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8 Obstacles That Ad-Supported E-Publishing Must Overcome

  |  January 30, 2012   |  Comments

Publishers, tablet makers must take these steps to win over advertisers.

After having had about a week to play with Apple's new iBooks Author, I'm convinced that it offers a glimpse of what might save print publishing. That is, if publishers can get their heads out of their collective nether regions. Instead, they must be creative with their business models and push for a few technological changes.

But I'm getting ahead of myself. Allow me to back up a bit.

If you've ever sat down to read a magazine on a tablet, you know that it's a far superior experience than reading a magazine on the web. The tablet format lends itself more to a "magazine-like" experience, allowing for better imagery, more readable text, and a tactile experience that's a lot closer to flipping through a magazine rather than scrolling and clicking down a web page.

From an advertising standpoint, the tablet experience can be a lot better too. Tablet-based magazines allow for bigger and more compelling ads than what we're used to on the web. Not only do they look better, they also allow interaction and engagement not possible in print. All things considered, e-book (or e-pub) advertising is better than print advertising.

But what about the eyeballs needed to make that advertising effective? We're rapidly approaching critical mass that the industry needs to make a go of it. According to a new Pew Internet report, almost one in three Americans now own an e-reader. Forrester projects that tablet sales will surpass laptop sales by 2015. And considering that all those tablets come with some sort of Internet connectivity built in, it's easy to see that it won't be long until they're nearly ubiquitous.

When this happens, print publishers that are still hanging on have a real chance of survival. That is, if they play their cards right. By freeing themselves from the costs of printing and distribution, publishers should be able to shave enough costs to remain viable. If we extrapolate from the book publishing model, publishers could reduce as much as 65 percent of their publishing costs for retailing, distribution, and printing. Publishers should then be able to reduce the cost of advertising to compete with web-based publishers (a requirement I examined in depth here), while at the same time offering an advertising model that may actually be more attractive than the web. It could be a pretty unbeatable combination.

Alas, this is a lot easier than it sounds. If advertising-supported e-publishing is going take off, there are hurdles that must be overcome. Here are eight suggestions to take the e-publishing industry to the next level.

1. The Industry Must Standardize on a File Format

As of early 2012, there were more than 25 e-book formats vying for dominance. Both Amazon and Apple each have their own preferred format, though Amazon's Kindle reader is widely available on just about every mobile platform. Apple's format works on many readers (except the Kindle) now, but the format released with iBook Author doesn't. Just as with video and audio distribution formats (Blu-ray versus HD DVD, anyone?), the industry can't reach its fullest potential unless everyone's standardized on the same format.

2. Advertising Has to Be Built In

Regardless of what publishers settle on, the format must incorporate standardized technology for including ads. And as the web has shown us, these technologies need to be able to incorporate third-party serving, multiple analytics, and other features we've become used to in online advertising.

3. Distribution Needs to Be Less Expensive

Apple and Amazon each take a pretty hefty cut of the list price to include a publication in their store. While Apple might be able to get away with around 30 percent now, there's no way that kind of deal will work in the future if publishers are to consider moving to an all-digital publication. It's a chicken-and-egg problem: publishers will resist until costs come down, but distributors won't bring prices down until volume (or competition) makes it economically viable. E-pub distributors need to blink first to catalyze the transition over to digital.

4. E-Publication Prices Must Come Down

A survey found that e-textbooks only saved students about $1 vs. printed textbooks. Amazon's Kindle Store pricing of popular books isn't all that much less than the printed versions…at least at first. This is absurd. If publishers are going to save money, those savings must be passed on to consumers. Until this happens, the e-publication market will be hobbled.

5. E-Publications Must Embrace Social Features and "Fair Use"

While some Kindle books can be "loaned" for 14 days, not all can. In many cases it's impossible to legally share a book with a friend or spouse, leading to the ridiculous situation where spouses with their own Kindles (or iPads) each have to buy their own version of a book they're interested in or get around it by swapping devices. This isn't a viable solution, especially for devices as personal as a tablet. And while the web encourages sharing articles (driving up traffic in the process), magazines and other e-periodicals treat the entire issue as an inviolate unit, providing no mechanism for sharing individual articles with others. Not only does this make no sense as far as driving eyeballs is concerned, but it also sets up a barrier to those who might switch from print to electronic. Finally, e-publications need to include facilities for "fair use," allowing excerpting or linking for educational purposes…just as they do on the web (for the most part).

6. E-Commerce Should Be Baked In

Another way to enhance revenue would be to include elements that allow people to either buy products or, perhaps more likely, additional electronic content or enhancements. The in-app purchase model has been extremely lucrative for game publishers - one study found that the average in-app purchase was worth $14 - and could be just as lucrative for creative content publishers. Allowing users to purchase premium content such as videos, animations, demos, mini-games, or even access to archival content related to the story could provide an additional source of revenue to publishers. In turn, that could help publishers limit a publication's cost to consumers. Going further to include affiliate-like purchases of products from the publication as well (imagine being able to buy what you see in an interior design publication, for example) could further boost revenues.

7. Take Advantage of the Medium

If publishers merely think of their e-pubs as "magazines-that-show-up-on-a-screen," they're missing out on an opportunity to develop content that will draw readers. IBook Author includes a number of "widgets" that allow authors to include updatable content, presentations, animations, videos, galleries, and 3D images…all stuff that just isn't possible on paper.

 apple-ibook-widget

Adding value by including these kinds of features is yet another way that publishers can create a product that draws people away from traditional (and expensive to print and distribute) media.

8. Get Creative About Distribution

Unfortunately, these nifty features come at a cost. Multimedia iBooks can now be as large as 2.77 gigabytes, making them unsuitable for distribution via cellular phone infrastructure and limiting their ability to be quickly and easily distributed. Fortunately, as Sam Churchill of dailywireless points out, it may be possible to use the existing mobile television spectrum to "broadcast" updates (read "issues") of e-publications wirelessly so that subscribers receive them overnight. For those of us used to the real-time web, that seems like we're stepping back in time. Still, this approach lends itself to long-form content such as magazine articles. Better yet, it could reduce distribution costs (perhaps $0.25/GB versus $10/GB on cellular networks), saving our cellular data plans from overage meltdown. Tablet manufacturers would need to modify their hardware to be able to receive these signals, but it's still worth a hard look. After all, if you have a Kindle, you know that Amazon's Whispernet wireless book delivery service is one of its greatest features. Think of this as Whispernet…I hate to say it, but will…on steroids.

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ABOUT THE AUTHOR

Sean Carton

Sean Carton has recently been appointed to develop the Center for Digital Communication, Commerce, and Culture at the University of Baltimore and is chief creative officer at idfive in Baltimore. He was formerly the dean of Philadelphia University's School of Design + Media and chief experience officer at Carton Donofrio Partners, Inc.

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