stores. Initially, it created a flowering of online stuff, which is now being winnowed heavily.

peer pressure, and products, or, I finally get a glimmer of why the anti-kindle commentary

Once upon a time, a few years ago, there was this small music device that wasn't an mp3 player. It was white. It had this weird wheel thing that was prone to breaking and instead of headphones, it had buds.

You know what I'm talking about. It has metastasized since then.

Around the time all my friends were buying one of these, I was planning my wedding, so I had a little free time on my hands (the kids came later, just like the rhyme says). I used some of that time to call my broker and say, buy me some AAPL, please. That decision at that time paid for a lot of free-spending in ensuing years.

Some of the discussion of the kindle revolves around it being the iPod of the book world and whether it is, and whether that's as important or whatever as being an actual iPod and blah blah bleeping blah. Apparently, AAPL fans think AMZN is overvalued and point at the P/E to prove it. Me, I just point to Apple, Inc.'s corporate history to prove that while AAPL has had a good few years, and has had amazing years in the past, those brief periods of brisk profit-making have been separated by the doldrums of expensive, unpopular ideas like the Apple Newton. I knew people who luuuuurved the Newton and carried it for years and years. But that sucker didn't sell worth shit.

AMZN, by contrast, while it has had trouble making an actual profit, has at least gone consistently in one direction: a bottom line that goes straight up. True, that can always change, but until it does, AMZN is going to have a bit of an edge on AAPL, especially when you compare the relative age and health of their charismatic leaders.

To return to the wheeled white thing that was so crazy popular (and apparently, as popular as it was, causing me to buy AAPL after having seen a _lot_ of my friends get wiped out when their AAPL dropped. On two separate occasions.), I had previously bought stock (which changed names repeatedly) in companies that made mp3 players (I want to say Sonic Blue, but please don't expect me to remember details like that). Stock which had not performed well at all. But it didn't particularly bother me to try again. The device itself however bugged the crap out of people who owned mp3 players. They didn't like the wheel. They really didn't like the proprietary aspects. Blah blah bleeping blah.

And so, I return to the kindle. I think there are an awful lot of people out there watching their friends, family and random strangers reading happily on their $359 device. Gadget people, who are used to being first on the block. They _were_ first on the block to read e-books, online, on a phone, on a PDA, on their laptop, heck, even on a Sony Reader that they bought because they got a bunch of free books with it to justify it. And either they don't really read that much in terms of books, so its more of a stunt than an addiction (my initial theory), or they didn't much care for the experience, or they _did_ care for the experience and so don't understand why everyone isn't doing it the way they like to do it.

And yet.

Not only are people dedicated enough to this device to buy it once. They'll get in line to buy it _again_ less than 2 years later for essentially the same price. And a lot of those people with the kindle are _not_ gadget people. Just like a lot of the early iPodders were not your typical early adopter.

I think this kind of bothers the gadget guys. Actually, I think it feels like a bunch of peer pressure. And not in a good way. Okay, I get it. I'll back down a bit.