The world of ebooks seems to be in a state of constant flux. Whether it's speculation over the impact of Apple's iPad and the iBook store or an announcement about the newest e-reader device, it seems that there is always something new for publishers to keep up with. With the announcement of O'Reilly Media's Digital Distribution Services (http://oreilly.com/digital-distribution.html) at the Tools of Change conference, Feb. 22-24, things may have gotten a little simpler for many publishers.
According to predictions from the Association of American Publishers and Forrester Research, ebooks will be a $6.6 billion market by 2015. "To succeed in this new world, publishers must make their content available in multiple digital formats and distribute it through many channels," says Pascal Honscher, general manager of O'Reilly's new division. "There's a lot to understand and much to do, including converting and formatting files, finding and managing distribution channels, bringing sales and marketing staff up-to-speed on the various partner programs, collecting and analyzing sales data for price testing, and managing potential rights issues." Under the guidance of Honscher, the new Digital Distribution Services division will outsource its tools and expertise to publishing partners.
"O'Reilly appears to have defined a solution that addresses one of the key problems in the publishing industry-how to get good content into a proliferating array of electronic distribution channels cost-effectively," says John Blossom, president and senior analyst at Shore Communications. "Given the breadth of platforms being engaged for distribution via O'Reilly and their extensive, industry-leading experience in packaging book-oriented content for electronic markets, I expect that they will have a major impact on the book industry as we have known it. It is in essence creating a content cloud for book production and distribution that will enable seamless electronic sales and distribution of ebooks across as many platforms as possible."
O'Reilly Media's Digital Distribution Services will offer a single point of entry; no upfront charges; a transparent pricing model based on a percentage of net sales; a dedicated sales and marketing team; secure storage, access, and distribution of your digital assets and metadata in its content warehouse; conversion of your content into digital distribution formats; custom channel selection to ensure you control how and where your products are distributed; and reporting and analytics to enhance market intelligence. Customers can use all of these services or simply choose which ones best suit their needs.
"We know technology is driving the publishing business now, but people shouldn't have to deal with technology issues," Honscher says. "We want to take the technological confusion and ambiguity away and help publishers get their books to readers." Publishers need only provide O'Reilly with PDF or quality ePub files. O'Reilly will then input the files into its services. "In addition, there is a set of metadata that describes a title's characteristics (title, author, description, etc.) and some specific metadata required for certain digital retailers," says Honscher.
O'Reilly charges a straight 25% revenue share based on net sales from the channels. It will also help customers understand which of those sales channels is the most successful. "Analytics, even simple sales reporting, in the digital marketplace is very fragmented currently," says Honscher. "Each e-retailer has [its] own reporting cycle and reporting format. At O'Reilly, we've been able to pull together those varied formats and provide a unified and coherent picture of how and where a publisher's content is selling."
Ebooks, however, are nothing new. "While many publishers have been working on their own solutions and approaches to the digital marketplace, many more either haven't started, don't know where to start, or have put in place components of a solution that can be nicely complemented with O'Reilly's Digital Distribution Services," says Honscher. "Based on the interest in our platform and services thus far, both large and small publishers alike are seeing the value in our service."
In many ways, O'Reilly is breaking down the barrier to market entry for many small publishers. "In the electronic era, the cost of inventory and ‘shelving' for ebooks is essentially zero, so the true risk of production is not having enough targeted, salable content to offer to people searching for book content and following links to it from online services," says Blossom. "O'Reilly is in essence taking the Google approach to ebooks, by focusing on making as much content as possible visible in as many relevant contexts as possible where that content in context can be turned into revenues."
Some might wonder, however, why O'Reilly would help the competition gain footing in a market it seems to have figured out already. "O'Reilly is a proven leader in doing exactly what this new offering aims to achieve. They have been doing it for themselves for years with tremendous success," says Ned May, director and lead analyst, Outsell, Inc. "They have seemingly been asked to present at every ebooks conference over the last several years, so it makes sense they finally decided to package it and offer it to the rest of the industry for a fee. What is remarkable here is that O'Reilly being O'Reilly does not worry about giving away trade secrets or somehow cannibalizing their own success."
Honscher says, "We believe helping the publishing industry remain relevant to its consumers as those consumers move towards digital devices is extremely important. One way that goal is achieved is by providing those consumers with access to content wherever they are and however they wish to consume it."
May adds, "[O'Reilly] understands this is where the market is headed, and if they do not do this, someone else will. Since they know it as well if not better than anyone else, it might as well be them profiting from the trend. They will likely hold a place on the short list of any publisher looking to use third-party services here."
