back to article 'No discernible increase in piracy' from DRM-free e-books

A little over a year ago, Speculative Science Fiction publisher Tor decided to do away with digital rights management (DRM) for its e-books. The company's publisher Tom Doherty said that the time that authors were supportive because DRM frustrates readers. “It prevents them from using legitimately-purchased e-books in perfectly …

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Pint

And

What's the big surprise here?

Other than someone was brave enough to do it.

but...

Won't somebody think about the lawyers

People being reasonable isn't good for their business.

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Re: And

I'd like to and am inclined to agree, but I do have a caveat.

SF readers are a bit of an outlier. They know what they like to read and they know they need to pay the people who produce it so they can get more of it. I think they are also inclined to put peer pressure on any friends who might try to leech from the creative commons. I expected similar results for Anime.

I'd like to believe the same will be true if other publishers adopt the same stance. But we'll need the data to confirm it.

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Re: And

You might equally say that Tor has a closer, more personal relationship with its customers.

Thats a lesson that all publishers should learn from.

Peer pressure is a good mechanism for getting people to pay for what they read.

That some of the larger publishers have a large disconnect between themselves and their readership is probably why DRM doesn't seem so morally bankrupt to them.

The Internet is making it possible for boutique publishers and authors themselves to sell more directly and more personally. In that environment, readers will feel more of an emotional connection to the people distributing to them.

I see that as a good thing.

The last publishers to make this move will be the large mega-corporations. But increasingly I think, they will find themselves becoming less and less relevant.

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JDX
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Re: Copyright Mafiaa wildly exaggerate, as this shows

Presumably the point is not that people aren't pirating their books, but that pirating DRM copies is so easy it makes little difference?

I don't know, do e-books suffer the same levels of piracy as music & video?

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Re: Copyright Mafiaa wildly exaggerate, as this shows

Good luck trying to get accurate figures on piracy in any medium

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Re: Copyright Mafiaa wildly exaggerate, as this shows

"I don't know, do e-books suffer the same levels of piracy as music & video?"

IMO piracy of SF e-books is very unlikely to be anywhere near the levels of piracy experienced by blockbuster movies or popular music. Somethings just don't need any protection. (Note: I am actually a fan of SF myself.)

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Baen Books also

provide drm-free (and in many cases, just free) ebooks.

I've spoken to a number of SF authors, and they seem much different to the 'rent the IP' model that was pushed with music: they don't expect you to have to purchase the same thing in a dozen different formats, and indeed are quite happy for you to scan their books provided you (a) have a purchased copy and (b) don't distribute it.

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It's about what you beleive your customers will do once theybought it.

The "suspicious" model is they immediately stick it out there for sharing to the rest of the world.

The "trusting" model is they will read it, and maybe transfer it to their ereader/phone/laptop to keep reading/read again.

Gosh. It looks like most peoples first instinct is not to stick it up for world + dog to share.

Who'd have thunk it?

Thumbs up for taking the gamble and (like with global warming) providing some real data about what really happens.

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Anonymous Coward

No surprise here - It is DRM that increases piracy

Once they go through the experience on not being able to read their (paid-for) book on their favorite device, or with something else than the distributor-imposed software, it is no surprise that many victims actively look for 'pirated' (DRM free) copies.

Charge a reasonable price (distribution and making copies are cheaper with digital books), and don't restrict your users to certain devices and software and the market for eBooks will explode. You can count on it.

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K
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Re: No surprise here - It is DRM that increases piracy

100% agree, especially on the costs.

Yet many e-books still sell for the same amount as the printed copies, which is where the Publishing Houses shot themselves in the foot. As a customer I will quite happily pay £3.50-£4 for a ebook from the Kindle store, but if they charge £8 for the eBook and £8 for the paperback, then can go jump.

By passing on the full savings of ebooks to customers the Publishing Houses are in a win-win situation. Not only will existing readers buy more books, but they will gain new readers as people will be more willing to take a punt of new authors and authors unknown to them! (A lot of readers find a couple of authors and stick to them).

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Re: No surprise here - It is DRM that increases piracy

As one who held this same opinion for a long time, I feel compelled to link you to the relevant Charlie Stross Common Misconceptions About Publishing article.

The only way ebooks are cheaper is if they are an afterthought to the printed publication and therefore can be considered, as a format, to have no inherent sunk costs of their own. But that's simply not true, partly because format testing for the variety of devices and platforms out there brings proofing and layout costs to the e-edition, and partly because every publisher who wants to stay in business these days has to include ebook sales into their total sales projections.

Note that I'm not arguing for price parity here; but reading Stross's article and talking to some friends who work in publishing has convinced me that the case for ebooks being vastly cheaper than printed books requires either special circumstances or wonky financials.

That said, I wish more publishers would do an O'Reilly on it and provide a bundle option at a marginal increase on the print edition price; I can see the value in both formats, and don't object to paying more for receiving a book in both formats to save me either printing out a digital copy or scanning in a paper one - but the pricing has to be better than "want both formats? buy two copies". Especially if DRM nonsense will be involved on the ebook side.

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Re: No surprise here - It is DRM that increases piracy

So, you've seriously convinced yourself that there is no extra inherent cost associated with chopping down thousands of trees, pulping them, pressing them into flat sheets, running those flat sheets through machines which cut them to an appropriate size, printing ink onto those smaller sheets, gluing those sheets together, and finally physically distributing all those heavy objects to thousands of locations throughout the target country.

Really?

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Re: No surprise here - It is DRM that increases piracy

Hmmm, can't help noticing that 8 and 13-17 onwards only apply to hardcopy books. And this is ignoring that number of tasks!=cost. I imagine distributing a million books and the markup required by bricks and mortar stores is one most significant costs.

Of course the big thing that isn't mentioned is second hand - all big readers I know buy books second hand then sell/donate them on. Many paperbacks probably go through at least 2-3 people this way. With ebooks that's not a problem though.

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K
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Re: No surprise here - It is DRM that increases piracy

@Captain Underpants

Interesting article, but my argument is based upon volume, the loss in profit by decreasing cost, is offset by attracting more customers. Which longer term is surely more beneficial for company and consumer. Its better to sell 1,000 copies of a book for £1, than it is to sell 100 for £10. Profit will be slightly less (bandwidth, commissions etc). But you now have 1000 loyal customers, who will return again and again.

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Re: No surprise here - It is DRM that increases piracy

@lurker:

Hmm, I should've chosen my words more carefully. I didn't mean to suggest that there's absolute parity end-to-end between ebooks and printed books, necessarily - I was trying to suggest that it's a fallacy to think "Ebook = no production costs, physical book = enormous production costs". Ebooks increase the workload for layout and platform proofing. I referenced Stross because his article is the best expression of the number of things done by a publisher as part of publishing a book that don't involve either the book being written or the words being put onto paper; the vast majority of those things apply regardless of format.

It's also relevant to mention that while I happen to know a bit about self-publishing and small press, I generally defer to people working full-time in the field when it comes to what is or is not true about that field.

@ Mojojojo:

I'm not sure you can ignore 16 and 17 For "shipping", you can substitute "file hosting & distribution", and for "invoicing and accounting" you can substitute...errr... "invoicing and accounting". Unless you are exclusively selling your ebook through your own channel (which reduces your reach substantially), you'll be dealing with partners. Ergo invoicing & accounting.

(You may be interested in CMAP #9: Ebooks, incidentally - not least for Stross's prediction that ebooks will end up replacing mass market paperbacks. A prediction that I don't like but suspect is going to be correct.)

@K

I'm not convinced that your volume argument is entirely correct - it assumes that there are no per-transaction costs, for starters, which is generally not the case. On top of which, there's no guarantee that simply cutting the per-item revenue (presumably by slashing the "profit" bit) the total number of item sales will increase enough to keep total revenue standard, never mind increase it. There's so much content out there that price alone isn't the main determinant, especially when you talk about material in which you the reader may be interested, but of which you aren't aware - because the solution to that is marketing (either word-of-mouth which takes ages or the traditional kind which takes money).

I do agree that book publishers want to get reader's loyalty, which is why they tend to want to retain first refusal rights to a given author's next book.

It's worth noting that some publishers are still doing very limited edition high-cost items (eg small runs of individually-numbered signed books, and even smaller runs of individually-lettered signed books - I heard about this when reading about China Mieville's books, but I'm sure he's not the only one). As with the music industry, I suspect that the way to go is to use different formats to target different audiences. (Why turn down the extra money to be made from rich fans who want a unique physical artefact just because casual readers want a cheap ebook, when you can do both?)

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Re: No surprise here - It is DRM that increases piracy

There's also VAT to consider on eBooks, but then if eBooks cost the same as hard backs, then how could they afford to drop the price when paperbacks come out?

Once the initial outlay of formatting and testing has been made, no additional outlay (other than the usual sales costs) needs to be made. No more reprints, no additional dead trees, just a file sitting on some storage somewhere.

I agree with K, if publishers made the pricing reasonable enough, I think more people may be willing to buy eBooks they may not usually read. As an avid reader, I've often trawled second hand book stores for cheap paperbacks and often picked up authors that sounded interesting, then gone on to buy other books by them, I'm not going to do that with hard backs at full RRP.

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Re: No surprise here - It is DRM that increases piracy

Hmm, odd. I've been known to do a book or two. My wifehas worked in the publishing field for YEARS, most recently doing the graphics and preflighting books for a number of publishers (including textbooks from the likes of Oxford university press, MIT, etc)

eBooks are easier in a lot of ways, if nothing else there's less worry about inks, etc. and they don't have to wait for a printmatch to be printed, sent back etc.

ebooks take maybe 2/3 the work of a print version. Now if they're going to do a print copy too, they have to do all the steps as well, but combined it's maybe 105% the work of doing a print-only.

This is of course, the experiences of the middle-man company who gets the raw manuscripts and images, and outputs either a finished ebook file(s) or sends the print order to the printer of choice.

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Re: No surprise here - It is DRM that increases piracy

K's numbers may be extreme, but that's the basic principle of economics - so long as demand goes up more than production costs, you make more total profit at a lower price point than you do at a higher one.

I'm surprised you were surprised about limited edition high-cost printings if you're involved with small presses. It's how they ultimately make their money. Those editions go to people with a collecting interest who are willing to pay for the privilege. You try to cover your cost of production with the paperback/ebook and make your profit from the hardbacks (numbered, w/slipcover and optional signature) which you might have to store for 3-5 years before you sell them all. The numbers I typically heard were 100-300 such hardbacks at $25-$50, 500 regular hardbacks at $15, and a couple thousand paperbacks in the $5.50-$8.50 range. Prices on the regular hardbacks and paperbacks tended to be set high so you could still make a small profit after discounts if you arranged with a local mass distributor to sell them (20%-50% depending on the size of the distributor). Two SF NPOs in my local area were both involved in these sorts of ventures.

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Anonymous Coward

Re: No surprise here - It is DRM that increases piracy @Captain underpants

So there is no cost to printing a book, sending it to a shop & having it sit on a shelf until its brought?

A physical item, vs a download? you can't tell me the savings are not massive...

And this is from someone who has produced items for sale physically and digitally, I can tell you the difference in costs is massive.. a CD vs a download... download is so much cheaper to put into practice...

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Re: No surprise here - It is DRM that increases piracy

I agree that there are costs to the publisher to make ebooks available; I might, given enough evidence, believe that the cost of paper, print, binding and shipping is negligible / approximately the same as the VAT so the price should be the same from the publishers point of view, but look at it from a customer point of view instead.

I get the same content to read, but not the property rights with the ebook. I can't lend it to a friend; I can't sell it on when I'm done with it. I can't pick up a completely unknown book second hand and go "you know what, for a couple of quid I'll take a chance" because there isn't a second hand market.

I'm not getting the same standard of product, so the price should reflect that. Alternately, create a market for 2nd hand ebooks - if you're using the honour system (no DRM) then allow resale, if you're using DRM allow transfer of ownership. At the moment, the publishers are screwing us both ways.

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Re: No surprise here - It is DRM that increases piracy

Whether this is effective or ineffective depends every much on the price elasticity of demand for books. That is, if you halve the price, will you actually double demand, or more than that, or less than that?

Most mainstream authors will have a core group of loyal readers who buy their books consistently (and without a lot of regard for price), plus "casual" readers who pick up a book because it looks interesting. Tom Clancy is not going to double his book sales by halving the price of his books, because he has many people who will buy his books without checking the price tag. I'll occasionally blow $50 on a hardcover by a favourite author even though I'll be able to pick up a paperback later at a third of the price.

As such, you need your casual readers to be MUCH more attracted to your book before you can count on a reduced price increasing your gross sales, because they also need to cover the lost income from the "loyal" readers.

In other words, for most mainstream authors, the "halve price to double sales and thus make more money" argument basically doesn't work. Sales will less than double, and the publisher will lose money relative to what they could make by pegging the price at a higher point.

Your "new" customers may well return again for later books, but it doesn't really matter if prices are kept at a low point. In terms of relative income, you still have a larger group of people buying your books, but not enough larger to compensate for the reduced income.

What you might do (and many publishers do sometimes) is release a back-catalogue title with costs already sunk at a reduced price point to attract new readers, and hopefully get them buying later titles by the same author at the normal, higher price point.

Note I would *like* books to be cheaper, but I can see how it might not work out for the publishers.

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Re: No surprise here - It is DRM that increases piracy

O'Reilly provide DRM free e-books in multiple formats at significantly lower prices than their paper books.

I've bought way more than I would otherwise have, due to this.

William

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Happy

Good on them....

The fuckwit mentality of the Americans, "Oooo can't rip your CD, copy the tracks to your PC or the MP3 player... and while we complain about piracy, the customers accuse us of gouging markets, ripping consumers off, using sellers like Itunes that sell the downloaded tracks for more than the CD's tracks etc., etc.. etc..."

"Yep - here is your book that you can lend, share, more around from your laptop to the e-book reader etc., etc., etc.."

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Alert

Re: Good on them....

The fuckwit mentality of the Americans, "Oooo can't rip your CD, copy the tracks to your PC or the MP3 player...

I think you'll find that format-shifting (if it doesn't involve cracking DRM) is legal in the USA but not in the UK.

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Anonymous Coward

"No DRM can survive contact with the pirates"

It only takes one determined pirate to crack a DRM schema.

Once it is cracked and loose, it only takes one customer to release a copy of an eBook/Film/Music etc.

Finally they have realised that pre-punishing everyone else, is a stupid business model that actually pushes some people towards pirated downloads.

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No No No This cant be right

people by nature are thieving bastards - we know cos we are!

Love The Mafiaa

I guess that's where the 'psychological' term 'projection' came from...

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JDX
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Re: No No No This cant be right

You have it backwards. Piracy is going on, but adding DRM doesn't reduce it. For anyone to suggest people don't pirate music in massive droves is just naive/stupid.

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This is proof

Why do they let simpletons like this guy do copyright math? I mean an ebook file is smaller than an mp3. It should be a dead giveaway that the damage to the economy is bigger than for an iPod. The real losses could be as high as $16 billion per reader.

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I always new the SF genre was in trouble

when Science was changed to Speculative.

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Now if only they'd sort out availability...

Now all they need to do is sort out availability. I'm fed up of seeing ebooks available in the US that we can't get in the UK. If a paperback isn't available in the UK I can buy it from Amazon.com , surely it's time that we should be able to do the same with ebooks?

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Not Orlowski?

I would have thought this would have been covered by the resident "IP" zealot Orlowski.

Or did he pass because it doesn't reinforce his prejudice?

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Anonymous Coward

Re: Not Orlowski?

I don't think he is pro-DRM in any such sense, just that he believes in content creators getting paid so is pro-IP & anti-filesharing on that basis alone.

He has often argued the case for simpler, more pleasant paying experiences compared to what the dum-wits at a lot of media companies believe the public should put up with.

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Shock News - Tor treats fans with respect, Fans continue to treat Tor with respect

The key point here is Tor turned dropped DRM and sales stayed the similar, they did not fall off a cliff as any industry wonk will tell you.

I am Tor's target market, i buy lots of books primarily SF but also over area's of fiction (and loads of non-fiction) and I spend as much time reading as i do on games/tv (the other big media outlets).

When i was at uni struggling to make ends meet (despite working as well) i did pirate some of the authors whose books Tor carry. However this was often only if i could not get them from the uni library, which gives the author sod all (seriously even rowling and pratchett get a maximum of a couple of grand from this). Now i have a job and can afford it i am buying both hard copy and ebook titles of authors whose first book i tried i might have downloaded a few years ago.

People will pay for content they deem good and at a reasonable price especially in a field like SF fiction which has always been the underdog of literature (they are just jealous of our jetpacks). Those who pirate often do so because they can't afford it or are doing "extended demo's" (try a game, if its 4 hours long not bother) THEY ARE NOT LOST SALES. Had copyright infringment been punishable by death and heavily policed i simply would not have read those authors books which would have translated to lost sales further along in time.

DRM does not do anything except piss off the legit consumer. I ended up downloading the PDF's of a training course my company had legally bought (and was made by a seperate department of the same company) because locklizard was such a pain to work with. 5 minutes on google and i had the unrestricted PDF's

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Re: Shock News - Tor treats fans with respect, Fans continue to treat Tor with respect

So true about DRM only pissing off legit customers. There are many things I would have purchased if I wouldn't have had to deal with draconian DRM to get it to work. But I'm not going to pay a company to treat me like a criminal, and restrict to high hell what I can do with what I paid for.

I'm sure companies just chalk the lost sales on people like me up to piracy even though most won't even bother pirating it either which they use to beat the DRM drum to death...

I will say though DRM has saved me a lot of cash as I've not bought 1/100th of what I would have if it was DRM free :D

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Re: Shock News - Tor treats fans with respect, Fans continue to treat Tor with respect

Completely agree, and free e-books can lead to sales.

I read a few books from baen free, and that lead me to buy 4 books in a series from that author!

I think many authors would benefit from removing DRM & releasing free books, especially to the start of a series!

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DRM - no purchase whatever the content

As the title says if some media that I want is DRM hobbled then it's an absolute no go as far as buying it is concerned. I'll go find it elsewhere, not pay for it, and be able to do as I choose with it.

Ok, as for not paying for it that's not what I want really. I do want to give the content creators some of my hard earned, but if they're going to piss me around by limiting what I can do with the media then they're going to have deal with the fact that they'll never get a penny from me.

Let me also clarify what I mean by " to be able to do as I choose with it". This does not mean stuffing it online for everybody to download. What this means is that I can shift the media between devices that I own without hassle, that I can say to my partner "hey have a read/listen to this". Also maybe pass on to a friend or two, which often, in my experience, either produces one of two results. The first being "no, didn't like that", or more often "bloody hell, I enjoyed that so I bought the entire back catalogue".

DRM kills sales, and therefore kills profits. I'm amazed that some media is still DRM protected, especially as DRM protection is actually no protection at all, just an impediment.

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Anonymous Coward

Bronycon

If anyone thinks DRM free is always good (note I use the word 'always') then look at the Bronycon documentary debacle. This was a Kickstarter project designed so that contributors got a copy of the video plus extras the more they spent towards it. It was eventually supposed to be sold to various distributors for broadcasting on TV networks etc.

However. Tthe day it was released DRM free it was pirated so much the makers gave up on the distribution model and dropped it like a hot potato.

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Re: Bronycon

looked up the reviews of it (wish I didn't learned way more about bronies then I ever wanted), and honestly the reviews I saw of it said it was terrible, and one went on to say it was so crappy that wasn't worth anything, and to bootleg it if the readers were interested. The reviews I read were written by bronies who almost seemed offended by it, and how it portrayed their... uhh.. culture...

So IMO that isn't a good example as the TV distribution was probably dropped due to reviewers thinking it was terrible at best. And lets face it there isn't any major TV station I know of that would put something like that on if it was done as bad as the reviews say as they generally screen something before airing it.

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Mushroom

Once again, we can vote with our dollars

I *choose* to shop for my tech books (programming, etc) at Oreilly Media because they are a drm-free publisher. Yes, it is more expensive. And they don't have the selection other publishers do. But it is worth it - freedom always comes at a cost. The only way those publishers will get the message that drm != customer-service is to vote with the dollar. Enough people do this, they'll get the message.

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Re: Once again, we can vote with our dollars

The only way those publishers will get the message that drm != customer-service is to vote with the dollar. Enough people do this, they'll get the message.

Dunno about that if you look at the software, movies, and music industry majority instead just blame piracy for the loss of sales(even if no one ever downloaded it), and use some skewed figures to prove their point to the share holders.

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isnt it evident

very few people "read" anymore. This is not the case with other media such as music, movies or games.

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