Should Publishers Abolish DRM and Trust Customers Instead?

My new column at Huffington Post suggests publishers should abolish DRM and trust their customers to do the right thing.

Most ebook customers don't know what DRM is. Many authors and small publishers don't understand it either. Yet if you're a reader, author or publisher, it's probably a good idea to roll up your sleeves and think about how DRM might impact you in the future.

All Smashwords books are published DRM-free. This means we don't apply copy-protection schemes that would prevent, for example, a customer from reading their ebook on any of the multiple ebook reading devices they may own today or in the future (e-readers, computer, cell phone, etc.).

Some of our retail partners apply DRM to our books in their own stores, and we're fine with this. It's up to the customer to decide if they care about DRM or not.

At Smashwords, we're strongly anti-piracy, though unlike publishers who infect their books with DRM, we instead work with our authors and publishers to help them educate customers to do the right thing. We think most customers are honest and honorable, and they understand the value of supporting the author or publisher who created the book for their enjoyment.

In the Smashwords Style Guide, we encourage our authors and publishers to add the following license statement to their books, which acts as a gentle reminder:

This ebook is licensed for your personal enjoyment only. This ebook may not be re-sold or given away to other people. If you would like to share this book with another person, please purchase an additional copy for each person you share it with. If you’re reading this book and did not purchase it, or it was not purchased for your use only, then you should return to Smashwords.com and purchase your own copy. Thank you for respecting the hard work of this author.

The license statement also acts as a trojan horse. Should the book fall into the hands of readers who didn't pay for it, the license statement provides the honest reader a chance to make good on their obligation to support the author or publisher.

Obscurity is a bigger risk to authors than piracy. And while I'd never say piracy is a good thing, I've seen some folks argue it can actually provide indirect benefits to the creator. The idea isn't as outlandish as you might think. Imagine if somehow my novel was pirated, and fell into the hands of one million readers. What if the gentle reminder above prompted one percent of them to purchase the book? That's 10,000 paid customers.

In the column at HuffPo, I have a real world example of how one forward-looking software company (and folks, ebooks are software!) leveraged piracy in their early years - even encouraged it - and now they sell billions of dollars in software per year. There are many lessons to be learned by authors and publishers willing to experiment.

The column at HuffPo is actually a re-write of a previous column that first appeared here on the Smashwords blog. In that column, I tried to rationalize what I viewed as dichotomous thinking on the part of mainstream publishers. They sell books in print, and those books are shared, resold, resold again, again and again, and at each step the publisher receives nothing. If that book was an ebook, the publisher would call it piracy.

The same previous column was also republished over at Teleread. One commenter there called it, "marvelously imperfect," which is the highest praise I've ever received on a blog post. To me, the best blog posts provoke thought and serve as conversation-starters, not the last word.

What do you think is the last word (or the next word) on the DRM debate? Comment here, or click here to join the discussion at HuffPo.

Do Authors Still Need Publishers?

In my new post today over at Huffington Post, I ask the question, "Does Stephen King still need a publisher?"

I think the answer is no.

Once an author develops the platform and fanbase of a Stephen King, Dan Brown or J.K. Rowling, why not self-publish? They can hire their own team of editors, designers, marketers and sales force, partner with a couple big distributors, and sell their books for less yet still make 2-3X the profit.

If publishers are going to remain relevant, they need to do what Stephen King can do for himself, only better.

The HuffPo post is an updated derivative of one I originally wrote here back in April, in which I speculated the risk of publishing would shift to the author. Given the changes we've seen in the industry since April, I'm more convinced than ever that author will continue to shoulder a larger share of the risk of publishing, and this will lead to a dramatic transformation of the publisher-author power balance in favor of authors.

For most of the last couple centuries, if you wanted your book published, you had to work with a publisher, because they controlled not only the printing press but the means of distribution as well.

Over at the Huffington Post story, a great discussion is already taking place in the comments. MJ Rose, well known as an early ebook advocate, a self publisher, and now a mainstream commercial author, argues that publishers remain relevant because they control access to brick and mortar retailers. I don't disagree. Publishers still control access to physical shelves.

Looking ahead, especially as ebooks rise from a likely 5 percent market share in 2009 to 30 or 50 percent within the next five years, publishers will be hard pressed to maintain the same relevance.

If in five years half or more of the market has gone digital, then that's half the market any author can distribute to without the need of a traditional publisher. Smashwords already has agreements in place to distribute books to several major online retailers as well as the top mobile apps, and within the next couple years we'll have all the major retailers covered.

How do you think the role of publisher will change over the next few years? Do authors still need publishers? Comment here, or join the discussion over at HuffPo.

OCTOBER 18 UPDATE: The column at HuffPo has sparked some interesting debate and discussion, at HuffPo, on Twitter and in the blogosphere. Some Twitterers, apparently concerned I was questioning the value of publishers (I love publishers BTW!), created a special Twitter hashtag of #publishersmatter and a spirited debate ensued (click the link to view the thread). Kate Eltham, a writer out of Brisbane, Australia, and the CEO of the Queensland Writer's Centre, contributed to the discussion with an intelligent response on her blog, Alphabet Soup.

Stephen King photo credit: http://www.flickr.com/photos/pinguino/ / CC BY 2.0

Time for the $4.00 ebook?

The Huffington Post launched a new books section today, and I'm one of their new bloggers. For my debut column, I challenge publishers to offer $4.00 ebooks.

No, I'm not suggesting we destroy the livelihoods of publishers and authors. Instead, I want to help save publishing from its slow downhill march to irrelevance as more and more readers abandon books in favor of lower cost forms of information and entertainment.

Books today are too expensive for the vast majority of the world's literate consumers. Imagine how much smaller the book market would be today if books were only offered in hard cover? We need lower cost formats, now.

I don't argue that all books should be priced at $4.00. The new price point would be for ebooks only, and only for a subsection of a publisher's catalog. For example, wouldn't it make sense to resurrect a publisher's out of print backlist via $4.00 ebooks?

While I'm sure some people will think I'm smoking opium to suggest such a low price point, my proposal isn't really that outrageous. Book prices are already dropping, and authors are helping to drive the drop. At Smashwords, we already have hundreds of authors who set the price of their books at zero. Don't quote me on this, but the last time I checked, about 20 percent percent of our titles were priced at free yet they accounted for over 80 percent of our downloads.

Authors and publishers should consider creating new lower cost formats for their books, just as trade paperbacks and mass market paperbacks are lower cost alternatives to the old hard cover book.

Since ebooks cost so little to produce, print and distribute, the format is ideally suited to the $4.00 book. For authors who sell a $4.00 book at Smashwords, they still net $3.05, or about eight times more than the average 5 percent royalty on a mass market paperback.

If we don't offer the consumer what they want, publishing is in for a world of hurt. The challenge is to learn how to balance what the consumer wants against the rights of authors, publishers and booksellers who deserve fair compensation for bringing us these books.

Read the column at Huffington Post.