Scott Waxman - literary agent, head of the Waxman Literary Agency, and now co-founder of eBook publisher Diversion Books – has witnessed a lot of changes since he started in publishing as an editor back in 1990, enough to know that not all of the shifts the industry has undergone in recent years can be pinned on the digital revolution.

“When I was at HarperCollins,” he remembers, ”we had an enormous number of editors, and it was just a huge number of books that was being published. Now the publishers are a lot more specific and focused and each book really counts. You’ve seen, especially the last few years, a sharpening of the editorial approach for each house and also a slimming down of the list.”

This is the kind of downsizing that can be difficult to navigate even for those watching from outside of the publishing houses, but Waxman is not one to get bogged down in trepidation. “It’s healthy and necessary. It’s painful for a lot of editors who have lost their jobs, and for agents who are having a hard time selling books, but I think it’s a natural progression.”

Slimmer lists and fewer editors has made the marketplace for submissions more competitive and agents have been forced to adapt as well. “The agents’ role has become much more hands-on,” says Waxman. “The agents have to take a very strong editorial hand in the shaping of proposals and making sure that what they submit is top quality.”

This is not a reflection on the editors’ craft, just the reality of a world where only the strongest submissions make it through the acquisitions process. Waxman elaborates: ”Editors edit as much as they ever did, but editors are not going to be interested in a submission if it’s not in excellent shape, because it will raise too many questions about the project for them to take a chance on it. If they can’t put a proposal in front of a supervisor with good comp books and with strong Bookscan numbers, then it’s very tough to make the case. They have to be sure that what they acquire has a really good chance of being successful, rather than just falling in love with that particular project for what it is.”

“That is a big difference” from the boom days when Waxman was an editor. In response, he draws on his past life: “I scrutinize every project I take on like an acquisitions editor. If I don’t think it’s going to sell copies I don’t take it on. I think the best thing an agent can do now is to be selective in what they submit, be very specific in a category that they can be an expert in, and then be savvy about the digital side so that they don’t miss what’s going on around them.”

Digital Diversion

Waxman was an early mover in the digital space with his 1999 start-up LiveREADS, which produced enhanced eBooks. Now that an actual eBook market has grown up, he didn’t hesitate to stake out a space for himself again, this time with Diversion Books, a straight eBook publisher.

“My personality is entrepreneurial and I see an opportunity for growth,” Waxman states simply. “I’m excited by the creative aspects of it as well, in terms of the kinds of books that we can do, reinventing what a book can be in terms of length and focus. And timing, doing books faster and shorter. Bringing back anthologies for authors in a way that can be monetized. It presents a lot of interesting opportunities for an author that I wanted to investigate. I don’t know where the business is going to end up going, exactly, but it’s certainly fun to be involved in it.”

Not everyone in the publishing sandbox is having so much fun at the moment. With the announcement of agent Andrew Wylie’s e-publishing start-up, Odyssey Editions, a small brouhaha erupted, and among the accusations leveled at Wylie was that a conflict of interest exists for any agent who gets into publishing, digital or otherwise. Waxman set up Diversion apart from his agency precisely to avoid this conflict.

“Diversion is a totally separate company, with different personnel, and Waxman Agency is not a shareholder,” he notes. “I’m a co-founder, but I’m certainly not running it. We’ve brought in someone to drive the business, her name is Jennifer Segal, who’s going to be the one spearheading the initiatives going forward.” 

As for the agency’s authors, Waxman says he’s heard nothing but positive responses, and a few of them have already chosen to publish eBooks with Diversion (which operates on a profit-sharing model): ”Any author who has a project they think would fit, we’re happy to talk about it, but we’re not soliciting it.”

Diversion is also unlike Odyssey in that it publishes almost all original titles rather than backlist books where the digital rights might be in contention with the publisher. “We’re not carving out any e-rights for this,” says Waxman. “A bunch of our authors have [worked with Diversion] for books that don’t fit with the big houses or books where they have the rights back.” And of course Waxman is not focusing only on his authors, he’s been in talks with other agencies as well, feeling out potential partnerships. 

No Magic Formula

It’s all potential in these early days for Diversion, which has only had books out for about two months. Waxman, a veteran in his second go-around at e-publishing, is not discouraged by the company’s so far modest beginnings. “I can tell you that most of the originals do not make a lot of money yet,” he admits.

And there have been a few speed bumps. “The production side has been a lot more time-consuming than we thought it would be. To get a book edited, formatted, and distributed everywhere has been extremely time-consuming and expensive, and it’s not an easy thing to do. But I think that with the right approach and the right books, it’s going to get there. You need to have a concerted effort on a book to sell it. There is no magic formula for selling books as eBooks.”

How long will it take for Diversion to come into its own? “I would hope within a year,” says Waxman, ”but it really depends on what kind of content we’re able to get and what we’re willing to spend, whether or not we want to go out and raise capital. The agency is very organic, you build it with the authors you have. Something like Diversion could probably get bigger faster if we want it to, so we’re exploring all those options right now. I want it to grow, I want it to be viable, I want it to be a great destination for authors.”

The Balance Between Old and New  

Like many publishing businesses trying to navigate the digital transition, the trickiest part for Waxman has turned out not to be the technical know-how. “The hardest part is balancing my time and knowing where to put my energy,” he explains. “Because on the one hand you need to sell books to make a living, but at the same time you want to make sure you are prepared for the future. And the future, in terms of digital publishing, is not profitable in a lot of cases yet. Realistically, you have to stick with the old media until the new media really takes root, in a financial way that makes sense.” 

Looking ahead, Waxman sees more change, more tough road, but also light on the horizon.

“The electronic disruption is going to be significant. There are a lot of things ahead of us that we just don’t know what they are yet, all you can do is try to hold on, ride the bronco.” But at the end it comes down to that steady gleam of optimism.

“The enthusiasm is still there for good books, that’s always the main currency in publishing,” says Waxman. “The enthusiasm is there for the potential that eBooks present to get new readers, and try new ways to present information. The question is going to come down to economics. I think it will change, I think it will be disruptive, but I think a lot of the big publishers are going to figure this out. I hope they will.”

Scott Waxman founded the Waxman Literary Agency in 1997, a mid-sized agency with a roster of more than 200 authors, including many national bestsellers in a variety of fiction and non-fiction categories. Always looking for new ways forward in the world of books, Waxman launched Diversion Books, a publisher of eBook originals that connects authors with the freedoms of digital publishing, earlier this year.

Emily Williams is co-chair of the BISG Rights Subcommittee and a former literary scout who currently works as an independent publishing consultant.

Toward the end of the management class I teach at NYU’s M.S. in publishing program, we cover three cases, including one on Harlequin at the time it is considering a launch of Mira, a trade imprint.

To that point, Harlequin had been known for series romance fiction, much of it sold directly to consumers. There is ample evidence in the case that the market is changing to favor single-title romances and named authors, and Harlequin assembles a task force to consider its options.

Ramping up single-copy sales is complicated by many factors, including a multi-year trade distribution deal that Harlequin had made with Simon & Schuster as part of an agreement that settled a “romance war” between the two firms. At the time the case is written, S&S is one of the dominant publishers of single-title romance novels.

I teach the case to draw together structural lessons taught throughout the semester. It’s a good opportunity to apply Michael Porter’s “five forces” framework. It’s also a preview of 2010’s interdependent publishing world.

Generally, students recognize the significant differences between a direct and a trade model, but very few discuss the sales and margin impact of a long-term agreement with a distributor whose interests diverge from Harlequin’s. I give them a break: they are students, at NYU to learn, and supply-chain analysis is hard.

They are also playing with Monopoly money: no harm, no foul.

Flash forward to 2010: Amazon is busy making the entire book business a “direct-to-consumer” model. This isn’t new; they have been doing it for 15 years. By most accounts, the company is now the largest retailer of physical books and the dominant player in the digital space.

What are Amazon’s priorities? It doesn’t hide them. In 2007, Amazon founder and CEO Jeff Bezos described a company that is “congenitally customer-focused” whose enduring priorities are selection, low prices and fast delivery.

Compare those priorities to the ones in place at most publishing houses. It’s easy to see where interests start to diverge. And if you apply Porter’s framework to Amazon, you quickly see why the company has become publishing’s best-known and most significant frenemy.

A direct customer focus has paid off for Amazon. Customers describe buying books from Amazon in ways that they seldom do when talking about bricks-and-mortar stores. And like it or not, the sense that books should and can cost less is now ingrained in our consciousness.

The recent controversy involving an agent selling exclusive eBook rights to Amazon (you know the one) has focused largely on royalty rates, the role of agents and the exclusive nature of the deal. I think that debate misses the point.

The publishing supply chain has shifted. The interests of the company best positioned to benefit from those changes are not aligned with those of most publishers today.

Publishers can defend, change or co-opt, but they can’t stand still. Issue all the press releases you want, but realize this isn’t about eBook royalty rates. It’s about Amazon.

This post was originally published by Magellan Media and has been reprinted with Mr. O’Leary’s permission.

Brian O’Leary is founder and principal of Magellan Media, whose clients include major media firms as well as smaller and not-for-profit entities with significant publishing and media commitments.

I’ve lost track of the number of articles, online and off, that try to decide if eReader X or eBook reading app Y will be the “Kindle Killer.”

Meanwhile, it seems to me that Amazon just keeps pushing the eBook envelope and selling more eBooks through its Kindle Store. Including to people who don’t even own a Kindle, thanks to their many Kindle apps — for the PC, Mac, iPad, iPhone, Blackberry, Android, etc.

This past week, Amazon announced that, over the past three months, sales of Kindle books outsold sales of hardcover books. Everybody’s trying to dissect that information to figure out what it really means.

The Wall Street Journal posted a short online article that begins:

Now we know why Amazon.com Inc. announced a few days ago that sales of e-books now exceed sales of print volumes. The e-tailer didn’t want the news to be overshadowed by its earnings miss.

Of course, the WSJ misstated the Amazon announcement, which dealt only with hardcover not all “print volumes.” It would be interesting to know how many trade and mass market paperbacks were sold in comparison during that same period.

The Amazon Advantage

I currently have five eBook apps on my iPad — Apple’s own iBooks, Amazon’s Kindle for iPad, B&N’s reader, Kobo’s reader, and the Ibis Reader.

Which one do I prefer? Usually, the Kindle app.

Why? Because the selection is so much better in the Amazon Kindle Store, and I see little real reading difference among those five reading apps. The iBooks interface is nice but much of it is little more than bells and whistles that are cool…but only for a while. The B&N and Kobo readers are OK but not a major improvement over anything else.

Any well-formed Kindle book will look great on the Kindle for iPad app. And if you want to find a new book to preview or buy, you’re far more likely to find it via the Amazon Kindle Store than any of the other outlets.

The other eReader apps all support ePub, which does allow more latitude in design and layout than Kindle’s rather limited MOBI format. Of course, Amazon has already begun expanding the capabilities of that format (such as allowing video and audio and accepting higher resolution images), and I see no reason to assume they do not have many more possibilities lurking just around the next eCorner.

Kindle vs. iPad

The iPad is great for reading eBooks and works just as well for Kindle books as for any of the ePub possibilities.

So, does that make the iPad a Kindle killer? Depends on what exactly you mean.

Will it seriously cut into sales of the Kindle devices? Maybe…unless Amazon continues to improve that device’s capabilities and continues to release new, more capable devices (maybe even color eInk displays).

Will the iPad result in fewer eBooks being sold by Amazon? I sincerely doubt it.

Amazon has such a head start with its digital catalog, sales platform, and brand loyalty that I’d be surprised if Apple can overtake them. Oh sure, iPad sales will almost certainly continue to accelerate and saturate the tablet computer market (with some much-needed improvements, I hope), but the iPad is really only peripherally an eBook reader.

I expect Amazon to continue dominating the eBook market by selling them for any device that crops up. Maybe even in ePub format eventually (after all, you can now read PDF documents on your Kindle 2/DX and pan and zoom them).

I think it is more likely that Amazon’s own apps will do more to reduce Kindle device sales than anything any other company comes up with. But, at the same time, sales of Kindle books will continue to increase.

And then there is the upcoming (I hate to have to type this) Google Editions. I only hope that does not prove to be the future of ePublishing, as that would greatly sadden me.

What do you think?

This post was originally published at View From the Publishing Trenches and has been reprinted with Mr. Shiel’s permission.

Walt Shiel is Publisher, Slipdown Mountain Publications LLC, and Managing Partner, Five Rainbows Services for Authors & Publishers. He is also an author, and commentator on books, publishing, authors, words, marketing, reading, relevant technology, etc.

By Richard Curtis, President of Richard Curtis Associates, Inc.; founder of E-Reads

Revolutions produce unlikely heroes, and the Digital Revolution has produced a very unlikely one in the form of a man that many believe is so wanting in ethical principles that he is nicknamed The Jackal. Yet it is on literary agent Andrew Wylie’s fangs and claws that the populist dream of a fair e-book royalty rests as he dares the world’s highest profile trade book publisher to do something about the slap he has administered to its face.

The smart money is on The Jackal, and to understand why you have to think like a jackal. While pundits debate contract law and publishing ethics, the real war is being conducted on a less visible battlefield. But it is one on which Wylie holds the high ground.

To understand Random House’s reluctance to protect its rights from Wylie and other marauders you need to understand a number of not so obvious factors. The most salient of them is this: Publishers are loath to sue authors (or the widows and children of authors).

Let’s see how these factors play out in the power struggle unfolding before our eyes.

Random House not confident of its legal position

In 2001 Random House sued Rosetta, an e-book startup that acquired directly from authors the digital rights to books by such Random House lions as Kurt Vonnegut Jr., Robert B. Parker and William Styron, books that were still in print in paper format under Random House imprints. Random had published them before there was such a thing as e-books, but nevertheless considered a book is a book is a book whether in tangible or digital form. The courts however rejected Random’s position, denying their request for an injunction against Rosetta. Random filed an appeal and the court turned it down. A second appeal was rejected too, forcing Random to work out a settlement with Rosetta.

The critical issue – what is a book? – remained unlitigated and left Random uncertain about its legal position.

Random Backs off from Open Road Threat

When publishing superstar Jane Friedman launched her Open Road e-book venture she declared her intention to start with several works by Styron including Sophie’s Choice and the Pulitzer Prize-winning Confessions of Nat Turner. The problem was, Random House claimed it owned those rights (presumably having recovered them from Rosetta as part of the settlement) and it issued a stern warning to all “third parties” without naming Friedman specifically. Authors, stated CEO Marcus Dohle, are “precluded from granting publishing rights to third parties that would compromise the rights for which Random House has bargained.” By drawing a line in the sand, Random expected Friedman and other potential interlopers to back off or face the full wrath of the publisher’s litigators. (see Random House Serves Notice on Would-Be E-Interlopers)

It is a fundamental business principle that you don’t make threats you aren’t prepared to act on. And that is why we were flabbergasted four months later to learn that Random House had released e-rights to the Styron estate (See Random Returns Sabre to Scabbard in Styron E-Book Standoff).

What was that about?

“The decision of the Styron estate is an exception,” Random executive Stuart Applebaum explained. “Our understanding is that this is a unique family situation.”

Why, after rattling its saber so truculently, did Random give in? In our estimation it’s because ultimately, to make good on their threat, they would have had to sue Styron’s widow and children. And that would be a public relations disaster.

Whether Styron was truly an exception or Random blinked, one thing was clear to publishing professionals: sooner or later there would be further tests of the publisher’s determination. How would Random react the next time?

We’re about to find out.

Don’t Bother Suing Agents

Claiming that he hates the low e-book royalties paid by traditional publishers (see Random House Changes E-Book Royalty Policy), agent Wylie, representing hundreds of distinguished authors such as Salman Rushdie, Martin Amis and the late John Updike, announced that he is starting his own e-book publishing venture and intends to launch it with books published by Random House and other trade book publishers.

"We will take our 700 clients, see what rights are not allocated to publishers, and establish a company on their behalf to license those e-book rights directly to someone like Google, Amazon.com, or Apple." - Fifteen Percent of Immortality, Harvard Magazine

Does he have the right to do that? Wylie says he does: “The fact remains that backlist digital rights were not conveyed to publishers, and so there’s an opportunity to do something with those rights,” he declares.

Despite what happened with Open Road, some industry observers expected Random House to threaten to sue Wylie’s ass into pebble-sized pieces. But Wylie knows they won’t, because, generally speaking, agents are not legally liable for breaches of contract committed by their clients. A lawsuit against Wylie would in all likelihood be thrown out of court, and the judge would tell Random that if they have a beef it’s with Wylie’s authors, they’ll have to sue Wylie’s authors.

Which brings us back to our thesis: Publishers are loath to sue authors (or the widows and children of authors).

So? How does Random intend to punish Wylie? “Regrettably,” Applebaum declared, “Random House on a worldwide basis will not be entering into any new English-language business agreements with the Wylie Agency until this situation is resolved.”

This is known as the We’ll Cut Off Our Nose to Spite Your Face ploy, and it will avail Random nothing. Wylie’s clients are so coveted by Random’s rivals that if Random made good on its threat you’d see the greatest migration since the Aleuts crossed the Bering Land Bridge. Jackals are standing by!

Buyer? Seller?

Though legal threats won’t faze Andrew Wylie, handling the challenge of being both an agent and an e-book publisher might. A number of knowledgeable people like Macmillan’s John Sargent have not only deplored Wylie’s decision to put all his authors’ eggs in Amazon’s basket but have questioned whether it’s in the best interests of his authors. There is arguably more money to be made selling not just to Amazon but to Sony, Barnes & Noble, Apple, Kobo, and other retailers.

Navigating the shoals of conflict of interest between buyer and seller is another daunting task. Even if he is able to build a “Chinese wall” insulating the two functions from short-circuiting each other, Wylie’s own clients will reasonably want to know how it’s going to work: “If my agent is now my publisher, who am I supposed hire to negotiate with him?”

Will Wylie’s stratagem succeed in forcing publishers to raise their royalty rate? Not a chance. E-book royalties will eventually go up, but it will be no thanks to Crusader Wylie. But we thank him for articulating the dissatisfaction of authors and agents with low royalty rates and for so fearlessly acting on his convictions.

This post was originally published at E-Reads.com and has been reprinted with Mr. Curtis’ permission.

Richard Curtis, president of Richard Curtis Associates, Inc., is a leading New York literary agent; founder of E-Reads, an electronic book publisher; and a well-known author advocate. He is also the author of numerous works of fiction and nonfiction including several books about the publishing industry and is a former president of the Association of Authors’ Representatives.

Amazon.com customers now purchase more Kindle books than hardcover books–astonishing when you consider that we’ve been selling hardcover books for 15 years, and Kindle books for 33 months.”

Jeff Bezos, CEO, Amazon.com

Depending on where you get your news, and how far beyond the tweets and catchy headlines you tend to read, yesterday’s well-timed press release from Amazon (they release their 2Q report on Thursday) either came as a shocker (TIPPING POINT!) or an interesting soft data point in need of further clarification.

Amazon Says

“We’ve reached a tipping point with the new price of Kindle–the growth rate of Kindle device unit sales has tripled since we lowered the price from $259 to $189,” said Jeff Bezos, Founder and CEO of Amazon.com. “In addition, even while our hardcover sales continue to grow, the Kindle format has now overtaken the hardcover format. Amazon.com customers now purchase more Kindle books than hardcover books–astonishing when you consider that we’ve been selling hardcover books for 15 years, and Kindle books for 33 months.”

Recent milestones for Kindle books include:

• Over the past three months, for every 100 hardcover books Amazon.com has sold, it has sold 143 Kindle books. Over the past month, for every 100 hardcover books Amazon.com has sold, it has sold 180 Kindle books. This is across Amazon.com’s entire U.S. book business and includes sales of hardcover books where there is no Kindle edition. Free Kindle books are excluded and if included would make the number even higher.
• Amazon sold more than 3x as many Kindle books in the first half of 2010 as in the first half of 2009.
• The Association of American Publishers’ latest data reports that e-book sales grew 163 percent in the month of May and 207 percent year-to-date through May. Kindle book sales in May and year-to-date through May exceeded those growth rates.
• On July 6, Hachette announced that James Patterson had sold 1.14 million e-books to date. Of those, 867,881 were Kindle books.
• Five authors–Charlaine Harris, Stieg Larsson, Stephenie Meyer, James Patterson, and Nora Roberts–have each sold more than 500,000 Kindle books.

Reading Beyond the Headlines

Publishers Lunch attempts to put the numbers in context:

• Amazon Inches Closer to Releasing Kindle Stats That Actually Mean Something: So let’s start with the data: jumping on last week’s announcement that James Patterson had sold 1.14 million e-books to date worldwide, Amazon says Kindle books account for 867,881 of those sales. (Of course, with print sales totalling more than 205 million copies, that Kindle figure accounts for roughly 0.4% of overall sales.) By the same token, four other blockbuster authors – Nora Roberts, Stieg Larsson, Charlaine Harris, and  Stephenie Meyer – have also sold more than half a million copies each of Kindle books, which is still a blip compared to print sales but clearly significant enough, especially compared to this time last year, as Amazon reports a tripling of Kindle book sales from 12 months ago.

At Daily Finance, Sarah Weinman adds further perspective:

• E-book Sales Surpass Hardcovers at Amazon: The caveat? Each of these authors sell tens to hundreds of millions of print books around the world, so total e-book sales don’t even approach 1% of print sales, and Amazon won’t break down e-sales by specific title. Consider, too, that 630,000 books in the Kindle Store is but a fraction of the millions of copies of print books Amazon offers for sale. It’s clear e-book market share continues to climb, but the medium still has a long way to go to catch print — even for the company with the most dominant digital share of all. Still, today’s news made Wall Street happy: Amazon shares rose 0.9% to $120.99.

At Jacket Copy, Carolyn Kellogg makes the music industry connection most tend to miss:

• What does Amazon.com’s rosy ebook news mean? But what isn’t being said is that these aren’t necessarily new books; most of these authors have an impressive backlist… When CDs began to outpace vinyl, music companies realized that they could sell the same original works to fans a second time, in a new format. How much of Amazon.com’s Kindle sales are an echo of this –  readers purchasing much-loved favorites in a new format — is impossible to say without seeing sales figures based on specific titles. And that’s something that no companies, neither publishers nor Amazon.com, seems interested in releasing.

And finally, the Wall Street Journal digs into the real question (albeit buried at the end of their article):

• Amazon Says E-Book Sales Outpace Hardcovers: Still, the hardback comparison figure doesn’t necessarily mean the end is near for paper books. Amazon said its hardback book unit sales also continued to increase. Moreover, while Amazon has become one of the largest booksellers in the U.S., it still attracts an online audience that is more inclined to be early adopters of new reading technology. As for the effect on paperbacks, Madeline McIntosh, president, sales, operations and digital at Bertelsmann AG’s Random House Inc., said: “Our conclusion is that there’s no data to prove any connection—good or bad—between growth in e-books and the growth or decline, in trade paperback sales. … If anything, we may be seeing a positive effect in which the steady pace of e-book sales helps to keep a book in front-of-mind for a growing number of consumers after hardcover momentum slows.”

The Takeaways

Beyond the obvious — “eBooks are an increasingly popular format for reading books!” — three interesting takeaways stand out for me.

First, as The New York Times reports, “Amazon’s latest sales figures are ‘clearly an indication that the iPad is complementary to the Kindle, not a replacement,’ said Youssef H. Squali, managing director at Jefferies & Company in charge of Internet and new media research.” Despite 3 million iPads and 5 million iBooks downloads, Amazon’s significantly larger inventory of eBooks (paid and free), their full embrace of “Buy Once, Read Everywhere” (including the iPad), and their long-standing relationship with book buyers is a tough combination to compete with. For Amazon, it’s not about the device and never has been; the long game was always about leveraging their existing customer base and becoming the dominant seller of eBooks.

Second, eBooks fit perfectly into Amazon’s long tail strategy, and only Barnes & Noble comes close to having the kind of built-in advantage they do to capitalize on a CD/MP3-style digital transition as many readers re-purchase their favorites in eBook format from the path of least resistance: the retailer they currently buy their print books from, who already has their credit card information and the ability to make targeted recommendations based on their purchase history.

And finally, Amazon chooses its words carefully; in the midst of the Kindle hype, Bezos made a point of noting that ”our hardcover sales continue to grow.”

A significant percentage of the eBooks Amazon offers for sale were NEVER published in hardcover format; many more are from independent publishers and authors taking advantage of the lower barriers to entry. The room to grow is exponential. Genres and niches that get limited shelf space in the brick and mortar book world are perfectly suited for the digital book world. New authors can be bundled with popular authors in digital-only anthologies and samplers to expose them to a wider audience.

With a bit of creativity, strategic print + eBook bundles can even lead to the holy grail: publishers having direct contact with their readers via email.

eBooks undoubtedly offer the opportunity to expand overall book sales and direct engagement with readers, but only if publishers can get above the trees and take a look at the forest.

Publishers are just recovering from the earth-shaking impact of the iPad release and the next tremor may already be on the way.  It has been widely reported that Google will be releasing their “cloud bookstore,” known as Editions, sometime this summer with upwards of 4 million books available. 

Such staggering volume begs the question − what do we know about Google Editions? The answer, unfortunately, is not a heckuva lot.

This article summarizes what those “in the know” are saying, what the rumor mill is spinning, and what Google, with its tight lips, has inferred.

Which Books?

It is assumed that initially Editions will cover only books submitted by publishers, probably launching with 400,000 to 600,000 to start, many more than Apple currently has in the entire iBookstore. The settlement between Google, authors and publishers over Google’s scanning of books that are in copyright but out-of-print (aka Google Books) has not yet been approved by the courts.  Whether Google plans to sell the out-of-copyright books has also not been announced, but it is assumed that they may be available to readers through Editions.

Platform

Google plans for the books to be read through a web browser rather than a specific reading program or device.  They have also mentioned the possibility of building software to optimize reading for certain devices, like the iPad, but haven’t announced any specific plans.  Since books are read from ‘the cloud,’ it is assumed that you must have internet access.  What’s not clear is what the browser requirements might be and whether an on-device browser, like the Kindle’s, will support Editions.

Partners

While Google has said that nearly all U.S. publishers (20,000+) will be included in the Editions bookstore, no publishers have yet publically announced their participation.  Since most publishers favor having as many outlets as possible, it is safe to assume that many of the large ones will be on board when the time comes.  Editions is planned in such a way that book retailers, including independent booksellers, can use Editions to sell books from their own websites and keep most of the revenue.

Google Editions & EPUB

There hasn’t been any announcement that specifically states that Editions will support the EPUB standard.  However, in an interview at BookExpo America this May, a Google manager stated that books that are downloaded, rather than cached, would be available using Adobe ACS4 DRM.  ACS4 supports PDF and EPUB.  So we can speculate that there may be EPUB support.  Google Books also supports download of books in the EPUB format, so there is a precedent.

Cost & Price

As is typical, Google plans to derive most of its revenue from Editions through advertising, and hasn’t alluded yet as to what prices books will be sold (competitive is the best estimate right now), what pricing model they will use, or what cut they will take.  Several sources have reported that publishers will be able to name their own price for their Editions books.  Other sources have reported that Google will give publishers 63% of revenues from eBooks sold directly to customers, and 45% for those sold through retailers, with a small share going to Google.

Enhanced Ebooks

At this time it appears that multimedia will not be supported within Google Editions, and it is not clear whether live links will be supported.

Print on Demand

Google has been quoted as saying that they would like to provide this capability, but it will be largely dependent on publishers as to whether it will be supported on a book by book basis.

gPad?

The last wave of articles about Editions included new rumors that Google was exploring the idea of building their own tablet.  The speculation that it will be supported by Verizon Wireless has recently been confirmed in several articles, including by Verizon. It’s not known if the tablet will be based on Android or Google’s new Chrome OS, although most guesses are with Android.

While there’s no confirmation of its existence, Google has been posting mock-ups of what a tablet running Chrome might look like.  With more than 3 million iPads already sold, any new device will have to be pretty special to catch-up, let alone overtake it.  That being said, the Android OS is giving the iPhone OS a run for its money, so anything is possible.

What does this mean for publishers? Most of the money being spent for iPad apps will need to be spent again if they want to support apps on a Google tablet.

To reduce or prevent this, proactive publishers and their partners should start developing enhanced eBooks and apps in ways that enable reuse and multi-platform support.  This includes the use of open, non-proprietary standards (e.g. HTML5 instead of Flash, MP4 or OGG instead of QuickTime, etc.) among other things.

Tune in to the upcoming DBW WEBcast, eBooks vs. Apps: The Pros, Cons and Possibilities, to learn more about creating enhanced eBooks and apps with an eye to the future.

Eric Freese is a Solutions Architect with Aptara, which provides digital publishing solutions that deliver significant gains in quality, time-to-market and production costs for eBook publishers.

Those who devalue the work of editors ought to consider history. Perhaps the greatest single contribution of an editor to a written work can be found in The Declaration of Independence.

Early drafts of the most important document of the United States of America show a lot of changes in word choice in the process of writing. Thomas Jefferson had a venerable editorial committee: John Adams and Benjamin Franklin, who wrote extensive comments in the margins.

In a crucial draft of the Declaration, Jefferson smudged out the word subjects in favor of the word citizens. Archivists have the technology to see the change for the first time, using special spectral technology to decipher the intent of manuscript authors.

Imagine if Jefferson had used the word subjects rather than citizens. For many, it would seem that the United States was merely replacing one tyranny with another, rather than crafting a system of government “of the people, by the people and for the people.” It seems plausible that this one edit changed the course of history. Not all edits have the same effect, of course. But as an IBM study suggests, their value can be measured. 

"We hold these truths to be self-evident..."

Why do organizations devalue editors?

Editors are seen as an unnecessary step in the content process. “All they do is make it hard to publish what we want to publish on the Web.” I’ve heard it many a time; a few times from a person pointing the finger squarely in my direction. As much as I try to show that I’m just trying to help, that my efforts are just trying ensure that my company’s brand is represented in the best possible light, it doesn’t work. Somehow editors are viewed as an extra cog in the machinery. “When we go to a lean six sigma process, we will be able to eliminate editors.” That is just the latest in cost cutting models editors have had to defend themselves against.

Anyone who has ever written anything for publication can cite chapter and verse about how they have been saved by a good editor. Even if editors don’t make changes, having a second set of eyes with a different perspective on the audience allows writers to relax and create better work. But measuring their value is another story.

How to measure the value of editors

Because editors are often seen as unnecessary, we at IBM conducted a study to demonstrate their value for some of our marketing pages. We took a sample of unedited pages with high traffic from across our various business units and ran them through Dave Harlan, the editing lead for the group that creates a lot of our marketing content. We then ran an A/B test, where we served the unedited versions to a random sample of users and the edited versions to the rest of the users. We then measured engagement (defined as clicks to desired links on the page) on those pages over the course of a month.

The results were astonishing.

The mean difference in engagement was 30 percent across the set of pages. And the standard deviation was one percent–we got a 30 percent improvement on the desired call to action for the pages across the board. 

Now it was just one test and it needs to be replicated before we draw strong conclusions. Your mileage may vary depending on the quality of your editors (Dave is exceptional, by all accounts). But we can provisionally conclude that well edited pages do 30 percent better than unedited pages.

What would 30 percent better engagement do to your bottom line? I’m going to let you draw your own conclusions about how 30 percent better engagement might affect your business. But let’s put an end to all the talk about editors being unnecessary.

This post was originally published at Writing For Digital and has been reprinted with Mr. Mathewson’s permission.

James Mathewson is the co-author of Audience, Relevance, and Search: Targeting Web Audiences with Relevant Content, and editor in chief of ibm.com, where he sets standards and delivers education to improve the effectiveness of IBM Web content. He has trained 1,000+ IBM writers, editors, and content strategists on Web content quality and SEO techniques.

The year 2010 will undoubtedly be the year of “e,” but it’s not going to stand for e-book; it will stand for experimentation. Experimentation with contracts, rights, formats and distribution channels; experimentation that will certainly include e-books, and rightfully so, but they won’t be the central focus — for publishers nor readers.

“E” is for Experiment (Not eBooks)

Six months ago, when exponential eBook growth was the dominant meme, I called for taking a step back from the hype to focus instead on the far more important ”e” — experiment.

Since then, eBook sales have modestly declined every month since peaking in January (May’s data hasn’t been posted yet as of this writing), but there have been some encouraging signs that publishers realize the key to their long-term viability doesn’t hinge on any particular device, but on a willingness to experiment with new business models, sales and marketing channels, and yes, a variety of digital formats and workflow strategies.

Following is a roundup of notable posts, some more recent than others, and a couple of new DBW WEBcasts that focus on how publishers can navigate the digital transition that is simultaneously disrupting established business models while creating amazing new opportunities for those willing to experiment, take calculated risks, and rethink where “the book” fits in the digital era.

Adapt to recover, warn publishing chiefs
Bookseller News Team

“Our business needs to change, regardless of whether there is a recession or not. The economic situation has merely hurried the process along . . . To be honest, I don’t anticipate the market ever returning to pre-recession levels in its current form.”

Barnsley, whose company saw sales fall 13.3%, the largest drop among the top 10 and despite Hilary Mantel’s Booker-winner Wolf Hall, explained it had been necessary to take “a lot of cost out of the business”, including cutting the number of titles published by 20%. “We are focusing more on profit than on market share [now at 7.3%],” she said. “Most publishers over-publish for today’s market.”

The Future of Print
by Kassia Krozser

I cannot predict when the shift from mostly print to mostly digital will happen. I suspect it will be like a patchwork quilt. Print becomes more valuable when it becomes less disposable. We will happily invest in quality because what we buy is something we want to preserve — and display — for a long time. I think we interact with different media in different ways. I’m not a smell of books person, but I am a tactile person. Different types of content (the wrong word here, but nicely umbrella) demand different types of interaction.

Print and digital are different experiences. It’s not good or bad or right or wrong. It’s what the book, the story within (be it fiction or non-fiction), requires. Some stories can be told in every format possible. Some must be purely digital. Some demand the pace of print.

The iPad, Transmedia, and the Future of Publishers
By Guy LeCharles Gonzalez, Chief Executive Optimist, Digital Book World

If the iPad fulfills its promise of changing the way we interact with digital content, the question of territorial rights for eBooks and the temptation to split eBook rights from print deals could become even thornier as the book becomes just one of a variety of platforms available to authors in a transmedia world, and “Transmedia Producers” become the preferred gatekeepers.

While there are some in the publishing world who appear to have seen this shift coming — including Open Road Integrated Media, Movable Type Literary Group, and Random House — developing new business models to take advantage of cross-media opportunities, can any of them compete with a truly collaborative approach that’s a far more natural fit for film producers?

Where does the book, and the publishing supply chain devoted to it, fit in a transmedia world?

Creation & Design: What Kids Want From Tech
By Kim Gaskins, Director of Content Development, Latitude

It’s no surprise that gaming is popular with kids. But creation and design? Yep – unsung favorites. Thirty one percent of technology ideas proposed by children were a tool or platform for creating something (a Web site, a game, a video to be shared, a physical object, etc.).

“Artistic creation and design were common underlying principles for a large subset of the kids’ technology concepts, with truly incredible diversity across disciplines. Kids wanted to be 3D game designers, Web designers, fashion designers, landscape designers, industrial designers, musicians, ‘traditional’ artists – and then, of course, the study itself was an exercise in imaginative creation,” said Reinis.

Publishers Need to Fail Better, Cheaper, Faster
By Rebecca Smart, Managing Director, Osprey Publishing/Shire

If you perceive that your only environment is that encompassed by your current supply chain then you’re only going to adapt to changes in that environment – so the response to the digital challenge viewed in this way would be to create and sell e-books. If you put the consumer at the heart of your thinking you can consider instead each group of customers you serve and what they might want on top of what you already provide, how they might want you to serve them differently in the future. More to the point, you can ASK them, listen and respond.

The best way to ensure that experimentation takes place is to push leadership out through your company. Those closest to the consumers are those best-equipped to come up with the ideas for future experiments. One of the experiments beginning at Osprey right now is a digital-only project in a new niche which was conceived and is being driven by two of our marketing team.

A Clear, Easy Roadmap for Change
By Edwina Lui, Director of Content Management and Strategy, Kaplan Publishing

Experimentation:  The (Pseudo) Scientific Method

If you recall those bygone days of high school (or college) science laboratory sessions, you know that the key to testing a hypothesis or making a new discovery is experimentation via the scientific method.  By carefully laying out a plan for the experiment, testing its permutations, and studying the results, all the mysteries of science could be uncovered as a finite list of conclusions.  If only publishing were so predictable.

Still, those long-ago lessons hold true, and trial-and-error often yields the most effective learning experience.

1. Mini-Pilots:  When you plan for change, think big, but when you implement, think small.  Running a small pilot as your first step will minimize risk and keep your current business on track.
2. Failure IS an Option:  In fact, failure is nearly a given.  Without the benefit of clairvoyance, you’re bound to stumble at some point.  Expect failure and embrace it—there’s much to be learned from what went wrong.  Study every backwards step and make sure your staff knows that their fates don’t hang on the success of a pilot project.
3. The Pre-Postmortem:  Not only is the term postmortem a bit morbid, putting off a project assessment until the pilot is ‘dead’ may yield you nothing but flies (sorry, I had to go there).  Discoveries and insights can occur at any point.  Capitalize on those eureka moments and keep your pilot project adaptive.
4. Agility:  Are you tired of that word, yet?  Building off the previous point, make sure to remain nimble in your pilot.  Unexpected insights crop up throughout a good pilot, and you should be ready to modify your goal, rather than doggedly pursuing a potentially outdated goal.  (What do they say about best laid plans?)  More importantly, identify a stopping point, which may or may not be the planned ‘end’ of the experiment.  You may reach a good stopping point halfway through a pilot, and be ready for the next stage.

Additionally, we have two upcoming DBW WEBcasts focusing on areas of publishing where the willingness to experiment has been a necessity for years – role-playing games and comic books — and the lessons learned are invaluable for ALL publishers.

More than a few BookExpo America panels this year derailed during the Q&A into variations on the same theme: Tell Me How to Figure This Online Stuff Out. I came away with a few ideas which percolated this past week.

First, I caught the PBS documentary “Art & Copy,” a breezy look at the ad world by a bunch of übercapitalists disguised as mavericks. There’s a great scene during Wieden + Kennedy’s office tour when the camera pauses over a wall mural of push pins spelling out “Fail Harder” across six feet of space. And then you note the words aren’t spelled out in push pins, but the negative space around them.

Second: I read Kassia (@Booksquare) Krozser’s impassioned “The Future of Print,” and I share her publishing-prognostication fatigue.

Returning to BEA. I came up with Fail Week: authors, editors, agents, bloggers, everyone take seven days and try something new online with the expectation of failure. Authors! Don’t go on Twitter to match @neilhimself‘s follower-count. Go on Twitter because it might be right for you. (Or not.) Agents! What’s the difference between a Facebook community page and a Public Figure page? I know one way to find out.

You get the idea. Behind everyone’s questions seemed a reluctance to just dive in (a.k.a. fail repeatedly until you get it). This reluctance is anathema to pretty much all online communication and social media.

So, Fail Week. Try it for yourself.

On a related note, I see a common cause behind my colleagues’ frustrations. It’s a question of scope.

A successful editor aims for three profitable books out of ten. Shouldn’t a successful online/new media department try for the same? Sadly, the departments I know of don’t attempt ten projects in a year. They’re aiming for the fences with every swing.

At FSG, I’m dialing things down a bit. Instead of grand attempts to Save Publishing, how about just hitting a double? (You know things are bad when I’m using sports metaphors.)

Long story short: I’m aiming to fail harder. I want to fail over and over again this year. The only people who never fail are those who can’t recognize failure, and we have a name for them: assholes. And who wants to be an asshole?

P.S. My next big attempt at failure’s coming July 15th.

This post was originally published on Chapman/Chapman and has been reprinted with Mr. Chapman’s permission.

Ryan Chapman has recently transitioned to Farrar, Straus and Giroux as Online Marketing Manager after a few years in Macmillan’s Online Marketing department. He’s privileged to have collaborated on digital campaigns for Thomas L. Friedman, Alex Ross and Naomi Klein. Before publishing, he created online education content for a dotcom in Seattle and DJed in Prague. He speaks often at conferences and programs the infrequent 7×20×21 event with a few of his most respected and contentious colleagues.

“In deep recession, with my job of 10 years ending [in June], and a baby on the way in August, I haven’t looked at a single job board or sent out a resume,” says Dan Blank, former Director of Content Strategy & Development for Reed Business Information. “I’ve just been talking to people, identifying problems, and considering ways I can help. That is how We Grow Media is forming.”

Having spent the past decade helping an impressive variety of editorial teams leverage the web — including Publisher’s Weekly, Library Journal and School Library Journal — Dan Blank’s understandably excited about his newest project, We Grow Media.

Half of WGM is consulting with media companies and online publishers to create compelling content and attract a vibrant community of fans and customers. “The other half,” he explains, “is working with writers, authors, editors and journalists to train them in building their online skills. Most of what stands in people’s way of growing is not lack of information, but fear. Working together, we can move past that. I work with creators one-on-one or via online classes I am creating.”

Blank is highly regarded by his peers because he really understands the “social” part of social media.

“So many people talk about the business or technical changes, but what I find even more interesting are the human changes. The economic meltdown, coupled with the business and technical changes affecting media have reshaped attitudes and the career paths of everyone in publishing and media.”

Which of these changes are you loving?

BLANK: I love how everyone has access to the world’s information and to each other. That we can not only dream, but take a step down the road to BECOME. That a 17-year-old in Alabama can create a piece of art and sell it to someone in London because of Etsy.com. That a college newspaper reporter in Montana can network with established media folks all over the world, and build credibility with them years before they enter the job market.

That a poor, struggling 13-year-old anywhere on the planet can access not just information, but the best teaching tools, and other people who can help them experience their passion. If astronomy is not taught in their school in India, that’s no problem. Just go online, and discover thousands of resources and thousands of passionate astronomy buffs to connect with.

This is the opportunity that I see for publishers.

What’s the biggest challenge?

BLANK: The fear that I know many people are going through. The sense that this is not where they wanted to be and they are powerless to know which way to move forward.

The sadness of institutions dying.

Who in publishing do you really admire? Whose creativity do you want to emulate?

BLANK: How much time do you have? I define publishing very broadly, so bear with me here:

• Debbie Stier (@DebbieStier): We have only met in person once, and I already feel like I would lie down in traffic for her. Brilliant energy.
• Betsy Bird (@FuseEight): Her passion, her work ethic, her ideas – she simply never stops amazing me.
• Heather McCormack (@hmccormack): So honest it’s frightening, and willing to try anything to better serve her audience.
• Calvin Reid (@calreid): When I grow up, I want to be Calvin. Nobody experiences their passions more openly and fully than he does.
• What I’ll call “the new generation” of movers and shakers who form their own clique on Twitter: Ryan Chapman (@chapmanchapman), Ami Greko (@ami_with_an_i), Kate Rados (@KateRados), Guy LeCharles Gonzalez (@glecharles) and several others: not only are they smart, not only are they savvy, not only are they doing things for the right reasons, but they are so open to helping. It’s astounding, and I feel incredibly lucky to know them.
• Gary Vaynerchuck (@GaryVee): I’ve become a bit obsessed with Gary. I think what he is doing is critically important – he is building the future. 
• Andrew Warner (@AndrewWarner): More than anyone else in the past six months, Andrew has reshaped how I view the world. Every day, he interviews an entrepreneur on Mixergy.com, and shares their story online via video/audio chats. His line of questioning goes beyond just the facts, to the emotional side of building something, and exploring in detail how decisions are made. If you want to build something – ANYTHING – I can’t recommend Mixergy enough. This is not just the business side of how to build something (although that is there), it is the human side.

 Clearly – a huge number of people are missing from that list, those are just the first who popped into my mind.

How are you staying up-to-date with industry news?

BLANK: Staying up-to-date comes down to this: sleep is optional.

Twitter is a great resource for me, because it’s not just that I am finding so much great information, but the context of who shared it makes it more meaningful. I know what people are talking about and what they are saying about it. I now follow 550 people on Twitter, five times as many people as I thought I ever could. And I get so much out of each of them, that I can’t bear to unfollow anyone! 

Conversations are a huge way to stay on the ball. I love – LOVE – grabbing a drink, a coffee, breakfast, lunch with someone, and just chatting for an hour. That takes you behind the facts, to the real-life transitions we are all going through.

I often try to take online conversations offline – even if it’s just via phone or Skype. I love learning about what other people are working on, their goals, their passions, their failures.

We have so much to learn from each other.

Future of publishing – half full or half empty?

BLANK: COMPLETELY full. If all you care about is protecting an established business model, then you are missing the point. And missing the future.

Dan Blank is the founder of We Grow Media, and was most recently Director of Content Strategy & Development for Reed Business Information where he worked across 40 business media brands, including Publishers Weekly. In April 2010, Dan was named to the Folio: 40 list of top innovators in magazine publishing. He doesn’t own a television, but goes to the library at least twice a week. “It’s like candyland for the mind.”

Marian Schembari digs social media and books. Usually at the same time.