This week we are talking about ebooks, and I got to interview Mario Armstrong (one of the nicest people I have ever interviewed!) and Brian Felson of BookBaby – who was also really nice, and is the CEO of BookBaby, which is a spinoff of CDBaby, which was founded by a personal hero of mine, Derek Sivers, and which also greatly inspired my AuthorsBookshop.com website (which, it must be said is doomed in part because of BookBaby, but that is a different post and I hold no grudge!)

So really, you should give it a listen.  You can find it here: http://indiebookman.com/2011/05/ebooks.html

So, I’ve spent a lot of time over the past month producing the show – developing it, scripting it, scheduling and doing the interviews, editing, and now getting it up and promoting it… and all of it has revolved around ebooks.  I got a lot of my own thoughts out, and got to dig deep into the thoughts of some pretty smart people.

All about ebooks.

Now, let it be said that a year ago, I was anti-ebook.   I new they were the future, but I also knew they were going to force me to shift my relationship with books and reading.  I also knew it meant learning a whole bunch of new stuff and either the end – or requiring some sort of rebirth of – AuthorsBookshop.com (turned out to be the end, but again, thats another post and again, I bear no grudge!)

But things have changed and I have become really excited about ebooks.  I wasn’t able to really come right out and say this in the show, but I think ebooks ARE the future, and I think they are good for writers and publishers.

Why?  Wehehell, let me explain;

1. They make reading sexy again.  Suddenly, it’s hip to be reading on the train.  I always thought it was, but I am weird.  Now hipsters, buisnessmen and gramma’s are ALL getting in on the transpo-lit action (that means they are reading on the subway.  I just made that word up so don’t feel bad if you had no idea what I was talking about) and they all look and feel up-to-date and with it.  By reading.  Can I let that sink in for a moment?  They are looking cool because they are reading.  Yay for the world.
2. They make reading fun again.  Reading has become gadgetized.  We are a Gadget Nation, and if it’s not gadgetized we don’t want it.  If it is we do because gadgets are fun.  We love dicking around with them, we love syncing them, we love charging them, we love plugging them into our cars, we love updating them… we even love replacing them.  Reading has suddenly been initiated into the gadgetized world, just as music and movies have been.
3. They make reading easier.  You can take your whole damn library with you.  No matter what mood you are in when you are waiting for the train, you will have something to read.  One book or another to peck away at.  Reading really does become much more like music… listen to what you are in the mood for, read what you are in the mood for.  Imagine if you could only carry around one album at a time?  We wouldn’t stand for that.  In a few years, neither will we with what we read.
4. They will get us to buy more books.  We are not only a Gadget Nation, we are an Impulse Buy Nation.  If we hear or see or read a bit of something we like, if we can buy it NOW and have it downloaded directly to our device, we will do it.  More books will be purchased in the next 5 years than have been purchased in the past 15.  But they will be digital.

So, how is this a bad time for books?  Or reading?  Or writers?  Or publishers?  Suddenly, reading is a Thing We Do.  All over the place.  We are reading more, buying more.

All good for authors.

So, that’s all well and good.  But… I have a little problem.  For all my new-found love of the ebook, I still don’t have an ebook reader.

Wuh-huh?

It’s true.  The $150 bucks (really, that’s all?  And they are getting cheaper!) i’d need to nab me a kindle has been frustratingly elusive.  I would by my kid the new bike before I would buy myself another widget, for example.

So, I will sit, enthusiastically, on the sidelines cheering you all on as you read away on your kindles, your nooks, your iPads… at least for a few months.  But see, I AM the IndieBookMan.  It is, I believe, incumbent upon me to Get With It. Sooo hang on, ill be right there with you soon.  You know, I’m savin’ up!

Show #16

The newest IndieBookMan Show is here, and it’s the probably the most informative show we have done to date. This week we are talking about eBooks – and who isn’t talking about eBooks these days?

But how is the eBook revolution effecting readers, writers and publishers? In other words… how is this new technology going to effect you?

We delve into that very question and more this week as we look at the quickly developing world of eBooks.

In this show we talk to:

• Mario Armstrong, Digital Lifestyle Expert and radio show host. Mario weighs in with his astute thoughts on the technical impact of ebooks.
• Brian Felson is the President of BookBaby. This new service will get your book on all the various ebook platforms, and Brian shares his thoughts on how ebooks are going to change the publishing and sales of books.
• Deborah Emin runs Sullivan Street Press – a successful indie that has decided to publish eBooks and only eBooks. How has this decision impacted their business, and the authors that they publish?
• We call Kindle owner and lover Rob Carlson to find out why he is so excited about this ubiquitous eBook reading device.

Special thanks to Monopoli and Persona for the use of their music this week.
Also, a huge thank you to our friends at The Inverse Delirium podcast for producing the opening segment for this weeks show.

The IndieBookMan Show is a member of the Baltimore Podcasting Network.

Thanks, and please enjoy show #16, eBooks:

Truthfully, you would probably fill your card up pretty fast hanging around The IndieBookMan Show and blog… because many of these arguments can be made about indie publishing as well.

And I know it’s meant to be snarky – but many of the points made on the card actually are valid. No matter how “tired” they may be.

The Epublishing Bingo card was created by John Scalzi

Like it or not, we are heading that way.

In an article yesterday, gadget blog Gizmodo.com explored best-selling authors that have started to publish and sell their work directly to readers via ebook format. This is a good read, as many of the benefits that these best sellers are experiencing can be had by indie authors as well. In fact, I think there are benefits that indies may realize that the big guys aren’t even effected by… or would have access to otherwise. Instant global distribution comes immediately to mind.

The post covers five reasonse why these top-selling authors are going “e” with their new books and I have to say… some of these overlap nicely with reasons we have been urging would-be best-selling authors to go indie in general. You know, things like, “You’re the Main Honcho” are right up our alley, but adding ideas such as “You’ll Have a Book Published in No Time” and “Epublishing is a More Cost Effective Route” aren’t too shabby either.

So take a look, but here is a quick-cut summary. Definitely worth your time to read the whole post.

Just recently the Association of American Publishers reported that ebook sales have increased by 176 percent in 2009, while print-book sales continues to decrease. The list of benefits for ebook writers is endless, but one major upside is that the authors are taking home more of the book sale profits. Not to mention that the editing process is simplified and that ebooks are produced much, much quicker. It also helps that authors have more control during the entire book production process and access to a whole new audience. The publishing industry is paying attention to the major move, including traditional publishers. More and more literary agencies, such as Andrew Wylie’s agency, have plans to start agencies that deal exclusively with epublishers. It’s no wonder why more authors are going direct.

Of course, his main consideration is regarding authors published by major houses such as McMillan. I still think, as we discussed on the radio show this week, that more pricing freedom is better for indies in the long run. I think this is true because a) we can set our prices of eBooks higher if warranted and b) we can be competative – even undersell – the majors who insist on jacking prices to protect their non eBook sales.

In any case, definitely worth a read. Heres a little taste:

But now, with ebook sales soaring, and with the iPad looking to make them soar even higher, publishers are panicking. Thanks in part to deep ebook discounting by Amazon, but also because the same people who can afford hardback books are the same people who can afford e-readers, people are starting to buy ebooks where they once bought hardbacks. The only cash-cow remaining in publishing is disappearing, like CD sales for music, and DVD sales for movies.

My basic problem is the one all of us who care about the adequate distribution of wealth and influence should always be caring about–he has an out of balance influence on how we as writers, publishers and distributors are going to earn some money from the very legitimate work we do.

The kinds of deals he is going to make with, for example, textbook publishers, is going to skew who can make money writing textbooks–again. I, personally, am not all that happy to see McGraw-Hill making deals.

We all have very short memories, unfortunately, I do not. Some things are so egregious in this world that it is necessary to recall them and to help one’s readers recall them too. The McGraw family and the Bush family were close and the former last president and the owner of the company grew up together. Thus when George W. Bush was governor in Texas, he made sure that his former playmate made a ton of money creating textbooks that would fill up the schools in Texas with George’s friends ideas of what should be taught.

There is that side of the equation.

The other side of it is, as anyone involved in e-book publishing can imagine, there is so much one can do to create e-textbooks that will help students learn in so many new and interesting ways. Yet, leaving it up to companies like the McGraw-Hills with their huge corporate profits to maintain means that there will be very little innovation (i.e., risk) and lots of dumbing down in order to make it palatable to the largest possible crowd.

I hope I am wrong about the latter part of my thinking but I am not all that hopeful.

The gadget is gorgeous but it has nothing to say about how it is used.

Deborah Emin is the Publisher of Sullivan Street Press, www.sullivanstreetpress.com

Sullivan Street Press and what we call our Itinerant Book Show are on a mission that dovetails well with what goes on here on this site. In fact, I accused Brad during our first talk that he had been listening in on our conference calls.

So, while he may know a good deal about what we do, I would like to introduce us and our partners in this endeavor in this first posting because you will be hearing a good deal about these other two people I am so intimately involved with at Sullivan Street Press (SSP).

First I just want to say that the three of us have a common bond, we are all writers. Both Angela Goldstein and Rob Lebow write separately from their work at the press. This is a good thing to have as a team in a publishing company as they understand only too well what goes into making a writer tick.

Angela is our guiding light. She is the one who dares to ask the difficult questions and to make what she thinks are the most obvious comments that stop the two of us in our tracks. Without her so much of what we value doing would either not get done or would get so obliterated that it would become unrecognizable.

Rob is our mad scientist. He works through every night as our tech genius, putting together our incredibly useful and easily navigable as well as just plain gorgeous website. He is just so valuable a player that when he does not answer his phone, we worry. But his business acumen is also a valued asset as we move forward now with our first biz plan as we call it.

I am the founder of the company but knew I never wanted to do anything alone. Having found two other people who work as well as the three of us do together is a real gift for which I am always very grateful.

So what do we do? We publish e-books only. But we also run a show called the Itinerant Book Show and we are in the process of hiring and training what we have called (thanks to Angela) Bookies to go out and sell independently published as well as self-published books in venues all over the country. We believe that these authors are undersold, undervalued and need as much of a voice in the book world as those who are supported by the major publishers. We give performances where we talk about the strange new world publishing has entered and where we read from the books we carry and sell these books. It is a labor of love but one which we believe (after talking to Brad about some ways to make this happen) can be a money-making venture for SSP and the authors whose books we carry.

That is us in a nutshell. I urge you to go to our website and look at our regular blog postings where we tell more of the stories of who we are, why we do what we do and what we are learning along the way.

Deborah Emin is the Publisher of Sullivan Street Press, www.sullivanstreetpress.com

A Solution for Capital-Starved Independent Bookstores

The following is a proposal made by Jack McKeown, former president and CEO of the Perseus Books Group and former president and publisher of the Adult Trade Group at HarperCollins. Currently he is director of business development for Verso Digital, the first vertical ad network for book publishers, and is president of Conemarra Partners, a media consultancy.

Last week brought the depressing news that Seattle’s Elliott Bay bookstore is in financial distress and may be forced to relocate from its Pioneer Square home of the last 36 years. Facing an expiring lease and a maxed-out credit line, owner Peter Aaron said, “Finding a lender to keep us liquid is an ongoing battle.” This has become an all-too-familiar story, of course. Securing adequate investment and working capital, never an easy task for independent bookstores, has been elevated to crisis proportions by the current recession. Is there a solution–one that could help independent bookstores maintain their local competitive advantage and even promote their expansion for years to come?
The Background

From my many years as a publishing executive, I always have believed that turbulent times in our industry foster opportunity as well as dislocation. The concept that I am floating is not especially complicated, but it does require a leap of imagination and strong leadership at the national level.

A thriving neighborhood bookstore is recognized as a key element in the social, cultural and economic fabric of any community. This is an opinion widely shared by urban planners, government planning boards, Smart Growth advocates and real-estate developers around the country. They will tell you that a bookstore offers a tremendous public amenity that should be built into the master plan of any new development or neighborhood revitalization. Primarily it has been the national chains that have been the beneficiaries of this perception, and their superior access to capital is a fundamental reason why.

But with the recession, chain-store expansion has ground to a halt and a period of contraction almost certainly will follow. (Barnes & Noble COO Mitch Klipper confirmed as much in an investor presentation last week.) This is part of a larger, radical reshaping of America’s retail landscape. More than 400 of the 2,000 largest U.S. malls have closed in the past two years and data suggest that at least another 1,000 are in distress. This represents an acceleration of a trend already underway before the recession took root. Main Street retail was decimated when the malls exploded decades ago, but may well rebound with a tidal wave of mall closures. “One of the biggest consequences of mall closings is the loss of a sense of community, a place where people gather and socialize,” said David Birnbey of the Shopping Center Group, as quoted in “The Vanishing Shopping Mall.” Can independent bookstores be positioned to help fill the vacuum as commercial real estate markets begin their gradual recovery?

The Concept

Essentially, my concept advances a sustainability and neighborhood redevelopment argument, with the independent bookstore at its center. I would like to propose the creation of a Neighborhood Bookstore Development Bank (NBDB). It is inspired by such special-purpose investment vehicles as the Fresh Food Financing Initiative (FFFI)–a successful five-year-old loan program for independent, neighborhood grocery stores. It also incorporates some of the mechanisms behind the proposed National Infrastructure Bank, as described by Felix Rohatyn and Everett Ehrlich in their October 2008 article for the New York Review of Books (“A New Bank to Save Our Infrastructure”).

The NBDB would be structured as a private investment bank, i.e., as an entity that evaluates project proposals and assembles a portfolio of investments to fund them. It would look to a prominent trade organization, such as the American Booksellers Association, to provide leadership in the form of a mission charter and board memberships, but otherwise would operate at arms-length. At the heart of the concept is a NBDB Commission, a committee of experts who would evaluate proposals to provide loans to existing or start-up bookstores on a case-by-case basis. The ABA would assist individual bookstores in assembling their business plans, but the bank’s Commission would operate independently and with the highest transparency, in order to attract capital and maintain the bank on a sound economic foundation.

Mission of the NBDB

The NBDB’s core mission would be to promote the expansion of healthy independent bookstores and to provide start-up funds to new bookseller entrepreneurs, while simultaneously generating acceptable returns to the bank’s investors. Among its specific goals would be the following:

Support capital improvements and expansion of established bookstores
Assist established bookstores in converting from commercial rental to ownership of their storefronts
Promote the creation of new bookstores in underserved markets or as part of new real-estate developments
Convert buildings to bookstores through adaptive reuse of historic structures, acquisitions of distressed properties or by foreclosure sales
Support established bookstores in upgrading their systems and websites, and in creating or expanding their e-commerce capabilities
Finance the establishment of print-on-demand centers (e.g., Espresso Book Machines) within local bookstores to generate new revenue streams
A recommended balance of investments between existing and new stores would be 60/40–a conservative approach meant to mitigate some of the risk of a portfolio too heavily weighted toward start-ups.

Financing

The NBDB would be capitalized through an initial round of paid-in equity and then leveraged at a suggested conservative ratio of 3:1. So, for instance, $2.5 million in minimum seed capital would be leveraged to $10 million at the outset. The pool of initial investors could include the ABA itself, along with such interested players as the national wholesalers (e.g., Ingram and Baker & Taylor). These parties would stand to earn meaningful annual dividends as well as long-term appreciation on their investments.

All the while they would be supporting the growth of a core customer segment.

Additional seed capital could be secured from REITs (Real Estate Investment Trusts) and private equity companies, perhaps as part of larger real-estate development financings. Capital would be callable beyond the seed round, with the ultimate objective of achieving a ratio of $10 million: $40 million by year three. These sums may strike some observers as modest indeed, but their impact on creating a base of larger and healthier independent bookstores would be dramatic, considering the under-capitalized state of the business now.

Ultimately the bank’s loans would be packaged and sold in the secondary capital markets, timed to take advantage of the recovery. The NBDB also would tap into the federal government’s interest in stimulating capital investment in local, community-based development projects and in promoting sustainability. Government grants and guarantees could be part of the solution to jump-start the effort, as has been the case with the FFFI. In addition, the NBDB could provide an engine for private-public partnerships at the local level, including community-owned bookstore retail via chartered stock companies.

In conclusion, the NBDB could play a major role in changing the narrative on independent bookstores from one of decline to rebound. For an industry preoccupied with
the discussion surrounding e-books and e-readers, it may seem like a counterintuitive strategy. But that could well prove its strength. It would play into larger demographic patterns, such as the imminent retirement of 78 million baby boomers, the urban migration of younger age groups and the contraction of America’s malls. These trends point to the development of better bricks-and-mortar, neighborhood-centered retail. With adequate capital at their disposal, and equipped with strong business plans that meet the NBDB’s test, independent booksellers could reposition themselves for a brighter future.

Here is the response I sent to Shelf Awareness (it wasn’t published by them, however):

Jack McKeown’s proposal to establish a Neighborhood Bookstore Development Bank (NBDB) is very welcome, and his analysis of the exciting prospects for our industry is superb.

As Shorebank and Calvert Foundation have shown in their decades of work with Community Development Finance Institutions worldwide, socially motivated investors can shift economic landscapes while earning solid returns. Calvert’s “Community Investment Notes” have in fact performed better during this recession than most other financial instruments. Jack’s proposed NBDB would among other beneficial effects, assist CDFIs and other potential partner institutions to evaluate and supervise bookstore loans they could make on their own to our critical but poorly understood sector of the American economy.

I would recommend, however, that Jack’s banking concept be supplemented with a coordinated apprenticeship initiative modeled on Grameen Bank’s Grameen Trust Replication Program, that has helped seed the world with hundreds of self-sustaining microfinance institutions (MFIs) over the past two decades.

MFIs specialize in making very tiny loans to very poor families, using loan-interest to fund operations expense. Grameen Trust Replication Program invites prospective MFI founders (microlenders) to spend significant time observing and participating in the operation of Grameen Bank, in Bangladesh. These prospective microlenders are then invited to apply for grant/loan combination packages. Upon approval of start-up funding, the new microlenders become part of a loose, international Grameen support network. Taking a similar “apprenticeship plus capital” approach to stimulating the growth of U.S. independent bookselling could help ensure that individuals wishing to launch new independent bookstores obtain a salutary mix of investment capital, debt, education and ongoing professional support.

Andy Laties, author, “Rebel Bookseller: How To Improvise Your Own Indie Store And Beat Back The Chains”

So, I can’t really give any sort of review, or preview, of this thing. All I know is what I have been reading and honestly, you have probably been reading the same shtuff. Gizmodo, Engagdet and TechCrunch are all over it, while Slate proposes that the thing is going to be so successful that it will bring B&N to it’s knees (Er, ok.)

But I can say it looks way more betterer than the kindle. Im sure Marc will point out that it’s still a damn ebook reader… but I can’t help it. I love widgets and I can’t help but get excited when I see what looks like a good one. Especially if it’s better than one I don’t like.

It has that cool swipy little screen (brilliant!) but also, oh yeah, some other features… such as; It looks good, SHARING!!!, and you can peep books that you haven’t bought while you are in the store (though… seriously…. this one has me a little confused. If your in the store… why don’t you just pick up the damn book from the shelf?).

Anyway, lets keep an eye on it. I’m not saying I am going to buy one… but I can still be happy if it’s better that the Kindle. Can’t I?

The end of books? Thesis: “Publishers are facing a new kind of reader, one who absorbs information from multiple sources simultaneously. As we move from the ‘don’t bother me, I’m reading the newspaper’ generation to the ‘yeah, got it’ sound-bite generation, publishers will have to adapt to a multimedia culture bombarded with information but lacking in knowledge….As empowered members of an increasingly multitasking interactive generation that lives in electronic communities, audiences are expecting unprecedented form and delivery of content and services. Only time will tell if the traditional publishing companies are up to the challenge.”—Chuck Martin, “The Nine Dynamics of Future Publishing,” Blueprint to the Digital Economy: Creating Wealth in the Era of E-Business, Edited by Don Tapscott, Alex Lowy and David Ticoll (New York: McGraw-Hill, 1998): 154-155.

The end of books? Antithesis: “It is interesting to note how often a technological development—such as Gutenberg’s—promotes rather than eliminates that which it is supposed to supersede, making us aware of old-fashioned virtues we might otherwise have either overlooked or dismissed as of negligible importance. In our day, computer technology and the proliferation of books on CD-ROM have not affected—as far as statistics show—the production and sale of books in their old-fashioned codex form. Those who see computer development as the devil incarnate (as Sven Birkerts portrays it in his dramatically titled Gutenberg Elegies) allow nostalgia to hold sway over experience. For example, 359,437 new books (not counting pamphlets, magazines and periodicals), were added in 1995 to the already vast collections of the Library of Congress.”—Alberto Manguel, A History of Reading (New York: Penguin, 1996): 135.

The end of books? Synthesis (and new Thesis): “In The Gutenberg Elegies: The Fate of Reading in an Electronic Age, Sven Birkerts warns that increasing multimedia experiences at the expense of written text risks ‘language erosion,’ decline of analytic and logical thought, ‘flattening of historical perspectives,’ and ‘the waning of the private self.’ Texts viewed as ‘difficult,’ predicts Birkerts, will increasingly be glossed over (which is, in fact, happening as students are both unwilling and unable to grasp the more subtle meanings or attend long enough to read them). As we forget or ignore the complexities of history’s lessons, a bland ‘electronic collectivization’ will render us ripe for political totalitarianism.”—Jane M. Healy, Failure to Connect: How Computers Affect Our Children’s Minds—and What We Can Do About It (New York: Simon & Schuster, 1998): 150. Sven Birkerts, The Gutenberg Elegies: The Fate of Reading in an Electronic Age (New York: Fawcett Columbine, 1994): 128-130.

New Antithesis: “In his book The Religion of Technology, [science historian David] Noble traces the interweaving of the technical arts with the millenarian spirit and shows that from the twelfth century on, technology has been perceived as a tool for precipitating the promised time of perfection. On the eve of the scientific revolution, Johann Andreae, Tommaso Campanella, Francis Bacon, and Thomas More each envisioned a man-made New Jerusalem—a fictitious city in which technology would play a key role. Andreae’s Christianopolis [1619], Campanella’s City of the Sun [1602], Bacon’s New Atlantis [1626], and More’s Utopia [1516] were all versions of idealized Christian communities notable for their use of technology. Today too, champions of cyberspace suggest that their technology will create a new utopia—a better, brighter, more ‘heavenly’ world for all. With contemporary cyber-utopianism, the…technology is digital rather than mechanical, but the dream remains the same.”—Margaret Wertheim, The Pearly Gates of Cyberspace (New York: Norton, 1999): 42-43. David Noble, The Religion of Technology: The Divinity of Man and the Spirit of Invention (New York: Knopf, 1997): 5.

All these, trumped by NEW SYNTHESIS: “Of man only the brain would remain, beautifully encased in a duroplast: a globe equipped with sockets, plugs and clasps….The brain case could be connected to any number of appendages, apparatuses, machines, vehicles….Then…transcepting would do away with crowds and congestion, the consequence of overpopulation. Channels of interbrain communication, whether by cable or radio, would make pointless all gatherings and get-togethers, excursions and journeys to attend conferences, and therefore all personal locomotion to whatever location, for every living being could avail itself of sensors and scanners situated over the whole expanse of human habitation….At this point I stopped and remarked that the authors of these papers were surely deranged. Trottelreiner replied coldly that I was a bit hasty in my judgments…the criterion of common sense was never applicable to the history of the human race.”—Stanislaw Lem, The Futurological Congress, Translated by Michael Kandel ([1971] New York: Continuum, 1974): 135-136.