Anyone who has been involved in decision making about the Internet over the last few years has made his or her fair share of judgment errors. Are e-books among them, or is it too early to write an epitaph?
The Web artifacts are piling up. T-shirts and mugs from Webvan. Carrying cases from Pets.com. Fancy wine from wine.com. Many additional souvenirs available via eBay. Maybe Flooz.com will figure out a way to auction its cyber currency before it becomes the modern-day equivalent of Confederate currency.
The Web is becoming littered with the equivalent of Wild West ghost towns. These well-publicized goings on can be read a number of ways. The media is having a field day chronicling "the dot-com implosion" and using other such doomsday metaphors. Corporations are slowing down or eliminating Internet development efforts as part of a "wait and see" attitude taking hold in boardrooms. Venture capitalists are slashing investments in dot-com-focused ventures in the belief that they shouldn't "throw good money after bad."
But are those the only kinds of lessons we can glean from the well-publicized failures? I think it's safe to say that anyone who has been involved in decision making about the Internet over the last few years has made his or her fair share of judgment errors. Even yours truly has been wrong on occasion. A little over a year ago, I wrote a ClickZ article ("Can Book Publishing Retain Its Most Precious Asset?") in which I suggested that traditional publishers were risking obsolescence by not doing more to take advantage of e-publishing and other Internet tools.
Well, now it looks as if e-books have been a huge bust. The e-book readers -- portable devices for downloading and reading books -- have sold quite poorly, reports Erik Sherman, a contributing editor of CommVerge. SoftLock, which caught the initial wave of enthusiasm by helping publish Stephen King's initial e-novella, has folded. Other online publishers are trying to hit authors up for additional fees or are discontinuing online publication of some titles.
Yet such seemingly discouraging news hides the fact that lots of positive things are going on in the world of e-publishing. Major publishers continue to convert hundreds of books each month into digital format for online publishing. An e-publishing industry of sorts has evolved to service this kind of activity. One member of this industry, Texterity, specializes in converting PDF files into e-book formats. According to its president, e-books are selling -- except that instead of being downloaded onto special e-book readers, they are being downloaded and read on Palms. "A year ago, e-books were overhyped," says Martin Hensel, president of Texterity. "Now, we're seeing basic increased activity month over month."
There are a number of messages in such developments. For example, just because a particular industry has had lots of high-profile dot-come failures doesn't mean that the industry is an online casualty. It more likely means that the high-profile players hadn't quite figured out exactly what makes consumers buy. In the case of e-book readers, it's becoming apparent that consumers resist adding another device to those they carry around and would just as soon use an existing one, like a Palm.
It usually takes new markets longer to mature than expected. All the talk about how the Internet would change everything may not have been all hype. The Internet likely will change many things -- the main question is when.
The winning approaches aren't always apparent at the start. We don't yet know how e-books will be displayed or delivered five years from now. For all we know, there will be cheap printers that can print and bind the books, much like there are now inkjet printers that do a nice job printing digital color photos.
As for those online souvenirs, I would not advocate a buy-and-hold strategy.
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