Three kinds of e-book illegals: Felix Torres’ tutorial for NYT columnist Randall Stross and publishers

imageEditor’s note: Who’s downloading e-books illegally, and how much are publishers really losing? Is every illegal download in fact a missed sale?

Randall Stoss, author of a “Napsterization” piece in the New York Times, should check out the post below by Felix Torres, a TeleRead community member. It’s a slightly edited version of comments Felix wrote here earlier. Publishers, too, should read him. This tutorial happened accidentally, but that’s what it is, in effect, while the headline is mine.

image I personally am in favor of legal action against major pirates, which Stross presumably would want at the very least. But DRMing of “sold” titles---and other consumer-hostile atrocities, including delayed releases of e-books---will just turn law-abiding readers into piracy fans. Why didn’t Stross mention the heavy damage the publishers are inflicting on themselves? Wouldn’t saner distribution of e-books be more cost-effective than just a flood of lawsuits? And now here’s Felix’s post. Also see Chris Meadows’ analysis of the Stross column. – D.R.

By Felix Torres

imageWhen it comes to book “piracy,” it is pretty clear there are kinds of players.

Category One: Hoarders

Hoarders grab free stuff just because it is free. More often than not, they will never actually consume what they troll for.

Even if they read a fraction of what they “pirate,” they would never actually buy the stuff if it were legally available. Hoarders are a nuisance at most---the online equivalent of shoplifters.

Category Two: Explorers

Explorers frequent the “pirate” sites out of curiosity, to sample content/genres/authors they otherwise wouldn’t. Unlike the music business, there is no radio-equivalent for books and review sites are of limited use. These people would be buying content if they could find it. Blame the publishers who have abdicated their promotional duties to retailers and reviewers and have failed to use modern technology to help customers find their product, as if word-of-mouth and newspaper columns are the only way to promote their products.

If publishers actually delivered properly priced e-books and properly used Web sites and Web ads,, this entire category of “pirates” would vanish overnight. They are under-served customers.

Category Three: True Believers

True Believers are the dangerous ones. They are tech savvy enough and committed enough to actively scan-OCR-proof print books and then offer them up for others to download. Not a trivial undertaking. These are people who passionately believe in e-books as a technology and have a strong idea of what the market should be like and are dedicated to promoting e-books by making content readily available and are not about to let legalities or copyrights get in their way.

They are hydra-like and dangerous to both the print and e-book industries. If their ethics should become mainstreamed, the way the music industry allowed Napster to get mainstreamed around the turn of the millennium, things could get very nasty for everybody. This sub-culture has been around since forever and likely will endure even if all publishers were to miraculously be as “enlightened” as Baen (whose content is not actively “attacked”) or, at least Harlequin.

But as long as it remains a sub-culture, the True Believers’ activities will be of minimal impact.

The thing is, it is fairly easy for anybody to plug in to the e-book distribution channels. The quality of product is spotty but occasionally *better* than the legal ebooks and often there is no legal alternative. (Just as in the early days of digital music-hint!)

Best solution to the “piracy” problem

The best solution to the problem of book “piracy” is to offer a competitive legal product that offers a good balance of price and value, quality, and accessibility, with fully defined terms of purchase. Way too much effort is being expended on secondary issues like file formats and DRM when first-order issues like terms of purchase (what is the customer buying? a file? a creative work? reading rights? resale rights? conversion rights?) and accessibility (where to find ebooks? how to tell what is good and what isn’t?).

Not brain surgery

This isn’t brain surgery; there are at least three ways to go about creating economically viable e-book ecosystems. It is being done by Baen, Amazon, and to a lesser extent, Fictionwise (multi-format sales).

Others probably exist, but instead of facing the music (sic) and realizing their business model is broken, most publishers are petulantly declaring war on their biggest retailer and their customers instead of realizing that it is their retrograde publishing, marketing and pricing policies that make piracy viable at all.

Finally here’s some advice to Macmillan, which says 90 percent of its front list is pirated. Whining about piracy achieves nothing.

Related: New York Times columnist fears ‘napsterization’ of e-books, a post by Chris Meadows. Also see Cost of piracy vs. price of fighting it: The real Pirates of Penzance? and 90 percent of Macmillan front list pirated: So much for the ‘protection’ of DRM. In addition, publishers might catch up with an O’Reilly book, Impact of P2P and Free Distribution on Book Sales, by Brian O’Leary of Magellan Media Partners.

Images: Second is from Wikipedia and third is a Creative Commons-license photo from Gemtech.

16 Comments on Three kinds of e-book illegals: Felix Torres’ tutorial for NYT columnist Randall Stross and publishers

  1. I actually downloaded a pirated version of a technical book recently — simply because I wanted to know exactly what was in it. I was comparing various books on the topic; this particular book was unavailable at my local bookshop. The ebook version wouldn’t have been sufficient for me; I would have certainly bought a print version (print versions are better reference guides). But a 30 second glance at the ebook revealed that this particular book wasn’t what I was looking for at all. (Of course, maybe the publisher’s website should have provided better information about the book; it did have information like the Table of Contents, but it gave a misleading picture of what the book actually was about.

    I just wanted to mention that the single-minded obsession with piracy is something that bigger publishers have and writers of fiction do not. But bigger publishers are more adept at training major media to listen to their complaints.

  2. Based on my own experiences with Fictionwise, I guess that many of the potential customers outside North America are underserved because of geographic restrictions on ebook rights (combined with the notion that it’s the buyer’s location that determines the location of the sale).

    I would count those sales as lost to bureaucracy, not to piracy…

  3. I’d disagree that “hoarders” are as bad a problem as shoplifters. They are no problem at all. They cost publishers no money, not even in lost sales – they wouldn’t buy anyway.

  4. A slightly different spin on this great topic…I believe that a missing link to publishers’ strategy and understanding is due to a lack of a personal relationship in knowing and serving the needs and interests of the consumer.

    Yes, it frustrates readers when they cannot find a digital edition of the book they want- right now. Yes, people do things they wouldn’t normally do when the publisher holds back releasing the e-book, upon the publication date. Yes, consumers get angry if they believe that the price is unfair. Let’s treat the consumer as a valued, trusted, and important essential in our business model.

    It is more important to serve the masses…not drive the business model based on the illegals. Who has the majority of the influence? Not those steeling content. Let’s keep our eye on the prize.

  5. Actually “whining about piracy” tells potential customers that there’s something so horrid about buying from you that former customers avoid your shop. If your complaint also features DRM then at least you’re telling potential customers why it’s better to get the pirate edition. The disincentives to buy can be something as simple as Fictionwise not being allowed to sell to non-US customers or the Sony store plus software being unusably awful.

  6. As ferrider suggests

    Category Four

    The underserved – where the publisher refuses to sell the book at all, or refuses to sell to people because of where they live. These people will easily become Category Two and Three. e.g. if you won’t sell me the book, I can’t give you money, why shouldn’t I download it, given it makes zero economic difference?

  7. When ebooks are reasonably priced and transferable between devices piracy will no longer be a problem.

  8. @ferrider @moz @Blue Tyson and anyone else who’s biggest ebook complaint is about territorial restrictions: this is not the publisher’s fault. The publisher does not have the legal right to sell you their edition outside of the country of origin, in most cases because the author did not sell them those rights. These complaints should be directed to the publishers and retailers in the country where you live, who do have the right to sell you the books you want and are apparently not satisfying that demand. US publishers shouldn’t be vilified simply because they’re based in the country that has the most developed ebook retail market, and customers living in other countries want access to their products. DRM, accessibility, and general slowness to get with the market are other questions and completely valid bases for complaint. But the territorial rights system we have now is based on legal copyright, i.e. the system of laws in place in every country to protect the rights of *authors*. The way it has evolved also protects the interests of publishers and bookstores in other countries, who have the exclusive right in most cases to sell books in their own territory. If you want this to change, take your complaints to them.

  9. @Emily: The problem is not so much with the publishers or with the system of territorial rights. The problem is with the interpretation of a digital sale happening where the buyer’s money happens to be, as opposed to sales of physical media, that occur where the seller is located.

    For instance, I can buy paper books and CDs just fine at Amazon.com, even if they are published with only North America rights, but I can’t buy mp3s on amazon.com, nor ebooks on Fictionwise.

  10. I guess I’m not sure I agree that these categories are inclusive. How about cheapskates? People who would pirate if it were easy and convenient, but would pay if they had to go to any particular trouble to avoid payments. I’d suggest that this is a substantial category.

    I know hoarders were a significant category in the early days of the net but I wonder if they really are today. Most of the web users I talk to think of the web as a source of information that will always be there. The hoarder mentality was common when the web was new and when we had the idea that all of these wonderful things might vanish.

    I agree that regional rights are a holdover from earlier times, but suspect that today’s economic climate is not really ready to break out into a free-trade mood.

    Rob Preece
    Publisher

  11. Garson O'Toole // October 5, 2009 at 6:40 pm //

    Perhaps the best way to learn about piracy is by gathering concrete data while trying to avoid law-breaking. I went to a top pirate bittorrent site and looked for ebook torrents. There was a massive high-profile torrent that I think gives insight into the future of piracy.

    The torrent was broken into three pieces and the combined size was 7 GB (gigabytes). The description claimed that the three torrents together contained fifteen thousand works of science fiction and fantasy. The torrents included files that listed the titles available, and so I decided to download these descriptive files only. The genre coverage was wide and deep, but many of the items were short stories and not full novels.

    I used the term “massive” above when describing the torrent, but it is not large compared to other pirate files. A double-layer DVD can contain 8.5 GB and DVD rips of movies are commonplace. Blu-Ray rips are even larger since the dual-layer format holds 50 GB. Storing 7GB is inexpensive nowadays. The data can be burned on two single-layer DVDs or one dual layer.

    Hoarder, explorer, true believer, underserved, or cheapskate: What category fits? I think that the creator-aggregator of the triple-torrent is probably a “true believer”. The downloader might be a “hoarder” but as technology progresses I think that this category breaks down. With a fast high-bandwidth connection a pirate would be tempted to grab the whole torrent collection even if he or she only wants a few ebooks. Why not? It is no more exertion than the effort to grab a DVD-quality movie or two. Ebooks are small compared to many other file types, e.g., movies, games, or OS software.

    Any full analysis of piracy should try to take into account the upcoming changes that can be extrapolated. The cost of communication keeps dropping, the cost of computer storage keeps plummeting, and the cost of hosting files on the internet keeps falling. The belief in rigid copyright is weakening in younger generations.

  12. Emily,

    The publisher signs the contract, do they not? Ergo, they are responsible. If it is the author’s recalcitrance – then they are perfectly free to say so to the public – or refuse to publish.

    Some publishers are able to manage worldwide non-exclusives, the hopelessness of others is completely on them.

    US publishers – being the biggest market, will have the most power, too, and can take advantage. You want a US contract? Then worldwide non-exclusive ebook distribution or get lost.

    Now for Stephen King you might do whatever he wants, but for the run of the mill author, why?

    The authors refusing to do so would lose more than they do now.

    Those splitting up ebook rights so only sold in one territory are of course all losing sales right now. This rate of losses will of course accelerate.

  13. Frode Aleksandersen // October 5, 2009 at 10:49 pm //

    Garson, I’ll actually readily admit that that torrent (and a couple of similar ones) is actually the primary reason I got a PRS-505 earlier this year while visiting the US. I’m a big SF/Fantasy fan and currently have a couple of thousand paper books. My bookshelves are completely full and I’ve had to resort to stacking them on the floor in order for them to fit.

    My goal with the 505 was to replace most of my paper library, which means digitizing it, before I throw most of it in the trash. Amazon has less than a 1000 titles in the genre and doesn’t sell to Norway in the first place, so they’re out as an alternative. Sony’s worse. The legit alternatives were out in other words. Now I could scan and proofread all my books on my own, but the pirates have already done that for me – why bother?

    I am in effect a hoarder, but it’s because there’s 1. no legit alternative that doesn’t involve an enormous amount of work on my part, 2. easy availability, and 3. not having to spend thousands of dollars to replace titles I’ve already paid for once.

    As a side benefit of organizing these files, I’ve actually rediscovered some of my favorite authors – not only by re-reading them, but also because the batch torrents contain books I wasn’t aware of. It’s also made it far easier for me to discover new authors, since I can ask friends for recommendations and then immediately check out their suggestions (provided I have the book in my e-library). It’s made it far more likely that I’ll buy future titles from them, provided they can actually provide me that content. I’ve thus become an explorer as well.

    A properly setup e-book store could also benefit from having a similar service – have friend recommendations or a scrobbler/pandora like system for figuring out what you like – and then provide sample chapters or even sample books from those recommendations, like Baen does with some of their Free Library titles. Downloading gave me that option – the publishers currently don’t and are in serious need of need of catching up.

    What I don’t see them ever solving is people’s need to replace their existing libraries – there’s just too many books out there, a lot of them out of print and/or not having enough sales to justify the cost of digitizing them. Even when digitized the costs of replacing them would remain too high.

  14. Further to the comments about geographical restrictions, consider this absurdity.

    eBooks.com has an office in Perth, Western Australia and an ABN (Australian Business Number) but will not sell ebooks to me because I am in Australia. That’s right, an Australian(?) company located in Australia will not sell books to Australians because they are in Australia, but will still send emails inviting Australians to buy books from them which they cannot purchase.

    As a result, I have raised a complaint with the Office of Fair Trading. Let’s see if anything happens …

  15. Greg,

    That’s an interesting one. Let us know what happens!

  16. Garson O'Toole // October 6, 2009 at 2:19 pm //

    Many thanks to Frode for an illuminating response. Technological advances are changing the nature of ebook piracy and piracy in general. A torrent with fifteen thousand titles should be a clarion call, but few are awakened and even fewer listen and understand.

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